M/s. MS Shoes East Ltd., New Delhi V. DCIT, New Delhi

ITA 946/DEL/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6899 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 18-07-2016
• Assessment Year: 2001-2002
• Appeal Filed On: 15-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEEPIKA MITTAL
• Assessee Lawyers: SANJAY KAPOOR
• Keywords: Wrong claim; Bad and doubtful debts; Difference of opinion
• Section: 143(3); 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : E NEW DELHI BEFORE SH. H.S. SIDHU , JUDICIAL M EMBER AND SH. O.P. KANT , ACCOUNTANT MEMBER ITA NO. 946 /DEL/ 2013 ASSESSMENT YEAR: 2001 - 02 M/S. MS SHOES EAST LTD, 112 - A, EKTA ENCLAVE, NEW DELHI VS. DCIT , CIRCLE - 6(1), NEW DELHI PAN : AABCS5980M (APPELLANT) (RESPONDENT) APPELLANT BY SH. SANJAY KAPOOR, FCA RESPONDENT BY MS. DEEPIKA MITTAL, CIT(DR) DATE OF HEARING 18.07.2016 DATE OF PRONOUNCEMENT 20.09.2016 ORDER PER O.P. KANT , A. M. : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST ORDER DATED 21/01/2013 OF LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) FOR ASSESSMENT YEAR 2001 - 02, WHEREIN HE HAS SUSTAINED THE PENA LTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOME - TAX ACT , 1961 BY THE ASSES SING OFFICER. THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE ARE AS UNDER: I. THE PROVISIONS OF SECTION 271(1)(C) READ WITH SECTION 275 ARE NOT APPLICABLE AT ALL. II. THE CIT(APPEAL) HAS ERRED IN CONFIRMING THE PENALTY LE VIED BY THE A.O. 2 ITA NO. 946/DEL/2013 AY: 2001 - 02 III. THE ASSESSEE HAS NEITHER CONCEALED NOR FILED INACCURATE PARTICULARS OF ITS INCOME, THUS THE PROVISIONS OF SECTION 271(1)(C) ARE NOT APPLICABLE AT ALL. IV. BONAFIDE CLAIM MADE, DISALLOWED IN ASSESSMENT PROCEEDING DOES NOT ATTRACT PENALTY AT ALL. V. THE ASSESSEE LOSS BEING HIGHER THAN THE RETURNED LOSS THERE IS NO CONCEALMENT OF INCOME THUS LEVY OF PENALTY IS WRONG. VI. THE COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN HOLDING THAT THE APPELLANT HAD INFLATED THE INTEREST LIABILITY. VII. THE COMMISSIONER OF INCOME TAX COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN HOLDING THAT APPELLANT SOUGHT TO EVADE TAX BY MAKING WRONG CLAIMS. VIII. THE AFORESAID GROUNDS OF APPEAL ARE INDEPENDENT AND WITHOUT PREJUDICE TO ONE ANOTHER. THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER, OR VARY ANY OF THE AFORESAID GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. 