2012 (5) TMI 660

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..... passed by the ld. CIT(A)-7, Mumbai, on 13-04-2010 deleting penalty of ₹ 6,99,112/- imposed by the AO u/s. 271(1)(c) of Income-tax Act, 1961, in relation to assessment year 2004-05. 2. Briefly stated, the facts of the case are that the assessee wrote off a sum of ₹ 19,48,743/- in its books of account towards Cafeteria expenses. On being called upon to explain as to how such deduction .....

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..... ed that the assessee capitalized the expenses in relation to Cafeteria project as capital work in progress in earlier year. Such project did not take off and eventually the assessee claimed it as a business loss in the current year. It is clearly borne out from records that the assessee claimed deduction by disclosing complete particulars in this regard. Simply because the assessee did not succeed .....

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..... this regard in its return of income, in our considered opinion the judgment of the Hon ble Supreme Court in the case of CIT vs. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 (SC) will come to the assessee s rescue, in which it has been held that mere making of a claim which is not sustainable in law, by itself, will not attract penalty under this section. Considering the entirety of facts and .....

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