2014 (2) TMI 941

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... assets. The learned CIT(A) failed to appreciate the fact that the appellant has neither concealed income nor furnished inaccurate particulars of income". 2. The solitary issue pertains to levy of penalty of Rs. 2,27,90,773/- u/s 271(1)(c) and sustained by the CIT(A). 3. The basic and brief facts are that the assessee is a bank, whose one of the businesses is leasing of assets. The assessee had been claiming depreciation on the assets leased by it for a number of years. The department consistently was of the view that the depreciation was not allowable. As mentioned in the assessment order, "the claim of depreciation on assets leased upto AY 1999-2000 has been disallowed by making detailed discussion in assessment order passed upto 19....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....d. 2 Admit on the following substantial questions of law:- (i) Whether on the facts and in circumstances of the case and in law, the Tribunal's conclusion that the lease agreement dated 04.09.1997 is a finance lease can be upheld both in fact and in law? (ii) Whether on the fact and in the circumstances of the case and in law, the Tribunal's finding that the Appellant was not entitled to depreciation under Section 32 of the Act is sustainable? (iii) Whether on the facts and in the circumstances of the case and in law, the Tribunal is right in holding that in a finance lease the lessee is the owner of the leased asset and not the lessor and hence only the lessee is entitled to depreciation under Section 32 of the Act"? 7. The ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....A No. 3006/Mum/2001 and connected appeals had held that, "... After having examined all the transactions which have been impugned before us, we are of the opinion that the assessee is entitled for the claim of depreciation.....". and also placed reliance on the decision of the Hon'ble Supreme Court in the case of ICDS Ltd. vs CIT, reported in 350 ITR 527 (SC). 11. As held by the coordinate Bench in assessment year 2001-02, this is neither the case of inaccurate particulars of income or concealment of income. We are of the opinion, that penalty in these circumstances is not exigible. We therefore reverse the order of the CIT(A) and direct the AO to cancel the penalty. 12. Taking into consideration the entire scenario, we are of t....