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TMI Blog2016 (2) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... l") in ITA No.925/CHD/2013 for the assessment year 2009-10, claiming following substantial questions of law:- i) Whether on the facts and in the circumstances of the case, the ITAT is right in law in cancelling the penalty under section 271(1)(c) even though the assessee has claimed deduction under section 80IC by not following the decision dated 17.8.2006 of Hon'ble Jurisdictional High court in the case of Liberty India 293 ITR 520 (P&H) and the assessee accepts that the decision of Liberty India dated 17.8.2006 is applicable in his case? ii) Whether on the facts and in the circumstances of the case, ITAT is right in law in giving a finding that the assessee can claim deduction till the decision of Hon'ble Supreme Court even th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment proceedings under Section 143(3) of the Act vide order dated 29.11.2011, Annexure 1 and disallowed deduction under Section 80IC of the Act amounting to Rs. 1,50,09,481/-. Penalty proceedings under Section 271(1)(c) of the Act were also initiated for filing inaccurate particulars of income. Order imposing penalty of Rs. 51,01,720/- was passed on 29.5.2012, Annexure 2. Aggrieved by the order, the assessee filed appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. Vide order dated 1.8.2013, Annexure 3, the CIT (A) dismissed the appeal. Not satisfied with the order, the assessee filed appeal before the Tribunal. Vide order dated 23.12.2014, Annexure 4, the Tribunal allowed the appeal and set aside the order passed by the CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Jurisdictional High Court had decided this issue against the assessee which is reported in 293 ITR 520 and decision of Hon'ble Punjab and Haryana in case of Liberty India vs. CIT on 17.8.2006. At the same time the decision of Hon'ble Delhi High Court in case of CIT vs. Eltek SGS (P) Limited, 300 ITR 6 was rendered on 19.2.2008 which was favourable to the assessee, therefore, assessee had the right to make claim of deduction. It is not always necessary that everybody would become aware of the decision. Ultimately when the same issue was decided by the Hon'ble Supreme Court on 31.8.2009 which is said to be published for the first time on 17.9.2009 and therefore there was very little gap between publication of the decision and fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 271(1)(c) had to be strictly construed, this being a taxing statute and more particularly the one providing for penalty. It was pointed out that unless the wording directly covered the assessee and the fact situation herein, there could not be any penalty under the Act. It was pointed out that there was no concealment or any inaccurate particulars regarding the income were submitted in the Return. Section 271(1)(c) is as under:- "271(1) If the Assessing Officer or the Commissioner (Appeals) or the Commissioner in the course of any proceedings under this Act, is satisfied that any person- (c) has concealed the particulars of his income or furnished inaccurate particulars of such income." 8. A glance at this provision would suggest tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etch of imagination, making an incorrect claim in law cannot tantamount to furnishing inaccurate particulars. In Commissioner of Income Tax, Delhi Vs. Atul Mohan Bindal [2009(9) SCC 589], where this Court was considering the same provision, the Court observed that the Assessing Officer has to be satisfied that a person has concealed the particulars of his income or furnished inaccurate particulars of such income. This Court referred to another decision of this Court in Union of India Vs. Dharamendra Textile Processors [2008(13) SCC 369], as also, the decision in Union of India Vs.Rajasthan Spg. & Wvg. Mills [2009(13) SCC 448] and reiterated in para 13 that:- "13. It goes without saying that for applicability of Section 271(1)(c), conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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