2. THE F ACTS IN BRIEF ARE THAT THE ASSESSEE FILED RETURN OF INCOME ON 29/10/2001 DECLARING TOTAL LOSS OF RS. 1,02, 604/ - . THE CASE WAS SELECTED FOR SCRUTINY AND THE ASSESSMENT W A S COMPLETED UNDER SECTION 143(3) OF THE INCOME TAX - A CT, 1961 (IN SHORT THE ACT ) ON 30/01/2004 AT TOTAL LOSS OF RS. 23,59,37,001/ - . IN THE ASSESSMENT, THE ASSESSING OFFICER MADE ADDITION/DISALLOWANCES ON ACCOUNT OF CLAIM OF INTEREST TO THE BANK OF RS.19,71, 8 6, 237/ - , LOSS ON MACHINERY OF RS. 3,29,27,354/ - , BAD DEBTS OF RS. 6,20,000 / - DISAL LOWANCE UNDER SECTION 28 OF RS. 1,22,67,221 / - AND LOSS OF STOCK AND MACHINERY RS. 14,35,85,117/ - . FURTHER , THE ASSESSING OFFICER NOTED THAT, AT THE TIME OF FILING OF RETURN , THE ASSESSEE WRITTEN BACK INTEREST OF RS.78,17,48, 715/ - AS INCOME UNDER SECTION 41(1) OF THE ACT. THE ASSESSEE REQUESTED THAT THIS INCOME 3 ITA NO. 946/DEL/2013 AY: 2001 - 02 SHOULD BE EXCLUDED AS REMISSION IS TAXABLE ONLY , IF THE ALLOWANCE OR DEDUCTION IN RESPECT OF SUCH AMOUNT WAS ALLOWED IN EARLIER YEAR S . SINC E THE ASSESSEE WAS NOT ALLOWED DEDUCTION OF INTEREST , NO PROFIT WAS TAXABLE UNDER SECTION 41(1) OF THE ACT. AFTER CONSIDERING THE FACTS OF THE CASE FOR THE YEAR UNDER CONSIDERATION, THE ASSESSING OFFICER HELD THAT RS.60,66, 68,263/ - CANNOT BE CONSIDERED AS INCOME UNDER SECTION 41 (1) O F THE ACT AND ACCORDINGLY TO THAT EXTENT THE LOSS OF THE ASSESSEE WAS ENHANCED. IN VIEW OF THE FACTS, THOUGH THE ASSESSING OFFICER MADE ADDITION S/DISALLOWANCES, THE WITHDRAWAL OF THE INCOME OFFERED UNDER SECTION 41(1) OF THE ACT AT THE TIME OF FILING RETURN , RESULTED IN ENHANCEMENT OF THE LOSS, AS COMPARED TO THE RETURNED LOSS. T HE CASE REACHED TO THE TRIBUNAL FOR ADJUDICATION . T HE TRIBUNAL SET ASIDE THE ORDERS OF THE LOWER AUTHORITIES AND DIRECTED THE ASSESSING OFFICER TO RE - ASSE SS THE INCOME . IN THE RE - ASSESSMENT ORDER , THE ASSESSING OFFICER RETAINED THE ADDITION ALREADY MADE BY THE EARLIER ASSESSING OFFICER AND MADE FURTHER ADDITION OF RS. 1,02,85,876/ - AND INITIATED PENALTY P ROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT. BEFORE THE ASSESSING OFFICER, THE ASSESSEE PLEADED THAT ASSESSED LOSS WAS HIGHER THAN THE LOSS AS RETURN ED, THUS , IT WAS EVIDENT THAT ASSESSEE COMPANY DID NOT MAKE ANY ATTEMPT TO EVADE TAX , WHICH IS A PREREQUISITE F OR LEVY OF PENALTY UNDER 271(1)(C) OF THE ACT. FURTHER , THE ASSESSEE SUBMITTED TH AT PENALTY UNDER SECTION 271(1)(C) IS LEVIABLE ONLY IF THE ASSESSEE HAS SOUGHT TO EVADE TAX BY FILING INACCURATE PARTICULARS OF INCOME OR CONCEALED THE INCOME AND IN THE FACTS 4 ITA NO. 946/DEL/2013 AY: 2001 - 02 AND CIRCUMSTANCES OF THE ASSESSEE , NO PE NALTY WAS LEVIABLE. IN VIEW OF THE ASSESSING OFFICER, THE ASSESSEE FURNISHED INACCURATE PARTICULARS OF INCOME AS IT FAILED TO OFFER A CORRECT EXPLANATION IN RESPECT OF FACTS MATERIAL TO THE COMPUTAT ION OF TOTAL TAXABLE INCOME AND, THEREFORE , HE LEVI ED PENA LTY UNDER SECTION 271(1)(C) OF THE ACT ON 30/06/2010 AT A N AMOUNT SLIGHTLY HIGHER THAN THE AMOUNT OF THE TAX SOUGHT TO BE EVADED , WHICH WAS COMPUTED AT RS. 