TMI Blog2023 (9) TMI 830X X X X Extracts X X X X X X X X Extracts X X X X ..... were found to be inaccurate. Hence, these facts would not lead to a case of furnishing of inaccurate particulars of income. This deduction has not been claimed by the assessee as an expenditure in the Profit Loss Account, but has been claimed only in computation of total income. Since this deduction is allowed as an incentive to promote exports, in the case of ACIT vs BSL Software Ltd.,[ 2012 (4) TMI 360 - ITAT DELHI] has held that where claim for deduction was made u/s 10A on the basis of certificate of Accountant which was bona fide and the required facts relating thereto were furnished, then assessee could not be held to be liable for penalty. Accordingly, we are of the view that the AO was not justified in levying penalty u/s 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame as Capital expenditure by placing reliance on the judgment rendered in the case of Brooke Bond India Ltd. [ 1997 (2) TMI 11 - SUPREME COURT] and levied penalty under Section 271(1)(c) for furnishing inaccurate particulars of income. We heard the parties on this issue and perused the record. In our view, it is a case where assessee has made a claim and same has been disallowed as, according to the AO the said expenditure is capital in nature. First of all, the decision taken by the AO is a debatable one and hence no penalty could be levied on such a debatable issue. In the case of CIT vs Reliance Petroproducts (P.) Ltd., [ 2010 (3) TMI 80 - SUPREME COURT] has held that mere making of a claim which is not sustainable in law by itse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pleted by the Assessing Officer under Section 143(3) of the Act on 31.12.2013, wherein he made following three additions :- Issue Disallowance as per order u/s 143(3) 1 Disallowance of claim of deduction u/s 10A Rs. 53,17,433/- 2 Disallowance u/s 40(a)(ia) Rs. 53,90,600/- 3 Disallowance of capital expenditure u/s 37(1) Rs. 5,84,698/- Total Rs. 112,92,731/- The Assessing Officer initiated penalty proceedings under Section 271(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rts, the Hon ble Delhi High Court in the case of ACIT vs BSL Software Ltd., (2012) 20 taxmann.com 408 has held that where claim for deduction was made under Section 10A of the Act on the basis of certificate of Accountant which was bona fide and the required facts relating thereto were furnished, then assessee could not be held to be liable for penalty. Accordingly, we are of the view that the Assessing Officer was not justified in levying penalty under Section 271(1)(c) of the Act on the disallowance of claim of deduction under Section 10A of the Act. 4. The next disallowance on which penalty was levied by the Assessing Officer relates to disallowance made under Section 40(a)(ia) of the Act amounting to Rs. 53,90,600/-. The Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e hold that the Assessing Officer was not justified in levying penalty on this disallowance. 6. The last addition on which penalty was levied relates to disallowance of expenditure of Rs. 5,84,698/- claimed by assessee holding the same as capital expenditure . The Assessing Officer noticed that the assessee has incurred a sum of Rs. 5,84,698/- for increasing its Share Capital and claimed same as Revenue expenditure . The Assessing Officer treated the same as Capital expenditure by placing reliance on the judgment rendered by the Hon ble Supreme Court of India in the case of Brooke Bond India Ltd. vs CIT, 225 ITR 798 (SC) and levied penalty under Section 271(1)(c) of the Act for furnishing inaccurate particulars of income. 7. W ..... X X X X Extracts X X X X X X X X Extracts X X X X
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