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TMI Blog2015 (3) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... cation order u/s.154 of the Act was passed by the AO and rest of the disallowance was deleted by the Tribunal vide order dated 12/08/2011 in ITA No.3496/Ahd/2008 (supra). These facts are not controverted by the Revenue by placing any contrary material, therefore we hereby direct the AO to delete the penalty levied on an amount of ₹ 2,38,533/-. In view of the fact that the assessee has claimed depreciation during the year under consideration. The Revenue has not controverted the same, therefore following the ratio laid down in the case of CIT vs. Reliance Petroproducts Pvt.Ltd.(2010 (3) TMI 80 - SUPREME COURT ), we are of the considered view that the ld.CIT(A) was not justified in confirming the penalty on this issue, therefore the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss Profit, disallowance out of deduction claimed u/s.80IB of the Act, disallowance of depreciation and deduction claimed u/s.80IB of the Act and addition by invoking provisions of section 41(1) of the Act. The AO also initiated the penalty proceedings. The AO vide order dated 18/03/2010 levied penalty in respect of the addition made on account of fall in GP, disallowance of deduction claimed u/s.80IB of the Act and disallowance of depreciation and deduction claimed u/s.80IB of the Act aggregating to ₹ 30,16,897/-. The AO imposed a penalty of ₹ 11,03,958/-. Against this, the assessee filed an appeal before the ld.CIT(A), who after considering the submissions of the assessee dismissed the appeal. Aggrieved by the order of the ld.C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of fall in GP of ₹ 25,46,363/-, the addition was deleted by the Hon ble Tribunal (ITAT Bench D Ahmedabad in ITA No.3496/Ahd/2008 for AY 2005-06 vide order dated 12/08/2011. He drew our attention towards paras-7,8 9 of the said order of the Tribunal, wherein the Hon ble Coordinate Bench has held that the addition made on account of fall in GP is not justified. He further submitted that in respect of addition made on account of disallowance of deduction u/s.80IB of the Act amounting to ₹ 2,38,533/-, the AO disallowed deduction of ₹ 2,38,533/- on interest income, in respect of vatav kasar of ₹ 5,82,803/- and ₹ 1,85,643/- respectively. He submitted that so far as the interest of ₹ 5,82,803/-, it i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the basis of the decision of Special Bench of ITAT in the case of Vahid Paper Converters Others in ITA No.1686/Ahd/2004 confirmed the disallowance. He submitted that, in fact, the assessee claimed the deduction u/s.80IB after claiming of the depreciation during the year under consideration as can be perused from the working of deduction u/s.80IB of the Act. However, the AO recomputed the profit by allowing depreciation of earlier years although in fact it was not allowed in assessment records. He submitted that, under such circumstances, the decision of Vahid Paper Converters Others cited supra is not applicable as held in the case of Khemani Distillers vs. ACIT in ITA No.2149/Ahd/2007 of ITAT, Ahmedabad. Even otherwise, the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the AO to delete the penalty levied on an amount of ₹ 2,38,533/-. In respect of disallowance of depreciation and deduction of ₹ 2,32,001/-, the basis of disallowance was on that the assessee claimed deduction u/s.80IB of the Act in the earlier years was found to have been worked out without claiming depreciation. The AO found that this position was not in accordance with law and, therefore he disallowed the deduction u/s.80IB of the Act and added back in the income of the assessee on account of excess/wrong claim of deduction u/s.80IB of the Act. The contention of the assessee is that the assessee claimed deduction u/s.80IB of the Act after claiming the depreciation during the year under consideration as can be perused from the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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