The Tax Publishers2016 TaxPub(DT) 1368 (Asr-Trib)

 


 

Shri Pawan Kumar Katia Prop. M/s. Laxmi Oil Mills v. ITO

 

INCOME TAX ACT, 1961

--Penalty under section 271(1)(c)--ConcealmentAdjustment of business loss against rental income--Assessee claimed various expenses on account of business, though no business of cold storage was carried out during the years. AO was of view that assessee had adjusted his business loss against rental income with a view to reduce its tax liability. Claim was disallowed and also penalties were levied. CIT(A) confirmed the same. Held: CIT(A) while confirming levy of penalties failed to take into consideration that in order to maintain business premises, even when no business was being transacted, expenses were necessarily required to be incurred. There was no finding of either of the authorities below, that any expenditure claimed by assessees was not required to be incurred for maintaining business premises. It was not the case of department that these expenses were not incurred or that assessee's claim was false. Levy of penalties confirmed by CIT(A) were set aside and cancelled.

Income Tax Act, 1961, Section 271(1)(c)

Relied:Price Waterhouse Coopers Pvt. Ltd. v. CIT 348 ITR 306 (SC), CIT v. Reliance Petroproducts (P) Ltd. 322 ITR 158 (SC), ACIT v. Torque Pharmaceuticals (P) Ltd. 173 TTJ 96 (Chd-Trib), CIT v. Usha Marketing (P) Ltd.', 332 ITR 334 (Del), CIT v. Inden Bislers 240 ITR 943 (Mad), Holy Shrine Hotesl (Pvt.) Ltd. v. Dy. CIT order dated 14-12-2015 and ITA Nos. 274 to 276(Asr)/2015.

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