TaxTMI 
TaxTMI 
2019 (8) TMI 845
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....n short 'the Act'). The grounds raised in the appeal are reproduced as under: 1. That the order passed by the learned Commissioner of Income Tax (Appeals) is bad in law, equity and justice. 2. That the learned Commissioner of Income Tax (Appeals) erred in confirming the levy of penalty u/s 271(1)(c) amounting to Rs. 58,98,180/-, ignoring company's contentions based on various judicial pronouncements. 2. Briefly stated facts of the case are that for the year under consideration the assessment under section 143(3) of the Act was completed on 11/03/2011 after making disallowance of Rs. 6,55,61,826/- under section 14A of the Act as against suomotu disallowance of Rs. 1,00,000/- made by the assessee in the return of income f....
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....ntifying the disallowance and sustained the penalty for filing inaccurate particulars of the income deliberately. Aggrieved, the assessee is before the Tribunal raising the grounds as reproduced above. 3. Before us, the Ld. counsel of the assessee filed a paper book containing pages 1 to 10 and submitted that disallowance under section 14A of the Act has been restricted to Rs. 181.79 lakhs in view of the decision of the Hon'ble Delhi High Court in the case of Joint Investment Private Limited in ITA No. 117/2015 dated 20/05/2015. According to him, merely making an incorrect claim would not tantamount to furnishing of inaccurate particulars of income, unless it is established that the assessee had acted with a malafide intention. He submit....
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....led position of the law in the case of Joint Investment Private Limited (supra). The Assessing Officer accordingly made disallowance of the said amount of Rs. 181.79 lakhs. The Assessing Officer levied penalty of the same and the Ld. CIT(A) upheld the penalty observing as under: "I have considered the above cited judgments of Hon'bie Delhi High Court and ITAT, Delhi. However, it may be seen here that the above judgments cited by the appellant are pertaining to the cases of disallowance u/s 14A prior to AY 2008-09. From AY 2001-02 to AY 2007-08 provision of section 14A was debatable issue and no methodology was prescribed by the Department for quantifying the expenses pertaining to earning exempt income. Therefore, for those assessm....
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....particulars of income. However, we find that disallowance in the assessment order passed consequent to the order of the Tribunal has been made in view of the decision of the Hon'ble Delhi High Court in the case of Joint Investment Private Limited (supra) and not strictly as per computation of Rule 8D of Income-tax Rules, 1962. Further, under the very scheme under section 14A of the Act, the apportionment of the expenditure attributable to earning exempt income, was difficult for identifying exactly on the precise, numerical and mathematical basis and to have rationality in the disallowance, the rule 8D has been introduced by the CBDT, but that too is a kind of estimate only. In such scenario, the difference between the suo-motu disallowance....