DCIT CEN CIR 10, MUMBAI vs. PRUDENTIAL LEASING LTD, MUMBAI

Per Joginder Singh (Judicial Member) The Revenue is aggrieved by the impugned order dated 23/10/2013 of the Ld. first Appellate Authority, Mumbai. The only ground raised by the Department pertains to deleting the penalty of Rs.9,05,267/- imposed u/s 271(1)(c) of the Income Tax Act, 1961 (hereinafter the Act) by placing

2.1. We have considered the rival submissions and perused the material available on record. We note that the addition was made by the ld. Assessing Officer on the ground that the expenses, incurred by the assessee, are not allowable, as no active business was carried out by the assessee and only income earned by the assessee was in the nature of dividend income which is exempt. However, we find that there is not finding in the assessment order that the claimed expenses are bogus. The assessee did not contest the quantum addition due to tax effect below monitory limit. The shops owned by the assessee company are likely to incur some expenses for earning income. No specific finding has been recorded in the assessment order nor any evidence was brought on record suggesting that the claimed expenses were bogus and merely disallowance was made on the pleat that no active business is carried out by the assessee. Without going in to much deliberation and in the light of uncontroverted finding in the impugned order, following the decision from Hon’ble Apex Court in Reliance Petro Products,

3 M/s Prudential Leasing Limited we affirm the stand of the ld. Commissioner of Income Tax (Appeals). The appeal of the Revenue, is, therefore dismissed.

Finally, the appeal of the Revenue is dismissed.

This Order was pronounced in the open court in the presence of ld. representatives from both sides at the conclusion of the hearing on 16/11/2015.