2021 (2) TMI 651

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....ome Tax Act, 1961 [hereinafter referred to as the "Act"] is directed against the order dated 26^th December, 2017, passed by the Income Tax Appellate Tribunal, Bench "C", New Delhi in ITA No. 3285/Del/2016 in respect of Assessment Year 2005-06. 4. The Respondent-Assessee is a Trust registered u/S. 12A of the Act and is claiming its income to be exempt from taxation u/s. 11 and 12 of the Act. During scrutiny assessment u/s. 143(3) of the Act, the AO noticed that the Assessee had one Katha Manufacturing Factory in Oel region of Himachal Pradesh, which was given on lease to its sister concern[ M/s. Shankar Trading Co. Pvt. Ltd.] and total receipts from it, including lease rental income were claimed to be exempt under section 11 of the Act. ....

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....e merits of the claim of exemption and argues that this Court had decided against the Assessee, and held that Katha business is not 'held under the Trust'. He submits that since the Assessee had furnished inaccurate particulars, therefore, the penalty imposed was justified. 7. Mr. Krishnan, on the other hand submits, that the entire information was disclosed by the Assessee in it's Return of Income and merely because the finding has been given against the Assessee on merits of the claim, would not ipso facto signify that Assessee has furnished inaccurate particulars. He submits that even otherwise, the issue is still at large as the judgment of this Court, relied upon by the Revenue, has been challenged before the Supreme Court and notic....

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....er of course, as sought to be contended by the Revenue. It can only be levied in cases where the concealment of income has been proven. If the quantum order itself has been challenged and this Court has framed substantial questions of law in the appeal preferred by the respondent-Assessee, it shows that the alleged concealment is not final and the issue is disputable. Consequently, the penalty levied by the assessing officer cannot survive in such a case. 11. It is pertinent to note that this Court in similar cases [CIT Vs. Liquid Investment Ltd, ITA 240/2009, CIT Vs. H B Leasing & Finance Co. Ltd. I.T.A. No. 1612/2010 and CIT Vs. Thomson Press India Ltd, ITA 426, 440/2013] has upheld the deletion of the penalty on the same ground ....