The ACIT,(OSD)Circle-8,, Ahmedabad v. M/s. Stalmec Engineering Pvt.Ltd.,, Ahmedabad

ITA 2667/AHD/2010 | 2004-2005
Pronouncement Date: 10-10-2013 | Result: Dismissed

Appeal Details

RSA Number 266720514 RSA 2010
Assessee PAN AADCS8754R
Bench Ahmedabad
Appeal Number ITA 2667/AHD/2010
Duration Of Justice 3 year(s) 27 day(s)
Appellant The ACIT,(OSD)Circle-8,, Ahmedabad
Respondent M/s. Stalmec Engineering Pvt.Ltd.,, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 10-10-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 10-10-2013
Date Of Final Hearing 07-10-2013
Next Hearing Date 07-10-2013
Assessment Year 2004-2005
Appeal Filed On 13-09-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH BEFORE: SRI MUKUL KR. SHRAWAT JUDICIAL MEMBER AND SHRI N.S. SAINI ACCOUNTANT MEMBER ACIT (OSD) CIRCLE-8 AHMEDABAD (APPELLANT) VS M/S. STALMEC ENGINEERING PVT. LTD. 365-368 GIDC ODHAV AHMEDABAD PAN: AADCS8754R (RESPONDENT) REVENUE BY: SRI J.P. JHANGID SR.D.R. ASSESSEE BY: SRI VIJAY RANJAN A.R. DATE OF HEARING : 07-10-2013 DATE OF PRONOUNCEMENT : 10-10-20 13 / ORDER PER : N. S. SAINI ACCOUNTANT MEMBER:- THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF LD. CIT(A)- XIV AHMEDABAD DATED 17-06-2010. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL OF THE RE VENUE IS THAT THE CIT(A) HAS ERRED IN DELETING THE PENALTY OF RS. 6 8 6 939/- U/S. 271(1)(C) OF THE ACT. ITA NO. 2667/AHD/2010 ASSESSMENT YEAR 2004-05 I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 2 3. BRIEF FACTS OF THE CASE ARE THAT THE AO DISALLOW ED RS. 11 58 112/- UNDER THE HEAD OF BAD DEBTS RS. 4 80 000/- UNDER T HE HEAD OF MEMBERSHIP FEES AND RS. 2 76 700/- UNDER THE HEAD OF WRITE BAC K OF NON MOVING SUNDRY CREDITORS. THE APPEAL OF THE ASSESSEE BEFORE THE L D. CIT(A) WAS DISMISSED BY THE CIT(A). THEREAFTER THE AO ISSUED NOTICE U/ S. 271(1)(C) OF THE ACT REQUIRING THE ASSESSEE TO SHOW CAUSE WHY PENALTY SH OULD NOT BE LEVIED FOR CONCEALING OF ITS PARTICULARS OF INCOME AND FURNISH ING OF INACCURATE PARTICULARS OF INCOME. 4. IN REPLY TO THE SAID NOTICE THE ASSESSEE OBJECT ED TO THE IMPOSITION OF PENALTY ON THE GROUND THAT THE AO HAS NOT RECORDED HIS DECISION IN THE TOP OF THE ORDER BUT MENTIONED IN THE BOTTOM OF THE ORDER. THE AO HAS NOT CONSIDERED THE CONTENTION OF THE ASSESSEE AS ACCEPT ABLE ON THE GROUND THAT PENALTY PROCEEDINGS WERE ALREADY INITIATED U/S. 274 R.W.S. 271(1)(C) OF THE ACT WHICH WAS RECORDED IN THE ASSESSMENT ORDER. TH E AO ALSO OBSERVED THAT THE CONTENTION OF THE ASSESSEE THAT THIS APPEAL WAS PENDING BEFORE THE CIT(A) WAS NOT CONVINCING AS THE CIT(A) HAS ALREADY CONFIRMED THE ADDITION