COMMISSIONER OF INCOME TAX vs. MASTER INDIA PVT LTD

ITA No 575/10

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THE HIGH COURT OF DELHI AT NEW DELHI

Judgment delivered on : 18.05.2010

ITA 575/2010

COMMISSIONER OF INCOME TAX

… Appellant

- versus –

MASTER INDIA PVT LTD

... Respondent

Advocates who appeared in this case: For the Appellant : Ms Prem Lata Bansal with Ms Anshul Sharma For the Respondent : None

CORAM:- HON’BLE MR JUSTICE BADAR DURREZ AHMED HON’BLE MR JUSTICE V.K. JAIN

BADAR DURREZ AHMED, J (ORAL) 1. This appeal is directed against the order dated 03.04.2009 passed by the Income Tax Appellate Tribunal in Appeal No.611/Del/2008 relating to the assessment year 2001-2002. The impugned order arose out of the penalty proceedings under Section 271(1)(c) of the Income Tax Act, 1961 by the Assessing Officer who ultimately imposed penalty of Rs 4,61,913/- on the assessee for allegedly furnishing inaccurate particulars of income. 2. The assessee had received interest of Rs 18,62,538/- on Fixed Deposits and had also received certain other receipts totalling Rs 21,91,820/-. These were included in the business income of the assessee

ITA No 575/10

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and were treated by the Assessing Officer as the assessee’s income from other sources. The eligible profits for computation of relief under Section 80HHD of the said Act were thereby reduced. The Assessing Officer computed the relief under Section 80HHD at Rs 42,90,282/- against the amount of Rs 53,92,895/- as claimed by the assessee. This resulted in excess amount of deduction on the part of the assessee under Section 80HHD at Rs 11,02,613/-. It was on the basis of this excess claim that the penalty of Rs 4,61,913/- was imposed on the assessee. 3. The Commissioner of Income Tax deleted the penalty and the said deletion was confirmed by Income Tax Appellate Tribunal. The Tribunal took the view that the assessee did not furnish any inaccurate particulars of income nor did the assessee conceal any part of its income. The question with regard to the claim of deduction under Section 80HHD was, at that point of time, debatable. Consequently, the Tribunal held that this was not a case where imposition of penalty under Section 271(1)(c) of the said Act could be justified. 4. We find no infirmity in the reasoning adopted by the Tribunal nor has any perversity been pointed out in the findings of fact. The appeal is dismissed.

BADAR DURREZ AHMED, J

V.K. JAIN, J MAY 18, 2010 ‘sn’