DCIT (E) Vs Rashtrotthana Parishat Keshava Shilpa (ITAT Bangalore)
ITAT Bangalore held that that mens rea is not an essential condition for imposing penalties under civil acts. Penalty u/s. 270A of the Income Tax Act nowhere specifically refers necessity of presence of mens rea for levy of penalty. Accordingly, appeal of revenue allowed.
Facts- Assessee is a trust. During assessment proceedings, AO held that revenue expenditure claimed as application of income includes the depreciation claim and the depreciation claim is in contravention of section 11(6) of the Act as the assessee has also claimed the capital expenditure as application of income which according to AO amounts to claim of double deduction and accordingly disallowed the claim of depreciation amounting to Rs.7,53,66,656/- claimed by the assessee trust as it violates section 11(6) of the Act.
Further, with regard to claim of Loss on sale of vehicle amounting to Rs.1,77,853/- as application of Income, the AO disallowed the same & not treated as application of Income on the ground that the assessee trust has not expended any amounts towards the items of expenditure & further the entire cost of acquisition of vehicle was allowed as application in earlier years & thus held that the loss cannot be treated as application again.
