Penalty proceedings are independent of assessment proceedings

Bistro Hospitality Pvt. Ltd. Vs ACIT (ITAT Delhi) ITAT Delhi held that imposition of penalty u/s 271(1)(c) of the Income Tax Act on the mere allegation that assessee failed to justify the revenue nature of the expenditure is unsustainable as penalty proceedings are independent of assessment proceedings. Facts- In the instant case the AO vide assessment order dated 29.12.2016 passed u/s 143(3) of the Act, made three additions i.e. (i) disallowance of service tax claimed in the P& L a/c at Rs. 40,45,470/-; (ii) addition on account of rejection of consumption of foods & beverages claimed ...