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TMI Blog2013 (11) TMI 268X X X X Extracts X X X X X X X X Extracts X X X X ..... on estimated disallowance. 3. The ld. CIT(A) erred in law in not considering that addition of Rs. 75 lakhs made only on account of concealment of facts by the assessee by way of not proving expenditure. 3. The assessee raised the following grounds: 1. The order of the learned CIT(A) is wrong inasmuch as it is based on suspicion, surmises and conjectures and not on any tangible evidence and as such deserves to be set aside. 2. The CIT(A) has upheld the penalty u/s. 271(1)(c) of IT Act, 1961 on disallowance of depreciation on leased assets taken on finance lease from IVRCL amounting to Rs. 10,41,610 with an allegation under para-5 of the impugned order dated 12.2.2013. 3. The CIT(A) is wrong, baseless and is proceeded entirely on incorre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al on record. With regard to levy of penalty on disallowance of depreciation, the Tribunal deleted the penalty on this issue for A.Ys. 2003-04 and 2004-05 in ITA Nos. 129 & 130/2013 & Others vide order dated 30.8.2013 by holding as follows: "31. We have heard both the parties and perused the material on record. Regarding the penalty on disallowance of depreciation on plant and machinery the penalty was levied by placing reliance on the order of the Tribunal in ITA No. 843/Hyd/2008 dated 21.1.2011 for A.Y. 2004-05 wherein the Tribunal confirmed disallowance of depreciation as cited above. 32. For levying penalty u/s. 271(1)(c) of the Act, there has to be concealment of particulars of income of by assessee or furnishing of inaccurate partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rein held that merely because the assessee claim of deduction of expenditure which was not accepted by the Revenue authorities, penalty u/s. 271(1)(c) of the Act is not attracted; mere making of a claim, which is not sustainable in law, will not amount to furnishing of inaccurate particulars of income of the assessee. 33. In view of the above discussion, we are inclined to delete the penalty on this issue. The assessee appeals in ITA Nos. 129/Hyd/2013 and 130/Hyd/2012 are allowed on this issue." 8. Respectfully following the above order of the Tribunal, we are inclined to delete the penalty. 9. Regarding deletion of penalty in case of ad-hoc disallowance of expenditure the same was considered by this Tribunal in assessee's own case in IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed on the material from which definite inference can be drawn that the assessee had concealed the income or furnished inaccurate particulars of income. In this case addition is made purely on estimate/ad-hoc basis without any basis and without any material to support that the assessee had income more than that declared by the assessee in its return of income. In respect of such estimated addition or disallowance, imposition of penalty will not be justified. Being so, we are inclined to confirm the deletion of penalty by the CIT(A). This ground in Revenue appeal is dismissed. 35. The assessee's appeals in ITA No. 129/Hyd/2013 and ITA No. 130/Hyd/2013 are allowed. Revenue appeals in ITA Nos. 104 and 105/Hyd/2013 are dismissed. The COs by t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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