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TAXAP/2489/2009 4/ 4 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
TAX
APPEAL No. 2489 of
2009
=========================================================
COMMISSIONER
OF INCOME TAX-I - Appellant(s)
Versus
CADILA
PHARMACEUTICALS LTD - Opponent(s)
=========================================================
Appearance
:
MR
MANISH BHATT, MRS MAUNA M BHATT
for
Appellant(s) : 1,
None for Opponent(s) :
1,
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE AKIL KURESHI
and
HONOURABLE
MS JUSTICE SONIA GOKANI
Date
: 29/03/2011
ORAL
ORDER
(Per
: HONOURABLE MS JUSTICE SONIA GOKANI)
1. The
revenue in this Tax Appeal has challenged the order of the ITAT,
dated 05.06.2009, whereby it upheld the order of the CIT Appeals of
deleting the penalty imposed on the respondent, assessee, seeking to
raise following questions of law:
” Whether the
Appellate Tribunal is right in law and on facts in confirming the
order passed by CIT(A) in canceling the penalty of Rs.69,30,004/-
levied under section 271(1)(c) of the I.T. Act?”
2. The
assessment, in the case of the assessee, was finalized. Thereafter,
certain additions were made by the Assessing Officer, and therefore,
he had levied penalty under Section-271(1)(c) to the tune of
Rs.69,30,004/-. Being aggrieved by the same, the assessee carried the
same before the CIT Appeals, which with its detail reasonings had
sought to delete the entire penalty. This was, further, carried in
appeal before the Appellate Tribunal, which dismissed the appeal of
the revenue stating that there was no material to show that the claim
for deduction / disallowance were not genuine.
3. We
have heard, learned Counsel, Mr. Manish Bhatt, for the department,
who has forcefully argued as to how the order of both the CIT Appeals
and that of the Appellate Tribunal are erroneous in deleting the
order of penalty, passed by the Assessing Officer. We have carefully
examined the facts and papers presented before us as well as the
submissions made by the learned Counsel and attempted to scrutinize,
as to whether the order passed under Section-271(1)(c) of the Act is
sustainable or is bad in law and whether rightly set aside?
4. The
order of CIT Appeals is essentially based on the facts and the
relevant discussion with regard to the imposition of the penalty
revolves around the fact that some of the disallowances made by the
Assessing Officer, which could not be crystallized during the year
could not be made basis for levying the penalty. CIT Appeals was
also guided by the fact that the assessee had fully disclosed the
facts even with regard to the claim of weightage deduction under
Section-35(2AB), on the basis of certificate of C.A.. The
disallowance was only because the Government had held that the amount
was not related to the in-house research. The assessee, on his own
volition, had filed the revised return, but, all the requisite
details were furnished at the time of the filing of the return, and
therefore, it had, in terms, held that this was not the case of
furnishing inaccurate particulars or having made the false claims.
The Appellate Tribunal, of course, was concerned with levying of
penalty of Rs.69,30,004/- and elaborately dealt with the facts of the
case of the assessee. The Tribunal was also guided by the fact that
at the time of filing of the return on 31.10.2001, the assessee could
not have visualized that the claim for exemption under
Section-35(2AB) of Income Tax Act would not be approved for
deduction, as the same was received on 02.01.2004. It was also in
view of the fact that the assessee had also filed its return for the
year 2001, itself, with the note appended that the approval of the
Government is still awaited. When no material having been brought on
record by the revenue that the explanation of the assessee was not
bona fide or false or that the expenditure claimed were bogus
in any manner, the Tribunal has rightly held that the same does not
justify the imposition of penalty. In absence of any material to
show that the assessee gave any fraudulent explanation or there was
absence of bona fide conduct, on the part of the assessee. We
are in broad agreement with the reasonings set out in the order of
the Tribunal and there is no reason at least to interfere with the
concurrent findings of both the authorities with no question of law
arising before this Court, this appeals deserves to be dismissed and
is DISMISSED, accordingly.
(AKIL
KURESHI,J.)
(Ms.
SONIA GOKANI,J.)
Umesh/
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