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TMI Blog2023 (6) TMI 1266X X X X Extracts X X X X X X X X Extracts X X X X ..... d merely for the reason that certain claim made by the assessee is not allowable or excessive in the opinion of revenue authority. In holding so we draw support and guidance from the judgment of Reliance Petroproducts Pvt .Ltd [ 2010 (3) TMI 80 - SUPREME COURT] The addition made was based on estimation of reasonable rate of interest. As such the assessee paid interest at different rate, the AO estimated different and the learned CIT-A further estimated different rate of interest. It settled position of law by the various High Court that the no penalty under section 271(1)(c) can be sustained in case of estimated addition. See Norton Electronics System Pvt. Ltd [ 2014 (2) TMI 606 - ALLAHABAD HIGH COURT] - Thus in view of the above discussion we are of the opinion that no penalty u/s 271(1)(c) of the Act can be levied on addition/disallowances of interest expenditure found to excessive as compared to market rate. Nature of expenses - computer repair maintenance expenses and excess depreciation - purchase of computer to be treated as revenue or capital expenditure - HELD THAT:- Again it is case of difference of opinion where assessee claimed certain deduction in the return o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thus the delay occurred in filing the appeal which needs to be condoned. 3. The learned DR at the time of hearing, considering the length of delay did not oppose on the condonation petition filed by the assesse. 4. We have heard the rival contention of both the parties and perused the materials available on record. Considering the length of delay and the explanation furnished by the learned AR for the assessee and also considering the fact that the learned DR not opposed the same, we hereby condone the delay in filing of appeal for 30 days and proceed to adjudicate the issue on merit. 5. The assessee has raised the following grounds of appeal: 1. The grounds raised in this appeal are without prejudice to one another. 2. The Learned CIT(A)-2 erred in law and on facts in confirming the penalty u/s.271(l)(c) in respect of sustained estimated addition of Rs.686466/-. The same deserves to be deleted. 3. On the facts and circumstances of the case it is contended that as there was no mensrea, penalty on the confirmed addition was not attractable. 4. Without prejudice, it is contended that as the assessee has discharged the burden that lay upon him under exp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITAT in ITA No. 681/RJT/2010 where the Tribunal vide order dated 09-01-2014 set aside the issue to the file of the AO. The AO in set aside proceeding did not make any addition or initiated any penalty proceeding. Thus, the assessee accordingly contended that no penalty should be levied. 10.1 However, the learned CIT(A) found that the Hon ble ITAT in quantum appeal confirmed the order of the learned CIT(A) except on one issue of addition representing Low GP for Rs. 15,60,234/- which was set aside to the file of the AO. Accordingly, the learned CIT(A) held that the assessee is liable to levy of penalty on addition of Rs. 6,86,466/- which was also confirmed the by ITAT. Thus. the learned CIT(A) directed the AO to re-compute the amount of penalty on concealment of income for Rs. 6,86,466/-. 11. Being aggrieved by the order of the learned CIT(A) the assessee is in appeal before us. 12. The learned AR before us filed a paper book running from pages 1 to 107 and inter alia contended that the assessee has furnished all the particulars of the claim made in the return of income but some of them were not admitted by the authorities below. However, the claims not admitted by the autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der section 271(1)(c). That is clearly not the intendment of the Legislature. 14.2 Coming to the case on hand, the first addition/disallowances made during the quantum proceeding is of interest expenses which was considered as excessive by the Revenue authority. Accordingly, the Revenue authority estimated the reasonable interest as per market and made disallowances of interest expenses claimed by the assessee over and above the amount estimated by the AO/Ld. CIT(A). Thus what is transpired that it is not the case that claim of the assessee altogether found incorrect or assessee has not incurred such interest expenses. As such it is a case where revenue authority was of opinion that the assessee was paying interest at excessive rate as compared to market rate. Hence, in our considered opinion, the same does not amount to concealment of income or furnishing incorrect particular of income. In our considered view penalty under section 271(1)(c) of the cannot be levied merely for the reason that certain claim made by the assessee is not allowable or excessive in the opinion of revenue authority. In holding so we draw support and guidance from the judgment of Hon ble Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 271(1)(c) of the Act was not imposable with respect to the additions made on such estimate by the Assessing Officer. Thus in view of the above discussion we are of the opinion that no penalty under section 271(1)(c) of the Act can be levied on addition/disallowances of interest expenditure of Rs. 5,51,313/- found to excessive as compared to market rate. 14.5 The next addition/disallowances made in the quantum proceeding for Rs. 18,745/- was based on the fact that the assessee purchased computer but claimed 100% deduction by treating the same as revenue expenses under the head repair and maintenance but the AO disallowed the same by treating the same as capital expenditure. Likewise, the assessee while claiming depreciation on weighing machine claimed depreciation at the rate applicable for computer but the AO held that depreciation should be allowed at the rate applicable for plant and machinery thus disallowed excess depreciation of Rs. 10,208/-. Again it is case of difference of opinion where assessee claimed certain deduction in the return of income which was not accepted by the AO. Hence, the question of concealment of income or furnishing inaccurate particular ..... X X X X Extracts X X X X X X X X Extracts X X X X
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