DCIT 5(2)(1), MUMBAI V. INFINITE COMPUTER SOLUTION (I) LTD, MUMBAI

ITA 7066/MUM/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 7566 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2011-2012
• Appeal Filed On: 05-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH KUMAR RAIDR
• Assessee Lawyers: THOMAS KUTTY M V
• Keywords: Wrong claim
• Section: 143(3); 14A

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES I, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ITA NO.7066/MUM/2016 ASSESSMENT YEAR: 2011-12 DCIT, CIRCLE-5(2)(1), R. NO.571, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 / VS. M/S INFINITE COMPUTER SOLUTIONS (I) LTD. 303, LOTUS HOUSE, 33A, NEW MARINE LINES, MUMBAI-400020 ( / REVENUE) ( ! /ASSESSEE) PAN. NO. AAACI5145D C. O. NO. 67/MUM/2018 (ARISING OUT OF ITA NO.7066/MUM/2016) ASSESSMENT YEAR: 2011-12 M/S INFINITE COMPUTER SOLUTIONS (I) LTD. 303, LOTUS HOUSE, 33A, NEW MARINE LINES, MUMBAI-400020 / VS. DCIT, CIRCLE-5(2)(1), R. NO.571, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 ( ! /ASSESSEE) ( / REVENUE) PAN. NO. AAACI5145D INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 2 / REVENUE BY SHRI SAURABH KUMAR RAI-DR ! / ASSESSEE BY SHRI THOMAS KUTTY M.V. ' # $ !% / DATE OF HEARING : 16/04/2018 $ !% / DATE OF ORDER: 16/04/2018 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 29/09/2016 OF THE LD. FIRST APPELLATE AUTHORI TY, MUMBAI, AND THE ASSESSEE HAS ALSO PREFERRED CROSS OBJECTION. FIRST, WE SHALL TAKE UP THE APPEAL OF TH E REVENUE IN NOT APPRECIATING THAT THE ASSESSEE ACCEP TED THAT ITS CLAIM OF DEDUCTION U/S 35D OF THE INCOME T AX ACT, 1961 (HEREINAFTER THE ACT) WAS NOT IN ORDER AN D WAS NOT CONTESTED WITH RESPECT TO THE DISALLOWANCE OF C LAIMED DEDUCTION WITHOUT APPRECIATING THE DECISION IN THE CASE OF RELIANCE PETRO PRODUCTS LTD. 322 ITR 158 (SUPR EME COURT) AND CONSEQUENT PENALTY U/S 271(1)(C) READ WI TH EXPLANATION-1 OF THE ACT. INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 3 2. DURING HEARING, AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SHRI THOMAS KUTTY M.V. CLAIMED THA T THE IMPUGNED ISSUE, EXACTLY ON IDENTICAL FACTS, IS COVE RED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF ASSESSE E ITSELF FOR ASSESSMENT YEAR 2010-11, ORDER DATED 29/12/2017 (ITA NO.1109/MUM/2016). THIS FACTUAL MATRIX WAS NOT CONTROVERTED BY THE REVENUE. HOWEVER, THE LD. DR, S HRI SAURABH KUMAR RAI, ADVANCED ARGUMENTS WHICH IS IDENTICAL TO THE GROUND RAISED BY DEFENDING THE PEN ALTY SO IMPOSED UPON THE ASSESSEE. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN VIEW O F THE ABOVE, WE ARE REPRODUCING HEREUNDER THE RELEVANT PO RTION FROM THE AFORESAID ORDER OF THE TRIBUNAL DATED 29/12/2017 FOR READY REFERENCE AND ANALYSIS:- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF THE CIT(A)-10, MUMBAI 20-11-2015 AND IT PERTAINS TO AY 2010- 11. