PRINCIPAL COMMISSIONER OF INCOME TAX Vs. CLP POWER INDIA PVT. LTD.
LAWS(GJH)-2020-2-393
HIGH COURT OF GUJARAT
Decided on February 25,2020

Principal Commissioner Of Income Tax-1 Appellant
VERSUS
CLP POWER INDIA PVT LTD Respondents

JUDGEMENT

J.B.Pardiwala, J. - (1.) This tax appeal under Section 260A of the Income Tax Act, 1961 [for short 'The Act, 1961'] is at the instance of the Revenue and is directed against the order passed by the Income Tax Appellate Tribunal, Ahmedabad Bench 'C', Ahmedabad dated 04th October, 2019 in the ITA No.1128/AHD/2015 for the A.Y 2007-08.
(2.) The facts giving rise to this tax appeal may be summarized as under:- 2.1 The assessee filed its return of income declaring total income to the tune of Rs.3,32,08,724/-. In the course of the assessment proceedings, the Assessing Officer noticed that certain expenditure on account of the professional fees, travelling expenses, tender expenses etc., aggregating to Rs.4,75,07,667/- with respect to the new power projects were wrongfully claimed as the revenue expenditure by the assessee. In such circumstances, the expenditure so claimed was disallowed in the quantum proceedings. It was held to be capital in nature. The assessment under Section 143(3) of the Act came to be framed determining the total income at Rs.5,60,71,852/- after disallowance of Rs.4,75,07,667/- on account of treating the said expenditure as capital expenditure. In the aforesaid context, the penalty proceedings under section 271(1)(c) of the Act came to be initiated against the assessee. The Assessing Officer levied penalty of Rs.1,59,91,080/- under Section 271(1)(c) on the premise that the assessee had furnished inaccurate particulars of income. 2.2 The assessee being dissatisfied with the order of penalty referred to above preferred an appeal before the CIT(A). The CIT(A) allowed the appeal preferred by the assessee substantially relying on the decision of the Supreme Court in the case of Commissioner of Income-tax, Ahmedabad Vs. Reliance Petro Products Private Limited, 2010 322 ITR 158 (SC). 2.3 The Revenue being dissatisfied with the decision of the CIT(A) preferred appeal before the Appellate Tribunal. The Appellate Tribunal concurred with the findings recorded by the CIT(A) and thereby, dismissed the appeal preferred by the Revenue. 2.4 In such circumstances referred to above, the Revenue is here before this Court with the present appeal.
(3.) The Revenue has proposed a solitary question of law for the consideration of this Court. The question reads thus:- "Whether, the Appellate Tribunal has erred in law and on facts in deleting the penalty amounting to Rs.1,59,91,080/- imposed under section 271(1)(c) of the Act?";


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