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TMI Blog2014 (12) TMI 604X X X X Extracts X X X X X X X X Extracts X X X X ..... as made of total deduction of such amount – it could not said to be a case of concealment within the ambit and scope of section 271(1)(c) - assessee in respect of the reconstruction of the old Makarpura Unit, had made a claim u/s 80IB - The Tribunal has rightly held that there is no concealment nor any furnishing of inaccurate particulars – thus, the order of the Tribunal for not levying the penalty is upheld – Decided against revenue. - TAX APPEAL NO. 923 of 2014 - - - Dated:- 29-9-2014 - MS. HARSHA DEVANI AND MS SONIA GOKANI, JJ. FOR THE APPELLANT : MR KM PARIKH, ADVOCATE JUDGEMENT Per: Sonia Gokani: 1) Following are the substantial questions of law raised by the Revenue in the present tax appeal preferred under Section 260A of the Income Tax Act, 1961 challenging the order of the Income Tax Appellate Tribunal (hereinafter the Tribunal ) dated 28.11.2013 for our consideration: (A) Whether on the facts and circumstances of the case and in law, the Hon ble ITAT is justified in deleting the penalty under section 271(1)(c) of the Income Tax Act, without appreciating the fact that the assessee had deliberately claimed deduction under section 80IB of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turing unit with effect from 1st February, 1996 at Makarpura where the deduction under section 80IB of the Income Tax Act, 1961 (hereinafter the I.T. Act ) had been granted. Another unit was set up at Manglej for which the assessee had claimed deduction under section 80IB of the I.T Act terming it as reconstruction of an existing business. The Assessing Officer denied the claim by observing that there was addition to building, plant, machinery and electrical installation and office equipment of the amount of ₹ 83,01,082/-, ₹ 1,21,54,410/-, ₹ 11,76,069/- and ₹ 41,930/-. The Assessing Officer further contradicted the claim by noting that the said unit had also been recorded as Unit No.2 at the District Industries Centre (DIC) which falsified the claim of the assessee that it got itself registered as a new unit. The Assessing Officer further held inter alia that after the commencement of the unit at Manglej, the old unit was discontinued and then was held to be the new industrial undertaking. Since the entire investment was of more than ₹ 1 crore on the last day of the financial year, it did not find such unit to be qualified as an SSI unit under the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be levied, it upheld the say of the assessee that mere culmination of the quantum proceedings into disallowance in favour of the assessee cannot give rise to levy of penalty. 7) We notice that the entire thrust of both the Assessing Officer and that of the CIT was on the ground that the claim made by the assessee under section 80IB amounting to ₹ 37 lakhs (rounded off) and depreciation on electric fitting to the tune of 2.23 lakhs (rounded off) was based on inaccurate particulars and it was a deliberate act on the part of the assessee to have made such claim despite being aware of the decision of the Apex Court on such an issue. Reliance was also placed on the decision of Methur Chemical Industrial Corporation Ltd. v. Commissioner of Income Tax, 217 ITR 768 and Commissioner of Income Tax, West Bengal v. Orient Paper Mills Ltd., 176 ITR 110 for the proposition that the certificate of DIC where the assessee had registered itself as the Industrial Unit No.2. We notice that in the decision of the Apex Court, concerning the new industrial undertaking on Orient Paper Mills Ltd. (supra), the Supreme Court followed the decision rendered in the case of Textile Machinery Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lling chemicals. The assessee claimed from the insurance company the amount on account of loss and damage to its plant and machinery on replacement cost basis and on account of loss of its finished or semifinished goods. The insurance company, however, paid in the month of November/December 1979, a sum of ₹ 84,462/- in respect of former claim and a sum of ₹ 56,173/- in respect of the latter. 10) The assessee filed its return declaring the loss. The Assessing Officer disallowed the loss claimed by the assessee on account of damage to the plant and machinery by noting that the assessee claimed the total deduction of such amount. It also initiated the penalty proceedings under section 271(1) (c) of he Act on the ground that the assessee had furnished inaccurate particulars of its income and concealed the income in respect of these two amounts. 11) The Tribunal also held that the penalty referable to the amount regarding capital loss being dishonestly claimed as trading loss in the profit and loss account and levying of was justified. 12) On reference, this court held that it could not be said that the assessee knew or had reason to believe that the claim made as r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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