Income Tax Appellate Tribunal - RanchiM/S Usha Martin Ltd, Kolkata vs Dcit Cent. Circle-1, Ranchi on 28 June, 20181
                                                          ITA Nos .1 85 to 187 /Ran /20 16
                                                                       C.O. 10 & 11/ R an/ 16
                                  A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 3




             IN THE INCOME TAX APPELLATE TRIBUNAL,
                      RANCHI BENCH, RANCHI

        BEFORE SHRI N.S SAINI, ACCOUNTANT MEMBER AND
            PAVAN KUMAR GADALE, JUDICIAL MEMBER


                ITA Nos.185 to 187/Ran/2016
        Assess ment Years: 1999-2000, 2001-0 2 & 2002 -03

     DCIT, Central Circle-1, Vs.              M/s. Usha Martin Limited,
     Ranchi.                                  Tatisilwai, Ranchi
     PAN/GI R No.AAACU 2339 M
             (Appellant)      ..                        ( Respondent)

                           C.O. Nos.10 & 11/Ran/16
               (in ITA Nos.185 to 186/Ran/2016
            Assessme nt Ye ars: 1999-2000 amd 2001- 02

     M/s. Usha Martin Limited, Vs.            DCIT, Central Circle-1,
     Tatisilwai, Ranchi                       Ranchi
     PAN/GI R No.AAACU 2339 M
              (Appellant)       ..                      ( Respondent)

                     Assessee by: Shri Vinay Jalan, Adv
          Revenue by : Shri D.K.Sutariya, CIT(DR)/A.K.Mohanty, JCIT

                    Date of Hearing :    25/05/ 2018
                  Date of Pronouncement : 28/06/ 2018

                                ORDER

Per N.S.Saini, AMThese are appeals filed by the revenue against the order of the CIT(A)-1, Bhubaneswar dated 4.1.2016 for the assessment year 1999-2000 and

2002-03 and dated 5.1.2016 for the assessment year 2001-02.2ITA Nos .1 85 to 187 /Ran /20 16
                                                                        C.O. 10 & 11/ R an/ 16
                                   A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 32.   In the cross objections, the assessee has raised the common grounds

as under:"1. That on the facts and in the circumstances of the case, the CIT(A)
     erred in concluding that the concurrence of erstwhile Joint
     Commissioner/Commissioner, in obtaining the satisfaction on the
     reasons recorded by the AO was not required.2. That on the facts and in the circumstances of the case, the CIT(A)
     erred in concluding that the appellant company was not liable to bring
     any evidence on record to show that the case falls u/s.151(2) of the
     I.T.Act, 1961.3. That on the facts and in the circumstances of the case, the CIT(A)
     erred in concluding that the AO was not required to pass a speaking
     order.4. That on the facts and in the circumstances of the case, the CIT(A)
     erred in concluding that the onus on the AO for passing a speaking
     order, disposing the objections of the appellant company, arises only
     on filing of return of income in response to notice/s.148 of the I.T.Act.5. That on the facts and in the circumstances of the case, the CIT(A)
     erred in not considering the submission of the appellant company
     dated 22.11.2004 filed in response to notice u/s.148 of the Act."3.   We have heard the rival submissions, perused the orders of lower

authorities and materials available on record. The facts of both the years

are same and, therefore, assessment year 1999-2000 is taken as lead year

for discussion herein-under.4.   The return of income was originally accepted u/s.143(1) of the Act.Originally, no assessment u/s.143(3) was framed.                        Thereafter, notice

u/s.148 was issued after recording the reasons as under:3ITA Nos .1 85 to 187 /Ran /20 16
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      "Assessee filed return of income on 30.12.1999 declaring total loss of
      Rs.20,57,01,250/- for the A.Y. 1999-2000. Return was processed
      u/s.143(1) on 25.9.2000. Subsequently, on verification of return,
      some discrepancies were found in the computation of book profit. The
      following amount has not been included in the computation of book
      profit u/s.115JA.Provision for wealth tax                            :        16,05,868/-

