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TMI Blog2013 (1) TMI 934X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee is in the business of running hospitals. The return of income for the impugned assessment year was filed on a total income of ₹ 35,78,13,918. In the course of scrutiny assessment proceedings, the Assessing Officer found that the assessee has claimed depreciation at the higher rate of 40 per cent. on all equipment. The Assessing Officer observed that higher rate of depreciation at 40 per cent. is available only in the case of life saving devices . This matter was discussed with the assessee in the course of assessment proceedings. The Assessing Officer thereafter corrected the amount of depreciation allowable in the present case and thereby disallowed an amount of ₹ 6,92,74,634 as excess depreciation claimed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax (Appeals) did not give a finding on the above facts which were clearly brought out by the Assessing Officer to prove that the assessee's intentions were not bona fide. 2.4 The Commissioner of Income-tax (Appeals) ought to have applied the ratio of the hon'ble Supreme Court's decision in the case of Union of India v. Dharamendra Textile Processors [2008] 306 ITR 277 (SC) which holds that 'mens rea' is not an essential ingredient for levy of penalty. 5. The facts of the present case are very simple. In Appendix I provided under rule 5 of the Income-tax Rules, 1962, different rates of depreciation are provided for different classes of machineries and assets. In the case of life saving devices the depreciation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ightly adopted the view that the entire equipment cannot be treated as life saving devices . He accordingly bifurcated the medical equipment into two, the first being life saving devices and the other being normal equipment. He granted depreciation at 40 per cent. on life saving devices . He granted depreciation at the normal rate on the remaining lot of equipment. 8. What is discussed in the above paragraphs is a very normal procedure in an assessment under section 143(3) of the Act. If no discussion is called for or no adjustment is necessary, or mistake is permissible, then what is the necessity of a scrutiny assessment under section 143(3) of the Act ? The concept of scrutiny assessment under section 143(3) by its nature itself e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssors [2008] 306 ITR 277, wherein the hon'ble apex court has held that mens rea is not an essential ingredient for levying penalty under section 271(1)(c) of the Act, as it is in the nature of a civil liability. The present case does not reach to the point where the above decision should be considered by us. The above decision declares that mens rea need not be present in a case of concealment, provided it is found that the assessee has concealed the income or has furnished inaccurate particulars of income. In the present case, there is no concealment of income as such. There is no furnishing of inaccurate particulars. So it is not at all necessary even to mention the judgment of the hon'ble Supreme Court in the case of Union of Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X
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