TMI Blog2019 (3) TMI 725X X X X Extracts X X X X X X X X Extracts X X X X ..... olding that this claim of the assessee was based on a bonafide belief. The I.T.A.T. held that differing orders passed by the revenue authorities, appellate authorities, the High Court and Supreme Court on this issue lend credence to the fact that the belief of the assessee was a bonafide belief. Since the issue involved in the present case is identical, the decision rendered by the I.T.A.T. in the aforesaid cases is squarely applied to the present case, also following which we delete the penalty levied u/s 271(1)(c). We, therefore, uphold the order of the CIT(A) in deleting the penalty levied.- Decided against revenue - ITA Nos.1084 And 1085/Chd/2018 - - - Dated:- 18-1-2019 - Shri Sanjay Garg, JM And Smt. Annapurna Gupta, AM For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on a bonafide belief that the same is admissible and the assessee had not concealed any particulars relating to the same. The Ld.CIT(A) followed the decision of the ITAT Chandigarh Bench in the case of Hycron Electronics in ITA No.326/Chd/2015 wherein identical penalty levied was deleted by the I.T.A.T. for the same reason. The relevant findings of the Ld.CIT(A) at paras 4.3 to 4.5 of the order are as under: 4.3 I am of the opinion that penalty cannot be upheld on this issue since the appellant was under a bonafide belief that deduction of 100% is admissible beyond 5 years u/s 80IC and therefore claimed deduction @100% instead of 25%, Though the AO may be justified in denying the claim of deduction but this issue cannot be a subject f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon'ble ITAT has observed as under:- 8. Considering the above discussion, we are of the view that it is not a fit case of levy of penalty under section 271(l)(c) of the Act because it is well settled that levy of penalty is not automatic in each and every case as it depends upon facts and circumstances of the case. Since the assessee's claim of deduction under section 80IC have been allowed in earlier years @100% and admittedly assessee undertook substantial expansion in assessment year under appeal, therefore, assessee made bonaflde claim of deduction under section 80IC of the Act and there were no judicial pronouncements against the assessee on the date of making such a claim. Therefore, it could not be construed that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of proof on the assessee to establish that the explanation offered was bonafide, which the assessee failed to discharge in this case. 4. On the facts and in the circumstances of the case, the Ld, CIT(A) has erred in deleting the penalty of ₹ 32,84,676/- on the confirmed addition on account of restricting the benefit of deduction claimed by the assessee under section 80IC of the Income Tax Act, 1961 to 25% as against 100% deduction relying upon the judgment of Hon'ble ITAT, Chandigarh Bench in the case of M/s Hycron Electronics, which was not accepted by the department and the department has filed appeal against the said order before Hon'ble H.P. High Court, which is still pending. 5. On the facts and in the circums ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I.T.A.T. held that the assessee having disclosed all details vis- -vis claimed made in his return of income the action in claiming the exemption can be considered as a bonafide belief that the assessee was eligible to claim exemption. The I.T.A.T., therefore, held that no penalty was leviable under such circumstances in accordance with the Explanation-1(B) to section 271(1)(c) of the Act. The relevant findings of the I.T.A.T. at para 6 of the order are as under: 6. We have heard arguments of both the parties. The issue of allowability of deduction under section 80IC on substantial expansion had a long history of oscillations gone through various Judicial Authorities. The deduction was allowed and also disallowed by the Revenue at diff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Quixotic Healthcare (supra) by the I.T.A.T. holding that this claim f the assessee was based on a bonafide belief. The I.T.A.T. held that differing orders passed by the revenue authorities, appellate authorities, the High Court and Supreme Court on this issue lend credence to the fact that the belief of the assessee was a bonafide belief. In view of the same, since the issue involved in the present case is identical, the decision rendered by the I.T.A.T. in the aforesaid cases is squarely applied to the present case, also following which we delete the penalty levied u/s 271(1)(c) of the Act. We, therefore, uphold the order of the Ld.CIT(A) in deleting the penalty levied. 9. The appeal of the Revenue is, therefore, dismissed. ITA No ..... X X X X Extracts X X X X X X X X Extracts X X X X
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