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Income Tax Appellate Tribunal, “E”
आदेश / O R D E R
Per Sandeep Gosain, Judicial Member:
The present Appeal filed by the assessee is against the order of Commissioner of Income Tax (Appeals)-20, Mumbai dated 10.01.13 for AY 2007-08 on the ground mentioned herein below:-
2 M/s Sejal Glass Ltd.
1. The learned Commissioner of Income Tax (Appeals) erred in levying penalty u/s. 271(1)(c) by holding that the appellant had furnished incorrect taxable income by way of claiming excess deduction u/s. 801B of Rs. 29,85,384/- and while doing so he amongst others failed to appreciate that: a. Penalty u/s. 271(l)(c) could not be levied in the facts of appellants case as the taxable income was computed u/s. I15JB as per the decisions of Hon'ble Delhi High Court in the case of CIT v. Naiwa Sons Investments Ltd. [2010] 327 ITR 543 (Delhi) which had been affirmed by Hon'ble Supreme Court. b. The appellant had neither concealed the particulars of its income nor had it furnished inaccurate particulars of income; c. The claim of deduction u/s. 801B was made under a bona fide belief that the appellant was eligible for deduction of the entire income of the industrial undertaking; and d. The items of income on which the deduction u/s. 801B was not allowed by the Hon'ble ITAT were debatable in nature as on the date when the appellant filed its return of income.
As per the facts of the present case, the assessee is engaged in the business of manufacturing of glass and had earned income from his business of manufacturing of glass and other sources. The assessee filed its return of income for AY 2007-08 declaring total income of Rs. 77,82,242/- after claiming deduction of Rs. 333,52,47/- u/s 80IB. The assessment order was passed u/s 143(3) of the Act assessing the total income of the Assessee at Rs. 1,11,17,489 by disallowing claim u/s 80IB. The AO initiated penalty proceedings u/s 271(1)(c) and passed order levying penalty u/s 271(1)(c) of the Act of Rs. 49,00,913/-.
Aggrieved by the order of penalty, assessee preferred appeal before Ld. CIT(A) and Ld. CIT(A) after considering the case of both the parties partly allowed the appeal of the assessee.
Now before us, the assessee has preferred the appeal by raising the above grounds.
At the very outset, it has been brought to our notice that the present appeal is covered by the CBDT Circular No. 25/2015 dated 31.12.15 which is at page no. 47 of the paper book. Wherein while considering the judgment of Hon’ble Delhi High Court and explanation 4 of Section 271, it is clarified that prior to 1.04.16, where the income tax payble on the total income as computed under the normal provisions of the Act is less than the tax payble on the book profits u/s 115JB of the Act, then penalty u/s 271(1)(c) of the Act is not attracted with reference to the additions/disallowance made under normal provisions.
After considering CBDT Circular No. 25/2015 dated 31.12.15, we find that the facts of the present case are covered. The order of Ld. CIT(A) dated 10.01.13 are prior to coming into force of Circular no. 25/2015. Therefore, in view of the above circular of CBDT, the present appeal filed by the assessee is allowed and thus penalty is set aside.