2013 (8) TMI 1110 - AT - Income Tax

Summary

Issues involved: Appeal by Revenue challenging deletion of penalty u/s 271(1)(c) for A.Y. 2005-06 and 2006-07 based on disallowance u/s 35(2AB) of IT Act.

Summary:
The Revenue appealed against the deletion of penalties imposed on the assessee for A.Y. 2005-06 and 2006-07 under Section 271(1)(c) of the IT Act, relating to disallowance u/s 35(2AB). The AO disallowed the claim as the assessee failed to produce the prescribed certificate u/s 35(2AB) during assessment proceedings. The Revenue argued that the claim was not made as per law, constituting inaccurate particulars. However, the CIT(A) upheld the assessee's position, citing precedents where voluntary disclosure and payment of tax precluded penalty imposition. The Tribunal approved the CIT(A)'s decision, dismissing the Revenue's appeals for both assessment years.

In A.Y. 2004-05, the assessee claimed deduction u/s 35(2AB) for Scientific Research and Development expenses based on certificates from the Ministry of Science and Technology. The claim was disallowed due to lack of prescribed certificate, not for inaccurate particulars. The CIT(A) referenced legal precedents where voluntary disclosure and tax payment prevented penalty imposition. The Tribunal upheld the CIT(A)'s decision, dismissing the Revenue's appeals for both A.Y. 2005-06 and 2006-07.