              Foxed asset written off as per books                :             98,896/-

              Loss on sale of fixed assets                        :         7,43,478/-

              Provision for contingencies                         :     1,80,00,000/-

              Int. On income tax refund                           :         8,94,204/-

              Income from investment                              :        53,41,911/-

              Profit from transfer of undertaking                 :     17,72,64,686/-

              Profit on sale of investment                        :          19,08,202

                                                        Total:         Rs.20,48,57,245/-Further commercial vehicles costing Rs.70,76,556/- and put to use in
      the business for less than 180 days during the previous year relevant
      to A.Y. 1999-2000, the assessee was entitled for depreciation @ 20%
      (50% of prescribed rate of 40%).Since no details and supporting evidences are available on record, I
      have reason to believe that non-inclusion of the above amount
      resulted in the short computation of book profit and, therefore, it
      comes under the purview of escapement of income u/s.147 of the
      I.T.Act, 1961.Issue notice u/s.148 of the I.T.Act, 1961."5.    On appeal, the CIT(A) upheld the validity of issuance of notice u/s.148

of the Act.4ITA Nos .1 85 to 187 /Ran /20 16
                                                                          C.O. 10 & 11/ R an/ 16
                                     A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 36.    The assessee before us argued that the issuance of notice u/s.148 of

the Act is not valid as the same was based on change of opinion.7.    In our considered view, in the instant case, no opinion was formed

earlier by the Assessing Officer as no assessment was made and, therefore,

it cannot be alleged that there was any change of opinion. We, therefore, do

not find any merits in the arguments of the assessee. Accordingly, the cross

objections filed by the assessee are dismissed.8.    The revenue in its appeal for the assessment years 1999-2000 and

2001-02,    is     aggrieved   by   the    deletion        of     Rs.5,80,00,000/-                and

Rs.5,46,00,000/- on debenture redemption reserve fund by treating it as a

known liability.9.    We have heard the rival submissions, perused the orders of lower

authorities and materials available on record. In the instant case, for both

the assessment years under appeal, the Assessing Officer added back the

amount which was debited in the profit and loss account under the head

"debenture redemption reserve fund" and computed the book profit

u/s.115JA of the Act.10.   On appeal, the CIT(A) deleted the above addition by observing as

under:"vi. Based on a reading of explanation to section 115JA of the Act, the
      meaning assigned to the term "Reserve" and "Provision" in theCompanies Actand the decision of the Supreme Court in the case of5ITA Nos .1 85 to 187 /Ran /20 16
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      National Rayon Corporation Ltd., 227 ITR 764 (SC), it is clear that the
      amount set aside for the purpose of redemption of debentures, is a
      known liability to the extent it is not excessive as per the opinion of
      directors. The same neither falls within the meaning of clause (b) as
      amounts carried to any reserves by whatever name called, nor within
      the meaning of clause (c) as amount or amounts set aside to
      provisions made      for meeting liabilities, other than ascertained
      liabilities.vii. In view of the aforesaid decision of the Apex Court, the amount set
      aside to redeem debentures must be treated as a known liability and
      cannot be considered to be a reserve. Further, it is clear that such
      amount set aside towards debentures redemption is not an
      unascertained liability. Ground of appeal is accordingly allowed."11.   Before us, ld D.R. supported the order of the Assessing Officer.12.   We find that ld D.R. could not point out any specific error in the order

of the CIT(A), which was passed following the order of the Tribunal in the

case of assessee itself for the assessment year 2003-04. The revenue has

brought no material on record to show that the order of the Tribunal was

either not applicable in the instant case or the said order was varied by any

higher authority.   In absence of any such material, we do not find any

reason to interfere with the order of the CIT(A). Therefore, the ground of

revenue for both the assessment year is dismissed.ITA No. 187/Ran/2016: A.Y. 2002-0313.   The revenue in its appeal for the assessment year 2002-03, the

assessee   is   aggrieved by the    deletion       of     Rs. 94,07,400/-               imposed