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS O F APPEAL:- 1(A). ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(A) ERRED IN DELETING THE PENALTY L EVIED U/S 271(1)(C) OF RS. 44,43,404/- ON THE GROUND THAT A W RONG CLAIM WHICH IS NOT SUSTAINABLE IN THE EYES OF LAW WILL NO T BECOME A BASE FOR CONCEALMENT OF PENALTY. INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 4 1(B). ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) FAILED TO APPRECIATE THAT THE CLAIM OF DEDUCTION U/S 35D MADE BY THE ASSESSEE WAS PRIMA FA CIE NOT ADMISSIBLE AS THE PROJECT HAD NOT COMMENCED DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2010- 2011 AND, HENCE, THE ASSESSEE HAD FURNISHED INACCURATE PARTICULARS OF ITS INCOME. 1(C). ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE ACCEPTED THAT ITS CLAIM OF DEDUCTION U/S 35D WAS NO T IN ORDER AND DID NOT CONTEST THE DISALLOWANCE OF THE DEDUCTI ON U/S 35D IN APPEAL. 1(D). ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) FAILED TO APPRECIATE THAT THE HON'BLE DELHI HIGH COURT HAS CONSIDERING THE DECISION OF TH E HON'BLE SUPREME COURT IN THE CASE OF RELIANCE PETRO PRODUCTS PVT. LTD. (322 ITR 158) HELD IN THE CASE OF CIT V. ZOOM COMMUNICATION PVT. LTD. (2010) 191 TAXMAN 179 (DELH I) THAT IF AN ASSESSEE MAKES A CLAIM WHICH IS NOT ONLY INCORRECT IN LAW, BUT IS ALSO WHOLLY WITHOUT ANY BASIS AND EXPLA NATION FURNISHED BY HIM FOR MAKING SUCH A CLAIM IS NOT FOU ND TO BE BONA FIDE, EXPLANATION TO SECTION 271(1)(C) WOULD C OME INTO PLAY AND ASSESSEE WILL BE LIABLE TO PENALTY U/S 271 (1)(C). 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E COMPANY ENGAGED IN THE BUSINESS OF DEVELOPMENT OF COMPUTER SOFTWARE, FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010-11 ON 27- 09-2010 DECLARING TOTAL INCOME OF RS.25,97,48,000. THE ASSESSMENT WAS COMPLETED U/S 143(3) ON 30-01-2014 DETERMINING TOTAL INCOME AT RS.27,39,70,181 AFTER M AKING ADDITION ON ACCOUNT OF DISALLOWANCE OF EXPENDITURE U/S 14A OF RS.77,500 AND DISALLOWANCE OF CLAIM OF DEDUCTION U/ S 35D AMOUNTING TO RS.1,41,44,681. WHILE DISALLOWING EXP ENSES U/S 35D, THE AO OBSERVED THAT THE ASSESSEE HAS CLAIMED DEDUCTION TOWARDS EXPENSES DIRECTLY IN THE STATEMENT OF COMPU TATION OF TOTAL INCOME WITHOUT ROUTING THROUGH P&L ACCOUNT. THE AO HAS MADE ADDITION ON THE BASIS OF REVISED STATEMENT OF TOTAL INCOME FILED BY THE ASSESSEE WITHDRAWING THE CLAIM MADE U/S 35D AS THE BUSINESS OF THE ASSESSEE COMPANY HAS NOT COMMENCED DURING THE YEAR UNDER CONSIDERATION. 