Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2018 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (12) TMI 46 - ITAT AHMEDABADPenalty u/s.271(1)(c) - Held that:- As far as the issue regarding depreciation on electric installation is concerned an addition of ₹ 8,502/- was made on account of difference in rate of depreciation. Thus, in our mind this doesn’t call for visiting the assessee with penalty. The assessee has disclosed basic facts fully and truly. It is a difference of opinion between AO and assessee about the admissibility depreciation at particular rate. As far as prior period income is concern the AO took the prior period income without giving set off prior period expenditure. ITAT in the quantum proceedings held that prior period income is to be set off against prior period expenditure. We have dealt with number of A.Ys and found that in certain A.Y the net balance was positive income whereas in other assessment year it was negative. Thus, on this issue it could be concluded that assessee has not concealed the particulars of income. It doesn’t call for visiting the assessee with penalty. As disallowance u/s. 14A is concern, during the quantum proceedings we have examined this issue and observe that assessee was having sufficient interest free fund for taking care of interest expenditure relatable to earning of tax free income on the estimate basis. Adhoc disallowance was confirmed in A.Y 2007-2008 and on same analogy adhoc additions stand confirmed for A.Y 2009-2010. Assessee has disclosed complete fact about the tax free income and how funds have been used. The Ld.CIT(A) has appreciated this aspect and thereafter deleted the penalty. Thus, we find that major additions which goad the AO to visit with penalty stands deleted in the quantum proceedings. The amount which have been added to income of the assessee on three issues were basically adhoc disallowances. The Ld.CIT(A) has appreciated this aspect and thereafter deleted penalty. We do not see any reason to interfere in the order of Ld.CIT(A) as far as Revenue’s appeal is concern. As far as assessee’s appeal is concern, we have already set aside the issue to the file of Ld.AO for re-adjudication in the quantum proceedings. There is no basis to visit the assessee with the penalty on this issue because the AO has yet to examine whether any disallowances/additions on account of Foreign exchange fluctuation loss claim is to be made in computation of total income of the assessee. After adjudicating this issue in quantum proceedings, it will be in the discretion of AO to initiate or not to initiate penalty on this issue. At this stage, there is no addition on whose basis it could be alleged that assessee has evaded tax. - Decided in favour of assessee.
|