15, 69,63,000/ - . BEFORE THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS) , THE ASSESSEE PLEADED THAT A LL THE FACTS IN RESPECT OF DISALLOWANCE/ADDITION WERE DULY DISCLOSED IN THE RETURN OF INCOME OR THE FINANCIAL STATEMENT APPENDED TO THE RETURN OF INCOME AND ADDITIONS HAVE BEEN MADE DUE TO DIFFERENCE OF OPINION OR ESTIMATE BASIS. THE ASSESSEE ALSO PLEADED THAT THE TAX SOUGHT TO BE EVADED AS PER EXPLANATION (IV) OF SECTION 271(1)(C) OF THE ACT WOULD BE THE DIFFERENCE BETWEEN THE TAX DUE ON INCOME ASSESSED AND THAT THE TAX THAT WOULD HAVE BEEN CHARGEABLE AT SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF CONC EALED INCOME AND THUS THE PENALTY IS LEVIED ON THE BASIS OF TAX ON THE DIFFERENCE BETWEEN THE INCOME ASSESSED AND INCOME RETURNED. THE LEARNED COMMISSIONER OF INCOME - TAX ( APPEALS), HOWEVER , DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND UPHELD THE PENALTY LEVIED BY T HE ASSESSING OFFICER. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE GROUNDS AS REPRODUCED ABOVE. 3. THE LEARNED COUNSEL OF THE ASSESSEE FILED PAPER BO OK CONTAINING PAGES 1 TO 127 AND SUBMITTED THAT AS A GAINST THE 5 ITA NO. 946/DEL/2013 AY: 2001 - 02 RETURNED LOSS OF RS.1,02, 604/ - , THE INCOME WAS FINALLY ASSESSED AT A LOS S OF RS.22,56,51, 125/ - IN THE ASSESSM ENT ORDER UNDER SECTION 254/143 (3) OF THE ACT DATED 24/12/2009 AND THUS THE ASSESSED LOSS BEING HIGHER THAN THE RETURNED LOSS, THERE WAS NO TAX SOUGHT TO BE EVAD ED BY THE ASSESSEE IN TERMS OF EXPLANATION - IV TO SE CTION 271(1)(C) OF THE ACT AND HENCE NO PENALTY UNDER SECTION 271(1) (C) OF THE ACT WAS LEVIABLE IN THE CASE OF THE ASSESSEE. FUR THER , THE LEARNED COUNSEL SUBMITTED THAT ASSESSEE HAS DISCLOSED ALL THE MATERIAL FACTS IN THE RETURN OF INCOME IN RESPECT OF THE ISSUE ON WHICH ADDITIONS/DISALLOWANCES HAVE BEEN MADE BY THE ASSESSING OFFICER AND THE EXPLANATION FURNISHED BY THE ASSESSEE HA S NOT BEEN FOUND FALSE. HE FURTHER SUBMITTED THAT EXPLANATION FURNISHED IS BONAFIDE. THE LEARNED COUNSEL ALSO SUBMITTED THE CIRCU MSTANCES UNDER WHICH RETUR N OF INCOME WAS FILED. IN VIEW OF ABOVE FACTS, THE LEARNED COUNSEL REQUESTED THAT THE PENALTY LEVIED MIGHT BE DELETED. 4. THE LEARNED SENIOR DEPARTMENTAL R EPRESENTATIVE, ON THE OTHER HAND, RELIED ON THE FINDINGS OF THE LOWER AUTHORITIES. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD INCLUDING THE ORDER OF THE LOWER AUTHORITIES . FROM THE ORDERS OF THE LOWER AUTHORITIES, WE FIND THAT THE ASSESSEE FILED RETURN OF INCOME DECLARING LOSS, HOWEVER , THE ASSESSING OFFICER MADE CE RTAIN ADDITIONS/ DISALLOWANCE S TO THE RETURNED LOSS AND SIMULTANEOUSLY ALSO WITH DRAWN THE INCOME OFFERED B Y THE ASSESSEE UNDER SECTION 41 (1) OF THE ACT . THE ASSESSING OFFICER LEVIED PENALTY