MADE IN THE CASE OF THE ASSESSEE THEREFOR E THE AO LEVIED PENALTY OF RS. 6 86 939/- BEING THE 100% TAX SOUGHT TO BE EVAD ED BY THE ASSESSEE U/S. 271(1)(C) OF THE ACT. 5. THE ASSESSEE FILED THE APPEAL BEFORE THE CIT(A) AND CONTENDED THAT THE ONLY REASON GIVEN FOR LEVY OF PENALTY WAS THAT DISALLOWANCES AND ADDITIONS HAVE BEEN CONFIRMED BY THE CIT(A). THE IMPUGNED PENALTY ORDER DOES NOT EXPLAIN HOW IT INFERS THE EXISTENCE OF CON CEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME BY THE ASSESSEE AND THEREFORE THE I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 3 PENALTY ORDER IS BAD IN LAW. FOR DISALLOWANCE OF B AD DEBTS OF RS. 11 58 112/- THE ASSESSEE SUBMITTED THAT IT HAD CHA RGED INTEREST ON THE RESPECTIVE DEBIT BALANCES FROM FINANCIAL YEAR 1995- 96 TO 1999-2000 AND HAD ALSO DEDUCTED TDS THE DETAILS OF WHICH ARE AS FOL LOWS:- A/C. YEAR INTEREST TDS 1995-96 5 89 190 1 35 514 1996-97 5 94 154 1 27 743 1997-98 4 44 962 88 992 1998-99 3 54 854 70 971 1999-2000 3 53 864 77 850 TOTAL 23 37 024 5 01 070 6. IT WAS FURTHER SUBMITTED THAT IN THE IMMEDIATELY PRECEDING TWO YEARS SUBSTANTIAL GOODS WERE PURCHASED FROM THE PARTY AND THE DETAILS OF WHICH ARE AS FOLLOWS:- A/C. YEAR AMOUNT 2001-02 2 27 086/- 2002-03 3 17 982/- TOTAL: 5 45 06 8/- 7. IT WAS SUBMITTED THAT IT HAS BEEN NOTICED IN THE ASSESSMENT ORDER AS WELL AS IN THE PENALTY ORDER THAT GOODS WORTH ABOUT RS. 5.45 LACS WERE RECEIVED IN THE PRECEDING TWO YEARS AND GOODS WORTH RS. 4 41 840/- WERE RECEIVED IN THE PREVIOUS YEAR RELEVANT TO THE YEAR UNDER APPEAL I.E. A.Y. 2004-05 THE TOTAL VALUE OF GOODS RECEIVED IN THIS YEAR AND IMMEDIATELY PRECEDING TWO YEARS WAS ALMOST EQUAL TO THE PAYMENT S MADE DURING THE YEAR OF RS. 9 88 409/-. THUS IT WAS REASONABLE TO INFER THAT THE SAID PAYMENTS WERE MADE FOR THE VALUE OF GOODS RECEIVED IN THESE THREE CONSECUTIVE FINANCIAL YEARS RELEVANT TO THE YEAR UNDER APPEAL. ULTIMATELY THE AFORESAID SUM OF RS. 11 58 112/- HAS BEEN WRITTEN OFF. THEREF ORE IT WAS NOT I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 4 UNREASONABLE TO INFER THAT THE ASSESSEES CASE FOR CLAIMING DEDUCTION WAS JUSTIFIED. IT WAS FINALLY SUBMITTED THAT ALL THE F ACTS AND FIGURES WERE DISCLOSED AND THOSE VERY FACTS AND FIGURES HAVE FOR MED THE BASIS FOR THE AFORESAID DISALLOWANCES OF RS. 11 58 112/-. HENCE THE ALLEGATION OF CONCEALMENT OR FURNISHING INACCURATE PARTICULARS OF INCOME WAS NOT AT ALL POSSIBLE. 