Karnataka High Court
Commissioner Of Income Tax-Iii vs M/S. Oscar Udyog Ltd. on 29 October, 2013
Bench: N.Kumar, Rathnakala
1
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 29th DAY OF OCTOBER 2013
PRESENT
THE HON'BLE MR. JUSTICE N. KUMAR
AND
THE HON'BLE MRS. JUSTICE RATHNAKALA
ITA No.311 OF 2013
BETWEEN;
1.Commissioner of Income
Tax-III, Central Revenue Buildings
Queens Road, Bangalore-1
2.The Income Tax Officer,
Ward 12(1), Bangalore. ... APPELLANTS
(By Sri. E.I. Sanmathi, Advocate)
AND
M/s.Oscar Udyog Limited
No.4713 and 4812,
Byatarayanapura Village
Yalahanka Hobli, North Taluk,
Bangalore-92. ... RESPONDENT
(By Sri.S. Parthasarthy, Adv)
-0-0-0-0-0-
This ITA is filed under Section 260-A of I.T. Act,
1961, arising out of Order dated 28.2.2013 passed in
2
ITA.No.1083/Bang/2012, for the Assessment year
2006-07 to formulate the substantial questions of law
stated therein and to set aside the appellate order dated
28.2.2013 passed by the ITAT, "B" Bench, Bangalore, in
appeal proceedings in ITA No.1083/Bang/2012 dated
28.2.2013.
This appeal coming on for admission this day, N.
KUMAR, J. delivered the following:-
JUDGMENT
The revenue has preferred this appeal challenging the order passed by the Tribunal which has set aside the penalty imposed by the Assessing Authority as well as the Appellate Authority on the ground that the assessee has furnished an inaccurate particulars.
2. The facts are not in dispute. The assessee is the company engaged in the business of construction of buildings. For the relevant assessment year, the assessee declared an income of Rs.3,27,98,130/- and claimed deduction of Rs.3,27,50,222/- under Section 80IB(10) of the Income Tax Act, 1961. A survey was conducted under Section 133A of the Act on 21.2.2007. 3 According to the revenue, the assessee had violated the norms for claiming deduction under Section 80IB(10) of the Act. When the assessee was confronted with the same. The assessee withdrew the deduction claimed, paid the tax as well as the interest. It is thereafter, penalty proceedings were initiated on the ground that but for the survey, the same could not have been detected and therefore penalty was imposed. The assessee preferred an appeal. The appellate authority dismissed the appeal confirming the imposition of penalty. It is against the said order the assessee preferred an appeal to the Tribunal. The Tribunal held that the assessee was entitled to claim deduction. Merely because the assessee withdrew the deduction, conceded to the demand of the department and paid tax and interest, as there is no malafide intention, the assessee cannot be imposed penalty and as such the order imposing penalty was set aside. Aggrieved by the said order, the revenue is before this Court. 4
3. In view of the judgment of this Court, which is now upheld by the Apex Court, the claim made by the assessee under Section 80IB(10) of the Act was legal and valid subject to verification. Because the revenue conducted the survey and pointed out to him that the assessee was not eligible for the said deduction, the assessee agreed to withdrew the deduction, conceded to the demand and paid the tax and interest. There was no dishonest intention on the part of the assessee in claiming the deduction. The very fact that when it had been pointed out to the assessee, that the assessee paid the tax and interest shows that the assessee has no malafides. Now that the law is settled and the assessee is eligible for the said deduction, it cannot be said that the assessee deliberately claimed deduction and did not disclose the said fact in the returns filed and therefore, the assessee is liable to be proceeded for imposition of penalty. The Tribunal was justified in setting aside the penalty imposed. 5 Therefore, there is no substantial question of law that arises for consideration in this appeal.
4. No merits. The appeal is dismissed.
Sd/-
JUDGE.
Sd/-
JUDGE.
*alb/-.