u/s.271(1)(c) of the Act6ITA Nos .1 85 to 187 /Ran /20 16
                                                                        C.O. 10 & 11/ R an/ 16
                                   A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 314.   The brief facts of the case are that the assessee is a widely held

domestic company engaged in the business of inter alia, manufacture and

sale of jelly filled telecommunication cables, wire ropes billets, etc. For the

assessment year under consideration, the assessee had filed a return of

income disclosing a net loss of Rs.21,37,79,845/- on regular computation of

income and a loss of Rs.6,58,63.519/- under MAT provisions. The Assessing

Officer completed the assessment u./s.143(3) and assessed loss was

Rs.1589410219/- on regular computation of income and book profit

u/s.115JB was assessed at Rs.78,05,593/-.15.   On appeal, the CIT(A) granted part relief to the assessee.                                The

assessee filed appeal against the order of the CIT(A) before the Tribunal and

same was allowed partly in favour of the assessee vide order dated 7th

March, 2008. The order giving effect to the order of the Tribunal was issued

on 31st October, 2008 computing book profit at Rs.5,36,05,842/-.16.   The Assessing Officer initiated penalty proceedings undersection

271(1)(c)of the Income tax Act, 1961 vide notice dated 3rd March, 2005

undersection 274read withsection 271of the Act. The Assessing Officer

passed an order dated 31.10.2008 levying penalty of Rs.94,07,400/-u/s.271(1)(c) of the Act for concealment of income and furnishing inaccurate

particulars of income.17.   On appeal, the CIT(A) deleted the penalty by observing as under:7ITA Nos .1 85 to 187 /Ran /20 16
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"9. I have considered the submissions made by the appellant and
have also carefully perused the penalty order. With regard to write
back of provision for contingencies of 24,60,00,000/- in computing' the
Book Profits underSection 115JBof the Income Tax Act, 1961 the
appellant submitted that it had created provision for contingencies, to
the extent of 27,50,00,000/- in Assessment Year-1998-99 and the
same was duly disallowed in the computation of book profits at the
time of filing the return of income. The computation of book profits for
Assessment Year-1998-99 was submitted. Further, the appellant
created another provision for contingencies to the extent of
21,80,00,000/- in 'Assessment Year-1999-00 which was also
disallowed in the computation of book profits at the time of filing the
return of income. The computation of book profit for Assessment Year-1999-00 was submitted.[10] The appellant submitted that out of the aforesaid provision
cheated in earlier years, the appellant had written back an amount of
24,60,00,000/- in Assessment Year-2002-03. Since, the entire amount
of provision for contingencies had already been disallowed in the year
of creation of the same (i.e, offered to tax in earlier years), the write
back of provision in the current Assessment Year was reduced while
computing the book profits. However, the said claim of the Appellant
was not allowed by the Learned Assessing Officer in the assessment
order issued underSection 143(3)of the Income Tax Act, 1961:[11] in this regard, the Hon'ble ITAT vide its order dated 30th June,
2d09 had restored the matter back to the file of the Learned Assessing
Officer for fresh adjudication. Further, the Learned Assessing Officer
vide its order dated 20th May, 2010 decided the issue in favour of the
appellant and upheld the argument of the appellant that the amount of
provision was already offered to tax in earlier Assessment Years. The
Learned Assessing Officer, in the aforesaid order for Assessment Year-
2002-03 also relied on the assessment order issued underSection
143(3)of the Income Tax Act, 1961 for Assessment Year-2004-05
wherein the Learned Assessing Officer has accepted the reduction on
account of write back of provision for contingencies amounting to
Z2,70,00,000/- while computing the book profits.12] With regard to the debenture redemption reserve of
Rs.6,71,50,0001- relying on the judgment of the Hon'ble Supreme
Court in the case ofNational Rayon Corporation Ltd v CIT(1997) 227
ITR 764 (SC) and the order of the ITAT Kolkata in appellant's own case
for 1998-99 in ITA No.112 dated 23.06.2006 the Ld. Assessing Officer
in his order uJs.143(3)/254 for the Assessment Year-2002-03 In the8ITA Nos .1 85 to 187 /Ran /20 16
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appellant case vide order dated 0.05.2010, has ,accepted the
contention of the appellant.[13] Considering the above penaltyu/s.271(1)(c)in respect of these
two items cannot be sustained,

