9911796707
TMI Blog2012 (7) TMI 489X X X X Extracts X X X X X X X X Extracts X X X X ..... Y: The revenue has filed this appeal aggrieved by the order of the learned CIT(A)-XX, Ahmedabad in appeal No. CIT(A)/XX/332/2009-10 dated 18-03-2010, for assessment year 2006-07, passed u/s 271(1) (c) read with section 250 of the IT Act. 2. The revenue in its appeal has raised three grounds wherein the second and third grounds being general in nature do not survive for adjudication. The lone surviving ground No.1 is reproduced herein below for adjudication: 1. The Ld. CIT(A) has erred in law and on facts in deleting the penalty of Rs.3,79,340/- levied u/s. 271 (1) (c) of the Act. 3. The assessee is a Private Limited Company engaged in the business of hotels and resorts, filed its return of income declaring income to be nil. The c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made the disallowance/additions on account of the fact that the appellant did not deduct tax on payments made for food items and catering. The appellant had made payment to Rasranjan Caterers Pvt. Ltd. in respect of payment of food items sold by it to the appellant and its customers. It is explained that such payments are not hit by the provisions of section 194C of the Act. Merely because certain expenses claimed by the appellant are disallowed and the addition made is confirmed by the first appellate authority does not automatically lead to levy of penalty. The finding given in the assessment proceedings for determining or computing the tax is conclusive and may be good evidence for assessment proceedings but for penalty proceedings it h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... table issue as to whether the payment is made on account of contract attracting provisions of section 194C of the Act or for purchase of food items. Considering the same, the learned CIT(A) was fair enough to delete the penalty. In these given circumstances, we concur with the view of the learned CIT(A) and therefore, confirm his order. 6. (II) Levy of penalty for disallowance made u/s 40A (2) (b) of the Act: The assessee had shown payment of interest on unsecured loan to Diptiben R. Patel for Rs.1,30,775/- @ 12%, Valvantbhai P. Patel for Rs.1,46,159/- @ 10.25% and Ramprasad P. Patel for Rs.5,78,437/- @ 9%. The assessee could not substantiate with proper explanation for payment of interest to Diptiben R. Patel and Valvantbhai P. Patel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is nothing on record to suggest that the assessee had concealed any particulars of his income or furnished inaccurate particulars of such income. Therefore, we confirm the order of the learned CIT(A) and delete the penalty levied on this issue. 8. (III) Levy of penalty on addition made for unexplained expenditure of Rs.10,000/- u/s 69C of the Act: The learned AO on verification of books of accounts found that the assessee had made payment of Rs.10,000/- vide cheques No.163011 dated 24-11-2005 to Ramprasad P. Patel which was claimed as expenditure. The learned AO required Shri Ramprasad P. Patel to furnish his books of accounts u/s 133(6) of the Act. On examining his books it was found that this amount was not correspondingly disclosed. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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