Case Law Details
LRs Management Vs DCIT (ITAT Rajkot)
it is an admitted fact that the addition on which penalty was levied under section 271(1)(c) of the Act was deleted by the ITAT. We have noted from the assessment order, and copy of the penalty order before us that the assessee, being an agent of freight beneficiary M/s LR2 Management K/s -Denmark, had filed various voyage final returns under section172(3) of the Act without paying freight taxes. The assessee had claimed DTAA benefit vis a vis Denmark for the said purpose, but the AO held that the assessee had wrongly claimed DTAA benefit and accordingly withdrew the same. Thus, 7. 5% of the total freight earned in India by the assessee was treated as its taxable income amounting to Rs. 1,76,71,602/- and penalty levied on the same for having concealed/furnishing inaccurate particulars of income. The ITAT passed order in ITA No. 757/RJT/2014 dated 30. 10. 2015 holding that profits embedded in the freight receipts were not taxable in India and deleted the demand raised on the assessee.
Since the quantum addition stands deleted by the ITAT in the above order, there remains no basis for levy of penalty under section 271(1)(c) and therefore the same is directed to be cancelled. The grounds of appeal of the assessee are allowed.
FULL TEXT OF THE ORDER OF ITAT RAJKOT
Present appeal has been filed by the assessee against order of the ld. Commissioner of Income-tax (Appeals)-13, Ahmedabad [hereinafter referred to as “the ld. CIT(A)”] dated 12. 06. 2017 passed under section 250 of the Income Tax Act, 1961 [hereinafter referred to as “the Act” for short] for the Asst. Year2013-14.
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