2021 (11) TMI 497

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....n upholding the levy of penalty under Section 271(1)(c) of the Act in respect of the impugned addition' made with regard to disallowance of provision of interest on advances to related parties, disallowance of miscellaneous balances written off and finally belated payment of employees contribution towards PF and ESIC. 2. The learned CIT (Appeals) failed to appreciate that the show cause notice issued for levy of penalty being defective, penalty was not exigible. Though specific averments have been made in this regard which have been noticed by the CIT (Appeals), the CIT (Appeals) erred in not giving a finding while sustaining the penalty and accordingly the penalty levied is opposed to law and principles of natural justice and ....

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.... the Act, dated 28/03/2014 made additions revising loss at Rs. 2,83,54,183/-. 3. Subsequently, penalty notice was issued to assessee on 28/03/2014 under section 271(1)(c) in respect of following additions made by the Ld. AO: provision for interest: 1,73,84,644/- miscellaneous balances written of: 96,37,016/ disallowance under section 43B: 1,88,431/-. 4. The Ld. AO levied penalty on above disallowances for concealment and furnishing inaccurate particulars of income. Aggrieved by the order of Ld. AO, assessee preferred appeal before the Ld. CIT(A). 5. The Ld. CIT(A) upheld the penalty levied by observing that relevant information was not made available to substantiate the claim. Aggrieved by the order of....

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.... in the subsequent period, as claimed, in its written-submissions. In the facts and circumstances, the disallowance of the 'provision' of Rs. 1,73,84,644/- debited to the P & L account as expenditure-claim during the current year, is upheld. The Assessee's Grounds of Appeal in this respect therefore, do not succeed 8.2. The assessee has not furnished any specific justification against the aforesaid disallowance. Except for certain general statements made in the Grounds of Appeal/statement of facts, no further explanation in this regard has been addressed by the appellant. It is seen from the written submission filed, during the appeal proceedings that, there is no elaboration or reasoning given by the Appellant, against....

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....ssessment order. 7.1. Looking into the reason for disallowance of provision of interest, we observe that the Ld. AO did not accept the manner in which the provision was debited to P&L account. There was difference of opinion in the stand taken by assessee vis-à-vis the Ld. AO in accounting the provision. The assessing officer rejected the treatment of provision. 7.2. In respect of belated payment of employees contribution, we note that this issue stands settled that in the event the payment is made before the due date of filing of returns under section 139(1) of the act, no disallowance could be made. Under such circumstances this issue is debatable and therefore levy of penalty is unwarranted. 7.3. In respect of interest ad....