TaxTMI 
TaxTMI 
2015 (5) TMI 1146
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....y Hon'ble ITAT, Chandigarh in this case : i) Addition on account of freight inward and outward u/s 40(a)(ia) Rs. 28,96,304/- ii) Addition on account of freight outward on payment made to M/s Gati Ltd. u/s 40(a)(ia) Rs. 63,447/- iii) Addition on account of repair and maintenance of cars u/s 40(a)(ia) Rs. 1,94,593/- iv)Addition on account of stitching of uniforms etc u/s40(a)(ia) Rs. 5,82,625/- v) Addition u/s40A(3) Rs. 18,297/- vi) Addition on account of disallowance u/s 80IC on re-allocation of expenses Rs. 28,63,569/- vii) Addition on account of interest capitalised Rs. 10,355/- (2053 + 8302) (viii) Addition on account of interest debited to Derra Bassi unit - treated as relating to Baddi Un....
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....ied only in respect of the addition made on the disallowances under section 40(a)(ia), but has levied penalty for concealment of the entire addition confirmed by the Tribunal. The assessee relied upon decision of the Hon'ble Supreme Court in the case of M/s Reliance Petroproducts Pvt. Ltd. 332 ITR 158, decision of Hon'ble Punjab & Haryana High Court in the cases of M/s Sidharath Enterprises 322 ITR 80 and M/s Haryana Warehousing Corporation 314 ITR 215. 5. The ld. CIT(Appeals) considering submission of the assessee, cancelled the penalty. His findings in para 5 & 6 of the appellate order are reproduced as under: "5. I have considered the submission of the Ld. Counsel. As per the provisions of section 271(l)(c), ....
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....ome. Hon'ble ITAT Delhi in the case of AT & T Communications Services India Pvt. Ltd. (42 DTR 22) has held that the disallowance made by invoking provisions of section 40(a)(i) cannot be a ground to levy penalty u/s 271(l)(c) since in such situations, it cannot be said that the assessee had failed to disclose fully and truly all material facts relevant to the deduction claimed by the assessee. Section 40(a)(i) pertains to payments made to non-residents and the corresponding provision for residents is section 40(a)(ia) and so the ratio of this decision is applicable in respect of disallowance u/s 40(a)(ia) also. Further, the entire amount has been added u/s 40(a)(ia) for non-deduction of tax and the appellant has already been pe....
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....dia) Pvt. Ltd. (supra) and also submitted that assessee has disclosed all the particulars of income before the authorities below and disputed the claim of the Assessing Officer. He has also filed order of the Hon'ble Punjab & Haryana High Court in the case of the same assessee for assessment year under appeal to show that the appeal of the assessee has been admitted against quantum addition by Hon'ble Punjab & Haryana High Court on substantial questions of law. He has, therefore, submitted that since appeal of the assessee is pending before Hon'ble High Court, therefore, claim of assessee is bonafide and penalty has been correctly cancelled. 8. We have considered the rival submissions and material available on record. The iss....