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TMI Blog2011 (1) TMI 1357X X X X Extracts X X X X X X X X Extracts X X X X ..... report it was noted that the factory has commenced its production on 24.12.1999 and the initial assessment year being 2000-01, the 5 year period eligible for 100% deduction was over by 2004-05 and claim of 100% in A.Y. 2005-06 was not correct. Assessee company was asked to show cause why deduction was claimed at 100% under section 80IB vide letter dated 17.12.2007. The assessee company submitted that the year of commencement was 24.12.1999 and as there was only three months period and activities were also very small, the first full five years of deduction was claimed including A.Y. 2005-06 without any wilful intention of claiming excess deduction. The assessee also withdrew the excess claim and paid tax immediately. The A.O. completed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n ground No. 1 and prior period expenses in ground No. 2. 3. With reference to ground No. 1 assessee s submissions are as under: - a) The mistake claiming of 100% deduction under section 80IB in the sixth year was an inadvertent error, which was apparent from records. b) The error when pointed out was accepted by the assessee and the assessee fully cooperated with the authorities and paid the taxes on the same. c) The claim of wrong rate was an inadvertent error and does not amount to filing of inaccurate particulars. The learned counsel for the assessee relied on the following case laws: - i) Niton Valve Industries (P) Ltd. vs. ACIT 30 SOT 236 (Mum) ii) Maya Ram Jiya Lal vs. CIT 152 ITR 608 (P H) iii) CIT vs. PHI Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 369 (SC) ii. CIT vs. MSTV Neethimohan Co. 107 ITR 585 (Mad) iii. CIT vs. Nav Bharat Automobiles 102 ITR 278 (All) iv. CIT vs. Tezpur Roller Flour Mills 103 ITR 259 (Gau) v. CIT vs. Dalmia Agencies (P) Ltd. 29 DTR (Del) 332 vi. CIT vs. Escorts Finance Ltd. 226 CTR (Del) 105 The ld.counsel also relied on the principles established by the Hon ble Supreme Court in the case of Reliance Petro Products 322 ITR 158(SC) 5. The learned D.R. reiterated the stand of the Revenue and also filed the judgement of the Hon'ble Delhi High Court in the case of CIT vs. Zoom Communication P. Ltd. 327 ITR 510 wherein the decision in the case of Reliance Petro Products (P) Ltd. 322 ITR 158 (SC) was distinguished to submit that the clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted by the assessee can be considered as a bonafide claim. On being pointed out the assessee not only withdrew the claim but also paid tax immediately. With reference to the claim of prior period expenses there is no dispute with reference to the allowability of the amount in the earlier year or in this year. Since assessee originally claimed deduction at 100% of the 80IB it would not have made any difference to the assessee company either with reference to the expenditure in the earlier year or in the later year. Only after being pointed out that the assessee would be eligible for deduction of 30% only the A.O. came to the opinion that there is an intention to claim more deduction by booking the amount in this year. This logic of the A.O. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars. In order to expose the assessee to penalty, unless the case is strictly covered by the provision, the penalty provision cannot be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate particulars. There can be no dispute that everything would depend upon the return filed by the assessee, because that is the only document where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate, the liability would arise. To attract penalty, the details supplied in the return must not be accurate, not exact or correct, not according to the truth o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT (2007) 293 ITR 520 (P H) upheld by the Supreme Court in Liberty India vs. CIT (2009) 317 ITR 218. Therefore, the Tribunal has rightly come to the conclusion that the assessee did not deliberately or consciously conceal the true particulars of income nor furnished inaccurate particulars of income. The deletion of penalty was justified. 10. The learned D.R. relied on the judgement of the Hon'ble Delhi High Court in the case of CIT vs. Zoom Communication P. Ltd. 327 ITR 510 in which the High Court distinguished the judgement in the case of CIT vs. Reliance Petro Products P. Ltd. 222 ITR 158 and held that the Court cannot overlook the fact that only a small percentage of the IT returns are picked up for scrutiny. If the assessee make ..... X X X X Extracts X X X X X X X X Extracts X X X X
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