- (1.) THE Income Tax Appellate Tribunal, Allahabad Bench, Allahabad (hereinafter referred to as 'the Tribunal') has submitted the following question for opinion of this Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was, in law, justified in cancelling the penalty of Rs.24,10,000 imposed u/s 271(1)(c) of the Income Tax Act, 1961?"
(2.) THE dispute relates to the assessment year 1982-83. THE assessee, is a Company registered under the Companies Act and it filed its first return which was a provisional return showing a net profit of Rs.3,09,30,029/-. It claimed the following among others amounts, as deduction: (a) Investment Allowance on trucks Rs. 5,07,396 (b) Application of Rule 115 Rs.37,58,732 (c) Donation to School in Iraq Rs. 1,71,420 Rs.44,37,548 The assessing Officer levied penalty of Rs.25,10,000/- holding that the assessee has concealed the particulars of its income in respect of the aforesaid three items. CIT (A) vide its order dated 20th January, 1989 allowed the appeal in part and cancelled the penalty on the amount of donation to School in Iraq but confirmed the penalty on the remaining two items. The penalty order was modified by providing that the Assessing Officer shall calculate the amount of penalty after excluding amount of Rs.1,71,420/-. In further appeal, being I.T.A. No. 643(Alld) of 1989 by the assessee-Company before the Tribunal, the Tribunal allowed the appeal in toto and deleted the penalty by the order order 15th June, 1990. Sri R.K. Upadhyay, learned counsel for the department in support of the reference submits that the Tribunal was not justified in deleting the penalty in view of the fact that the investment allowance on trucks was clearly not admissible. He submits that in I.T.R. No. 114 of 1989 at the instance of assessee-Company, reference has been decided against the assessee meaning thereby the additions made in the income of the assessee and dis-allowance of deduction has been upheld by the High Court. Strong reliance was placed on Commissioner of Income-Tax v. Zoom Communication P. Ltd., (2010) 327 ITR 510 (Delhi) in support of his contention that claim for deduction, which is not found bonafide amounts to concealment of income.
(3.) NONE appeared on behalf of the assessee-respondent-Company. Considered the aforesaid submissions of the learned counsel for the department.;