8. AS REGARDS TO DISALLOWANCE OUT OF MEMBERSHIP OF RS. 4 80 000/- IT WAS SUBMITTED THAT THE ISSUE HAD ARISEN IN INCOME T AX MATTER TIME AND AGAIN HAS BEEN ELABORATELY DISCUSSED IN CHATURVEDI AND PI THISARIAS BOOK (5 TH EDITION-VOL. 2). ON PAGES 2081 AND 2107 WHEREIN CI TATIONS OF REPORTED DECISIONS ARE REFERRED IN SUPPORT OF THE PROPOSITIO NS NOTED THEREIN. THE MAIN PRINCIPLE EMERGING IS THAT THE QUESTION TO BE DECID ED BY THE APPLICATION OF PRINCIPLE OF COMMERCIAL EXPEDIENCY AND SHOULD BE VI EWED PRIMARILY FROM THE ANGLE OF BUSINESS MAN. IT WAS SUBMITTED THAT T HE ASSESSEE HAS SECURED SOME CONCESSION IN RESPECT OF EXPENDITURE WHICH WOU LD HAVE BEEN ALLOWABLE ON REVENUE ACCOUNT AND EVEN WHEN IT ENVISAGES THAT CONTENTION FOR 25 YEARS THE EXPENDITURE IS ON REVENUE ACCOUNT. 9. REGARDING THE ADDITION ON ACCOUNT OF WRITE BACK OF NONMOVING SUNDRY CREDITORS ARE RS. 2 76 700/- IT WAS SUBMITTED THA T IN THE ACCOUNTS FOR THIS YEAR THE ASSESSEE HAD CREDITED AND OFFERED A SUM O F RS. 8 95 803/- FOR THE SUNDRY CREDIT BALANCES WRITTEN BACK MEANING THEREBY THE ASSESSEE HAD BEEN ITSELF ANALYZING THE POSITION OF SUCH ACCOUNTS WRIT ING THEM BACK TO THE PROFIT AND LOSS ACCOUNT AS AND WHEN NECESSARY. THE AO WAS NOT JUSTIFIED IN APPLYING HIS OWN SUBJECTIVE STANDARDS AND MAKING TH E ADDITION WHICH WAS WHOLLY ON THE BASIS OF CONJECTURES AND SURMISES. I T WAS MENTIONED THAT THREE OF THOSE BALANCES HAVE BEEN WRITTEN BACK BY THE ASS ESSEE ITSELF IN THE NEXT I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 5 YEAR AND OFFERED FOR TAX. IT WAS ALSO SUBMITTED TH AT THE ASSESSEES JUDGMENT SHOULD BE HONOURED AND THE AO CANNOT APPLY HIS OWN SUBJECTIVE VIEWS FOR MAKING AN ADDITION ON CONJECTURES AND SURMISES. TH US THE ADDITION WAS WHOLLY UNJUSTIFIED. THERE IS NEITHER ANY CONCEALME NT NOR ANY FURNISHING OF INACCURATE PARTICULARS AND THE POINT IS THAT THE FA CTS AND FIGURES AVAILABLE ON RECORD HAVE BEEN RELIED BY THE AO FOR MAKING THE AD DITIONS AND THUS THERE WAS NO POSSIBILITY FOR ALLEGING CONCEALMENT OR FURN ISHING INACCURATE PARTICULARS. IT WAS SUBMITTED THAT IN RESPECT OF N ONE OF THESE THREE ITEMS THERE WAS POSSIBILITY OF ANY ALLEGATION OF ANY FACT S OR ASPECTS HAVING CONCEALED BY THE ASSESSEE OR OF FURNISHING OF INACC URATE PARTICULARS. THE ASSESSEE PLACED RELIANCE ON THE DECISION OF HONBE SUPREME COURT IN THE CASE OF CULCUTTA DISCOUNT CO. VS. ITO 41 ITR 91 (SC ) AND IOC VS. ITO 159 ITR 956 (SC) WHEREIN IT WAS HELD THAT WHEN PRIMARY FACTS ARE DISCLOSED IT CANNOT BE REGARDED AS A FAILURE ON THE PART OF THE ASSESSEE TO DISCLOSE FULLY AND TRULY ALL MATERIAL FACTS. IT WAS ALSO SUBMITTE D THAT IT IS NOT A DEEMED CONCEALMENT OR DEEMED FURNISHING OF INACCURATE PART ICULARS EITHER BECAUSE ITS CASE IS NOT COVERED EVEN BY EXPLANATION-I BELOW SECTION 271(1)(C). THE ASSESSEE IN THIS CASE