BCD Travels India Pvt. Ltd. v. Dy. CIT, Range 9(2)(1), (Earlier Addl. CIT-8(1)), Mumbai
[Citation -2019-LL-0905-80]

Citation 2019-LL-0905-80
Appellant Name BCD Travels India Pvt. Ltd.
Respondent Name Dy. CIT, Range 9(2)(1), (Earlier Addl. CIT-8(1)), Mumbai
Court ITAT-Mumbai
Relevant Act Income-tax
Date of Order 05/09/2019
Assessment Year 2009-10
Judgment View Judgment
Keyword Tags levy of penalty • claim of deduction • disallowance of deduction • allocation of expenses • commission expenses • genuineness of expense • concealment of income • furnishing inaccurate particulars of income
Bot Summary: The A.O. relied upon the decision of the Hon'ble Apex Court in the case of Union of India v. Dharamendra Textile Processors, 2008 306 ITR 277. He rejected the assessee s reliance upon the decision of Hon'ble Apex Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd., 11 SCC 762. Upon the assessee s appeal in this regard, he confirmed the penalty. Hence there is no case that any particular has been withheld. The disallowance of claim of the assessee ipso facto cannot lead to levy of penalty u/s. This view is duly supported by Hon'ble Apex Court decision in the case of Reliance Petroproducts Pvt. Ltd. Furthermore, in our considered opinion, the assessee s conduct is not contumacious so as to warrant levy of penalty. In the result, this appeal by the assessee stands allowed.


IN INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI SANDEEP GOSAIN, JM ITA No. 4161/Mum/2018 (Assessment Year: 2009-10) M/s. BCD Travels India Pvt. Ltd. Dy. CIT, Range 9(2)(1), Level 2, Office No.3-B, B-Wing, (Earlier Addl. CIT-8(1)), Times Square, Andheri Kurla Road, Vs. Aayakar Bhavan, Mumbai-400 012 Marol, Andheri (East), Mumbai-400 059 PAN/GIR No. AAACF 1613 R (Appellant) : (Respondent) Appellant by : Miss Nipur Agarwal Respondent by : Shri Ashish Kumar Date of Hearing : 22.07.2019 Date of Pronouncement : 05.09.2019 ORDER Per Shamim Yahya, A. M.: This appeal by assessee is against order of learned Commissioner of Income Tax (Appeals)-16 ( ld.CIT(A) for short) pertaining to assessment year (A.Y.) 2009-10. 2. issue raised is that ld. CIT(A) erred in confirming penalty of Rs.7,06,400/- u/s. 271(1)(c) of Income Tax Act, 1961 ( Act' for short). 3. In this case, in assessment proceedings, Assessing Officer ( .O. for short) has disallowed claim of deduction u/s. 80IA in respect of its Division of Multinational Service Centre at Bangalore. As against claim of deduction of Rs.1,60,06,372/-, on account of change in allocation of common expenditure, A.O. allowed deduction of Rs.1,37,20,277/-. This reduction of Rs.22,86,095/- was due to allocation of commission 2 ITA No. 4 1 6 1 /Mu m/2 0 1 8 M/s. BCD Travels India Pvt. Ltd. expenses to Bangalore unit. On this disallowance, penalty u/s. 271(1)(c) was levied. In doing so, A.O. relied upon decision of Hon'ble Apex Court in case of Union of India v. Dharamendra Textile Processors, [2008] 306 ITR 277 (SC). He rejected assessee s reliance upon decision of Hon'ble Apex Court in case of CIT vs. Reliance Petroproducts Pvt. Ltd., (2010) 11 SCC 762 (SC). 4. Upon assessee s appeal in this regard, he confirmed penalty. 5. Against this order, assessee is in appeal before ITAT. 6. We have heard both counsel and perused records. We find that in this case there is reduction in allowance for section 10A exemption by allocation of certain common expenditure. There is no doubt about genuineness of expenditure. From material available on record, Assessing Officer has done re-allocation. Hence there is no case that any particular has been withheld. In this view of matter, in our considered opinion, when there is no case of concealment or furnishing of inaccurate particulars of income. Hence assessee cannot be visited with rigors of penalty u/s. 271(1)(c) of Act. disallowance of claim of assessee ipso facto cannot lead to levy of penalty u/s. 271(1)(c) of Act. This view is duly supported by Hon'ble Apex Court decision in case of Reliance Petroproducts Pvt. Ltd. (supra). Furthermore, in our considered opinion, assessee s conduct is not contumacious so as to warrant levy of penalty. In this regard, reliance is placed on Hon'ble Apex Court decision in case State of Orissa vs. Hindustan Steel of 83 ITR 23. 3 ITA No. 4 1 6 1 /Mu m/2 0 1 8 M/s. BCD Travels India Pvt. Ltd. 7. Accordingly, in background of aforesaid discussion and precedent, we set aside orders of authorities below and delete penalty. In result, this appeal by assessee stands allowed. Order pronounced in open court on 05.09.2019 Sd/- Sd/- (Sandeep Gosain) (Shamim Yahya) Judicial Member Accountant Member Mumbai; Dated : 05.09.2019 Roshani, Sr. PS Copy of Order forwarded to : 1. Appellant 2. Respondent 3. CIT(A) 4. CIT - concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER, (Dy./Asstt. Registrar) ITAT, Mumbai BCD Travels India Pvt. Ltd. v. Dy. CIT, Range 9(2)(1), (Earlier Addl. CIT-8(1)), Mumbai
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