TaxTMI 
TaxTMI 
2013 (4) TMI 546
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.... income for the year under consideration was filed by it on 31-10-2005 declaring total income of Rs. 7,79,610/- after claiming deduction of Rs. 81,99,000/- u/s 80IB(10) of the Act. During the course of assessment proceedings, it was found by the A.O. that the assessee has debited various expenses to the P&L account for the year under consideration which were actually not related to the project, income of which was offered to tax. The said expenses were related to the projects which were yet to commence. When this position was confronted by the A.O. to the assessee, the later admitted the same and offered to tax a sum of Rs. 31,58,467/- on account of disallowance of such expenses by filing the revised return. The A.O. however further found t....
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....f the total disallowance of Rs. 38,05,470/- made on account of expenses relating to the projects yet to be commenced holding that the assessee had furnished inaccurate particulars of its income to that extent. 4. The penalty imposed by the A.O. u/s 271(1)(c) of the Act was challenged by the assessee in an appeal filed before the ld. CIT(A) and it was submitted on its behalf before the ld. CIT(A) that all the relevant details pertaining to the expenses claimed were duly furnished by the assessee in the financial statements filed along with the return of income. It was also submitted that the genuineness of the said expenses was not doubted or disputed by the assessee and the disallowance was made merely on the ground that the same were al....
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....information by A.O. Further, disallowance of Rs.6,37,000/- was made which includes Rs. 4 lac, Rs. 2 lac and Rs.47,000/- out of electricity charges relatable to the projects, income of which were not taxable. Before me it was submitted that the appellant was seeking approval for Jaycoach project for exemption regarding which the A.O. was of the opinion that indirect expenditure could not be claimed as revenue expenditure. However, I do not find this fact as having been mentioned in the assessment order. As per Para 51 of assessment order, the disallowance has been made by the A.O. since the same not found allowable as expenditure at all to which the assessee also agreed and filed revised return. Regarding addition of Rs. 6,47,000/-, it is cl....
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....nafide. In view of this, I agree with the A.O. that the appellant has filed inaccurate particulars of income. Accordingly, the penalty imposed by the A.O. is upheld." Aggrieved by the order of the ld. CIT(A) the assessee is in appeal before the Tribunal. 6. The ld. Counsel for the assessee at the outset invited our attention to the assessment order passed by the A.O. u/s 143(3) of the Act and submitted that the satisfaction for initiating penalty u/s 271(1)(c) of the Act was recorded by the A.O. specifically in respect of addition made by way of disallowance of assessee's claim for deduction u/s 80IB(10) of the Act. He submitted that no such satisfaction, however, was specifically recorded by the A.O. in respect of addition made by wa....
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....and, submitted that the disallowance of expenses having been specifically made by the A.O. in the computation of total income of the assessee made in the assessment order and there being a direction contained in the said order for initiation of penalty proceeding u/s 271(1)(c) of the Act, the satisfaction to initiate the penalty proceeding in respect of disallowance of expenses was deemed to be recorded by the A.O. as per the provisions of section 271(1B) of the Act inserted by Finance Act (2008) in the statute with retrospective effect from 1-4-1989. On merit, the ld. D.R. relied on the order of the authorities below in support of the Revenue's case that it is a fit case to impose the penalty u/s 271(1)(c) of the Act. 8. We have conside....
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....der consideration were allowable only in the subsequent year when the corresponding projects were to commence. He therefore was of the opinion that the disallowance of expenses to that extent was liable to be made in the year under consideration and this position was accepted by the assessee by offering the disallowance in the revised return. As rightly submitted by the ld. Counsel for the assessee, the genuineness of the said expenses, however, was not doubted or disputed by the A.O. and there is nothing in the orders of the authorities below to doubt the bonafide of the assessee in claiming the said expenses as per the practice consistently followed. Moreover, all the material particulars relating to the said claim made on account of the ....