The Commissioner Of Income Tax v. M/S Shahabad Co-Op Sugar Mills Ltd

ITA No. 519 of 2010 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH ITA No. 519 of 2010Date of Decision: 9.11.2010 The Commissioner of Income Tax Versus M/s Shahabad Co-op Sugar Mills Ltd. ....Appellant. ...Respondent. CORAM:-HON'BLE MR. JUSTICE ADARSH KUMAR GOEL.HON'BLE MR. JUSTICE AJAY KUMAR MITTAL. PRESENT: Mr. Yogesh Putney, Advocate for the appellant. ADARSH KUMAR GOEL, J. 1.This appeal has been preferred by the revenue underSection 260A of the Income Tax Act, 1961 against the order of theIncome Tax Appellate Tribunal, Chandigarh Bench “B” in ITA No.32/Chandi/2009 dated 9.9.2009 for the assessment year 2002-03,proposing to raise following substantial question of law:- “Whether on the facts and in the circumstances ofthe case the Ld. ITAT is right in law in deleting thepenalty imposed upon the assessee u/s 271(1)(c) ofthe Income Tax Act on account of admitted wrongclaim of depreciation against the law laid down by theHon'ble Apex Court in the case of Union of India andothers vs. Dharmendra Textiles Processors andothers 306 ITR 277 (SC)?” 2.The assessee is a Cooperative Sugar Mill and in its returnmade a claim for depreciation which was found to be inadmissible.Apart from disallowing the said claim penalty was also imposed whichwas set aside on appeal. The Tribunal upheld the order of the CIT(A)with the following observation:- “Firstly, it is to be appreciated that there is noallegation on the assessee of not disclosing thecomplete particulars. In fact, the return of income ofthe assessee was accompanied by a schedule offixed assets which inter-alia showed additions madeprior to 30.09.2001 and post 30.09.2001. Moreover,the Account Books of the assessee have beensubject to tax audit u/s 44AB of the Act by a firm ofChartered Accountants, a copy of which has beenplaced on record. Even in such statement, thedepreciation claim has been calculated by applyingthe normal rate of depreciation on the entireadditions. Secondly, having regard to the fact thatthe respondent assessee is a Co-operative SugarMills which is manned by public officers, thebonafides of the same are prima-facie not in doubt.Further, the difference in the claim has arisen onaccount of a mere wrong application of depreciationrate. It is not a case where such mistake has beenfound after a long drawn investigation or enquiry soas to establish that any concealed income has been unearthed. The mistake was discovered during theassessment proceeding and the assessee filed acorrected claim in the assessment proceeding.Under these circumstances, we therefore aresatisfied that it was a mere mistake committed by theassessee while filing return of income and the entirefacts had been duly disclosed by the assesseebonafidely. Thus, there cannot be a scope foralleging any concealment or furnishing of inaccurateparticulars of income against the assessee within themeaning of Section 271(1)(c) of the Act.” 3.We have heard learned counsel for the appellant. 4.In view of finding of the Tribunal which is not shown to beperverse in any manner, no substantial question of law arises.5.The appeal is accordingly dismissed.perverse in any manner, no substantial question of law arises.5.The appeal is accordingly dismissed. (ADARSH KUMAR GOEL) JUDGE November 9, 2010gbs (AJAY KUMAR MITTAL)JUDGE