2014 (8) TMI 1172

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..... business of Builders & Land Developers. During the assessment proceedings it was interalia observed by the AO that during the year, the assessee firm has sold a plot of land for Rs. 1,25,00,000/-. Against the sale consideration, the expense claimed were cost of land at Rs. 30,62,154/-, Administration & Other Expenses of Rs. 28,80,209/- and Brought Forward expenditure not pertaining to the current financial year Rs. 41,47,255/-. In all, an expenditure of Rs. 1,00,89,618/- had been claimed against the sale proceeds. The assessee was asked to show as to how the brought forward expenditure of Rs. 41,47,255/- not pertaining to the year under consideration was admissible. At the same time, out of the Administrative & Other expenses, there was an .....

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..... nistrative & establishment expenses were never sought to be allowed to be carried forward. In view of the observations made by him, he held that the assessee-firm was keeping their books on mercantile basis and was also showing the income/losses from year to year and that it was not following Projects Completion Method. Therefore the AO interalia disallowed brought forwarded expenses of Rs. 47,41,255/- and added back to the assessee's total income for the year under assessment. The penalty proceedings were also initiated. 3. In appeal against the assessment order (quantum appeal), the learned CIT(A) after considering the assessment orders for the Assessment Years 1989-90 and 1994-95 and the accounts of the assessee observed that in the .....

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..... e Tribunal and that of the AO was restored. 5. In penalty proceedings, the AO observed that in the instant case, the assessee had furnished inaccurate particulars of income and tried to get undue benefit. If an assessee falsely claims a deduction, it will amount to concealing the particulars of income or deliberately furnishing inaccurate particulars of income within the meaning of section 271(1)(c) of the Act. She therefore levied penalty @100% of the of the amount of tax sought to be evaded at Rs. 20,33,487/-. 6. In appeal against the penalty order before the ld. CIT(A), the ld. CIT(A) observed that in view of the fact that the ITAT had upheld the findings of the AO disallowing the claim of brought forwarded expenditure, it was clear th .....

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