2018 (4) TMI 16

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.... u/s 271(1)(c) of the I.T ACT 1961 without appreciating the facts and circumstances of the case as well as merits brought on record by the AO in the assessment order passed u/s 143(3) of the Act which was confirmed by the CIT(A) and ITAT in the appellate orders passed in confirming the additions/ disallowances on account of setting off the income from the capital work in progress of Rs. 77,93,470/- and Rs. 2,65,555/- as claim of depreciation on non-factory building. 2. That the Ld. CIT(A) erred in law and on facts in allowing the appeal of the assessee in respect of deletion of penalty imposed of Rs. 22,61,489/- u/s 271(1)(c) of the I.T ACT 1961 without appreciating that assessee company failed to offer any justified explanation in....

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....had received as interest on public issue deposit and had also concealed the profits on transactions in mutual funds, the investment of which was made out of share capital received through public issue. Learned D. R. submitted that the assessee had adjusted these incomes against capital work in progress which was not in line with the decision of Hon'ble Supreme Court in the case of Tuticorin Alkali Chemicals and Fertilizer Ltd. vs. CIT [1997] 227 ITR 172 (SC) and therefore, the assessee had necessarily concealed the particulars of income and Assessing Officer has rightly imposed the penalty which learned CIT(A) has wrongly deleted. 4. Learned A. R., on the other hand, stated that the assessee had come out with a public issue and was i....

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....d from these investments the assessee earned income in the form of interest and profit from mutual funds. The said incomes were disclosed by the assessee in the books of account and in the balance sheet. However, instead of declaring the same as income, the same were reduced from the capital work in progress and therefore, the assessee had disclosed the full particulars of such income in its balance sheet. In fact the Assessing Officer came to know about these incomes from the particulars filed by the assessee itself therefore, it cannot be said that the assessee had concealed particulars of income or had furnished inaccurate particulars of income. Learned CIT(A) has rightly deleted the penalty relying on the case law of Reliance Petroprodu....

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....deleted the other part vide their order no. ITA No. 31 & 32/LKW/2013 for AY 2006-07 and AY 2007-08. Since penalty proceedings are separate proceedings than assessment proceedings what is to be seen is that whether addition made were of such nature as to attract penalty u/s 271(1)(c) of the Act. It is evident from the record that all the details that were relevant to the above two transactions were duly disclosed in the books of accounts and in the return of the income and were also shown to AO during assessment proceedings and were found to be correct by the AO as far as their nature is concerned. The disallowance was made in the assessment order solely on account of different view taken on the same set of disclosed facts ....