The Commissioner Of Income Tax-6 v. M/S. Glaxo Smithkline Pharmaceuticals Ltd

ASN IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL (L) NO.1642OF 2012 The Commissioner of Income Tax-6. ..Appellant. v. M/s. Glaxo Smithkline Pharmaceuticals Ltd...Respondent. Mr. Suresh Kumar for the Appellant. Mr. P.J. Pardiwala, Senior Advocate i/by S.H. Merchant for the Respondent. CORAM : J.P. DEVADHAR AND M.S. SANKLECHA, JJ. DATE : 4[th] February, 2013. PC: In this appeal by the revenue for assessment year 1995-1996 the basic issue raised by the revenue is Whether the Tribunal was justified in deleting the penalty under Section 271(1)(C) of the Income Tax Act on the ground that prior to the amendment to Section 43(6)(c) of the Act in A.Y.2000-01 the issue whether depreciation can be allowed in respect of block of assets including the assets transferred on account of Slump sale was a debatable issue? 2)The Tribunal in the impugned order has held that till the assessment year 2001-02 when amendment was made to Section 43(6)(c) of the Income Tax Act there was no clear provision in respect of depreciation claimed on the block of assets transferred in a slump sale. The Tribunal was of the view that issue in the 1995-96 was a debatable issue and thus no penalty is imposable. Moreover, the Tribunal relied upon the decision of the Apex Court in the matter of Reliance Petro Products Pvt. Ltd. 329 ITR 158 (S.C.) wherein it has been held that merely because claim was disallowed the penalty would not be justified if the claim was otherwise bonafide. 3)In view of the fact that issue was debatable prior to the amendment in assessment year 2000-01 and the finding of the CIT(A) that a note had been made in the return of income that depreciation has been claimed in the block of assets even in respect of the assets forming part of slump sale. Thus, establishing that there was a complete disclosure. The view of the Tribunal that no penalty is imposable is a reasonable view. In view of the above, we see no reason to entertain the present appeal. ASN 4)The appeal is, accordingly, dismissed with no order as to costs. (M.S.SANKLECHA, J.) (J.P. DEVADHAR, J.)