Case Law Details

Case Name : ACIT Vs M/s.Beekman Heiix India Consulting P. Ltd. (ITAT Delhi)
Appeal Number : ITA No. 4886/Del/2013
Date of Judgement/Order : 18/07/2014
Related Assessment Year :
Courts : All ITAT (4773) ITAT Delhi (1047)

CA Prarthana Jalan

Hon’ble Delhi ITAT has in the case of ACIT V/S M/s.Beekman Heiix India Consulting P. Ltd.has held that Incorrect claim would not  tantamount to furnishing of inaccurate particulars and penalty u/s 271(c ) should not be levied on it.In the assessment framed disallowances on 3 heads i.e

(i) Call option fees of Rs. 53,12,500/- was disallowed in full.

(ii) Feasibility study charages of Rs. 11,93,827/- was treated as mortizable expenses u/s 35D and 4/5th of these were disallowed.

(iii) Disallowance of Rs. 2,13,126/- u/s 14A. Hon’ble CIT(A) had sustained the disallowance on account of Feasibility study charges and 14A.

Subsequently penalty was initiated by the assessing officer, which was deleted by the cit(a) . The department preferred an appeal to the ITAT. The Hon’ble ITAT dismissed the appeal by observing as under

“8. We have heard rival submissions and perused the material on record. The CIT(A) has made threadbare analysis of disallowance of expenditure made in the quantum assessment which had resulted in the imposition of penalty u/s 271(1)(c) of the Act and had come to a correct conclusion that two disallowance of expenditure is only an incorrect claim and does not amount to concealment of income. The conclusions /findings of the CIT(A) have not been dispelled by the revenue. The CIT(A)’s reliance on the various case laws on the subject is apt to the facts of this case. The revenue in its grounds of appeal relied on the case of CIT vs. Rubber Udyog Vikas (P) Ltd. 335 ITR 558 (2011 (P&H). This decision has been taken note of by CIT(A) at para 3.8 of the impugned order. The dictum laid down in case of Rubber Udyog Vikas (P) Ltd. is that incorrect claim would not tantamount to furnishing of inaccurate particulars unless it is established that assesee has acted with malafide intention. The decision relied on by the revenue is in no way helpful to the case of the revenue. On the contrary it help the assessee’s case. For the aforesaid reason, we are of the view that CIT(A)’s order is correct and in accordance with law and no interference is called for”

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