ABHILASHA C.H.S. LTD,MUMBAI vs. ITO 16(2)(4), MUMBAI

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ITA 5652/MUM/2013Status: DisposedITAT Mumbai16 March 2017AY 2005-064 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the assessee had a bonafide belief that the interest income was exempt under Section 80P. This belief was not contumacious enough to warrant a penalty.

What were the facts?

The assessee society did not offer interest income received from HDFC Bank, claiming it as exempt under Section 80P. A penalty was levied for this omission.

What were the issues?

Whether a penalty under Section 271(1)(c) is leviable when the assessee had a bonafide belief regarding the exemption of income under Section 80P.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 80P

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

Before: SHRI SHAMIM YAHYA & SHRI RAVISH SOOD

For Respondent: Shri. Rajesh Kumar Yadav

This appeal by the assessee is directed against order of Ld. CIT- A dated 12.8.2013 and pertains to assessment year 2005-06. 2. The issue raised is that Ld. CIT (A)erred in confirming the levy of penalty of Rs14,100/- u/s. 271 (1) (C).

Abhilasha C.H.S. Ltd., ITA no.5652/Mum./2013 3. We have heard the Ld. DR. Non appeared on behalf of the assessee. However, in our considered opinion the issue can be adjudicated by hearing the Ld. DR and perusing the record.

4.

We find that in this case penalty was levied for not offering interest received from HDFC Bank amounting to Rs. 57,500/- claiming the same to be exempt u/s. 80(P). Penalty was levied on ground that said income is not covered under exemption u/s. 80(P).

5.

Upon hearing the Ld. DR and perusing the record in our consider opinion a bonafide belief on the part of the assessee that interest income is also exempt u/s. 80P cannot be said to be contumacies so as to warrant levy of penalty u/s. 271 (1) (C) of I.T. Act. Our this view is fortified by the decision of a larger bench of Hon’ble Apex Court in the case of Hindustan Steel Ltd. vs. State of Orrisa 83 ITR 26.

6.

Accordingly we set aside the order of authorities below and delete the levy of penalty.

In the result this appeal filed by the assessee stands allowed.

Order pronounced in the Open Court on 16.03.2017 Sd/- Sd/- RAVISH SOOD SHAMIM YAHIYA JUDICIAL MEMBER ACCOUNTANT MEMBER

Abhilasha C.H.S. Ltd., ITA no.5652/Mum./2013

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