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TMI Blog2020 (4) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... nal High Court, however the findings of this Tribunal on these issues have not been disturbed by the Hon'ble Jurisdictional High Court till date. Therefore, in the facts and circumstances of the case when additions/ disallowances were deleted by this Tribunal then the penalty deleted by the ld. CIT(A) does not require any interference. Levy of penalty u/s 271(1)(c) on account of disallowance of provisions for doubtful debts - HELD THAT:- From the findings of the AO as well as Tribunal in the quantum proceedings, it is clear that it is not a case of furnishing inaccurate particulars of income or concealment of particulars of income but the claim of the assessee is regarding provision for bad and doubtful debts being outstanding dues ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee challenged the action of the AO regarding levy of penalty u/s 271(1) of the Act before the ld. CIT(A). The ld. CIT(A) deleted the penalty levied by the AO in respect of the additions made on account of depreciation on non-existing assets and prior period expenses on the ground that these two additions were deleted by the Tribunal in the quantum appeal. The penalty levied in respect of doubtful debts was confirmed by the ld. CIT(A) as the said addition was confirmed by the Tribunal in quantum appeal. Thus both the Revenue as well as assessee are aggrieved by the impugned order of the ld. CIT(A) and filed the cross appeals. 3.1 The Revenue has raised the following grounds. In view of the facts and circumstances of the case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the ld. CIT(A) does not require any interference. Thus both the grounds raised by the Revenue are dismissed. 4.1 The assessee in its appeal has raised the following ground:- Under the facts and circumstances of the case, the ld. CIT(A) has erred in confirming the levy of penalty u/s 271(1)(c) of I.T. Act, 1961 of ₹ 10,41,34,400/- on account of disallowance of provisions for doubtful debts which is bad in law. 4.2 The ld.AR of the assessee has submitted that the assessee has made the provisions of bad doubtful debts from consumers. Though the assessee has actually written off the outstanding dues from the consumers whose electricity connection was permanently disconnected, however, as per accounting norms of the electr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the inaccurate particulars of income. The ld. DR relied on the orders of the authorities below qua this issue 4.4 We have considered the rival submissions as well as the relevant materials available on record. During the course of assessment proceeding, the AO made the disallowance of provision for bad and doubtful debts in para 7 of assessment order as under:- 7. Provisions for Doubtful Debts On verification of Profit Loss Account, it is seen that the assessee has claimed bad and doubtful debts provisions for dues of ₹ 30,63,23,038/-. Therefore, vide questionnaire dated 23-01-2013 it was show caused as to why provision for bad doubtful debts should not be disallowed and also added to the Book Profit u/s 115JB. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct from the profit and loss account of the assessee. Though the provision for bad and doubtful debts are not allowable claim until and unless it is actually written off and the said addition was confirmed by the Tribunal in quantum appeal in ITA No. 371/JP/2016 for the Assessment Year 2010-11 vide order dated 28-08-2017 (M/s. Ajmer Vidyut Vitran Nigam Ltd vs ACIT, Circle 2, Ajmer) by observing at para 48 as under:- 48. We have heard the rival submissions and purused the material available on record. The assessee company has contended that it is not a provision but an actual write off. It was submitted that as per accounting procedure/guidelines prescribed for the electricity companies, it is not directly debited to the customer ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und of the assessee is dismissed. Thus from the findings of the AO as well as Tribunal in the quantum proceedings, it is clear that it is not a case of furnishing inaccurate particulars of income or concealment of particulars of income but the claim of the assessee is regarding provision for bad and doubtful debts being outstanding dues from the electricity disconnection consumers. Once the assessee has produced and disclosed all the relevant facts then mere disallowance of claim by the AO on the ground that the same is not allowable as per provisions of the Income Tax would not lead to the conclusion that the assessee has furnished the inaccurate particulars of income or concealed the particulars of income. Accordingly, following t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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