TaxTMI 
TaxTMI 
TaxTMI 
2016 (12) TMI 294
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....nd and initiated penalty proceedings for making wrong claim. Thereafter, the Assessing Officer vide order dated 18-03-2013 levied penalty of Rs. 14,50,240/- in respect of additions made during the assessment proceedings. The assessee filed appeal before the Commissioner of Income Tax (Appeals) against the order levying penalty u/s. 271(1)(c) of the Act. The Commissioner of Income Tax (Appeals) vide impugned order rejected the contentions of the assessee and confirmed the levy of penalty. Now, the assessee is in second appeal before the Tribunal assailing the order confirming levy of penalty. 3. The grounds raised by the assessee in appeal are as under : "GROUND NO. 1 On validity of order passed u/s. 271(l)(c) of the I. T. Act, 1961 by the DCIT and confirmed on appeal by LD. CIT(A) On facts, in the circumstances of the case and in law, the order u/s. 271(1)(c) of the Income-tax Act, 1961 passed by the Deputy Commissioner of Income-tax (A.O.) and confirmed by the learned Commissioner of income tax (Appeals) is invalid, unlawful and without jurisdiction on the ground of uncertainty as to the exact charge at the time of initiation proceedings and levy of charge on the part of th....
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.... issuance of notice. The ld. AR further submitted that the Assessing Officer in para 07.3 of the assessment order has observed that the assessee has made wrong claim of depreciation. However, in the penultimate paragraph (para 08.9) of the assessment order the Assessing Officer concluded by observing : "the assessee has by claiming depreciation for which it is not entitled to has concealed its income and has filed inaccurate particulars thereof............." In the order levying penalty u/s. 271(1)(c) of the Act the Assessing Officer in para 10 has observed : "the assessee has furnished inaccurate particulars in respect of above income added by the assessing officer by not disclosing correct income in his return of income." Thus, the Assessing Officer at the time of recording satisfaction as well as issuance of notice u/s. 274 r.w.s. 271 of the Act was not clear, whether the penalty is to be levied for concealment of income or furnishing of inaccurate particulars of income. It is only at the time of passing of the penalty order the Assessing Officer has observed that penalty is levied for furnishing of inaccurate particulars of income. The ld. AR submitted that the penalty is ....
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....cision of Hon'ble Delhi High Court in the case of Commissioner of Income Tax Vs. Pradeep Agencies Joint Venture reported as 349 ITR 477. The ld. AR placed on record a copy of the order of Hon'ble Bombay High Court in the case of Owens Corning (India) Ltd. Vs. The Commissioner of Income Tax in Income Tax Appeal No. 2445 of 2011 dated 5th March, 2013 wherein the Hon'ble High Court admitted the issue relating to allowability of claim of deduction in respect of annualized write off of the amount paid to Maharashtra Industrial Development Corporation (MIDC). The Tribunal had disallowed the claim of assessee. The ld. AR further draws support from the decision of Hon'ble Bombay High Court in the case of Commissioner of Income Tax Vs. Nayan Builders & Developers reported as 56 taxmann.com 335 to contend that where High Court has admitted substantial question of law no penalty is to be levied in respect of such issue. 4.4 The ld. AR further submitted that penalty has been levied by invoking the provisions of Explanation 1. The Explanation 1 to section 271(1)(c) of the Act relates to concealment of income, whereas the penalty in the present case has been levied u/s. 271(1)(c....
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....son under the Act, such person fails to offer an explanation or offers an explanation which is found to be false or such person offers an explanation which he has not able to substantiate and fails to prove that such explanation is bonafide, then the amount added or disallowed in computing total income of such person as result thereof, shall for the purposes of clause (c) to section 271(1) of the Act be deemed to represent the income in respect of which particulars have been concealed. Meaning otherwise, in cases governed by Explanation - 1, where the explanation offered by the person is found to be false, not bonafide or where the explanation has not been substantiated with and in cases where the person fails to offer any explanation, are the cases where the person is held to have concealed particulars of his income and is liable to levy of penalty under section 271(1)(c) of the Act. 11. Now, coming to the facts of the present case, the assessee had acquired a running unit of Greaves Cotton Limited, situated at Nashik, which in turn, was engaged in the manufacturing of drilling equipment for oil fields, blast hole drilling (mining) and waterway drilling application. As per the a....
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....n on various blocks of assets i.e. (1) building, (2) furniture and fittings, (3) machinery & plant and (4) intangible assets @ 25%. As per the schedule D attached to the balance sheet also, the leasehold land and the factory building and the office buildings were shown separately on which depreciation was claimed as per the Companies Act. The said depreciation chart is placed at page 4 of the Paper Book. The assessee claims that it had revised its claim of depreciation during the course of assessment proceedings alleging that it was entitled to the depreciation @ 25% on the value of leasehold land as depreciation was allowable under section 32(1)(ii) of the Act. The Tribunal while deciding quantum appeal, vide order dated 23.08.2011 had held that the depreciation even in the amended section 32(1)(ii) of the Act was allowable on the restricted categories of tangible assets or intangible assets, which are in specifically enumerated in the section. 13. The Tribunal further held that the provisions of the Act cannot be interpreted to mean that leasehold rights granting such type of ownership over land, etc. would also qualify as intangible assets for the purpose of depreciation under....