HAS FURNISHED EXPLANATION AND THE DEPARTMENT HAS NOT FOUND THE SAME TO BE FALSE. THIS PROVISION HAS BEE N ANALYZED AND EXPLAINED BY THE HONBLE GUJARAT HIGH COURT IN THE CASE OF SA RABHAI CHEMICAL P. LTD VS. CIT 257 ITR 355(GUJ). IT WAS FURTHER SUBMITTED THAT THE DELHI HIGH COURT APPROVED THE TRIBUNALS DECISION IN DELETING THE PENALTY FOR CONCEALMENT WHEN THE ASSESSEE HAD CLAIMED A DEDUCTI ON ON REVENUE ACCOUNT FOR FEES PAID TO THE REGISTRAR OF COMPANIES FOR INC REASING THE AUTHORIZED SHARE CAPITAL. THE SLP (CIVIL) NO. 30148 OF 2008 H ELD BY THE DEPARTMENT WAS DISMISSED WHICH IS REPORTED IN 308 ITR 14 I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 6 10. LD. CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE DELETED THE PENALTY. 11. LD. DR FULLY JUSTIFIED THE ORDER OF AO LEVYING THE PENALTY. HE ARGUED THAT THE BAD DEBTS CLAIMED BY THE ASSESSEE WERE NOT ALLOWABLE TO THE ASSESSEE AS IT WAS ONLY AN ADVANCE PAYMENT BY THE ASSESSEE R EGARDING MEMBERSHIP FEE. IT WAS SUBMITTED THAT THE SUM OF RS. 5 LACS W AS PAID BY WHICH THE ASSESSEE FOR NEXT 25 YEARS ENTITLED TO OCCUPY A ROO M IN LE MERIDIAN HOTEL SAHAR AIR PORT MUMBAI OR ANYWHERE ELSE IN THE WORL D AT SUBSIDIZED RATES. THUS THE ASSESSEE GOT AN ENDURING BENEFIT AND WAS N OT ENTITLED TO DEDUCTION OF THE ENTIRE AMOUNT AND THEREFORE THE AO RIGHTLY A LLOWED ONLY 1/25 TH OF DEDUCTION. AS REGARDS RIGHT BACK OF NON-MOVING OF SUNDRY CREDITORS OF RS. 2 76 700/- IT WAS SUBMITTED THAT THERE WAS NO MOVE MENT IN THESE ACCOUNTS SINCE MORE THAN 3 YEARS AND THEREFORE THE SUM WAS A DDED BACK AND TREATED THE INCOME OF THE ASSESSEE AND THEREFORE HE JUSTIF IED THE LEVY OF PENALTY BY THE AO. 12. LD. AR OF THE ASSESSEE ON THE OTHER HAND REITE RATED THE SUBMISSIONS MADE BEFORE THE CIT(A) AND SUPPORTED THE ORDER OF T HE CIT(A). HE FURTHER PLACED RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF RELIANCE PETRO-PRODUCTS PVT. LTD. 322 ITR 158. 13. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE THE SUM OF RS. 6 86 939/- WAS LEVIED AS PENALTY U/S. 271(1)(C ) OF THE ACT IN RESPECT OF DISALLOWANCE OF BAD DEBTS OF RS. 11 58 112/- DISAL LOWANCE OUT OF MEMBERSHIP FEE OF RS. 4 80 000/- AND ADDITION OF RS . 2 76 700/- IN RESPECT OF I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 7 NON MOVING SUNDRY CREDITORS. ON APPEAL LD. CIT(A) DELETED THE AFORESAID PENALTY BY OBSERVING AS UNDER:- 2.3 I HAVE CONSIDERED THE FACTS OF THE CASE AND TH E SUBMISSIONS OF THE APPELLANT ALONG WITH VARIOUS JUDICIAL DECISIONS AS RELIED UPON BOTH BY THE A.O. AS WELL AS THE APPELLANT. 