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TMI Blog2009 (11) TMI 1004X X X X Extracts X X X X X X X X Extracts X X X X ..... nt year under appeal, it filed return of income showing total income at ₹ 2,18,37,780/- on 31.03.2003. The revised return was furnished with a view to re-compute the deduction under sections 80IA and 80HHC as under :- As per original return As per revised return Deduction u/s. 80IA Rs.1,45,40,698/- Rs.1,01,13,610/- Deduction u/s. 80HHC Rs.3,86,07,038/- Rs.3,14,70,845/- 4. The A.O. framed the assessment under section 143(3) on 08.03.2006 computing the total income at ₹ 2,18,37,780/-. In this assessment order, the A.O. also initiated penalty proceedings under section 271(1)(c) for furnishing inaccurate particulars of income. Subsequently vide order dated 22.03.2006, the A.O. levied the penalty of ₹ 45,73,277/- @ 100% of tax sought to be evaded in furnishing inaccurate particulars of income to the tune of ₹ 1,15,63,281/- under section 271(1)(c) of the Income Tax Act, 1961. 5. Against the order of A.O. in levying penalty under section 271(1)(c) of the I.T. Act, the assessee preferred appeal before the Learned Commissioner of Income Tax(Appeals). Before the Learned Commissioner of Income Tax(Appeals), the assessee filed the following submissions :- "2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellate Tribunal in the following cases where assessee is entitled to deduction u/s. 80HHC. 2.3. The appellant submits that under the circumstances its contention as per the original return have been accepted by the Appellate Tribunal. The appellant submits that under the circumstances income stands assessed higher amount and the claim made by the appellant as per the original return were correct as per the provisions of law. The appellant further submits that under the circumstances the question of any concealment of income, the question of furnishing inaccurate particulars does not arise. The appellant also submits vehemently that each and every particular placed on the records of the assessing officer was accurate and each and every particular was correctly furnished The assessing officer has merely made observation regarding default on the part of the appellant without any instance as to how there was furnishing of Inaccurate particulars by the assessee. The appellant further submits that on identical facts and circumstances the assessing officer had imposed the penalty upon the appellant for the assessment year 2000-01. The appellant submits that penalty stands deleted b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e interpretation of these two provisions, i.e. under sections 80HHC and 80I, had come before the ITAT and a view has been taken by the Appellate Tribunal in the following cases when an assessee is entitled to deduction under section 80HHC :- (i) Vijay Industries -vs.- ITO [112 TTJ 353 (JP) (ii) CIT -vs.- Raju Eng. Ltd. [284 ITR 119(Rajkot ITAT)] (iii) Shree Ram Food Industries -vs.- CIT (Ahd. ITA No.705/RJT/2005) (iv) SCH Creations -vs.- Asst. CIT [304 ITR 319] It was also submitted by the ld. counsel of the assessee that on 06.05.2008, the Hon'ble Madras High Court in the case of SCM Creations reported in 304 ITR 310 has taken a view that relief under section 80IA of the Income Tax Act, 1961 should not be deducted from profits and gains of the business on which relief under section 80HHC of the Act is to be computed. In view of this, it cannot be said that when the assessee filed the original return of income on 30.10.2001, the issue whether or not relief under section 80IA of the Income Tax Act, 1961 should be deducted from the profits and gains of business before computing relief under section 80HHC of the Income Tax Act, 1961, was highly debatable. Therefore, on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; 45,73,277/- levied by the A.O. under section 271(1)(c) of the I.T. Act, 1961. 11. In view of our decision above in Revenue's appeal, i.e. ITA No. 477/AHD/2007 (supra), the Cross Objection filed by the assessee is rendered infructuous, therefore, the same is dismissed. 12. Now we come to the ITA No. 478/AHD/2007 for the assessment year 2003-04. The only ground of appeal raised by the Revenue is that the Learned Commissioner of Income Tax(Appeals) erred in deleting the addition of ₹ 35,50,506/-, being the difference in value of stock as per book and that declared to Bank, which was made as the assessee failed to produce evidences like sales bills and other documents to prove that the value of stock given in Bank statement was arrived at by adopting market value as on 31.03.2003. 13. At the time of hearing, the ld. D.R. for the Revenue fairly admitted that there is no difference in quantity. The different is only on account of value. However, he submitted that for difference in value, the addition of ₹ 35,50,506/- was rightly made. On the other hand, the ld. counsel for the assessee supported the order of Learned Commissioner of Income Tax(Appeals). 14. We have given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tant Commissioner to whom the assesses appealed, reduced the amount of the addition from ₹ 34,070/- to ₹ 26,000/-. On appeal to the Tribunal, the Tribunal deleted the addition. On a reference :- Held, that the Tribunal had accepted the explanation of the assessee. The Tribunal had exercised its jurisdiction and the question decided by it was a question of fact. Therefore, there was no scope for interference with the order of the Tribunal". The decision of the Hon'ble Madras High Court, which is relied by the Learned Commissioner of Income Tax(Appeals), is squarely applicable to the facts of assessee's case. Therefore, we inclined to uphold the order of Learned Commissioner of Income Tax(Appeals) and reject this ground of appeal of Revenue. 15. Now we come to the Cross Objection being No. 68/AHD/2007 arising out of the ITA No. 478/AHD/2007 filed by the assessee for the assessment year 2003-04. The only ground of C.O. is that the Learned Commissioner of Income Tax(Appeals) correctly deleted the addition of ₹ 35,16,506/-. This ground of C.O. clearly indicates that the A.O. filed by the assessee is merely in support of the order of Learned Commissioner of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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