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2024 (4) TMI 592 - ITAT DELHIPenalty proceedings u/s 271(1)(c) - deduction u/s 35(2)(AB) was reduced by the Competent Authority - HELD THAT:- As time of filing of the return of income, the claim of deduction u/s 35(2)(AB) of the Act, was not reduced by the Competent Authority. The Competent Authority had subsequently approved the expenditure to an extent , therefore, the assessee during the course of assessment proceedings, reduced its claim as approved. CIT(A), therefore, considering the facts and circumstances of the case, applied the ratio laid down in the case of Price Water House Coopers Pvt. Ltd [2012 (9) TMI 775 - SUPREME COURT] It is not the case of the Revenue that expenditure claimed by the assessee, was not genuine. The accounts are audited and reported in Form No.3CLA was filed. Thus, the assessee had disclosed all material particulars before the Assessing Authority. Merely because the DSIR reduced and approved lower expenditure should not be the only reason for imposition of penalty. The AO ought to have brought adverse material in respect of the expenditure so claimed by the assessee more particularly, when the assessee himself has reduced its claim as recorded by the AO in the assessment order itself. Thus in the light of decision of M/s. Napord Life Sicences P.Ltd. [2019 (2) TMI 980 - ITAT MUMBAI] no infirmity in the finding of Ld.CIT(A), the same is hereby affirmed. Grounds raised by the Revenue are accordingly, dismissed.
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