1 AM INCLINED T O ACCEPT THE CONTENTIONS OF THE APPELLANT WHICH CAN BE SUMMARISE D AS FOLLOWS:- A) THE A.O. HAS NO PROPER SATISFACTION FOR IMPOSITION OF PENALT Y. B) THE A.O. EXCEPT THE GROUNDS THAT ADDITION SO MAD E WERE CONFIRMED BY LD. CIT(A) AND THEREFORE LIABLE TO PENALTY IS UNR EASONABLE AND UNJUSTIFIED. C) COMPLETE DETAILS AND EXPLANATION FOR ALL THE ISSUES RELATED TO ADDITIONS WERE DISCLOSED IN RETURN OF INCOME AND THEREAFTER D URING THE COURSE OF ASSESSMENT AND APPELLATE PROCEEDINGS. THE LD. CIT(A ) DISMISSED APPELLANT'S APPEAL BUT THE SAME IS SUBJECTED TO BE FORE HON ITAT HENCE NOT FINAL. CONSIDERING VARIOUS CASE LAWS AS RELIED ON THE APPELLANT CANNOT BE HELD GUILTY FOR FURNISHING OR DISCLOSING TRUE AN D FULL PARTICULARS AND THEREFORE NOT LIABLE TO BE PENALIZED. D) CONSIDERING RATIO OF VARIOUS CASE LAWS AND ISSUE INVOLVED IN ALL SUCH ADDITIONS MULTIPLE INTERPRETATION IS POSSIBLE. THE APPELLANT CONSIDERED SUCH INTERPRETATION WHICH IS FAVOURABLE TO IT AND THEREFORE ITS BONAFIDE CANNOT BE HELD AS MALAFIDE AND TO BE PENALISED. E) THE APPELLANT'S EXPLANATION IN RESPECT OF SHOW C AUSE TO PENALTY NOTICE WAS NEITHER HELD FALSE BY A.O. NOR SAME WAS PROVED TO BE MALAFIDE. AS PER SETTLED LEGAL PROPORTION FOR PENALTY IMPOSIT ION THE PROCEEDINGS WERE HELD TO BE DIFFERENT THAN ASST. PROCEEDINGS. T HE A.O. FAILED TO BRING OUT BY ANY EFFORT THE VARIOUS ISSUES RAISED B Y THE APPELLANT AS CONTROVERTABLE OR FALSE OR MALAFIDE. MERELY THE FAC T THAT ADDITIONS MADE BY A.O. WERE CONFIRMED BY LD. CIT(A) DOES NOT AUTOMATICALLY EMPOWER THE A.O. TO IMPOSE PENALTY. HON'BLE SUPREM E COURT IN A RECENT JUDGMENT IN THE CASE OF CIT VS. RELIANCE PET ROPRODUCTS PVT. LTD. (2010) 322 ITR 158 HELD THAT 'IF NO INFORMATIO N GIVEN IN RETURN OF INCOME FOUND TO BE INCORRECT AND THEREFORE MAKIN G INCORRECT CLAIM DOES NOT ARISE AND THE SAME DOES NOT AMOUNT TO C ONCEALMENT OF PARTICULARS. HON'BLE ITAT AHMEDABAD B BENCH IN THE CASE OF DY. CIT V. GUJARAT STATE FERTILIZER AND CHEMICAL LTD. ( 2010) 1 ITR (TRIB.) 361 HELD THAT SUCH PARTICULARS FOR CLAIM FOR 80I DE DUCTION WERE NOT FOUND TO BE INACCURATE AND THEREFORE PENALTY IS NO T JUSTIFIED ON SUCH I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 8 DISALLOWANCE. THE A.O. IS THEREFORE NOT JUSTI FIED IN IMPOSING PENALTY. HE IS DIRECTED TO DELETE THE PENALTY. THE APPELLANT GETS RELIEF OF RS. 6 86 939/-. LD. D.R. SUBMITTED BEFORE US THAT THE ASSESSEE WAS AWARE OF THE FACT THAT RS. 4 LACS PAID AS MEMBERSHIP FEE WAS OF 25 YEARS AND T HEREFORE OUGHT TO HAVE CLAIMED DEDUCTION FOR RS. 20 000/- ONLY AND THEREFO RE BY CLAIMING DEDUCTION OF BALANCE AMOUNT OF OF RS. 4 80 000/- THE ASSESSEE IS LIABLE FOR PENALTY U/S. 