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Case Law Details

Case Name : RBM Pati Joint Venture Vs DDIT (ITAT Delhi)
Appeal Number : ITA No. 3471/Del/2015
Date of Judgement/Order : 03/12/2018
Related Assessment Year : 2007-08
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RBM Pati Joint Venture Vs DDIT (ITAT Delhi)

An insight over the penalty order, we find that the penalty was initiated on account of loss claimed by the appellant on sale of assets, even though, that particular block of assets had not been exhausted. We do not find any justification to discard the findings reached by the ld. CIT(A) that the assessee had duly disclosed the loss on sale of assets at Rs. 61,21,337/-, being part of administrative expenses and this amount was duly appearing in the schedules forming part of profit and loss account for the year under consideration.

The accounts are audited by qualified chartered accountant. In presence of these facts, the ld. CIT(A) has not fallen in error while holding that this was not a case of concealment. However, the fact remains that the assessee had made ineligible claim, for which the bona fide of the assessee stands proved from the fact that as per Form No. 3CD, at item no. 17(a), the auditor has reported that there is no expenditure of capital nature which has been debited to the profit and loss account. Therefore, in our considered opinion, the claim of loss made on the basis of tax audit report cannot be said to be non-bona fide.

We have also gone through the decisions relied by the ld. CIT(A) and we find that in the present scenario, the said decisions are found applicable to the case in hand and the distinguishing features given in the grounds of appeal are not found tenable in the eyes of law. It is also worth consideration that at the initial stage of original assessment, the assessee had claim similar loss, which was partly accepted by the Assessing Officer and penalty proceedings initiated at that point of time were also dropped. Therefore, there appear different opinions of revenue authorities at different points of time.

In such circumstances, the ld. has rightly following the decision in CIT vs. Reliance Petro Products Pvt. Ltd, 322 ITR 158), where it has been held that “ mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the Return cannot amount to the inaccurate particulars.”

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