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2016 (9) TMI 1067 - ITAT HYDERABADPenalty u/s 271(1)(c) - deduction u/s 10A allowed - Held that:- There is no scope for levy of penalty on the given facts of the case. As far as the provisions of Section 10A are concerned, the Sub-Section 1 of Section 10A allows the deduction for a period of ten consecutive assessment years beginning with the assessment year relevant to the previous year in which the undertaking begins to inform or produce such articles or things or computer software as the case may be. Subsection 1A however, has certain restrictions on quantum of deduction and rest of the provisions pertain to computation of quantum and restrictions placed, if the units are transferred etc. Nowhere in Section 10A, it is specified that the deduction is not eligible, if the STPI does not continue the approval beyond the five year period. On a complete reading of the provision, anybody will come to a conclusion that once deduction of Section 10A is allowed in the first year, on the basis of satisfying the conditions, assessee would be eligible for deduction for consecutive ten assessment years. In this case, there is no dispute that assessee was eligible for deduction u/s 10A in earlier years. There is also no dispute that assessee has applied for renewal on STPI approval for the later five years which was however, not pursued. According to my understanding, assessee has made a claim of deduction on the strength of the provisions, even though it has accepted that the claim made cannot be substantiated in the absence of STPI approval. It may be assessee’s opinion and accepted the disallowance made in assessment proceedings. Mere erroneous claim in the absence of any concealment or furnishing of inaccurate particulars is not a ground for levying penalty especially when there is nothing on record to show that assessee has concealed any particulars or furnished any inaccurate particulars. Assessee simply made a claim u/s. 10A on the reason that having been eligible in earlier years, assessee would be allowed deduction in the impugned assessment year as well. This, in my view does not come into the purview as concealment of income or of furnishing of inaccurate particulars - Decided in favour of assessee
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