DCIT 12(1)(1), MUMBAI V. ALLIED INSTRUMENTS P.LTD, MUMBAI

ITA 759/MUM/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 0472 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2002-2003
• Appeal Filed On: 12-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AJAI PRATAP SINGH
• Assessee Lawyers: SANJIV M SHAH
• Keywords: Depreciation; Difference of opinion; Revenue expenditure; Capital expenditure
• Section: 80HHC; 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A, MUMBAI BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) THE DCIT,12(1)(1), R.NO.223, 2 ND FLOOR, AAYKAR BHAVAN,M.K.ROAD, MUMBAI 400 020 ...... A PPELLANT VS. M/S. ALLIED INSTRUMENTS PVT. LTD., 30, CD GOVT. INDUSTRIAL ESTATE, KANDIVALI (W), MUMBAI 400 067 PAN: AAACA 1032F .... RESP ONDENT APPELLANT BY : SHRI AJAI PRATAP SI NGH RESPONDENT BY : SHRI SANJIV M. SHAH DATE OF HEARING : 31/05/2017 DATE OF PRONOUNCEMENT : 31/05/2017 ORDER THE CAPTIONED APPEAL FILED BY THE REVENUE PERTAI NING TO ASSESSMENT YEAR 2002-03 IS DIRECTED AGAINST AN ORDER PASSED BY CIT(A)-20, MUMBAI DATED 30/11/2015, WHICH IN TURN, ARISES OUT OF AN ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE INCOME TA X ACT, 1961 (IN SHORT THE ACT) DATED 25/03/2013. 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL IN ITS APPEAL:- 1. 'WHETHER ON THE FACTS AND IN CIRCUMSTANCES OF TH E CASE AND IN LAW, THE LD CIT(A) WAS RIGHT IN CANCELLING THE PENALTY UNDER SECTION 2 71(1)(C) OF THE INCOME-TAX ACT, 2 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) AMOUNTING TO RS.19,26,150/- WITHOUT APPRECIATING TH E FACT THAT THE ASSESSEE HAS WRONGLY CLAIMED EXCESS DEDUCTION U/S 80IB?' 2. 'WHETHER ON THE FACTS AND IN CIRCUMSTANCES OF T HE CASE AND IN LAW, THE LD CIT(A) WAS RIGHT IN CANCELLING THE PENALTY UNDER SECTION 2 71(1)(C) OF THE INCOME-TAX ACT, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE HAD DELIBERATELY FILED INACCURATE PARTICULARS WITH A VIEW TO INCREASING THE PROFIT OF THE UNIT ELIGIBLE FOR DEDUCTION UNDER SECTION 80LB AND REDUCING THE INCOME OF THE UNIT NO T ELIGIBLE FOR DEDUCTION UNDER SECTION 80IB?' 3. 'THE APPELLANT PRAYS THAT THE ORDER OF THE LD C IT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE A.O BE RESTORED.' 3. IN BRIEF, THE RELEVANT FACTS ARE THAT PENALTY U NDER SECTION 271(1)(C) OF THE ACT WAS IMPOSED BY THE ASSESSING OFFICER OF RS.19,2 6,150/- ON TWO COUNTS, FIRSTLY, IN RELATION TO THE VARIATION IN THE CLAIM OF DEDUCTION UNDER SECTION 80IB OF THE ACT AS A RESULT OF THE ASSESSMENT. ON THIS COUNT, THE ASSESSING OFFICER HAS NOTED IN THE PENALTY ORDER THAT THE DEDUCTION UNDER SECTION 80 IB OF THE ACT WAS REDUCED BY AN AMOUNT OF RS.47,40,065/-; OUT OF THIS AN AMOUNT OF RS.21,41,743/-, WAS CONSIDERED AS AN INCOME NOT D ERIVED FROM THE