2010 (2) TMI 881

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....la, Judicial Member:-   1. The appeal by the Revenue is dt. 9th Sept., 2009 against the order of CIT(A)-II, Ludhiana, relating to asst. yr. 2004-05 against the order passed under s. 271(1)(c) of the IT Act.   2. The only issue raised in the present appeal is against the deletion of penalty levied under s. 271(1)(c) of the IT Act.   3. The brief facts of the case that while ....

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.... 4. Mr./Shri S.P. Khutan appeared on behalf of the Revenue and Shri Sudhir Sehgal appeared on behalf of the assessee.   5. We have heard the rival contentions and perused the records. During the year under consideration, the assessee had debited expenditure of Rs. 2,06,190 on account of foreign travel expenses of the wife of the director. The plea of the assessee is that complete particul....

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.... was disallowed being not relatable to the business of the assessee company. Merely because an expenditure has been disallowed in the hands of the assessee does not automatically make the assessee exigible to levy of penalty under s. 271(1)(c) of the Act. In any case, mere disallowance of expenditure does not attract the levy of penalty under s. 271(1)(c) of the Act. We are in conformity with the ....