TaxTMI 
TaxTMI 
2013 (10) TMI 597
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....of penalty in relation to disallowance of expenses on foreign travel of Rs. 5,51,167 and donation of Rs. 8,91,000. 2. Facts in brief:- The assessee company is engaged in the business of construction as a builder and developer. The assessee has purchased a plot of land and after getting approval from the local authority in the year 2000, started the construction of buildings consisting of three wings. It was explained before the Assessing Officer that the assessee is following completed contract method as per the old Accounting Standard AS/7 as the project has commenced in the year 2000 i.e., before the revision of AS/7. It has considered the construction of three wings as a single project. During the course of assessment proceedings, the....
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.... Other income 10,33,230.00 Net Total Revenue from "A" & "B" Wing 10,73,85,236.00 Less: Net construction cost of "A" & "B" wing 11,05,29,152.62 (31,43,916.62) 4. Thus, the assessee had computed a loss of Rs. 31.43 lakhs on construction of "A" and "B" wing. The Assessing Officer, from the details furnished, noticed that the assessee has claimed the use of land area of 70% for construction of "A" and "B" wing is not correct because the final permissible FSI for construction as approved by the Thane Municipal Corporation was at 9,560 sq.mtrs., whereas, the total FSI consumed for construction of "A" and "B" wing works out to 5,182 sq.mtrs. Accordingly,....
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....he assessment order, the addition was made after reducing the proportionate cost of land @ 46% instead of 30% reduced by the assessee and worked out the interest in the same proportion. Insofar as the foreign travel expenses of Rs. 5,51,167 and donation of Rs. 8,91,000 are concerned, which are the subject matter of penalty in the present appeal, the same has been reduced from the cost by the assessee as well as by the Assessing Officer also, which is evident from the chart reproduced herein above. The only difference is in the reduction of proportionate cost of land which, as per the assessee, was Rs. 1,18,22,398 and according to the Assessing Officer, it should have been Rs. 1,81,27,678. The difference comes to Rs. 63,05,280, which has bee....
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....e Act was initiated by issue of notice u/s 274 r.w.s 271(1)(c) of the Act on 29-12-2009 for concealment of income within the meaning of section 271(1)(c) read with Explanation there to. The assessee was provided with a further opportunity vide letter dated 6-4-20 10 to explain as to why penalty u/s 271(1)(c) should not be levied." 7. The reason given by the Assessing Officer in the aforesaid manner is completely divorced from the findings and the additions made by the Assessing Officer in the quantum proceedings. The assessee made detail submissions in response to the show cause notice on the basis of the additions made by the Assessing Officer in the quantum proceedings. However, the Assessing Officer levied the penalty on the disallowa....