ELIGIBLE UNIT, AND THE BALANCE OF RS.25,29,322/- WAS ON ACCO UNT OF CHANGED BASIS OF APPORTIONMENT OF EXPENSES BETWEEN ELIGIBLE AND NON -ELIGIBLE UNITS, WHICH HAD RESULTED IN REDUCED PROFITS FROM THE ELIGIBLE UNIT OF RS.25,95,322/-. THUS, WITH RESPECT TO THE AMOUNT OF RS.47,40,065/-, THE PENALT Y WAS LEVIED. SECONDLY, THE PENALTY HAS BEEN LEVIED WITH RESPECT TO A SUM OF R S.8,81,750/- ON ACCOUNT OF TREATMENT OF SOFTWARE EXPENSES, WHICH WAS NOT ACCEP TED BY THE ASSESSING OFFICER. THE ASSESSEE HAD CLAIMED THE SOFTWARE EX PENSES AS A REVENUE EXPENDITURE, WHEREAS THE ASSESSING OFFICER TREATE D IT AS CAPITAL EXPENDITURE, ON WHICH DEPRECIATION WAS ALLOWABLE. ON BOTH THESE COUNTS, THE PENALTY WAS LEVIED UNDER SECTION 271(1)(C) OF THE ACT OF RS.19 ,26,150/-. THE CIT(A) HAS SINCE DELETED THE PENALTY, AGAINST WHICH REVENUE IN APPEAL BEFORE US. 3 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) 4. BEFORE PROCEEDING FURTHER WE MAY NOTICE THAT IN THE GROUNDS OF APPEAL RAISED BY THE REVENUE, THE ONLY ISSUE MANIFESTED I S WITH REGARD TO THE VARIATION IN THE CLAIM OF DEDUCTION UNDER SECTION 8 0 IB OF THE ACT AND THERE IS NO REFERENCE TO THE PENALTY DELETED BY THE CIT(A) ON THE OTHER COUNT NAMELY, INCORRECT TREATMENT OF SOFTWARE EXPENSES. BE THAT AS IT MAY, WE MAY PROCEED FURTHER. 5. AT THE TIME OF HEARING, LD.REPRESENTATIVE FOR TH E ASSESSEE POINTED OUT THAT THE ISSUE RELATING TO THE VARIATION IN THE AMO UNT OF DEDUCTION ALLOWABLE UNDER SECTION 80 IB OF THE ACT WAS ALSO PRESENT IN ASSESSMENT YEAR 2001-02, WHEREIN THE TRIBUNAL VIDE ITS ORDER IN ITA NO.985/M UM/2009 DATED 9/2/2011 HAS DELETED THE LEVY OF PENALTY UNDER SECTION 271( 1)(C) OF THE ACT. THE RELEVANT PORTION OF THE ORDER OF THE TRIBUNAL DATE D 9/2/2011(SUPRA) READS AS UNDER:- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF THE LD. CIT(A)- IX, MUMBAI DATED 22.12.2008 FOR THE A.Y.2001-02. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE THEREFO RE WE HEARD THE LD. DEPARTMENTAL REPRESENTATIVE AND DISPOSE OF THE MATT ER EX PARTE ON MERIT. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE COMP ANY HAS TWO MANUFACTURING UNITS FOR MANUFACTURING THE SAME PRODUCT. ONE UNIT IS ELI GIBLE FOR DEDUCTION U/S. 80IB AND OTHER UNIT IS NOT ELIGIBLE FOR THE DEDUCTION. DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER FOUND THAT MOST OF THE EXPENSES HAVE BEEN CLAIMED IN THE UNIT WHICH IS NOT ELIGIBLE FOR DEDUC TION U/S. 80IB. THE AO THEREFORE HAD COME TO THE CONCLUSION THAT THE ASSESSEE COMPANY HA S TRIED TO REDUCE ITS INCOME OF KANDIVALI UNIT WHICH WAS NOT ELIGIBLE FOR DEDUCTION 80IB AND INCREASE THE PROFIT OF THE DAMAN UNIT WHICH WAS ELIGIBLE FOR DEDUCTION U/S. 80 IB. THE AO IS OF THE VIEW THAT THE ASSESSEES CLAIM OF DEDUCTION U/S. 80HHC AND 80IB W AS NOT