TMI Blog2021 (7) TMI 1139X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. The Ld. DR could not bring on record any evidences contrary to these facts on record. In such scenario, we are of the considered view that this is not a fit case for imposing penalty u/s.271(1)(c) of the Act and therefore, we do not find any reason to interfere with the findings of the Ld. CIT(Appeals) and relief provided to the assessee is hereby sustained - Decided in favour of assessee. - ITA No. 1674/PUN/2019, ITA No. 1676/PUN/2019 - - - Dated:- 28-7-2021 - Shri Inturi Rama Rao, Accountant Member And Shri Partha Sarathi Chaudhury, Judicial Member For the Assessee : Shri Sharad Shah For the Revenue : Shri S.P Walimbe ORDER PER PARTHA SARATHI CHAUDHURY, JM: These two appeals preferred by the Revenue emanates from the different orders of the Ld. CIT(Appeals)-1, Aurangabad dated 09.08.2019 for the assessment year 2014-15 as per the following identical grounds of appeals on record: 1. The Ld. Commissioner of Income-tax (A)-I erred in passing the order both on the facts of the case and in law. 2. The Ld. Commissioner of Income-tax (A)-I erred in deleting the penalty levied by Assessing Officer u/s 271(1)(c) for furnishing inaccurate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s before the Tribunal by the Department, these appeals are not maintainable, however, the subject matter falls within the exception since in these cases, prosecution has been launched and therefore, these cases are covered under Para 10(f) of Circular No.17/2018 dated 11.07.2018 and subsequently amended on 20.08.2018 and therefore, needs to be adjudicated. ITA No.1674/PUN/2019 A.Y. 2014-15 5. The facts concerning levy of penalty, as per the lead case are that the assessee company is engaged in the business of manufacturing, assembling, processing, importing, exporting, fabricating and trading in various kinds of electrical and electronic parts, components, instruments required for automobile and engineering industry. The assessee had filed its return of income for the assessment year 2014-15 on 13th October, 2014 declaring total income of ₹ 1,34,42,280/-. The assessee company had claimed a deduction of ₹ 26,25,000/- u/s.35(1)(ii) of the Act being 175% of the amount of ₹ 15,00,000/- paid to School of Human Genetics and Population Health (SHGPH) for undertaking scientific research. The said return was assessed u/s.143(3) of the Act and the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 13th October, 2014 and at the time of filing the return of income SHGPH was a duly notified organization u/s.35(1)(ii) of the Act. 8. The Ld. CIT(Appeals) on this issue observed that the assessee company had filed its return of income on 13.10.2014 and during that time SHGPH was an approved organization u/s.35(1)(ii) of the Act by the Central Government vide Notification No.4/2010 dated 28th January, 2010. That further, the CBDT vide its Notification No.4/2010 (F. No.203/64/2009/ITA-II) dated 28.01.2010 had also recognized SHGPH as an approved scientific research association /institution for claiming deduction u/s.35(1)(ii) of the Act. The said organization was also recognized as Scientific and Industrial Research Organization (SIRO) by the Ministry of Science and Technology, Government of India on 25th April, 2008. This recognition was renewed by the Government of India on 17th June, 2010 and 1st April, 2013. On the basis of notifications and approvals granted by the Government and CBDT, the assessee paid donation of ₹ 15,00,000/- to SHGPH on 26th March, 2014 and had claimed deduction u/s.35(1)(ii) of the Act. It was further observed by the Ld. CIT(Appeals) that on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngs are independent proceedings. With these observations, penalty levied u/s.271(1)(c) of the Act was cancelled and relief was provided to the assessee by the Ld. CIT(Appeals). 11. The Ld. DR for the Revenue has placed strong reliance on the assessment order. 12. Per contra, the Ld. Counsel for the assessee invited our attention to the decision of the Hon‟ble Bombay High Court in the case of Bhanumati Malraj Kabali Vs. Income Tax Officer, Writ Petition No. 3595 of 2018 dated 24th January, 2019. There also, it was with regard to the donation made to SHGPH amounting to ₹ 15,00,000/- during the assessment year 2011-12. The Hon‟ble Jurisdictional High Court has held and observed as follows: This information in case of the petitioner, refers to sum of ₹ 15 lakhs, allegedly donated by the petitioner to the said Trust. Thus, on the basis of such information supplied by the Investigation Wing is falsified upon perusal of the return filed by the assessee. We also notice that in the return the assessee had claimed to have paid the donation of ₹ 20 lakhs to one Scientific Research of Rural Development. However, the information supplied to the AO b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... complete disclosure in the income tax return and offered the surrendered amount for the purposes of tax. 15. That further the Hon‟ble Supreme Court in the case of CIT Vs. Reliance Petroproducts (P) Ltd., (2010) 322 ITR 158 (SC), the very basis for imposing penalty u/s.271(1)(c) of the Act was analysed and the principle emerged was that the alleged concealment of income or furnishing of inaccurate particulars of income by the assessee has to be determined from income tax returned filed by the assessee. That further proceedings u/s.271(1)(c) of the Act, is a separate proceedings than from the assessment proceedings and the omission or error i.e. concealment of income or furnishing of inaccurate particulars of income should come out specifically from the return of income filed by the assessee before the Department. There is no scope for any guess work or surmises or any hypothetical situation for imposing penalty u/s.271(1)(c) of the Act. 15.1 The position of law further is very much clear as per the various aforesaid referred judgments that retrospective withdrawal or cancellation of an entitlement will have no effect upon the assessee who had acted upon it when it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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