3. THEREAFTER, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) FOR WRONG CLAIM OF DEDUCTION TOWARDS IPO EXPENSES U/S 35D OF THE INCOME-TAX ACT, 1961. THE AO INITIA TED PENALTY PROCEEDINGS ON THE GROUND THAT THE ASSESSEE HAS FIL ED INACCURATE INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 5 PARTICULARS OF INCOME, WHICH WARRANTS LEVY OF PENAL TY U/S 271(1)(C). IN RESPONSE TO NOTICE ISSUED BY THE AO ASSESSEE SUBMITTED THAT MERE CLAIM OF EXPENSES OR DISALLOWAN CE OF EXPENSES DOES NOT TANTAMOUNT TO FURNISHING OF INACC URATE PARTICULARS OF INCOME SO AS TO LEVY PENALTY U/S 271 (1)(C) OF THE ACT. IN THIS REGARD, HE RELIED UPON THE DECISION O F THE HONBLE SUPREME COURT IN THE CASE OF CIT VS RELIANCE PETROP RODUCTS PVT LTD 322 ITR 158 (SC). THE AO, AFTER CONSIDERING RE LEVANT SUBMISSIONS OF THE ASSESSEE AND ALSO RELYING UPON T HE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS KP MADH USUDAN REPORTED IN 251 ITR 99 (SC) OBSERVED THAT THE ASSES SEE HAS FILED INCORRECT CLAIM IN THE RETURN OF INCOME IN RESPECT OF DEDUCTIONS CLAIMED TOWARDS IPO EXPENSES U/S 35D WHICH WARRANTS LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. 3. AGGRIEVED BY THE PENALTY ORDER, ASSESSEE PREFERRED APPEAL BEFORE CIT(A). BEFORE CIT(A), ASSESSEE SUBMITTED T HAT THE AO WAS ERRED IN LEVYING PENALTY U/S 271(1)(C) IN RESPE CT OF DISALLOWANCE OF IPO EXPENSES U/S 35D ON THE WRONG F OOTING THAT THE ASSESSEE HAS FILED INACCURATE PARTICULARS OF IN COME WITHOUT APPRECIATING THE FACT THAT DURING THE COURSE OF ASS ESSMENT PROCEEDINGS, THE ASSESSEE HAS FILED REVISED STATEME NT OF TOTAL INCOME WITHDRAWING DEDUCTION CLAIMED U/S 35D. THE ASSESSEE FURTHER SUBMITTED THAT MAKING AN INCORRECT CLAIM IN LAW CANNOT TANTAMOUNT TO FURNISHING INACCURATE PARTICULARS OF INCOME. IN THIS REGARD RELIED UPON CERTAIN JUDICIAL PRECEDENTS . THE CIT(A), AFTER CONSIDERING RELEVANT SUBMISSIONS OF THE ASSES SEE AND ALSO RELYING UPON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS RELIANCE PETROPRODUCTS PVT LTD (SUPRA) OB SERVED THAT WHEN THE APPELLANT HAS WITHDRAWN THE CLAIM BY FILIN G A REVISED STATEMENT BEFORE THE AO DURING THE COURSE OF ASSESS MENT PROCEEDINGS ITSELF, THE AO SHOULD HAVE CONSIDERED T HE REQUEST WHILE FINALISING THE PENALTY PROCEEDINGS. THE WITH DRAWAL OF CLAIM IN THE COURSE OF ASSESSMENT PROCEEDINGS IS A SUFFICIENT GROUND TO PROVE THAT THE MISTAKE IS INADVERTENT AND THERE IS NO INTENTION TO AVOID TAXES. WITH THESE OBSERVATIONS, THE CIT(A) DELETED PENALTY LEVIED BY THE AO. THE RELEVANT POR TION OF THE ORDER OF THE CIT(A) IS EXTRACTED BELOW:- 5.1 I'M NOT CONVINCED WITH THE CONCEALMENT PENALTY LEVIED BY THE AO. THE DISALLOWANCE MADE IS IN ORDER SO FAR AS THE QUANTUM IS CONCERNED. WHEN THE APPELLANT HAS WITHDRAWN THE CLAIM BY FILING A REVISED STATEMENT B EFORE THE AG DURING THE COURSE OF ASSESSMENT PROCEEDINGS ITSELF, THE AG SHOULD HAVE CONSIDERED THE REQUEST WHILE FINALISING THE PENALTY PROCEEDINGS. THE WITHDRAWAL OF CLAIM IN THE COURSE OF ASSESSMENT PROCEEDINGS IS A SUFFICIENT GROUND TO PROVE