TaxTMI 
TaxTMI 
2016 (9) TMI 1367
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.... penalty levied under section 271(1)(c) of the Income Tax Act, 1961 ["Act" in short]. 2. The brief facts of the case are that the assessee is engaged in the business of design, fabrication and supply of cement equipment and. The assessee has filed its return of fringe income for the assessment year 2002-03 on 31.10.2002 declaring total income of Rs..3,10,70,066/-. The assessment was completed under section 143(3) of the Act, determining the income at Rs..9,22,42,335/-. Subsequently, the assessment was revised under Section 154 of the Act determining an income of Rs..9,26,68,392/-. Thereafter, again on 31.12.2008, a revision was made giving effect to the order dated 22.06.2007 of the ITAT, Chennai determining the income at Rs..9,16,60,121/-....
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....ion (3) of section 80HHB stipulated a condition that 50% of the said profits is to be transferred to a reserve account known as "Foreign Projects Reserve Account". 1.5 From the financial year 2000-2001, the quantum of deduction available to an assessee was reduced to 40%, 30%, 20% and 10% respectively for the previous years ended 31.03.2001, 31.03.2002, 31.03.2003 and 31.03.2004. Consequential amendment was also made to clause (ii) to sub-section (3) of section 80HHB to provide for the respective percentage of profits to be transferred to the "Foreign Projects Reserve Account". 1.6 For the subject AY 2002-03, the Appellant is eligible to claim 80HHB deduction at the rate of 30% of the profits derived from foreign projects. 1.7 During ....
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....ccount" and as such the Appellant had transferred the said sum relying on the certificate issued by the Chartered Accountant (refer P&L account in Annexure 2). 1.12 It may also be noted that, in the preceding previous years, the Appellant had been duly transferring the requisite quantum to the "Foreign Projects Reserve Account" as required u/s 80HHB even when the appellant had incurred overall losses. Therefore, we submit that there is no mala-fide intention on the part of the Appellant to transfer a lower amount to such reserves. The Appellant has a good track record of paying taxes duly and was being compliant with section 80HHB for all of previous years. 1.13 The AO has failed to appreciate the fact that there was all inadvertent hum....
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..... 147 of the Act on 23.03.2009. As such, based on the particulars furnished by the assessee, the Department has not properly verified the particulars of the assessee while doing the original assessment under section 143(3) of the Act dated 31.03.2005. 6. During the course of penalty proceedings, the assessee has represented that while issuing the certificate, the Chartered Accountant has inadvertently omitted to consider the ceiling in respect of amount credited by the assessee to foreign projects reserve account, thereby the claim made by the assessee was disallowed. Otherwise, the Department did not have any incriminating material evidence for even for initiating reassessment proceedings or leading to levy of penalty during the course of....