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TMI Blog2016 (4) TMI 1008X X X X Extracts X X X X X X X X Extracts X X X X ..... of the year consistently. We find that during the instant assessment year, the AO has made addition and, at first appellate stage, the CIT(A) gave relief to the assessee. However, ITAT held that unless the hologram is destroyed, the same cannot be written off. We find that the ld. CIT (A) observed that at the time of filing Income Tax return, the decision of ITAT order was not there, hence, the assessee was of bonafide belief that writing off of unused hologram is legal since it cannot be used next year and we concur with the said view of the ld. CIT (A) and also of the view that the claim of the assessee is not bogus. Accordingly, we uphold the order of the CIT (A) deleting the penalty on this addition also. So, we uphold the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377; 1,73,133/- was claimed refundable in the return. The AO completed the assessment u/s 143(3) of the Act on 14.12.2011 determining the income at ₹ 95,59,885/-, inter alia, by making the following additions / disallowances :- (i) Provision of interest on SDF Loan Rs.14,45,710/- (ii) Collection of Dharmada for charitable Purpose and interest accrued on Accumulated fund of Dharmada Rs.30,84,058/- (iii) Hologram written off ₹ 1,69,655/- However, the aforesaid assessed income of ₹ 95,59,885/- was set off from brought forward losses and the income w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount of provision of Interest on Sugar Development fund (SDF) for ₹ 14,45,710/-. The assessing officer disallowed the interest payable to IFCI under Section 43B of the Act. The Ld. AR has argued that the Sugar Development fund was created by Government of India, Ministry of Consumer Affairs, Food Public Distribution Department of Food and Public Distribution to provide Loan for modernization of sugar plant. During the appellate proceeding, on the nature of loan, Ld. AR has filed letter no. 4-1I2005- SDF, Government of India, Dt. 1-07-2005, where it is mentioned that loan has been sanctioned to the assessee company after considering its application for modernization/ replacement of two numbers of boilers with incidental expansion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r other years and the Assessing Officer has accepted the same vide order dated 14.12.2011 for A.Y 2003-04, CIT(A) has given the relief to the assessee which was reversed by hon'ble ITAT vide order dt. 4.6.2010. Therefore, on the date of filing of Return of income, there was two opinions available on the tax ability of Dharamda collection. I, therefore, am of the view that considering the facts and circumstances, penalty u/s 271 (1)(c) is not leviable. 3) Addition of ₹ 1,69,655 on account of writing off unused hologram:- Ld. AR's main argument against non leviability of penalty u/s 27l (l)(c) on this addition is that as per UP Excise Rules, the holograms printed and issued for a particular year can only be consumed dur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eleting the same. Therefore, he wants us to set aside the order of the ld. CIT (A) and restore that of the AO. 7. Ld. AR for the assessee, while relying on the order of the CIT (A), submitted that in the assessee s own case for AY 2007-08 in ITA No.5147/Del/2013 dated 14.11.2014, the Tribunal has deleted the penalty levied u/s 271(1)(c) against the similar additions made in this assessment year also. Therefore, he pleaded that the order of the ld. CIT (A) be upheld. 8. We have heard both the sides and perused the material on record. We note that the AO made the penalty u/s 271(1)(c) of the Act against the following additions / disallowances :- (i) Provision of interest on SDF Loan Rs.1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, the same cannot be written off. We find that the ld. CIT (A) observed that at the time of filing Income Tax return, the decision of ITAT order was not there, hence, the assessee was of bonafide belief that writing off of unused hologram is legal since it cannot be used next year and we concur with the said view of the ld. CIT (A) and also of the view that the claim of the assessee is not bogus. Accordingly, we uphold the order of the CIT (A) deleting the penalty on this addition also. So, we uphold the order of the CIT (A) deleting the penalty levied u/s 271(1)(c) of the Act. 9. The grounds taken in the cross objection filed by the assessee are only supportive of the order of the ld. CIT (A). As we have already dismissed the appeal of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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