IN RESPECT OF 6 ITA NO. 946/DEL/2013 AY: 2001 - 02 ADDITIONS/DISALLOWANCES MADE IN THE ASSESSMENT ORDE R . THE ASSESSING OFFICER HAS MADE FOLLOWING ADDITIONS/DISALLOWANCES: 1. I NTEREST DUE TO BANK RS. 19,71,86 , 237 / - 2. INTEREST DISALLOWANCE S ON LOAN FROM IAFBF RS. 36,00,000/ - 3. LOSS ON MACHINERY RS. 3,29,27, 354/ - 4. BAD DEBTS RS. 6,20, 000 / - 5. LOSS OF A STOCK AND MACHINERY R S. 14,35,85, 117/ - 6. EXPENSES DISALLOWED ESTIMATES BASIS RS. 1,02,85, 876/ - 6. PENALTY IN RESPECT OF EXPENSES OF RS.1,02,85,876/ - DISALLOWED ON ESTIMATE BASIS WAS DELETED BY THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS), HENCE , THE ASSESSEE IS IN APPEAL BEFORE US IN RESPECT OF THE PENALTY LEVIED ON BALANCE ADDITIONS/DISALLOWANCES. 7. IN RESPECT OF ADDITION OF RS.19,71,86, 237/ - TOWARDS INTEREST DUE TO BANKS, W E F I N D T H A T THE ASSESSEE C LAIMED INTEREST EXPENSES OF RS.25,48,90, 292/ - AS THE INTE REST C LAIMED BY THE BANKS BEFORE THE DEBT R ECOVERY TRIBUNAL , HOWEVER , THE ASSESSING OFFICER ALLOWED INTEREST OF RS.5,76,30, 452/ - CALCULATED ON THE SIMPLE INTEREST BASIS. THE DISPUTE BETWEEN THE AUTHORITIES AND THE ASSESSEE IS WHETHER THE QUANTIFICATION OF THE INTEREST LIABILITY TOOK PLACE DURING THE YEA R OR NOT, BUT THE ASSESSEE MADE ENTIRE DISCLOSURE IN RESPECT OF ITS CLAIM OF EXPENDITURE AND NO FALSE OR INCORRECT PARTICULARS HAVE BEEN FILED BY THE ASSESSEE. THE ASSESSEE HAS ALSO FILED EXPLANATION FOR THE CLAIM MADE BY IT AND WHICH IS NOT A MALAFIDE . SIMILARLY, THE ASSESSEE FURNISHED ALL PARTICULARS IN RESPECT OF CLAIM OF INTEREST OF RS. 36 LA CS RELATED TO LOAN OF R S . 2 CRORES FROM THE INDIAN AIR FORCE BENEVOLENT F UND ( I A F B F ) , HOWEVER , THE INTEREST WAS 7 ITA NO. 946/DEL/2013 AY: 2001 - 02 DISALLOWED D UE TO DISPUTE OF THE QUANTIFICATION OF THE AMOUNT IN THE YEAR. IN RESPECT OF THE CLAIM OF LOSS ON THE SALE OF THE FACTORY SHADE OF RS.3,29,27,354/ - , W E F I N D T H A T IT WAS DULY DISCLOSED AN D APPROPRIATE NOTE WAS GIVEN TO THE NOTES TO THE ACCOUNT TO BALANCE SHEET [ NOTE 16 PARA (A) TO (D) ] . SIMILARLY , AS REGARD TO THE LOSS OF RS.14, 35,85,117 / - ON ACCOUNT OF STOCK AND MACHINERY, THE ASSESSEE PROVIDED COMPLETE DISCLOSURE IN THE NOTES TO ACCOUNT TO THE BALANCE SHEET (S CHEDULES 16 - NOTE NO. 6) AND ON THE BASIS OF THE DETAILS/ EXPLANATIONS PROVIDED DURING ASSESSMENT PROCEEDING, THE ASSESSING OFFICER MADE DISALLOWANCE. THE ASSESSING OFFICER HAS NOT UNEARTHED ANY NEW FACT FROM HIS INDEPENDENT SOURCES WHICH COULD LEAD TO FURNISHING OF INACCURATE PARTICULARS BY THE ASSESSEE. SIMILAR LY , ALL DETAILS OF BAD DEBT OF RS.6, 20,000/ - WERE AVAILABLE ON THE RECORD. FURTHER, IT IS EVIDENT FROM THE FACT OF THE CASE MENTIONED IN THE SUBMISSIONS BEFORE THE ASSESSING OFFICER