2018 (5) TMI 898

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.... levied by the ld. Assessing Officer u/s.271 (1) ( c) of the Income Tax Act, 1961 (herein after referred to as 'the Act'). 2. Facts apropos are that assessee engaged in the business of design, development and implementation of technologies used in Train Control Systems had filed its return of income for the impugned assessment year declaring a loss of Rs. 3,33,64,487/-. During the course of assessment proceedings, it was noted by the ld. Assessing Officer that assessee had incurred an expenditure of Rs. 1,81,35,161/- for development of base designs for a project called "McSigCD Editor/ viewer, SIGMA, CD Verifier tool, Remote Point Cotnroller, Centralized Freight Traffic Controller, i-Lock gate- level crossing controller''. As per the ld.....

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....ations and change of office, the company had lost come of its important documents in transit, and the said fixed assets bills are part of such lost documents. The bills were misplaced and the company present management had tired to locate them for submission during the course of assessment. As the mangement was not able to find the bills, it was accepted during the assessment for the disallowance of respective depreciation in order to buy peace with the depreciation''. However, ld. Assessing Officer was not impressed by the above reply. According to him, acceptance of an addition to avoid litigation would not absolve the assessee from penalty proceedings. Ld. Assessing Officer held that assessee was guilty of furnishing inaccurate par....

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....ngly supported the order of the ld. Commissioner of Income Tax (Appeals). 7. We have considered the rival contentions and perused the orders of the authorities below. It might be true that assessee had claimed expenditure incurred in relation to development of basic designs for its train control systems as Revenue outgo before the ld. Assessing Officer. However, assessee had preferred such claim only when it found that ld. Assessing Officer was not accepting its claim regarding such expenditure to result in intangible assets. Ld. Assessing Officer has clearly specified in para 3.1 of the assessment order that the expenditure of Rs. 1,81,35,161/- resulted in intangible assets. It may be true the intangible asset might have been eligible f....