The Commissioner Of Income Tax v. M/S. Tata Teleservices Mah.ltd

((-1-)) HVN IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL (L) NO. 2458 OF 2006 The Commissioner of Income Tax ... Appellant Versus M/s. Tata Teleservices Mah.Ltd. .... Respondent Mr. A.D. Kango for the Appellant. Mr.Dinesh Vyas with Mr. Tripathi for Respondent. CORAM: F.I.REBELLO&R.S. MOHITE, JJ.DATED: JANUARY 15, 2008 CORAM: F.I. R.S. MOHITE, JJ. DATED: JANUARY 15, 2008 P.C. P.C. . The appeal has been preferred on the following question : "Whether on the facts and in the circumstances of the case and in law, was the Hon’ble Tribunal right in upholding the action of CIT(A) in cancelling the penalty levied by the Assessing Officer u/s. 271(1)(c), ignoring the fact that Assessee failed to withdraw its claim of deduction u/s. 35ABB, despite the fact that the deduction was not available in light of the amended provisions of section 35ABB, coming into force retrospectively w.e.f. 1.4.1996". ((-2-)) . The tribunal by its impugned order held as under : "We have duly considered the rival contentions. On perusal of the record, we find that along with computation of return assessee has duly disclosed the basis for claiming deduction u/s. 35 ABB. It has also disclosed that it is the first year of business and P&L Account has not been prepared. When the assessee filed its return old provisions was in operation according to which assessee is entitled to deduction u/s. 35ABB. The amendment in section 35ABB has been made subsequent to filing of the return which empower the A.O. to disallow the claim of assessee but as observed by the Hon’ble Supreme Court in the above authoritative pronouncement penalty could not be justified on the basis of retrospective application of law. We have to see the element of concealment on the date when the return was filed. On that date the amended provision was not in picture, it cannot be said that assessee has concealed the particulars of income or furnished inaccurate particulars. More so in the note extracted above everything has been duly disclosed by the assessee.Hence, ((-3-)) taking into consideration the over all circumstances we do not find any error in the order of ld. CIT(A). This appeal of the revenue is rejected." . The tribunal also relied on the judgment of the Supreme Court in CIT Vs. Hindustan Electrographites Ltd. 243 ITR 48. On the consideration of the law pertaining to retrospective amendment the court has observed as under : "When additional tax has the imprint of penalty the Revenue cannot say that levy of additional tax is automatic under section 143(1A) of the Act. If additional tax could be levied in such circumstances, it will be punishing the assessee for no fault of his. That cannot ever be the legislative intent...." . In the instant case, we are concerned with imposition of penalty. The ratio of the judgment of the Supreme Court in Hindustan Electro Graphites Ltd. (supra) squarely covers the facts of the present case. In the light of the above, question of law as raised would not arise. Consequently appeal dismissed. ((-4-)) (F.I.REBELLO, J.) (R.S. MOHITE, J.)(F.I.REBELLO, J.) (R.S. MOHITE, J.) (F.I.REBELLO, J.) (R.S. MOHITE, J.)