Case Law Details
Atul Limited Vs DCIT (ITAT Ahmedabad)
ITAT Ahmedabad held that in an identical matter, jurisdictional High Court ruled the matter in favour of the assessee, however, later on Apex Court held otherwise. Accordingly, the issue was debatable do to which levy of penalty u/s 271(1)(c) of the Income Tax Act is unsustainable.
Facts- The assessee had filed ROI declaring total income comprising of only LTCG amounting to Rs.3,95,20,413/-. This income under the head “Capital Gains” was computed after adjusting losses under the head “Business Income” and after considering the effect of deduction under Section 80G and 80HHC of the Act. In the assessment framed for the impugned year u/s. 143(3) of the Act, the assessee was denied claim of deduction under Section 80G and 80HHC of the Act in the absence of any business income returned by the assessee.
Thereafter, penalty proceedings u/s 271(1)(c) were initiated for this incorrect claim made by the assessee and penalty was levied by AO holding that the claim of deduction u/s. 80G and 80HHC of the Act against LTCG of the assessee was against the specific provision of law in this regard as provided u/s. 112(2) of the Act. AO held that the assessee had filed inaccurate particulars in respect of the deduction claimed u/s. 80G and 80HHC of the Act and accordingly levied penalty @ 100% of tax sought to be evaded.
The finding of the AO was upheld by CIT(A). Being aggrieved, the present appeal is filed.
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