2023 (10) TMI 89

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....all the appeals. For reference, facts are being taken from ITA No. 283 of 2014. 2. The instant appeal (ITA No. 283-2014) under Section 260-A of the Income Tax Act, 1961, has been filed against the order dated 28.01.2014 (Annexure A-4) passed by the Income Tax Appellate Tribunal, Chandigarh, whereby appeal filed by the Revenue against the order dated 14.01.2013 passed by the Commissioner of Income Tax (Appeal) (Central), Gurgaon, relating to the assessment year 2007-2008, has been dismissed. 3. Respondent-assessee (M/s Bhushan Power & Steel Ltd.) had set up a new unit at Hoogly, District Kolkata. The said unit started its commercial production on 13.05.2000. In terms of Section 41 of the West Bengal Sales Tax Act, the unit was allowed ....

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....penalty of Rs. 10,99,19,325/- was imposed upon the assessee under Section 271 (1) (c) of the Income Tax Act and show cause notice was issued to the assessee. Against this order, the assessee filed an appeal before the Commissioner of Income Tax (Central) (A), Gurgaon, which was allowed vide order dated 14.01.2013 (Annexure A- 3). While allowing the appeal, it was observed that as per Section 271 (1) (C) of the Income Tax Act, penalty is to be levied if, the assessee had concealed particulars of income or has furnished inaccurate particulars of such income. In the present case, the issue was, whether the sales tax exemption availed during the relevant year amounting to Rs. 32,65,57,714/- as capital receipt, was to be held as revenue in natur....

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....n that the assessee had claimed the expenditure to be revenue would not render the assessee liable to penalty proceedings. In Commissioner of Income Tax vs. Gurdaspur Co-operative Sugar Mills Ltd., (2013) 354 ITR 27 (P&H), there was no dispute about the quantum of receipt of grant-in-aid from the State Government. The assessee had reflected the same as capital receipt, whereas it had been treated to be a revenue receipt. The Court observed that the issue, whether the amount of grant-in-aid was a capital receipt or a revenue receipt, was a debatable issue. In this backdrop, the penalty could not be imposed under Section 271 (1) (c) of the Act. 7. In the present case, it is not the case of appellant-revenue that against the earlier order d....