2019 (7) TMI 181

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....ding the levy of penalty by the AO u/s 271(1)(c) of the Act is bad, both in the eyes of law as well as on facts. 2. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in upholding the levy of penalty u/s 271(1)(c) of Rs. 16,71,400/- on account of disallowances made by the AO. 3. On the facts and circumstances of the case, the learned CIT(A) has erred, both on facts and in law in confirming the penalty under Section 271(1)(c) of the Act levied by the AO on the basis of a notice under Section 271(1)(c) whereby no specific allegation with regard to concealment of income or furnishing of inaccurate particulars has been levied. 4. On the facts and circumstances of the case, the learned CIT(A)....

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....noring the fact that the penalty proceedings are independent proceedings, and as such, mere disallowance or addition could not lead to the levy of penalty." 3. The assessee Company filed its return of income on 28/9/2012 declaring current year loans at Rs. 63,43,06,818/-. The assessment was completed on 20/03/2015 at loss of Rs. 62,88,97,759/- after making disallowance of expenses u/s 40(a)(ia) made to Rs. 25,064,49/- and addition on account of disallowance of interest expenses amounting to Rs. 28,45,000/- The Assessing Officer also initiated penalty proceedings u/s 271(1)(c) of the Act. The penalty proceedings were completed on 30/09/2015 by imposing penalty at Rs. 16,71,400/-. 4. Being aggrieved by the penalty order, the assessee filed ....

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....ed upon the assessment order, penalty order and the order of the CIT (A). 7. We have heard both the parties and perused the material available on record. First of all, in the notice issued u/s 274 r.w.s 271(1)(c) of the Income Tax Act, 1961, there was no specific charges as relates to concealment of income or furnishing of inaccurate particulars of income. Therefore, there was no concealment on the part of the assessee. This was a simple case of disallowance u/s 40(a) (ia) as the assessee was under the belief that TDS is not liable to be deducted on payment of NBFCs. Thus, the authorities cited by the Ld. AR are applicable in the present case. In respect of interest expenses, the same was not concealed by the assessee before the Assessing ....