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Income Tax Appellate Tribunal, DELHI BENCH ‘B’, NEW DELHI
Before: SH. N. K. BILLAIYA & SH. YOGESH KUAMR US
ORDER PER N.K. BILLAIYA, AM:
2019 and Cross Objection No.51/Del/2022 are appeal and cross objection by the revenue and assessee preferred against the order of the CIT(A)-22, New Delhi dated 28.02.2019 pertaining to A.Y.2010-11.
The appeal and the cross objection were heard together and are disposed of by this common order for the sake of convenience and brevity.
3. First we will address to the appeal of the revenue. The solitary grievance of the revenue is that the CIT(A) erred in deleting the penalty levied by the AO u/s. 271 (1) (c) of the Act. A perusal of the orders of the authorities below show that the penalty levied on the additions/ disallowances made on account of corporate guarantee fee, interest on foreign currency disallowance u/s. 35(2AB) of the Act and donation to SRF Vidyalaya.
We find that in so far as the addition on account of corporate guarantee fee and interest on foreign currency loans and advances are concerned the impugned addition have been deleted by this Tribunal in order dated 24.02.2020. Since the addition have been deleted we do not find any justification in the levy of penalty u/s. 271 (1) (c) of the Act and the same has been rightly deleted by the CIT(A) and, therefore, no interference is called for.
In so far as disallowance u/s. 35 (2AB) is concerned. In our considered opinion the claim of the assessee was bonafide the only point of concern was that the department of Scientific and Industrial Research vide letter dated 12.07.2012 has approved the sum of Rs.1282.46 lakhs including additional 50% of revenue expenditure of Rs.1023.53 lakhs whereas the assessee has claimed deduction of Rs.1305.26 lakhs which prompted the AO to make the impugned disallowance. In our humble opinion the assesee’s claim is being bonafide levy of penalty u/s. 271 (1) (c) of the Act is not justified in the light of the ratio laid-down by the Hon’ble Supreme Court in the case of Reliance Petro Products 322 ITR 158.
Considering the facts of the case in totality we decline to interfere with the findings of the CIT(A). The appeal filed by the revenue is accordingly dismissed.
Cross Objection No.51/Del/2022 ( A. Y.2010-11)
Cross objection of the assessee is in respect of the penalty confirmed by the CIT(A) on disallowance of donation made to SRF Vidyalaya amounting to Rs.4,28,000/-/
2. We find that this Tribunal in vide order dated 04.02.2020 has deleted the disallowance. Since the addition has been deleted no penalty is leviable u/s. 271 (1) (c) of the Act. The AO is directed to delete the impugned penalty on the addition made on account of donation to SRF Vidyalaya.
In the result, the Cross objection filed by the assessee is allowed
Decision announced in the open court on 20.06.2022.