[14] As regards Rs. 63,19,360/- on account of sale of fixed assets
during the year, the said profits of. which were reduced In computing
the book profits the appellant submitted that the appellant earned a
profit of 263,19,360/- on account of sale of fixed assets during the
year. At the time of filing the return of income, the appellant had
furnished notes to the computation of MAT liability providing the basis
(along with relevant Judicial pronouncements) on which the said
profits were reduced in computing the book profits.           The said
disclosure was also made in the Form No.29B, certifying the
computation of MAT liability. The appellant argued that as could be
noted from the MAT computation & Form No.29B, in Note-1 to the
computation, the appellant had suo-motu disclosed its position that
the profit on sale of fixed assets had not been considered for
computing. MAT liability.In the said note, the appellant had also
mentioned that its position was based on the [ decisions of the Delhi
Tribunal in the case ofOswal Agro Mills Ltd vs DCIT(1994) 51 ITD 447
(Del) and the decision of the Special bench of Hon'ble Calcutta
Tribunal in the case ofSutlej Cotton Mills Limited vs ACIT(1993) 45
ITD 22 (Cal)(SB).[15] In this connection, it was submitted that the profit on sale. of
fixed assets was excluded by the appellant from the computation of
the book profit undersection 155JB(2)of the Act on the basis that
profit on sale of fixed assets was not earned in the regular course of
business.In this regard, the appellant submitted that the Hon'ble
Mumbai ITAT in the case ofITO vs Frigsales (India) Ltd.(2005), 4
SOT 376 (Mumbai), had decided on the issue of treatment to be
accorded to sale of Fixed Asset in computing book profit. Towards the
same, the Hon'ble ITAT receipt which is not in the nature of income
cannot be taxed as income undersection 115JAof the Act. Therefore,
the Hon'ble Mumbai ITAT held that Capital Gains arising to the
Appellant undersection 50of the Act on a depreciable asset is liable to
be excluded from deemed profits undersection 115JAof the Act.
Relying onthe said judgment, it was inferred by the appellant that the
profit on sale of fixed asset was liable to be excluded in computing
book profit undersection 115JBof the Act. The appellant under a bona9ITA Nos .1 85 to 187 /Ran /20 16
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fide belief had claimed exclusion of capital profit in computing book
profit undersection 115JBof the Act.[16] Regarding the assertion of the Ld. Assessing Officer in the order
undersection 271(1)(c)of the Income Tax Act, 1961, that the
appellant had consciously and deliberately refused to take into
consideration the judgment of the Apex Court in the case ofApollo
Tyres Ltd. vs CIT(2002) 255 ITR 273 (SC) it was submitted, without
prejudice, that in another case ofFrigsales (Indio) Ltd.(Supra), the
Hon'ble Mumbai ITAT had decided the issue of exclusion of profit on
sale of fixed assets from the computation of book profit undersection
115JAof the Act, only after distinguishing the Apex Court judgment in
the case ofApollo Tyres Ltd.(Supra). The Hon'ble Mumbai ITAT
distinguishing the Apex Colt judgment held that the same was
rendered in the context of provisions ofsection 115Jof the Act, which
is an independent code, whilesection 115JAof the Act is not an
independent code and the Legislature in their wisdom has brought
sub-section (4) ofsection 115JAof the Act on the statute to makesection 115JAof the Act also a part of the Act.Accordingly, on the
basis of the above facts, it was submitted that without prejudice to
earlier submission, that the issue of exclusion of profit on sale of fixed
asset, while computing book profit undersection 115JAor 115JB of
the Act, was a matter subject to litigation even after the Apex Court
judgment of.Apollo Tyres Ltd.(Supra).[17] The appellant further submitted that the Ld. Assessing Officer
imposed penalty on the ground that the appellant had 'consciously
and deliberately' refused to take into consideration the Judgment of
the Apex Court in the case ofApollo Tyres Ltd.(Supra). In this regard,
it was submitted that as a matter of fact, in the order issued undersection 143(3)of the Act as well as the commissioner of Income-