THAT INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 6 THE MISTAKE IS INADVERTENT AND THERE IS NO INTENTIO N TO EVADE TAXES. IN MY CONSIDERED VIEW THERE IS NO HIDING OF FACTS WHILE FILING THE RETURN OF INCOME BUT THERE IS A WRONG CL AIM. AS IT IS A SETTLED LAW THAT A WRONG CLAIM WHICH IS NOT SUSTAIN ABLE IN THE EYES OF LAW WILL NOT BECOME A BASE FOR CONCEALMENT PENALTY. RELIANCE IS PLACED ON THE DECISION OF THE HONOURABL E SUPREME COURT IN THE CASE OF RELIANCE PETROPRODUCTS P LTD 3 22 ITR 158. FURTHER, WHEN THE APPELLANT HAS WITHDRAWN THE CLAIM, THERE IS NO BASE ON WHICH PENALTY CAN BE LEVIED. IN VIEW OF THESE FACTS, THE PENALTY IS NOT SUSTAINABLE. ACCORDINGLY THE GROUND IS ALLOWED. 4. THE LD.DR SUBMITTED THAT THE LD.CIT(A) ERRED IN DELETING PENALTY ON THE GROUND THAT A WRONG CLAIM W HICH IS NOT SUSTAINABLE IN THE EYES OF LAW WILL NOT BECOME A BA SE FOR CONCEALMENT PENALTY. THE LD.DR FURTHER SUBMITTED T HAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS IN RE SPECT OF DEDUCTION CLAIMED U/S 35D EVEN THOUGH IT IS NOT ELI GIBLE FOR DEDUCTION AS THE ASSESSEE HAD NOT COMMENCED ITS BUS INESS OPERATIONS DURING THE YEAR UNDER CONSIDERATION. TH OUGH THE ASSESSEE HAS WITHDRAWN THE CLAIM BY FILING REVISED STATEMENT OF TOTAL INCOME, SUCH WITHDRAWAL WOULD NOT ABSOLVE THE ASSESSEE FROM THE PENAL PROVISIONS OF SECTION 271(1(C). AS THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS ZOOM COMMUNI CATIONS P LTD (2010) 191 TAXMAN.179 HELD THAT IF AN ASSESSE E MAKES A CLAIM WHICH IS NOT ONLY INCORRECT IN LAW BUT ALSO W ITHOUT ANY BASIS AND EXPLANATION FURNISHED BY HIM FOR MAKING S UCH A CLAIM NOT FOUND TO BE BONA FIDE, EXPLANATION 1 TO SECTION 271(1(C) WOULD COME INTO PLAY AND ASSESSEE WILL BE LIABLE TO PAY PENALTY U/S 271(1)(C). 5. ON THE OTHER HAND, THE LD.AR FOR THE ASSESSEE SUPPO RTED ORDER OF THE CIT(A). 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED MATERIAL AVAILABLE ON RECORD. THE AO LEVIED PENALTY U/S 2 71(1)(C) IN RESPECT OF DISALLOWANCE OF DEDUCTIONS CLAIMED U/S 3 5D TOWARDS IPO EXPENSES ON THE GROUND THAT THE ASSESSEE HAS FU RNISHED INACCURATE PARTICULARS OF INCOME WHICH ATTRACTS PEN ALTY U/S 271(1)(C) OF THE ACT. ACCORDING TO THE AO, MAKING A WRONG CLAIM IN THE RETURN OF INCOME TANTAMOUNT TO FURNIS HING OF INACCURATE PARTICULARS OF INCOME WITHIN THE MEANING OF EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT. THE AO FURTHER OBSERVE D THAT BY VIRTUE OF EXPLANATION 1, IF ANY A MOUNT HAS BEEN ADDED OR DISALLOWED IN COMPUTING THE TOTAL INC OME, IT IS REQUIRED TO BE HELD THAT THE AO IS SATISFIED THAT T HE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME OR FURNISHING I NACCURATE PARTICULARS OF INCOME AS IT IS INHERENT IN THE EXPL ANATION ITSELF INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 7 THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. IT IS THE CONTENTION OF THE ASSESSEE THAT MAKING AN INCORRECT CLAIM IN L AW CANNOT TANTAMOUNT TO FURNISHING INACCURATE PARTICULARS OF INCOME. IT HAS DISCLOSED ALL NECESSARY FACTS AND PARTICULARS IN IT S BOOKS OF ACCOUNT AND NO FALSE STATEMENT HAS BEEN MADE EVEN I N THE RETURN OF INCOME. IT HAS WITHDRAWN WRONG CLAIM MADE U/S 3 5D BEFORE THE AO AND ALSO EXPLAINED THE REASONS FOR MAKING SU CH CLAIM. ACCORDING TO THE ASSESSE, IT HAS MADE A WRONG CLAIM ON THE BONA FIDE BELIEF THAT IT IS ELIGIBLE FOR 1/5 TH OF DEDUCTION TOWARDS IPO EXPENSES, EVEN THOUGH IT HAS NOT COMMENCED BUSINESS ACTIVITIES. HOWEVER, ON COMING TO KNOW THAT IT IS NOT ELIGIBLE FOR DEDUCTION DURING THE CURRENT FINANCIAL YEAR, IT HAS FILED A R EVISED STATEMENT OF TOTAL INCOME WITHDRAWING ITS CLAIM WHICH SHOWS T HE BONA FIDENESS AND HENCE, THE AO WAS INCORRECT IN HOLDING THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF IN COME WHICH ATTRACTS PENALTY U/S 271(1)(C). 7. HAVING HEARD BOTH THE SIDES AND CONSIDERED MATERIAL AVAILABLE ON RECORD, WE FIND MERIT IN THE ARGUMENT OF THE ASSESSEE FOR THE REASON THAT THE HONBLE SUPREME CO URT IN THE CASE OF CIT VS RELIANCE PETROPRODUCTS (P) LTD (SUPR A) HELD THAT A MERE MAKING OF THE CLAIM, WHICH IS NOT SUSTAINABLE IN LAW BY ITSELF WILL NOT AMOUNT TO FURNISHING OF INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. SUCH CLAIM M ADE IN THE RETURN CANNOT AMOUNT TO FURNISHING OF INACCURATE PA RTICULARS. IN THIS CASE, ADMITTEDLY, THE ASSESSEE HAS FILED REVIS ED STATEMENT OF TOTAL INCOME WITHDRAWING DEDUCTION CLAIMED U/S 35D AT THE TIME OF ASSESSMENT PROCEEDINGS. THE ASSESSEE ALSO EXPLA INED THE REASONS FOR MAKING SUCH CLAIM. THEREFORE, WE ARE O F THE CONSIDERED VIEW THAT MERE MAKING A CLAIM WHICH IS N OT SUSTAINABLE IN LAW CANNOT TANTAMOUNT TO FURNISHING OF INACCURATE PARTICULARS OF INCOME WHICH WOULD ATTRACT PENALTY U /S 271(1)(C). THE CIT(A), AFTER CONSIDERING RELEVANT SUBMISSIONS OF THE ASSESSEE AND ALSO BY FOLLOWING THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF CIT VS RELIANCE PETROPRODUCTS (P) LTD (SUPRA) DELETED PENALTY LEVIED BY THE AO. WE DO N OT FIND ANY ERROR IN THE ORDER OF THE CIT(A). HENCE, WE ARE IN CLINED TO UPHOLD THE FINDINGS OF THE CIT(A) AND DISMISS THE A PPEAL FILED BY THE REVENUE. 8. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. 2.2. IT IS NOTED THAT ON THE ISSUE OF NON-APPRECIA TION OF FACTS WITH RESPECT TO CLAIMED DEDUCTION U/S 35D OF THE INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 8 ACT AND DELETION OF PENALTY LEVIED U/S 271(1)(C) OF THE ACT, THE TRIBUNAL HAS DELIBERATED UPON THE ISSUE AND FIN ALLY DISMISSED THE APPEAL OF THE REVENUE, UPHOLDING THE STAND TAKEN BY THE FIRST APPELLATE AUTHORITY. IN THE PRES ENT APPEAL ALSO, THE ASSESSMENT WAS