DCIT (LTU), Vs. M/s International Tractors Ltd., New Delhi. Sonalika House, 283 AGCR Enclave, Karkardooma, Delhi.

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH "C" NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI T.S. KAPOOR ITA No. 1459/Del/2013 Asstt. Yr: 2005-06 DCIT (LTU), Vs. M/s International Tractors Ltd., New Delhi. Sonalika House, 283 AGCR Enclave, Karkardooma, Delhi. PAN: AAACI2270H ( Appellant ) ( Respondent ) Appellant by : Shri Satpal Singh Sr. DR Respondent by : Shri K. Sampath Adv. ORDER PER R.P. TOLANI, J.M : This is Revenue's appeal against CIT(A)'s order dated 12-12-2012 relating to A.Y. 2005-06. 2. Sole effective ground raised is as under: "On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the penalty levied u/s 271(1)(c) in respect of addition of rs. 1,89,25,000/- on account of disallowance of deduction u/s 35(2AB) of the I.T. Act as the Department has not accepted the order of the ITAT on this issue in quantum appeal and has filed an appeal before Hon'ble High Court." 3. Ld. DR fairly concedes that in quantum appeal the ITAT Delhi Bench "C" vide order dated 11-5-2012 in ITA no. 6071/Del/2010 has deleted the disallowance u/s 35(2AB). ITA 1459/Del/2013 International Tractors Ltd. 4. We have heard both the parties, perused the material available on record. Since the quantum disallowance made u/s 35(2AB) has been deleted by the ITAT, the penalty u/s 271(1)(c) imposed on account of such disallowance does not survive. 4.1. The CIT(A) has deleted the penalty qua addition u/s 35(2AB) by observing as under: "5. I have carefully considered the facts of the facts of the case in the light of the applicable law in this regard. So far as the first ground of addition under section 35(2AB) is concerned, since the ITAT, which is the final fact finding body, had allowed the appeal on this ground, keeping in view the above referred decision of the Gujarat High Court, there is in fact no instance of concealment or furnishing of inaccurate particulars. 5.2. However, on the other ground of addition of Rs. 2,10,875/- , the appellant could not furnish detail and any supporting evidence in claiming deduction under section 37 till the stage of appeal before the ITAT. Since the ITAT is the final fact finding authority which has upheld the disallowance on this ground and there are no evidences that such expenses were wholly and exclusively for business purposes and were not capital or personal in nature, I hold that the appellant company had furnished inaccurate particulars of income in respect of various expenses embedded in the amount of Rs. 2,10,875/-. 5.3. In view of the above, levy of penalty under Section 271(1)(c) is confirmed to the extent of the above disallowance of Rs. 2,10,875/- upheld by the ITAT. The appellant company gets relief on the balance amount. 2 ITA 1459/Del/2013 International Tractors Ltd. 4.2. Since the quantum addition u/s 35(2AB) stands deleted by the ITAT, we see no infirmity in the order of CIT(A) in deleting the penalty u/s 271(1)(c) to that extent. The order of CIT(A) is accordingly upheld. In the result, Revenue's appeal stands dismissed. Order pronounced in open court on 16-09-2013. Sd/- Sd/- ( T.S. KAPOOR ) ( R.P. TOLANI ) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 16th Sept. 2013. MP Copy to : 1. Assessee 2. AO 3. CIT 4. CIT(A) 5. DR 3