IN PROCEEDINGS UNDER SECTION 254/143 (3) OF THE ACT THAT DURING THE PERIO D THE DIRECTOR OF THE COMPANY WAS UNDER ARREST AND THE COMPANY DID NOT HAVE ANY QUALIFIED PERSONS TO COMPILE THE RETURN AS PER LAW AND , THEREFORE, EVEN THE INTEREST WRITTEN BACK CREDITED TO THE PROFIT AND LOSS ACCOUNT WAS NOT WITHDRAWN IN SPITE OF THE CLEA R MANDATE OF SECTION 41 (1) OF THE ACT THAT SUCH WRITTEN BACK WAS NOT TAXABLE. WE FIND THAT THE ASSESSEE HAS DISCLOSED ALL FACTS REGARDING INTEREST AND OTHER CLAIMS IN THE AUDITED ACCOUNTS AND COMPLETE DISCLOSURE WAS MADE IN NOTES TO ACCOUNTS AND FULL EXPL ANATION WAS FURNISHED DURING THE 8 ITA NO. 946/DEL/2013 AY: 2001 - 02 ASSESSMENT PROCEEDINGS AND THE EXPLANATION FURNISHED ARE FOUND TO BE BONAFIDE. 8. WE FIND THAT IN THE CASE OF COMMISSIONER OF INCOME T AX, AHMEDABAD VS. R ELIANCE PETROPRODUCTS (P) LTD , 322 ITR 158 (SC), APEX C OURT HAS HEL D THAT WHEN THE DETAIL SUPPLIED B Y ASSESSEE ARE NOT FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE THERE WERE NO QUESTION OF INVITI NG PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THE RELEVANT FINDING S OF THE HON BLE SUPREME COURT ARE REPRODUCED AS UNDER: 9. WE ARE NOT CONCERNED IN THE PRESENT CASE WITH THE MENS REA. HOWEVER, WE HAVE TO ONLY SEE AS TO WHETHER IN THIS CASE, AS A MATTER OF FACT, THE ASSESSEE HAS GIVEN INACCURATE PARTICULARS. IN WEBSTER'S DICTIONARY, THE WORD 'INACCURATE' HAS BEEN DEFINED AS: - ' NOT ACCURATE, NOT EXACT OR CORRECT; NOT ACCORDING TO TRUTH; ERRONEOUS; AS AN INACCURATE STATEMENT, COPY OR TRANSCRIPT'. WE HAVE ALREADY SEEN THE MEANING OF THE WORD 'PARTICULARS' IN THE EARLIER PART OF THIS JUDGMENT. READING THE WORDS IN CONJUNCTION, THEY MUST MEAN THE DETAILS SUPPLIED IN THE RETURN, WHICH ARE NOT ACCURATE, NOT EXACT OR CORRECT, NOT ACCORDING TO TRUTH OR ERRONEOUS. WE MUST HASTEN TO ADD HERE THAT IN THIS CASE, THERE IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN WERE FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE. SUCH NOT BEING THE CASE, THERE WOULD BE NO QUESTION OF INVITING THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT. A 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. 10. IT WAS TRIED TO BE SUGGESTED THAT SECTION 14A OF THE ACT SPECIFICALLY EXCLUDED THE DEDUCTIONS IN RESPECT OF THE EXPENDITURE INCURRED BY THE ASSESSEE IN RELATION TO INCOME WHICH DOES NOT FORM PART OF THE TOTAL INCOME UNDER THE ACT. 9 ITA NO. 946/DEL/2013 AY: 2001 - 02 IT WAS FURTHER POINTED OUT TH AT THE DIVIDENDS FROM THE SHARES DID NOT FORM THE PART OF THE TOTAL INCOME. IT WAS, THEREFORE, REITERATED BEFORE US THAT THE ASSESSING OFFICER HAD CORRECTLY REACHED THE CONCLUSION THAT SINCE THE ASSESSEE HAD CLAIMED EXCESSIVE DEDUCTIONS KNOWING THAT THEY A RE INCORRECT; IT