CORRECT THUS IT HAS CLAIMED EXCESS DEDUCTION U/S. 80HHC AND 80IB BY F URNISHING INACCURATE PARTICULARS OF INCOME AND THEREBY CONCEALED ITS INCOME 4. AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A). BEFORE THE LD. CIT(A) THE AR CONTENDED AS FOLLOWS: THE PENALTY PROCEEDINGS HAVE BEEN RESORTED TO IN A VERY MECHANICAL MANNER. IT IS SUBMITTED THAT THE APPELLANT HAD DISC LOSED ALL MATERIAL FACTS IN 4 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) CONNECTION WITH THE CLAIM FOR DEDUCTION U/S. 80IB A ND IT HAD PRODUCED ALL THE INFORMATION AND EVIDENCE REQUISITIONED BY THE AO WI TH REGARD TO THE DEDUCTION U/S. 80IB. THEREFORE, THE APPELLANTS CAS E DOES NOT FALL WITHIN THE MISCHIEF OF THE FIRST LIMB OF SEC. 271(1)(C). RELIA NCE IS PLACED ON K.C. BUILDER VS ACIT (265 ITR 562)(SC), DILIP SHROFF VS JCIT (291 I TR 519 (SC) AND ASHOK PAI VS CIT 292 ITR 11 (SC). THE APPELLANT HAD THUS CONTEND ED THAT ITS CASE DOES NOT SATISFY THE SECOND LIMB VIZ. FURNISHING OF INACCURA TE PARTICULARS OF INCOME OF SEC. 271(1)(C). THE AO HAS NOT RELIED UPON ANY INDE PENDENT MATERIAL TO HOOK THE CASE OF THE APPELLANT U/S. 271(1)(C). THUS THE PENALTY ORDER IS FOUNDED ON GUESS WORK, SURMISES AND CONJECTURES. IT IS WELL SE TTLED THAT WHERE AN ASSESSMENT IS FOUNDED ON ESTIMATE, COGENT PROOF IS NECESSARY TO PROVE CONCEALMENT 5. THE LD. CIT(A) HELD AS FOLLOWS: I HAVE CAREFULLY CONSIDERED THE ABOVE FACTS OF THE CASE, APPELLANTS SUBMISSION AS WELL AS THE AOS CONTENTION. IT IS EV IDENT FROM THE ASSESSMENT ORDER AS WELL AS DETAILS AVAILABLE ON RECORD THAT T HE ASSESSEE COMPANY HAS DEBITED UNDER THE HEAD ADMINISTRATIVE CHARGES TOT ALING TO RS. 45,34,956/- TO KANDIVALI UNIT WHICH WAS NOT ELIGIBLE FOR DEDUCTION U/S. 80IB. THE ASSESSEE WAS ASKED TO EXPLAIN BY THE AO AS TO WHY THE COMMON EXPENSES SHOULD NOT BE ALLOCATED TO DAMAN UNIT WHICH IS ELIGIBLE FOR DE DUCTION U/S. 80IB, SO THAT PROFITS OF THE ELIGIBLE UNIT ARE CORRECTLY ASCERTAI NED. SINCE, NO SATISFACTORY EXPLANATION IN SUPPORT OF THE ALLOCATION OF THE EXP ENDITURE TO THE KANDIVALI UNIT WAS FILED, THEREFORE, THE PROFIT OF THE DAMAN UNIT WHICH IS ELIGIBLE FOR DEDUCTION U/S. 80IB WAS RECOMPUTED BY DEBITING THE EXPENDITURE OF RS. 45,34,956/-. SUCH ALLOCATION WAS ALSO CONFIRMED BY THE LD. CIT(A). ACCORDINGLY, THE APPELLANTS CLAIM OF DEDUCTION U/S . 80IB WAS ALSO REDUCED. NO PLAUSIBLE REASON HAS BEEN GIVEN BY THE APPELLANT FO R SUCH ALLOCATION OF EXPENSES WHICH RESULTED INTO EXCESS CLAIM OF DEDUCT ION U/S. 80IB. THE TAXABLE INCOME OF THE KANDIVALI UNITS WHICH WAS NOT ELIGIBL E FOR THE DEDUCTION U/S. 80IB HAS BEEN REDUCED BY THE APPELLANT COMPANY 3 IT A NO. 985/M/09 FOR WHICH ALSO NO SATISFACTORY EXPLANATION HAS BEEN FIL ED. UNDER THE CIRCUMSTANCES AND FACTS OF THE CASE, I AM OF THE VI EW