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TMI Blog2016 (5) TMI 626X X X X Extracts X X X X X X X X Extracts X X X X ..... llant that similar disallowance made in the Assessment Years 2006-07 and 2008-09 have not resulted in levy of penalty by the Assessing Officer itself. This fact-situation also justifies the assertion of the assessee that the impugned penalty deserves to be set-aside, and we do so. - Decided in favour of assessee - ITA No. 4403/MUM/2013 - - - Dated:- 29-4-2016 - Shri G. S. Pannu, Accountant Member And Shri Ram Lal Negi, Judicial Member For the Petitioner : Shri K. Shivaram Shri Rahul Sarda For the Respondent : Ms. Radha Katyal Narang ORDER Per G. S. Pannu, AM The captioned appeal by the assessee is directed against the order of CIT(A)-20, Mumbai dated 04.03.2013, pertaining to the Assessment Year 2007-08, which in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer has since been upheld by the CIT(A), against which the assessee is in appeal before us. 4. Before us, the learned representative for the assessee has made varied submissions on facts and in law to justify that there was no concealment of income or furnishing of inaccurate particulars of income within the meaning of u/s. 271(1)(c) of the Act in the present case qua the disallowance of ₹ 3,54,47,542/- being advertisement/sales promotion expenses. The learned representative explained that the aforesaid expenses were claimed as revenue expenditure on the basis of the method of accounting followed by the assessee consistently since Assessment Year 1990-91. It is pointed out that the action of the Assessing Officer is based on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar 2008-09 also similar disallowance was made by the Assessing Officer but no penalty was initiated in the assessment order itself and in this connection reference was made to the assessment order u/s. 143(3) of the Act for Assessment Year 2008-09 placed at pages 66 to 71 of the Paper Book. Apart therefrom, the learned representative pointed out that a mere difference in the year of taxability of an amount cannot be a ground to levy penalty u/s. 271(1)(c) of the Act. In support of his submissions, reference has been made to the ratio of the judgment of the Hon'ble Supreme Court in the case of Reliance Petroproducts Pvt. Ltd., 322 ITR 158 (SC) and also the judgment of the Hon'ble Bombay High Court in the case of Nalin P. Shah (HUF), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such income. 7. In the above context, we may now refer to the fact-situation in the instant case. The assessee before us is engaged in the business of construction and development of properties and such income is being historically computed following the project completion method of accounting. The pertinent dispute revolves around the advertisement/sales promotion expenses of ₹ 3,54,47,542/- claimed during the year to arrive at the business income. The Assessing Officer, in the course of the assessment proceedings, held that the expenses are relatable to ongoing projects and the same should be allowed in the year in which corresponding flats are sold, i.e., advertisement expenditure is to be allowed in the year in which the fla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear, the Assessing Officer in the subsequent Assessment Years of 2009-10 and 2010-11 in the assessments finalized u/s. 143(3) of the Act, copies of which have been placed in the Paper Book at pg. 42 to 52 and 53 to 58 respectively, allowed the claim of the assessee. Notably, the claim was disallowed in the instant year on the ground that such advertisement/sales promotion expenses should be allowed in the year in which the sale of flats were undertaken in respect of which such expenses were incurred. Pertinently, in Assessment Years 2009-10 and 2010-11 such expenses were allowed following the methodology devised by the Assessing Officer in the instant Assessment Year. The aforesaid factual matrix goes to amply demonstrate that the differenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not found sustainable by the Assessing Officer, by itself will not amount to furnishing of inaccurate particulars of income within the meaning of u/s. 271(1)(c) of the Act. 9. Therefore, in view of the aforesaid discussion, in our view, where the difference between the assessee and the Revenue is merely on account of difference in the year of allowability of claim, and in the absence of any finding or doubt with regard to the genuineness of the expenses claimed, the penal provisions of Sec. 271(1)(c) of the Act are not attracted. In our considered opinion, the aforesaid proposition clearly covers the instant case and the penalty levied u/s. 271(1)(c) of the Act deserves to be deleted. Apart therefrom, on the issue of uniformity of appr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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