Appeal partly allowed, penalty deleted for acting in good faith.

The Appellate Tribunal partly allowed the appeal, directing the Assessing Officer to delete the penalty imposed under section 271(1)(c) for the Assessment Year 2015-16. The Tribunal found that the appellant acted in good faith, following guidance notes and past practices, and that there were two possible views on the issues raised, indicating no deliberate inaccurate reporting of income.

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Issues:
1. Validity of penalty order under section 271(1)(c) of the Income-tax Act, 1961.
2. Specific charge framed by the Assessing Officer under section 274 r.w.s. 271(1)(c).
3. Treatment of administrative and general expenses by the appellant.
4. Disclosure of details of administrative and general expenses by the appellant.
5. Addition of expenses while passing the assessment order under section 143(3).
6. Allowability of expenditure disallowed in the current year.
7. Existence of two possible views on the issue under consideration.

Issue 1: Validity of penalty order under section 271(1)(c) of the Income-tax Act, 1961:
The appeal challenged the penalty order levied by the Assessing Officer under section 271(1)(c) for the Assessment Year 2015-16. The appellant argued that the basic conditions for the levy of penalty were not satisfied. The appellant contended that no inaccurate particulars of income were furnished, thus requesting the deletion of the penalty.

Issue 2: Specific charge framed by the Assessing Officer under section 274 r.w.s. 271(1)(c):
The appellant raised concerns regarding the absence of a specific charge against them in the original notice issued under section 274 r.w.s. 271(1)(c). It was argued that without a specific charge, no penalty could be levied under section 271(1)(c).

Issue 3: Treatment of administrative and general expenses by the appellant:
The Assessing Officer observed that the appellant had claimed administrative and general expenses as revenue expenditure, contrary to capital expenditure treatment followed for other project expenses. The appellant defended their treatment based on the guidance note issued by the ICAI.

Issue 4: Disclosure of details of administrative and general expenses by the appellant:
The appellant contended that complete details of administrative and general expenses were disclosed in the financial statements and provided to the Assessing Officer. It was argued that no inaccurate particulars of income were furnished.

Issue 5: Addition of expenses while passing the assessment order under section 143(3):
The penalty was imposed based on the addition of expenses during the assessment under section 143(3). The appellant argued that a mere disallowance of a claim does not amount to filing inaccurate particulars of income.

Issue 6: Allowability of expenditure disallowed in the current year:
The appellant highlighted that the disallowed expenditure was otherwise allowable in subsequent years. It was argued that the claim was in accordance with ICAI guidance notes and relevant accounting standards, thus not constituting filing inaccurate particulars of income.

Issue 7: Existence of two possible views on the issue under consideration:
The appellant contended that there were two possible views on the matter, and in such cases, penalty under section 271(1)(c) cannot be invoked. The appellant emphasized the bonafide reasons behind their treatment of expenses and cited relevant judicial precedents supporting their position.

The Appellate Tribunal, after thorough consideration of the arguments and evidence presented, partly allowed the appeal filed by the appellant. The Tribunal directed the Assessing Officer to delete the penalty levied under section 271(1)(c) for the Assessment Year 2015-16, as the appellant demonstrated acting in good faith based on guidance notes and past practices.

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