TaxTMI 
TaxTMI 
TaxTMI 
2011 (2) TMI 957
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....ribunal") in ITA No. 1059/Del/2008, relating to the assessment year 1993-94, claiming the following substantial questions of law:- "I. Whether, on the facts and in the circumstances of the case, the Ld. ITAT was right in law in upholding the order of the Ld. CIT(A) in deleting the penalty of Rs.4,78,640/- on the ground of non-recording of satisfaction by the Assessing Officer in the assessment order despite the amendment by the Finance Act, 2008 with effect from 01.04.1989 to clause (1B) below Explanation 7 of Section 271(1)(c) of the Income Tax Act, 1961? II. Whether, on the facts and in the circumstances of the case, the Ld. ITAT was right in law in upholding the order of the Ld. CIT(A) in deleting the penalty of Rs.4,78,6....
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.... assessee filed an appeal before the Commissioner of Income Tax (Appeals) [in short "the CIT(A)"]. The CIT (A) vide order dated 8.1.2008 deleted the said penalty. Against the deletion of penalty, the department filed an appeal before the Tribunal who vide order dated 27.3.2009 upheld the order of the CIT (A) and dismissed the appeal and this gave rise to the revenue to approach this Court by way of instant appeal. 3. We have heard learned counsel for the parties. 4. The issue that arises for consideration in this appeal is whether the Tribunal was right in deleting the penalty levied under Section 271(1)(c) of the Act. 5. Learned counsel for the revenue placed reliance upon the following observations in the judgment of Delh....
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.... to Explanation 1, the onus to establish that the explanation offered was bona fide and all facts relating to the same and material on the computation of his income have been disclosed by him will be on the person charged with concealment. Mere failure to substantiate the explanation is not enough to warrant penalty. The Revenue has to establish that the explanation offered was not substantiated. The proviso to Explanation 1 is concerned only with cases coming under clause (B) of the Explanation where the assessee offered an explanation which he was not able to substantiate. The explanation of the assessee for purposes of the avoidance of penalty must be an acceptable explanation; it should not be a fantastic or fanciful one. As indicated a....
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....al and the judgment of this Court in ITA No. 450 of 2009 (Commissioner of Income Tax, Faridabad v. M/s SSP Ltd.) decided on 20.8.2009. 8. We have given our thoughtful consideration to the respective submissions of learned counsel for the parties and do not find any merit in the submissions made by learned counsel for the revenue. 9. The principles enunciated in Gurbachan Lal's case (supra) are that the initial onus lay upon the assessee to prove that there existed no concealment or deliberate attempt on its part to furnish inaccurate particulars. The assessee was further required to establish that the explanation so offered by it stood substantiated. In the present case, it has been specifically recorded by the CIT(A) and th....
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.... it was directed to the Assessing Officer to decide the issue considering the decisions of Madras High Court in the case of CIT vs. Sanmar Holdings Ltd. 183 CTR 346 and, thus, it has been held by CIT(A) that this was a case only of difference of opinion and the assessee did not misrepresent or misstate the facts regarding the source of income. Therefore, Ld. CIT(A) has deleted the penalty on this account. XX XX XX XX 6. The second addition in respect of which penalty has been levied is depreciation on electrical installation, fire fighting, plant and machinery and depreciation on building which is a sum of Rs.1,04,643/- as mentioned in ground No.4 of the appeal filed by the revenue. Here also it has been observed by the CIT(....
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....tion in closing stock is made same is allowable in the next year as the additional cost of opening stock for that year. He also held that penalty cannot be justified because it is a petty disallowance. After hearing Ld. DR, we do not find any infirmity in such findings of CIT (A) and, thus, on third account also, it is not a justified case for levy of penalty. In view of above discussion, we find no infirmity in the order of the CIT(A) vide which penalty of Rs.4,78,640/- levied by the Assessing Officer has been deleted for the reasons discussed above." 10. The said finding has not been shown to be erroneous or perverse in any manner by the learned counsel for the appellant and, therefore, the judgment relied upon by the revenue, in ....