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TMI Blog2014 (4) TMI 551X X X X Extracts X X X X X X X X Extracts X X X X ..... not a fit case for levy of penalty. 3. Facts necessary for disposal of the appeal are stated in brief. The assessee is engaged in the business of import and trade in iron and steel. Under the Customs and Central Excise provisions the assessee had to pay redumption fine of Rs.110 lakhs. When the liability arose in A.Y. 1999-2000 the assessee claimed deduction though the levy of fine was disputed before the appellate authorities. On 10.09.2004 the CESTAT deleted the said redumption fine but the order passed by the CESTAT was challenged before the Hon'ble Bombay High Court by the Commissioner of Customs. 4. Though the assessee claimed deduction of Rs.110 lakhs as business expenses in A.Y. 1999-2000. The same was disallowed by the AO but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upreme Court on 27.08.2010. As per the original intention of the assessee the sum of Rs.110 lakhs ought to have been offered to tax in A.Y. 2011-12 but before the due date for filing the return, the AO, for A.Y. 2008-09, called upon the assessee to explain as to why the said sum is not assessable to tax in A.Y. 2008-09, since the refund was received in the previous year relevant to assessment year under consideration. In response thereto the company explained, vide its letter dated 14.12.2010, that all the particulars were disclosed in the return of income by making its intention clear about the event of taxability but since the SLP has also been rejected in 2010 they have agreed to offer the same to tax in A.Y. 2008-09 and accordingly did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Kedarnath Jute Manufacturing Co. Ltd. vs. CIT 82 ITR 363 the statutory liability of sales tax incurred by issue of notice by the authorities is deductible notwithstanding the fact that the liability is disputed by the assessee and in the same token assessee was bound to return the impugned receipt in A.Y. 2008-09. He also relied upon several case law to conclude that failure to return redumption fine refunded to the appellant amounts to furnishing of inaccurate particulars of income. He accordingly confirmed the action of the AO. 9. Further aggrieved, assessee is in appeal before us. The learned counsel for the assessee strongly relied upon the decision of the Hon'ble Supreme Court in the case of Hindustan Housing and Land Developmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cases penalty should not be levied. 10. On the other hand, the learned D.R. strongly relied upon the orders passed by the tax authorities. The case of the learned D.R. is that most of the returns are not taken up for scrutiny by virtue of the provisions of section 143(1) of the Act and if the assessee does not voluntarily offer to tax it could give an undue benefit and under such circumstances it is duty of the assessee to declare correct income without being guided by the view taken by it, which is contrary to law. 11. We have carefully considered the rival submissions and perused the record. In the instant case the assessee offered an explanation alongwith supporting case law. It is not in dispute that so long as a matter is pending be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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