2014 (11) TMI 1067 - AT - Income Tax

Penalty u/s 271(1)(c) - CIT(A) deleted the penalty - Held that - CIT(A) has deleted the penalty on the basis that there was two opinion available as regards the addition made by A.O. CIT(A) after examining the facts in detail has passed a well reasoned and speaking order with which we do not find any infirmity and therefore appeal filed by the Revenue is dismissed - Decided in favour of assessee

Summary

Issues:
Appeal against deletion of penalty under section 271(1)(c) of the Income Tax Act.

Analysis:
1. The Revenue filed an appeal against the deletion of penalty by the Ld. CIT(A) amounting to Rs. 15,97,334 under section 271(1)(c) of the Act. The assessee also filed a cross objection to the appeal. The grounds raised by the assessee in the cross objection included contentions about the justification of penalty imposition and the calculation of tax sought to be evaded.

2. The assessment of the assessee was completed, and various additions were made, including interest payable to Sugar Development Bank and Dharmada account. The Assessing Officer initiated penalty proceedings under section 271(1)(c) for concealment of income. The assessee appealed before the Ld. CIT(A) and provided submissions.

3. The Ld. CIT(A) considered the penalty order, written submissions, and oral arguments. The Ld. AR argued against the penalty imposition, citing judicial pronouncements to support the contention that there were differences of opinion regarding the allowability of the claims made by the assessee. The Ld. CIT(A) concluded that unless inaccurate particulars were filed or income was concealed, penalty under section 271(1)(c) was not leviable.

4. The Revenue appealed against the decision of the Ld. CIT(A), arguing that there were no two opinions regarding the interest payable to IFCI, and the penalty was justified. The Revenue also contested the deletion of penalty concerning Dharmada account, stating that the addition was confirmed by Ld. CIT(A) and reversed by ITAT.

5. The Ld. AR contended that all information was submitted in the computation of income, indicating no wrong furnishing of particulars. Different views by authorities on the additions showed the possibility of two opinions, making the penalty inapplicable. The AR relied on case law to support the argument.

6. After hearing both parties and reviewing the material, the Tribunal found no infirmity in the well-reasoned order of the Ld. CIT(A) and dismissed the Revenue's appeal. The cross objection of the assessee was also dismissed as it had become infructuous.

This detailed analysis highlights the grounds of appeal, the arguments presented by both parties, the consideration of judicial pronouncements, and the final decision of the Tribunal regarding the penalty under section 271(1)(c) of the Income Tax Act.