AMOUNTED TO CONCEALMENT OF INCOME. IT WAS TRIED TO BE ARGUED THAT THE FALSEHOOD IN ACCOUNTS CAN TAKE EITHER OF THE TWO FORMS; (I) AN ITEM OF RECEIPT MAY BE SUPPRESSED FRAUDULENTLY; (II) AN ITEM OF EXPENDITURE MAY BE FALSELY (OR IN AN EXAGG ERATED AMOUNT) CLAIMED, AND BOTH TYPES ATTEMPT TO REDUCE THE TAXABLE INCOME AND, THEREFORE, BOTH TYPES AMOUNT TO CONCEALMENT OF PARTICULARS OF ONE'S INCOME AS WELL AS FURNISHING OF INACCURATE PARTICULARS OF INCOME. WE DO NOT AGREE, AS THE ASSESSEE HAD FURN ISHED ALL THE DETAILS OF ITS EXPENDITURE AS WELL AS INCOME IN ITS RETURN, WHICH DETAILS, IN THEMSELVES, WERE NOT FOUND TO BE INACCURATE NOR COULD BE VIEWED AS THE CONCEALMENT OF INCOME ON ITS PART. IT WAS UP TO THE AUTHORITIES TO ACCEPT ITS CLAIM IN THE RE TURN OR NOT. MERELY BECAUSE THE ASSESSEE HAD CLAIMED THE EXPENDITURE, WHICH CLAIM WAS NOT ACCEPTED OR WAS NOT ACCEPTABLE TO THE REVENUE, THAT BY ITSELF WOULD NOT, IN OUR OPINION, ATTRACT THE PENALTY UNDER SECTION 271(1)(C) . IF WE ACCEPT THE CONTENTION OF THE REVENUE THEN IN CASE OF EVERY RETURN WHERE THE CLAIM MADE IS NOT ACCEPTED BY ASSESSING OFFICER FOR ANY REASON, THE ASSESSEE WILL INVITE PENALTY UNDER S ECTION 271(1)(C) . THAT IS CLEARLY NOT THE INTENDMENT OF THE LEGISLATURE. 9. T HUS , THE HON BLE SUPREME COURT HAS HELD THAT WHERE THE ASSESSEE HAS FURNISHED ALL THE DETAILS OF ITS EXPENDITURE AS WELL AS INCOME IN ITS RETURN , WHICH IN THEMSELVES WERE NOT FOUND TO BE INACCURATE , NOR COULD BE VIEWED AS CONCEALMENT OF INCOME ON ITS PART AND MERELY BECAUSE THE ASSESSEE HAD CLAIMED THE EXPENDITURE, WHIC H HAS NOT BEEN ACCEPTED BY THE R EVENUE CANNOT LEAD TO LEVY OF PENALTY UNDER SECTION 271(1) (C) OF THE ACT. 10 ITA NO. 946/DEL/2013 AY: 2001 - 02 10. IN VIEW OF OUR DISCUSSION A B O V E , RESPECTFULLY FOLLOWING THE DEC ISION IN THE CASE OF RELIANCE PETROPRODUCTS PRIVATE L IMITED (SUPRA) , WE HOLD THAT NO PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS LEVIABLE IN RESPECT OF ADDITIONS/ DISALLOWANCES MADE IN THE CASE OF THE ASSESSEE, ACCORDINGLY , WE DELETE THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. 11. SINCE WE HAVE ALREADY HELD THAT THERE WAS NO CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME IN THE CASE OF THE ASSESSEE, THE OTHER GR OUND WHETHER THE TAX SOUGHT TO BE EVADED WAS NIL IN THE CASE OF THE ASSESSEE IS RENDERED ONLY ACADEMIC AND , THEREFORE , THE SAME IS NOT REQUIRED TO BE ADJUDICATED UPON. 12. IN THE RESULT , THE APPEAL OF THE ASSESSEE IS ALLOWED. THE DECISION IS PRONOUNCED I N THE OPEN COURT ON 2 0 T H SEPTEMBER , 2016 . S D / - S D / - ( H.S. SIDHU ) ( O.P. KANT ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 2 0 T H SEPTEMBER , 2016 . LAPTOP / - COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI