2010 (9) TMI 187 - HC - Income Tax

-Penalty - levied by the Assessing Officer under Section 271(1)(c) of Act, 1961 - in view of the amendment in the provision of section 115JA with retrospective effect the set off of unabsorbed depreciation while determining the book profit u/s 115JA of the Act was held not allowance to the assessee - Held that - it cannot be said that the assessee either concealed the particulars of income or furnished inaccurate particulars of income by harbouring the belief that it was entitled to claim the same - appeal taken by the revenue is rejected.

Summary

Issues:
Challenge to penalty under Section 271(1)(c) of the Income Tax Act, 1961 for Assessment Year 1998-99.

Analysis:
The appeal was filed challenging the order passed by the Income Tax Appellate Tribunal regarding the penalty imposed under Section 271(1)(c) of the Income Tax Act, 1961. The Revenue contended that the Tribunal erred in law by deleting the penalty. However, it was observed that both the Commissioner of Income Tax (Appeals) and the Tribunal had already deleted the penalty. The Tribunal noted that the issue involved a legal matter with differing opinions, and the assessee did not conceal or furnish inaccurate particulars of income. The Tribunal upheld the cancellation of the penalty by the Commissioner of Income Tax (Appeals) based on the reasoning that there was a legal issue with multiple interpretations. The Tribunal concluded that the approach taken by the Commissioner of Income Tax (Appeals) was correct, and the penalty was rightly cancelled. Therefore, the Tribunal found no reason to interfere with the impugned order and dismissed the appeal without costs.