Jubilant Infrastructure Ltd, Noida V. DCIT,CC-1, Noida

ITA 1682/DEL/2021

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 8138 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2016-2017
• Appeal Filed On: 14-11-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation
• Section: 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “C” NEW DELHI BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER आयकर अपील सं./I.T. A. No.1682/Del/2021 ( नधा रण वष / Assess ment Yea r : 2016-17) Ju b il a n t I n f r a st r u c t u r e L td . Pl o t N o .1 A , S e c to r - 1 6 A , N o id a बनाम/ V s . D C I T C ir c l e - 1 N o id a थायी लेखा सं. /जीआइआर सं. / P A N / G I R N o . A A B C J 6 8 9 9 C (अपीलाथ /Appellant) . . ( यथ / Respondent) अपीलाथ ओर से /Appellant by : Ms. Shweta Bansal, CA Sh. Gaurav Jain, Advocate यथ क ओर से / Respondent by : Sh. Anul Jain, CIT DR स ु नवाई क तार ख / D a t e o f H e a r i n g 12.09.2022 घोषणा क तार ख /D a t e o f P r o n o u n c e m e n t 12.09.2022 आदेश/O R D E R PER PRADIP KUMAR KEDIA, AM: The captioned appeal has been filed at the instance of the assessee against the penalty order passed by the Commissioner of Inco me Tax (Ap peals) [CIT( A) ], National Faceless Appeal Centre, Delhi dated 29.10.2021 concerning AY 2016-17. 2. As per the grounds of appeal, t he assessee has challenged i mposition of penalty of Rs.9,50,000/- u/s. 271 (1) (c) of the Act with respect to disallowance of deprecia tion of Rs.28,39,272/- clai med on intangible assets viz water use rights acquired b y the a ssessee. 3. When the matter was c alled for he aring the Ld. Cou nsel for the assessee, in defence, broadl y sub mit ted that :- (a) A Oneti me pa yme nt of Rs.3,58,94,000/- M/s. Gujar at Industries Develop ment Corporation (GIDC ) for use of wa ter supply and drainage connection which was capitalized in its fixed assets and the assessee has been clai ming depreciation since A. Y.2011-12. No disallowance was carried out in the part. (b) The disallowance of depreciation in quantum proceedings in A. Y.2016-17 has also r esulted in corresponding enhance ment of deduction under section 80 IAB b y the equal a mount. The AO has also allowed the enhanced deduction in the quantum a nd, therefore, no prejudice was c a used to the revenue by such claim. It was thus contended that no malafide can be attributed to the assessee towards such claim and thus no penalty is warranted under nor mal provisions of Act. It was thereafter pointed out that the adjustme nt in the ‘book profits’towards such disallowance of depreciation does not trigger penalty u/s. 271 ( 1) (c) in the cont ext of section 115JB of the Act in the light of judg ment rendered in the c ase of C IT Vs. Nal wa Sons Investments Li mit ed ( 2010) 194 taxmann 387 (Delhi). 4. We find pri ma f acie merit in the plea of the as sessee for cancellation of penalty on both counts i.e. under nor mal provision as well as under M AT provision. I n the absence of an y malafide as de monstrated on behalf of the assessee, the penalt y u/s. 271 (1) (c) a re not attracted under the nor mal provisions. Not only th e allowances for depreciation was accepted in the earlier assessment yea rs such disallowance has not resulted in increase in assessed income due to enhance ment of deduction under section 80 IAB. Thus, it is far fetched to i mpose penalty on such disallowance. 5. Si milarl y ad justment in the book of profit on account on disallowance of depreciation could not culminate in i mposition of penalty under the MAT provisions in view of the judgment of rendered in Nalwa Sons (s upra) in which S LP was dis missed b y the Honble Supre me Court re ported in (2012) 21 tax mann.co m 184 (SC). 6. The penalt y i mposed stands cancelled. 7. In the result, the a ppeal of the assessee is allowed. Sd/- Sd/- (ANUBHAV SH ARMA) (PRADI P K UM AR K EDIA) JUDI CIAL ME MBER ACCO UNTANT M EMBE R Dated: /09/2022 *Neha, Sr. Private Secretary* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI This Order was pronounced in the open court on 12/09/2022