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TMI Blog2017 (12) TMI 1413X X X X Extracts X X X X X X X X Extracts X X X X ..... highly a debatable and legal issue. Therefore, it cannot be said that the assessee furnished inaccurate particulars of income or concealed its income. See CIT vs. Reliance Petro Products [2010 (3) TMI 80 - SUPREME COURT] In the present case also the claim of the assessee for exemption u/s 11 has not been allowed by the AO on the basis of the judgment of the Hon’ble High Court. Therefore, not allowing the claim of the assessee u/s 11 of the Act itself cannot tantamount to furnishing of inaccurate particulars of income - Decided in favour of assessee. - ITA No. 3281-3287/Del./2016 - - - Dated:- 26-12-2017 - SH. N.K.SAINI, AM AND SH. K.N.CHARY, JM For The Assessee : Sh. V. Raja Kumar, Adv. For The Revenue : Sh. Arun Kumar Yadav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts included the lease rental income from M/s. Shankar Trading Co. P. Ltd. claimed to be exempt u/s. 11 whereas the business of manufacturing of Katha was not incidental to the objects of the trust. He invoked the provisions of section 11(4A) of the Act, denied the benefit of exemption u/s 11 of the Act and assessee the income at ₹ 62,86,390/-. 5. Being aggrieved the assessee carried the matter of the ld. CIT(A) who vide order dated 06.03.1996 confirmed the action of the AO for denial of exemption u/s 11 of the Act. On further appeal, the ITAT vide order dated 04.09.2002 allowed the exemption u/s 11 of the Act but the department did not accept the said order and filed an appeal u/s 260A of the Act before Hon ble Jurisdictional High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot be termed as mala fide. It was further stated that the AO himself allowed the exemption up to the assessment year 1988-89 and thereafter up to assessment year 2007-08 and even ITAT had also allowed the exemption. Therefore, the assessee had a bona fide belief that it was entitled to exemption u/s 11 of the Act. It was contended that the order of the Hon ble Delhi High Court came much later on 20.11.2012, therefore, there was no mala fide intention on the part of the assessed furthermore, the impugned penalty was levied on the basis of wrong and illegal computation of total income by the AO taking the gross income / gross receipts as taxable income without deducting the legitimate expenses, depreciation, etc. and that the Hon ble High Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laim, was untrue or false or to show that any material fact has been suppressed by the assessee. He further observed that the penalty in the present case was levied after the Hon ble High Court confirmed the disallowance of assesse s claim of exemption u/s 11 of the Act. This claim was earlier allowed by the ITAT Delhi Bench besides, this, the AO did not find any adverse material against the assessee for furnishing inaccurate details or concealment of income and that from the past history also it was clear that the claim was not deliberately or willfully made in a false manner because in the earlier years even the AO and the Ld. CIT(A) had been allowing the claim of deduction. Therefore, the debatable interpretation can not held to be a rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O up to the assessment year 1988-89 and thereafter upto assessment year 2007-08, for the year under consideration also the claim of the assessee was allowed by the ITAT. Subsequently the Hon ble Jurisdictional High Court did not allow the claim of the assessee u/s 11 of the Act. However, SLP is pending before the Hon ble Supreme Court. Therefore, it can be said that the issue relating to the claim of exemption u/s 11 of the Act is highly a debatable and legal issue. Therefore, it cannot be said that the assessee furnished inaccurate particulars of income or concealed its income. 12. On a similar issue, the Hon ble apex court in the case of CIT vs. Reliance Petro Products 322 ITR 158 (supra) held as under :- A glance at the provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regarding the income of the assessee. Such a claim made in the return cannot amount to furnishing inaccurate particulars. 13. In the present case also the claim of the assessee for exemption u/s 11 has not been allowed by the AO on the basis of the judgment of the Hon ble High Court. Therefore, not allowing the claim of the assessee u/s 11 of the Act itself cannot tantamount to furnishing of inaccurate particulars of income. We, therefore, in view of the ratio laid down by the Hon ble Apex Court in the aforesaid referred to case are of the confirmed view that the impugned order passed by the ld. CIT(A) do not require any interference. In that view of the matter, we do not see any merit in this appeal of the department. 14. In all ..... X X X X Extracts X X X X X X X X Extracts X X X X
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