TMI Blog1993 (7) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... in consonance with law in the facts and circumstances of the present case. The Revenue agitated the amount of reduction made in the penalty on the basis of findings given by the CIT(A). 3. The assessee-company is engaged in the business of publishing newspapers and periodicals. The accounting year of the assessee ended on 30th April, 1983. The assessee is following mercantile system of accounting. For the relevant assessment year, the assessee filed on 30th June, 1984 return of its income reflecting therein total income at Rs. 91,88,730. The assessment was completed vide order dt. 23rd March, 1987 on total income of Rs. 5,15,01,460. The Assessing Officer has also initiated penalty proceedings under s. 271(1)(c). The Assessing Officer le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the resolution was filed before the Assessing Officer. The correspondence with the Government was also submitted. By the time, the assessment proceedings were taken up, the matter became clear that the Government was not willing to give the permission. Therefore, in the assessment proceedings, this deduction was not pressed. There was no allegation by the Revenue that the assessee made any false claim in this regards Revenue authorities have not given any finding of concealment and furnishing inaccurate particulars. In view of this, according to the learned counsel, there was no concealment. In regard to the loss on assignment of pronotes of Angelo Bros., it was submitted that the Assessing Officer has not discussed anything about this. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (I) and (ii), the Tribunal accepted the contention of the assessee. In regard to item (iii), Tribunal held that the choice of the system of accounting lies with the assessees and Department is bound to follow the same. Apropros the change in the method of accounting regarding insurance claim, the Tribunal held that it is true that by making the insurance claim, no right accrues in favour of the assessee until and unless the same is accepted by the Insurance company, but the contrary is also true, i.e., the loss for the goods lost in transit is also not perfect unless and until it is rejected by the Insurance company. According to learned counsel, the claim was made by the assessee under a bona fide belief and there is cleavage of judicial o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. Coming to the Departmental appeal, we find that the Revenue objected the deletion of penalty imposed on the basis of addition made on expenses on foreign trip, disallowance under ss. 40A(9), 37(3A), 43B and advertisement debtors' suspense account. Learned Departmental Representative relied on the orders of the Assessing Officer. Learned counsel submitted that the claims were made under a bona fide belief and there was no mens rea. Apparently, there is a cleavage of judicial opinion in regard to the allowability of the claims. In these circumstances, the assessee cannot be penalised for the concealment. 9. We have heard the rival submissions in the light of material placed before us and precedents relied upon. After hearing both the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er to escape from the clutches of s. 271(1)(c) does not introduce the proof of factors which are not inherently relevant in the proof of conscious concealment. On examination of the various facts, which mere made bed-rock or foundation for the purpose of imposition of penalty, we find that in relation to assignment of pronotes of Panchsheel Shipping Co., the Tribunal accepted the claim of the assessee. In regard to the depreciation on Panchsheel Shipping Co., there is no allegation against the assessee that false claim was made. No finding apropos the concealment was given. 10. In regard to Angelo Bros., we find that the Assessing Officer has not made it a point for the imposition of penalty. The view taken by the CIT(A) cannot be upheld ..... X X X X Extracts X X X X X X X X Extracts X X X X
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