2011 (6) TMI 821 - AT - Income Tax

Summary

Issues involved: Appeal against penalty u/s 271(1)(c) of the Income Tax Act for claiming excessive depreciation without reducing subsidy received on capital assets.

Summary:
The Appellate Tribunal ITAT Ahmedabad heard the Revenue's appeal against the penalty imposed on the assessee for claiming excessive depreciation without reducing the subsidy received on capital assets. The AO had levied the penalty under section 271(1)(c) based on the claim of excessive depreciation. However, the CIT(A) canceled the penalty stating that the incorrect depreciation claim did not amount to concealment of income. The Tribunal noted that the issue was covered by the decision of the Hon'ble Apex Court in CIT Vs. Reliance Petroproducts Pvt. Ltd. The Court held that making an incorrect claim does not constitute furnishing inaccurate particulars for penalty under section 271(1)(c). As all facts were disclosed during assessment and the dispute was regarding the depreciation claim, it did not amount to concealment of income. The Tribunal upheld the CIT(A)'s decision based on the Apex Court's ruling and dismissed the Revenue's appeal. The appeal was ultimately dismissed on 17th June 2011.