TaxTMI 
TaxTMI 
2017 (5) TMI 1311
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....elief to the assessee but none of the parties is satisfied by the stand so taken by the learned CIT(A). The parties are in appeal before us and have raised the following grievances :- I) Grievances raised by the assessee:- "1. The order passed by the learned CIT(A) is erroneous and contrary to the provisions of law and facts and therefore requires to be suitably modified. It is submitted that it be so done now. 2. The learned CIT(A) erred in not appreciating the fact that the appellant being a company established under an act of the Parliament, namely NDDB Act there cannot be any malafide intention on its part to defray the revenue. It is submitted it be so held now and penalty levied be cancelled. 3. The....
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....on lease for the period of 99 years and therefore the expenses claimed was for the purpose of acquiring lease hold right which was a capital expenditure and not revenue expenditure as claimed by the assessee so as to reduce the tax liability. 3. On the facts and in the circumstances of the case, the learned CIT(A) ought to have upheld the order of the Assessing Officer. 3. So far as the assessee's appeal is concerned, the grievances raised are against confirmation of penalty in respect of deduction of Rs. 4,02,06,000/- claimed under section 36(1)(viii) which stands declined to the assessee. As for appeal of the Assessing Officer, the grievances raised therein are against deleting the penalty in respect of interest income on proj....
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....327 ITR 510 (Del)]. The assessee is aggrieved and is in appeal before us. As far as penalty in respect of interest income on project expenses is concerned, it was imposed on the ground that the interest income accrued to the project fund, which, according to the assessee, was to be used for the purposes of fund only, accrued to the assessee and there is no evidence of the assessee having paid the same. The quantum of addition of Rs. 1,16,92,827 was thus made, and it was also held that the assessee is to be held responsible for having furnished inaccurate particulars of income. Accordingly, penalty under section 271(1)(c) was also imposed. However, when matter was carried in appeal before the CIT(A), the penalty was deleted as the CIT(A) was....
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....um disallowance and in doing so, the coordinate bench has taken particular note of the position (a) that processing of milk cannot be treated as industry and, for that reason, condition of section 36(1)(viii) is not satisfied; and (b) that since the assessee does not have a share capital, proviso to section 36(10(viii) cannot come into play thus defeating the formulae in that section. However, we have noted explanation of the assessee that (a) vide CBDT notification no SO 627(E) dated 4.8.99 producing milk and milk products have been held to be industry, and that (b) proviso to section 36(1)(viii) is in respect of the limitation on deduction, and as such the limited impact of proviso not being satisfied in any event is that no such limitati....
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....9;ble Patna High Court, Their Lordships had observed that "The Patna High Court emphasised that as to the nature of the explanation to be rendered by the assessee, it was plain on principle that it was not the law that the moment any fantastic or unacceptable explanation was given, the burden placed upon him would be discharged and the presumption rebutted. We agree. We further agree that it is not the law that any and every explanation by the assessee must be accepted. It must be acceptable explanation, acceptable to a fact-finding body." Viewed in the light of this well settled legal position, the explanation of the assessee is indeed acceptable so far as penalty under section 271(1)(c) is concerned. We, therefore, direct the Assessing Of....