COMPLETED U/S 144C/143(3) OF THE ACT ON 05/03/2015. WHILE MAKING THE ADDITION ON ACCOUNT OF 14A AND DISALLOWANCE OF CLAI M U/S 35D AMOUNTING TO RS.1,41,44,681/-, THE LD. ASSESSIN G OFFICER INITIATED PENALTY PROCEEDINGS, U/S 271(1)(C ) OF THE ACT SPECIALLY AGAINST THE DISALLOWANCE OF CLAIM OF EXPENSES U/S 35D OF THE ACT. THE ASSESSEE CLAIMED THE AMOUNT OF RS.1,41,44,681/- BEING ONE FIFTH OF THE TOTAL EXPEN SES. THE TRIBUNAL HAS ALREADY CONSIDERED THE DECISION FROM H ON'BLE APEX COURT IN CIT VS RELIANCE PETROPRODUCTS PVT. LT D. 322 ITR 158 (SUPREME COURT) AND ALSO THE DECISION IN TH E CASE OF CIT VS K.P. MADHUSUDAN 251 ITR 99 (SUPREME COURT ). THE HON'BLE APEX COURT IN RELIANCE PETROPRODUCTS PV T. LTD. OBSERVED THAT WHEN THE ASSESSEE HAS WITHDRAWN THE CLAIM BY FILING A REVISED STATEMENT BEFORE THE ASSE SSING OFFICER ITSELF, THE ASSESSING OFFICER SHOULD HAVE C ONSIDERED INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 9 THE REQUEST WHILE FINALIZING THE PENALTY PROCEEDING S. THE WITHDRAWAL OF CLAIM DURING ASSESSMENT PROCEEDINGS I S A SUFFICIENT GROUND TO PROVE THAT THE MISTAKE IS INAD VERTENT AND THERE IS NO INTENTION TO AVOID TAXES. THE ASSES SEE WITHDREW THE CLAIM MADE U/S 35D OF THE ACT BEFORE T HE LD. ASSESSING OFFICER AND ALSO EXPLAINED THE REASON FOR MAKING SUCH CLAIM. ACCORDING TO THE ASSESSEE, WRONG CLAIM WAS MADE ON A BONA-FIDE BELIEF THAT ASSESSEE IS ELIGIBLE FOR 1/5 TH OF DEDUCTION TOWARDS IPO EXPENSES, EVEN THOUGH IT HAS NOT COMMENCED BUSINESS ACTIVITIES. ON COMING TO KNOW THAT THE ASSESSEE IS NOT ELIGIBLE FO R DEDUCTION, DURING CURRENT FINANCIAL YEAR, A REVISED STATEMENT OF TOTAL INCOME WAS MADE WITHDRAWING THE CLAIM WHICH SHOWS BONA-FIDE INTENTION OF THE ASSESS EE. THUS, FOLLOWING THE AFORESAID DECISION OF THE TRIBU NAL, WE FIND NO INFIRMITY IN THE ORDER OF THE FIRST APPELLA TE AUTHORITY. IT IS UPHELD, RESULTING INTO DISMISSAL O F APPEAL FILED BY THE REVENUE. 3. NOW, WE SHALL TAKE UP THE CROSS OBJECTION (C.O. 67/MUM/2018), FILED BY THE ASSESSEE. THE LD. COUNSE L FOR INFINITE COMPUTER SOLUTION (I) LTD. ITA NO.7066/MUM/2016 & C.O. NO.67/MUM/2018 10 THE ASSESSEE DID NOT PRESS THE SAME, THEREFORE, THE CROSS OBJECTION OF THE ASSESSEE IS DISMISSED AS NOT PRESS ED. FINALLY, THE APPEAL OF THE REVENUE AS WELL AS THE CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVE FROM BOTH SIDES AT T HE CONCLUSION OF THE HEARING ON 16/04/2018. SD/- SD/- ( RAMIT KOCHAR ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER ' # MUMBAI; ' DATED :16/04/2018 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. )*+, / THE APPELLANT 2. -.+, / THE RESPONDENT. 3. / / ' 0! ( )* ) / THE CIT, MUMBAI. 4. / / ' 0! / CIT(A)- , MUMBAI 5. 23 -! , / )*% )4 , ' # / DR, ITAT, MUMBAI 6. 5 6# / GUARD FILE. / BY ORDER, / (DY./ASSTT. REGISTRAR) , ' # / ITAT, MUMBAI