HEALTH BIOTECH LIMITED,CHANDIGARH vs. DEPUTY COMMISSIONER OF INCOME TAX,CIRCLE 1(1), CHANDIGARH

ITA 987/CHANDI/2025Status: DisposedITAT Chandigarh24 February 2026AY 2014-15Bench: the disposal of the same.6 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal found the penalty notice valid but held that the penalty itself was not sustainable as the additions resulted from legal disallowances based on disclosed particulars and a bona fide belief, rather than inaccurate particulars or concealment. Since the assessee was under the MAT regime and the additions did not lead to any additional tax liability, the element of tax evasion was missing, rendering the penalty unsustainable.

What were the facts?

The assessee filed a loss return, and the Assessing Officer made additions for non-deposit of TDS under section 40(a)(ia) and excess depreciation (assets funded by capital subsidy). Consequently, a penalty of Rs. 69,68,581/- was levied under section 271(1)(c) for furnishing inaccurate particulars, which was subsequently confirmed by the CIT(A).

What were the issues?

1. Whether the penalty notice issued under section 274 read with section 271(1)(c) was vague and invalid for not specifically mentioning the limb of penalty. 2. Whether penalty under section 271(1)(c) is sustainable for disallowances made under section 40(a)(ia) and for excess depreciation when all particulars were disclosed, the claims were bona fide, and no additional tax liability arose due to the assessee being under MAT.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 143(3),Section 40(a)(ia),Section 250,Section 274,Section 80IC

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
आयकर अपीलीय अिधकरण,च"ीगढ़ "ायपीठ “ए” , च"ीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “A”, CHANDIGARH HEARING THROUGH: PHYSICAL MODE "ी लिलत कुमार, "ाियक सद" एवं "ी कृणव" सहाय, लेखा सद" BEFORE: SHRI. LALIET KUMAR, JM & SHRI. KRINWANT SAHAY, AM आयकर अपील सं./ ITA No. 987/Chd/ 2025 िनधा"रण वष" / Assessment Year : 2014-15 Health Biotech Limited बनाम The DCIT SCO-162-164, JAL Building, Sector Circle 1(1) 34, Chandigarh-160036 "ायी लेखा सं./PAN NO: AABCH1876K अपीलाथ"/Appellant ""थ"/Respondent िनधा"रती की ओर से/Assessee by : Shri Parikshit Aggarwal, C.A (Virtual) राज" की ओर से/ Revenue by : Shri Vivek Vardhan, Addl. CIT, Sr. DR सुनवाई की तारीख/Date of Hearing : 21/01/2026 उदघोषणा की तारीख/Date of Pronouncement : 24/02/2026

आदेश/Order PER LALIET KUMAR, J.M:

The present appeal filed by the assessee is directed against the order dated 07.07.2025 passed by the Ld. CIT(A), NFAC, Delhi, confirming the penalty of Rs.69,68,581/- levied by the Assessing Officer under section 271(1)(c) of the Income-tax Act, 1961 for the Assessment Year 2014-15. 2. In the present appeal Assessee has raised the following grounds:

1.

That on the facts, circumstances and legal position of the case,

The order continues below.

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