271(1)(C) OF THE ACT. FURTHER THE LD. DR CONTENTED THAT IN RESPECT OF NON MOVING SUNDRY CREDITORS BALANCES WAS BOGUS THEREFO RE THE ASSESSEE WAS LIABLE FOR PENALTY U/S. 271(1)(C) OF THE ACT. FURT HER IN RESPECT OF BAD DEBTS OF RS. 11 58 112/- CLAIMED BY THE ASSESSEE LD. DR SUB MITTED THAT THE SAID AMOUNT WAS ADVANCE GIVEN BY THE ASSESSEE AND THEREF ORE WRITING OF THE SAME IS NOT ALLOWABLE AS BAD DEBT TO THE ASSESSEE AND AS THE ASSESSEE CLAIMED DEDUCTION FOR THE SAME THE ASSESSEE WAS LIABLE FOR PENALTY U/S. 271(1)(C) OF THE ACT. WE DO NOT FIND ANY FORCE IN THE ABOVE ARG UMENTS OF LD. DR. WE FIND THAT NO SPECIFIC ERROR IN THE ORDER OF LD. CIT (A) COULD NOT BE POINTED OUT BY LD. DR. WE FIND THAT NO MATERIAL WAS BROUG HT ON RECORD TO SHOW THAT THE PAYMENT OF RS. 5 LACS AS MEMBERSHIP FEE BY THE ASSESSEE WAS NOT GENUINE. THE ISSUE WHETHER EXPENDITURE IS A CAPITA L OR A REVENUE EXPENDITURE IS LARGELY DEBATABLE ISSUE AND ONLY BECAUSE A DIFFE RENT VIEW IN RESPECT OF NATURE OF EXPENDITURE WAS ADOPTED BY THE DEPARTMENT DOES NOT ENTITLE THE AO TO LEVY PENALTY U/S. 271(1)(C) OF THE ACT. FURT HER NO MATERIAL WAS BROUGHT BEFORE US TO SHOW THAT NON MOVING SUNDRY CR EDITORS BALANCE OF RS. 2 76 700/- WAS BOGUS OR EVEN ANY MATERIAL TO SHOW T HAT THE SAME WAS INCOME OF THE ASSESSEE OF THE YEAR UNDER CONSIDERAT ION. IN ABSENCE OF ANY MATERIAL TO SHOW THAT THE SAID AMOUNT WAS ACTUALLY INCOME OF THE ASSESSEE OF THE YEAR UNDER CONSIDERATION IN OUR CONSIDERED VIEW LEVY OF PENALTY U/S. I.T.A NO.2667/AHD/2010 A.Y. 2004-05 PAGE NO ACIT VS. M/S. STALMEC ENGINEERING PVT. LTD. 9 271(1)(C) IN RESPECT OF THE SAID AMOUNT WAS NOT JUS TIFIED. FURTHER IN RESPECT OF AMOUNT OF RS. 11 58 112/- WHICH WAS CLAIMED BY T HE ASSESSEE AS BAD DEBT NO MATERIAL WAS BROUGHT BEFORE US TO SHOW THAT THE CLAIM WAS FALSE. WE DO NOT FIND ANY ERROR IN THE ORDER OF THE LD. CIT(A) W HICH WAS PASSED FOLLOWING THE ORDER OF THE HONBLE SUPREME COURT IN THE CASE OF RELIANCE PETRO- PRODUCTS (2010) 322 ITR 158 (SC) WHEREIN IT WAS HEL D THAT MERELY BECAUSE A DEDUCTION CLAIMED BY THE ASSESSEE WAS FOUND TO BE N OT ALLOWABLE DOES NOT ENTITLE THE DEPARTMENT TO LEVY PENALTY U/S. 271(1)( C). IN VIEW OF THE ABOVE WE DO NOT FIND ANY ERROR IN THE ORDER OF LD. CIT(A) AND THEREFORE THE ORDER OF THE LD. CIT(A) IS CONFIRMED AND THE APPEAL OF TH E REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON THRUSDAY THE 10 TH DAY OF OCTOBER 2013 SD/- SD/- (MUKUL KR. SHRAWAT) (N.S. SAINI) JUDICIAL MEMBER AC COUNTANT MEMBER AHMEDABAD : DATED 10/10/2013 AK / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR ITAT AHMEDABAD 6. GUARD FILE. BY ORDER/ /