INCOME TAX ACT, 1961

--Penalty under section 271(1)©--ConcealmentDeduction for depreciation not allowed--The assessee was a company and in the return of income filed for the assessment year in question it had claimed depreciation on building, which was being used by the partnership firm in which the assessee was a partner. In the quantum proceedings it has been held that the assessee was not entitled to depreciation on the building as the same was being used by the partnership firm and not by the assessee-company. The aforesaid addition/disallowance made by the AO had been confirmed by the High Court. Along with the return of income, the assessee had filed a table disclosing income from business. On the basis of legal advice the company had claimed depreciation on Land and Building etc. by the company as owner, to the firm for its used in terms of Partnership Deed. The contention of the assessee was that under section 28(v) of the Act, salary, bonus, commission or remuneration received from the partnership firm were to be assessed under the head income from business”. In the present case the assessee had received interest income, which was assessed under section 28(v) of the Act. The assessee, accordingly, believed that it was entitled to depreciation on the building, which was being used by the partnership firm. AO, however levied penalty for concealment. Held: The claim made by the assessee may have been rejected, but it cannot be said that the same was not plausible or legally tenable. The claim made was bona fide. Assessees do take legal opinion and in the present case the return of income was duly audited. Claim for depreciation is a technical claim based on interpretation of legal provision. Legal opinion, in such cases, is frequently given by Chartered Accountants to help the company to prepare its return of taxable income. In the present case, there is no allegation that the quantum of depreciation claim was incorrectly computed. The note filed with return itself indicated that it was written by a professional. Divergent legal views on legal interpretation of a statute can take place, but it is not necessary that there should be uniformity or consensus of opinion on the aspects of law. Assessee cannot be faulted and penalty should not be imposed because the assessee had taken a particular stand point, unless there are grounds or reasons to show that the assessee had not disclosed all the facts before the departmental authorities concerned.