THAT THE APPELLANT HAS FURNISHED INACCURATE PARTICULARS OF INCOME BY MAKIN G ALLOCATION OF EXPENSES BETWEEN THESE TWO UNITS WHICH RESULTED INTO EXCESS CLAIM OF DEDUCTION U/S. 80IB FOR THE DAMAN UNIT. THE HONBLE ITAT CALCUTTA BENCH IN THE CASE OF ACIT VS MCLEOD RUSSELL INDIA LTD. 101 ITD 39 KOLKATA HAS HELD THAT EVEN IF THE INCOME IS ULTIMATELY DETERMINED BY APPLYING METHOD OF ESTIMATE PENALTY CAN BE IMPOSED. THE HONBLE MADRAS HIGH COURT IN THE CA SE OF CEMENT DISTRIBUTORS PVT. LTD VS CIT 60 ITR 586 HAS HELD TH AT RECORDING OF BOGUS TRANSACTION IN ORDER TO DISPLAY INCOME AT A MUCH LO WER FIGURE AMOUNTS TO DELIBERATE FURNISHING OF INACCURATE PARTICULARS OF INCOME WITHIN THE MEANING OF SEC. 271(1)(C). THE HONBLE MP HIGH COURT IN THE CASE OF ADDL. CIT VS SMT. CHANDRAKANTA 205 ITR 607 HAS HELD WHERE THE ASSESSM ENT IS BASED ON ESTIMATE PENALTY CAN BE IMPOSED U/S. 271(1). SIMIL AR VIEW WAS ALSO TAKEN BY 5 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) THE HONBLE BOMBAY HIGH COURT IN THE CASE OF R.B. S HREE RAM DURGAPRASAD N. FATHECHAND NARINHAS VS CIT 168 ITR 619. THEREFORE O N THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE, I AM OF THE VIEW THAT TH E ASSESSING OFFICE WAS JUSTIFIED IN LEVYING THE PENALTY ON EXCESS CLAIM OF DEDUCTION U/S. 80IB BY THE APPELLANT COMPANY. 6. AGGRIEVED BY THE ORDER OF THE LD. CIT(A) ASSESS EE IS IN APPEAL BEFORE US AND RAISED THE FOLLOWING GROUNDS: 1. UNDER THE FACTS & CIRCUMSTANCES OF YOUR APPELLA NT THE LD. CIT(A) ERRED CONFIRMING PENALTY ORDER IN RESPECT OF ALLEGED EXCE SS CLAIM OF DEDUCTION U/S. 80IB OF I.T. ACT 1961. 1.02 UNDER THE FACTS & CIRCUMSTANCES OF YOUR APPEL LANT THE LD. CIT(A) ERRED IN HOLDING THAT YOUR APPELLANT HAS COMMITTED DEFAULT U /S. 271(1)(C) OF THE I.T. ACT, 1961. 1.03 THE LD. CIT(A) ERRED IN APPLYING THE SUPREME C OURT JUDGEMENT IN THE CASE OF UOI VS DHARMENDRA TEXTILES DT. 18.10.2008. 7. WE HEARD THE LD. DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE HAS DISCLOSED ALL MATERIAL FACTS IN CONNECTION WITH THE DEDUCTION U/S. 80IB AND HAS PRODUCED ALL T HE INFORMATION AND EVIDENCE REQUISITIONED BY THE AO WITH REGARD TO THE DEDUCTIO N U/S. 80IB. 8. THE HONBLE SUPREME COURT IN THE CASE OF CIT VS RELIANCE PETRO PRODUCTS PVT. LTD (2010) 322 ITR 158 (SC) HAS HELD THAT THE ASSESSEE FURNISHED ALL THE MATERIALS IN RETURN WHICH WAS NOT FOUND TO BE INCORRECT, IT WAS UPTO THE AUTHORITIES TO ACCEPT ITS CLAIM IN THE RETURN OR NOT BUT THE SAME COULD NOT B E CONSIDERED AS CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF I NCOME. IN OUR CONSIDERED OPINION THE RATIO DECIDENDI OF THIS JUDGEMENT IS FULLY APPL ICABLE TO THE FACTS OF THE INSTANT CASE. WE, THEREFORE, OVERTURN THE IMPUGNED ORDER AN D DIRECT THE DELETION OF PENALTY. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 5.1 THE LD.REPRESENTATIVE FOR THE ASSESSEE ALSO POI NTED OUT THAT THE DECISION OF THE TRIBUNAL FOR ASSESSMENT YEAR 2001- 02 DATED 9/2/2011 HAS SINCE BEEN AFFIRMED BY THE HON'BLE BOMBAY HIGH COUR T ALSO. FURTHER, JUSTIFYING THE DELETION OF PENALTY BY THE CIT(A) THE LD.REPRES ENTATIVE FOR THE ASSESSEE POINTED OUT THAT IN ASSESSMENT YEAR 2005-06,SIMILA R ADDITION WERE MADE BUT THE PENALTY PROCEEDINGS WERE DROPPED BY THE ASSESSI NG OFFICER VIDE ORDER DATED 05/03/2012, A COPY OF WHICH HAS BEEN PLACED I N THE PAPER BOOK AT PAGE 169. IN THIS CONTEXT, THE LD.REPRESENTATIVE FOR TH E ASSESSEE RELIED UPON THE 6 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) JUDGMENT OF THE HON'BLE BOMBAY HIGH COURT IN THE CA SE OF CIT VS. ORIENTAL PRESS LTD., IN INCOME TAX APPEAL NO.1498 OF 2007 DA TED 24 TH MARCH,2009 TO CANVASS THAT WHERE IN ONE ASSESSMENT YEAR THE PENAL TY PROCEEDINGS HAVE BEEN DROPPED BY THE ASSESSING OFFICER, THEN ON SIMILAR G ROUND THE PENALTY IMPOSED IN ANOTHER YEAR IS UNTENABLE. 5.2 IT IS CANVASSED THAT EVEN OTHERWISE, DIFFERENCE IN ALLOCATION OF EXPENSES BETWEEN ELIGIBLE AND NON-ELIGIBLE UNITS CANNOT BE A GROUND FOR IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. FURTHE R, WITH REGARD TO THE PENALTY LEVIED ON ACCOUNT OF INCORRECT TREATMENT OF SOFTWAR E EXPENSES, THE LD.REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ASSESSING OFFICER REJECTED THE PLEA OF THE ASSESSEE FOR REVENUE EXPEN DITURE FOLLOWING THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL IN TH E CASE OF AMWAY INDIA LTD. VS. DCIT, 111 ITD 112(SB)(DEL). IT WAS POINTED OUT TH AT THE SAID DECISION OF THE TRIBUNAL HAS SINCE BEEN PARTLY REVERSED BY THE HON' BLE DELHI HIGH COURT ALSO, WHICH SHOWS THAT THE ISSUE WAS DEBATABLE AND NO PEN ALTY UNDER SECTION 271(1)(C) OF THE ACT WAS LEVIABLE IN SUCH A SITUATI ON. 6. THE LD. DEPARTMENTAL REPRESENTATIVE HAS ASSAILED THE ORDER OF THE CIT(A) BY POINTING OUT THAT THE ALLOCATION OF EXPENSES BET WEEN ELIGIBLE AND NON- ELIGIBLE UNITS MADE BY THE ASSESSEE WAS NOT ACCEPTA BLE, WHICH HAS LED TO THE INCREASED PROFITS FROM THE ELIGIBLE UNITS AND THUS IT SHOWED AN INCORRECT CLAIM OF DEDUCTION UNDER SECTION 80 IB OF THE ACT. THUS, IT IS A CASE OF FURNISHING OF INACCURATE PARTICULARS OF INCOME WITHIN THE MEANING OF SECTION 271(1)(C) OF THE ACT. 7. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. QUITE CLEARLY, IN SO FAR AS THE QUANTIFICATION OF DEDUCTION UNDER SECTIO N 80 IB OF THE ACT IS 7 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) CONCERNED, THE DIFFERENCE BETWEEN ASSESSEE AND REVE NUE IS ON SAME FOOTING AS WAS IN ASSESSMENT YEAR 2005-06, WHICH WAS NOT FOUND AMENABLE TO LEVY OF PENALTY BY THE ASSESSING OFFICER AS IS EVIDENT FROM HIS ORDER DATED 5/3/2012, DROPPING THE PROCEEDINGS INITIATED FOR LE VY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT . A COPY OF THE SAID ORDER IS PLACED AT PAGE 169 OF THE PAPER BOOK FILED BEFORE US. ON THIS COUNT ITSELF, FOLLOWING THE RATIO OF THE JUDGMENT OF HON'BLE BOMBAY HIGH COURT IN THE CASE O F ORIENT PRESS LTD.