No section 271(1)(c) Penalty Merely based on section 37 disallowance

DCIT Vs. Maharashtra State Power Generation Co. Ltd. (ITAT Mumbai) The issue under consideration is whether the cancellation of the penalty u/s 271(1)(c) by the CIT(A) is justified in law? ITAT states that, the claim of the assessee that no penalty under Sec. 271(1)(c) could have been validly levied in its hands in respect of the said issue. Also, ITAT find that the assessee in the course of the penalty proceedings before the A.O, and also in the course of the appellate proceedings before the CIT(A) had satisfactorily explained that the coal cost freight issue (Bhusaval) was an expense allowab...