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2018 (10) TMI 1439 - ITAT DELHIPenalty u/s 271(1)(c) - addition on account of disallowances made in relation to the alleged incorrect claim of deduction u/s 36(i)(viia) and disallowance on account of alleged incorrect claim of deduction of interest paid by the assessee to the head office - Held that:- Perusal of the aforesaid substantial questions of law framed by Hon’ble High Court of Delhi in the appeal against the assessment order on the basis of which this penalty has been levied shows that it is still debatable if the disallowance of ₹ 4,88,61,772/- u/s 36(i)(viia) and disallowance of the interest payment made by the assessee to its head office by following the special bench order in case of ABN AMBRO BANK vs. ADIT (2010 (12) TMI 340 - CALCUTTA HIGH COURT) is sustainable or not. So when the issue as to disallowances is still debatable no penalty can be levied and as such penalty imposed in this case is liable to be deleted on this score only. Even on merit when we examine the assessment order as well as penalty order, the revenue has not come up with any allegation that there is concealment of income or furnishing of inaccurate particulars of income rather simple allegation made by the revenue is that the assessee has claimed incorrect deduction u/s 36(i)(viia) out of which ₹ 4,88,61,722/- has been disallowed and that the assessee has claimed deduction on account of interest payment of ₹ 32,20,00,000/- paid to its head office which has also been disallowed. Mere claiming of deductions under the relevant provisions of law and as per RBI Guidelines does not and cannot amount to furnishing of inaccurate particulars of income. More over it is not case of the revenue that the assessee has not claimed the deductions as per law nor it is claim of the revenue that the assessee has made a double claim of such deductions. - penalty levied by AO and confirmed by CIT(A) is not sustainable in the eyes of law - Decided in favour of assessee.
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