- (1.) This appeal has been preferred by the revenue under section 260A of the Income Tax Act, 1961 (in short, "the Act") against the order dated 19.5.2015, Annexure A.6 passed by the Income Tax Appellate Tribunal, Chandigarh Bench 'A' (in short, "the Tribunal") in ITA No.972/CHD/2013, for the assessment year 2006-07, claiming following substantial question of law:- "Whether the ITAT was right in law in upholding the decision of the CIT(A) deleting the penalty levied for assessment year 2006-07 who has relied upon the decision of ITAT Delhi in AT&T Communication Services India Pvt. Limited (42 DTR 22) and the decision relied upon by the Hon'ble ITAT is adequately countered by the judgment of the Hon'ble Delhi High Court in the case of CIT vs. Zoom Communication (P) Limited, 2010 327 ITR 510 -
(2.) A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. The assessee company filed its return of income on 4.12.2006 declaring nil income. The case was selected for scrutiny and assessed under section 143(3) of the Act on 19.12.2008. The Assessing Officer made following additions and initiated the penalty proceedings on all the issues:- i) Addition of Rs. 26,96,304/- on account of non deduction of TDS on freight inward. ii) Addition of Rs. 63,447/- on account of non deduction of TDS on freight outward. iii) Addition on account of repair and maintenance of cars under section 40(a)(ia) amounting to Rs. 1,94,593/-. iv) Addition on account of capitalization of interest amounting to Rs. 5,82,625/- plus Rs. 2053/- plus Rs. 8302/-. v) Addition under section 40A(3) amounting to Rs. 18,297/-. vi) Addition on account of disallowance under section 80IC on reallocation of expenses amounting to Rs. 28,63,569/-. vii) Addition amounting to Rs. 1,42,520/- on account of interest debited to Dera Bassi unit and treated as relating to Baddi Unit. viii) Addition of Rs. 3,70,836/- on account of claim of expenditure of interest payment which was never paid by the assessee." The assessee filed appeal before the Commissioner of Income Tax (Appeals) which was partly allowed vide order dated 31.5.2010, Annexure A.2. Still not satisfied, the assessee filed appeal before the Tribunal. Vide order dated 4.7.2011, Annexure A.3, the appeal was partly allowed. Thereafter, the Assessing Officer imposed penalty under Section 271(1)(c) of the Act on all the issues amounting to Rs. 22,88,770/- vide order dated 29.3.2012, Annexure A.4. The assessee filed appeal before the Commissioner of Income Tax (Appeals) [CIT(A)]. Vide order dated 1.7.2013, Annexure A.5, the CIT(A) cancelled the penalty imposed by the Assessing Officer. The revenue filed appeal before the Tribunal. Vide order dated 19.5.2015, Annexure A.6, the Tribunal upheld the order passed by the CIT(A). Hence the instant appeal by the revenue.
(3.) We have heard learned counsel for the revenue.;