(SUPRA), THE PENALTY IMPOSED BY THE ASSESSING O FFICER IN THIS YEAR DESERVES TO BE DELETED. EVEN OTHERWISE, IT IS NOTICED THAT FOR ASSESSMENT YEAR 2001-02, THE TRIBUNAL VIDE ORDER DATED 09/02/2011 HAS DELETE D THE PENALTY IMPOSED UNDER SIMILAR CIRCUMSTANCES, AND THUS THE IMPUGNED PENALTY HAS BEEN RIGHTLY DELETED BY THE CIT(A). 7.1 APART FROM THE AFORESAID, THE OTHER ISSUE ON WH ICH THE PENALTY WAS LEVIED BY THE ASSESSING OFFICER IS THE TREATMENT OF SOFTWARE EXPENSES. THE ASSESSEE TREATED SOFTWARE EXPENSES AS REVENUE IN NA TURE, WHEREAS THE ASSESSING OFFICER TREATED THE SAME AS CAPITAL EXPEN DITURE ON WHICH DEPRECIATION WAS ALLOWABLE. THE ASSESSEE POINTED O UT THAT THE ASSESSING OFFICER S BASED HIS DECISION ON THE JUDGMENT OF TH E SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF AMWAY INDIA LTD.(SUPRA). T HE LD.REPRESENTATIVE FOR THE ASSESSEE EXPLAINED THAT IT IS MERELY A DIFFERENCE O F OPINION, INASMUCH AS, THE DECISION OF THE SPECIAL BENCH HAS SINCE BEEN VARIE D BY THE HON'BLE DELHI HIGH COURT SUBSEQUENTLY. IN ANY CASE, IN OUR VIEW, THE DIFFERENCE IN TREATMENT OF SOFTWARE EXPENSES DOES NOT SUGGEST ANY CONCEALMENT OF INCOME AND RATHER, IT IS ONLY A DIFFERENCE OF OPINION, WHICH DOES NOT ATT RACT PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 8 ITA NO.759/MUM/2016 (ASSESSMENT YEAR 2002-03) 7.2 THE LD. DEPARTMENTAL REPRESENTATIVE HAS ARGUED THAT SCALING DOWN OF DEDUCTION TANTAMOUNT TO FURNISHING OF INACCURATE PA RTICULARS OF INCOME. IN THIS CONTEXT, IT IS NOTABLE THAT NONE OF THE PARTICULARS FILED BY THE ASSESSEE HAVE BEEN FOUND TO BE FALSE OR INACCURATE, AND THEREFORE , THE STAND OF THE LD. DEPARTMENTAL REPRESENTATIVE IS NOT TENABLE. WE MAY ALSO NOTE THAT THE CIT(A) HAS, INTER-ALIA, RELIED UPON THE JUDGMENT OF THE HO N'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD., 322 ITR 158 (SC) TO DELETE THE PENALTY. CONSIDERING THE FACTS AND CIRCUMSTANCES O F THE CASE, WE FIND NO ERROR ON THE PART OF THE CIT(A) IN RELYING ON THE DECISIO N OF THE HON'BLE SUPREME COURT IN THE CASE OF RELIANCE PETROPRODUCTS PVT. LT D.(SUPRA) FOR DELETING THE IMPUGNED PENALTY. 7.3 IN THE RESULT, APPEAL OF THE REVENUE IS DISMIS SED. ABOVE DECISION WAS PRONOUNCED IN THE OPE N COURT IN THE PRESENCE OF BOTH THE PARTIES AT THE CONCLUSION OF HEARING ON 31/05/2017. SD/- SD/- (RAVISH SOOD) (G.S.PANNU) JUDICIAL MEMBER ACCOCUNTANT MEMBER MUMBAI, DATED 31/05/2017 VM , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI