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2014 (4) TMI 310 - ITAT DELHILevy of penalty u/s 271(1)(c) of the Act – Held that:- The penalty order deserves to be quashed - Simply because the additions made were not challenged by the assessee this fact by itself is not a good enough reason to confirm or impose penalty - There can be many reasons which may prevail on the mind of an assessee on account of which the assessee may not challenge the additions in a certain year - The mere fact of accepting the additions ipso facto does not lead to the conclusion that the assessee has nothing to say - it is a matter of record that the assessee has been crying hoarse right for the penalty proceedings itself that on merits had the assessee chosen to agitate the claim of higher depreciation the claim would have been allowed – there was no reason as to why the explanation was not considered by the authority. Addition made u/s 14A of the Act – Excess depreciation claimed – Held that:- The assessee has contended that there was full disclosure and it is only a case that disallowance made by the assessee was found to be inadequate which issue had the assessee chosen to challenge may have resulted in relief - The explanation too warranted a consideration - quantum proceedings and penalty proceedings are separate and distinct - The explanation offered in the penalty proceedings necessarily has to be considered judiciously within the Statutory framework - Relying upon COMMISSIONER OF INCOME TAX Versus BSES YAMUNA POWERS LLD. / BSES RAJDHANI POWERS LTD. [2010 (8) TMI 58 - DELHI HIGH COURT] – the order and the penalty proceedings set aside – Decided in favour of Assessee.
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