Commissioner Of Income Tax, Central – I, Mumbai v. M/S.jyothi Laboratories Private Limited

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.3095 OF 2009 Commissioner of Income Tax, Central – I, Mumbai ..Appellant. Versus M/s.Jyothi Laboratories Private Limited..Respondent. Mr.Suresh Kumar for the appellant.Mr.S.M. Shah for the respondent. CORAM : J.P. Devadhar &K.K. Tated, JJ. P.C. : DATE : 13th September 2011 1.Whether the Income Tax Appellate Tribunal was justified in deleting the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 is the question raised in this appeal. 2.The Income Tax Appellate Tribunal in para 7.1 of its order has recorded a finding of fact that the assessee claimed deduction bona fide under Section 37(1) as a revenue expenditure, instead of claiming it as capital expenditure under Section 35D of the Income Tax Act, 1961. The Income Tax Appellate Tribunal has further recorded a finding of fact that the assessing officer has nowhere recorded that the expenditure claimed by the assessee was not bona fide or not genuine. Making wrong claim of deduction under a bona fide belief cannot be a ground to hold that the assessee is guilty of furnishing inaccurate particulars or concealing particulars of income. In these circumstances, deletion of penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 by the Income Tax Appellate Tribunal cannot be faulted. 3.The appeal is accordingly dismissed with no order as to costs. (K.K. Tated, J.) (J.P. Devadhar, J.)