2013 (3) TMI 370

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.... Adv with Mr. Atul K Jasani JUDGEMENT:- 1. In this appeal by the Revenue for assessment year 2004-2005, the basic dispute is whether the Tribunal was justified in deleting the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 ('Act' for short). 2. The respondent - assessee is engaged in the business of providing services in respect of electronic goods sold by M/s.MIRC Ele....

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....ssee claimed to have earned net income of Rs.4.62 crores (Rs.10.98 crores - Rs.6.36 crores) from the transaction of assignment with MIRC and offered the same to tax in the assessment year in question i.e. A.Y. 2004-05. 4. The assessing officer was of the opinion that the assignment transaction between the assessee and MIRC was a sham transaction / colourable device and accordingly brought to ta....

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....ng officer were upheld by the CIT (A). On further appeal, officer who had held that the transaction was a sham and colourable transaction and accepted the genuineness thereof. However, the Tribunal considering the fact that though the sales tax liability taken over by the assessee was Rs.53.31 crores, since the assessee had actually settled the liability for Rs.26.64 crores and had paid Rs.17.64 c....

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....of liability and purchase of debts were two integral part of assignment of business and the net realizable value of the debt made by the assessee was bona fide and honest. The Tribunal further held that the basis adopted by the Tribunal in the quantum proceedings to determine the income of the assessee from assignment business was entirely different from the one adopted by the assessee as also the....