tax(Appeals) order in the appellant's case for the subject assessment
year, the said Apex Court judgment in the case of Apollo Tyre Ltd .
(Supra), not taken into consideration while making/confirming the
aforesaid disallowances. It is only before the Hon'ble 1TAT (in merit
appeal) that the said Apex Court judgment was considered for the fir-
St time.Moreover, it was only after the said Hon'ble ITAT order
(issued can 07th March, 2008), the Assessing Officer concluded that
the Appellant had not taken into consideration the Hon'ble Apex Court
judgment ofApollo Tyres Ltd.(Supra).Accordingly, the learned
Assessing Officer erred in holding that the Appellant has consciously
and deliberately refused to take into consideration the judgment of the
Apex Court in the case ofApollo Tyres Ltd.(Supra).10ITA Nos .1 85 to 187 /Ran /20 16
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[18] I have considered the submissions of the appellant and have also
perused the penalty order. The main argument of the Ld. Assessing
Officer is that the appellant had deliberately taken shelter under the
judicial pronouncements which were in its favour and had deliberately
not considered the judgment in the case ofApollo Tyres(supra) which
had become available before the date of thin of return.[19] It is an admitted position that the appellant had made elaborate
disclosures on its notes to the computation of MAT liability providing
the basis (along with relevant judicial- pronouncements) on which the
sale profits were reduced in computing the book profits. The said
disclosure was also made in the Form No.29B, certifying the
computation of MAT liability. The question is whether under such-
conditions penaltyu/s.271(1)(c)could be levied.[20] The expression 'concealment of income' implies that incomes and
particulars thereof is/are being hidden, camouflaged or covered up so
as it cannot be seen, fc4incl, observed or discovered. The expression
furnishing of inaccurate particulars of income' implies furnishing of
details or information about income, which are not in conformity with
the facts as per the truth.2I] The above disclosures made by the appellant and other
disclosures in the financial statements dearly indicate that the
appellant has neither concealed any particulars of its income/profit nor
furnished any inaccurate particulars thereof.[22] In the case ofT Ashok Pal vs CIT(2007) 292 ITR 11 (SC), the
Hon'ble Supreme Court has observed as follows : -"The expression "conceal" is of great importance. According to
Law Lexicon, the word "conceal" mean: to hide or keep secret. The
word "conceal" is on plus celare which implies to hide. it means to
hide or withdraw from observation; to cover or keep from sight; to
prevent the discovery of to withhold knowledge of. The offense of
concealment is, thus, a direct 'attempt to hide an item of Income or a
portion thereof from the knowledge of the income tax authorities.[23) In the 'case ofCIT vs Indian Metals and Ferro Alloys Ltd.(1993)
211 ITR 35 (OH), the Orissa High Court has held as follows :"The Word "conceal" is derived from the                                loan word
     'concealment' which Implies `to hide': Webster                          in its New
     international Dictionary equates its meaning "to hide                   or withdraw
     from observations; to cover or keep from sight; to                      prevent the11ITA Nos .1 85 to 187 /Ran /20 16
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      discovery of; to withhold knowledge of offence of concealment is
      thus a direct attempt to hide an item of income or a portion
      thereof from the knowledge of the income-tax authorities. In
      furnishing the return of income, an assessee is required to
      furnish particulars and accounts on which such returned income
      has been arrived at. These may be particulars as per Its books of
      account, if it has maintained them, or any other basis upon
      which It had arrived at the returned figure of income. Any
      inaccuracy made in such books of account or otherwise which
      resulted in keeping off or hiding a portion of its income is
      punishable as furnishing inaccurate particulars of its income."[24] In the case ofK C Builders vs ACIT(2004) 265 ITR 562 (SC), the
Hon'ble Supreme Court has held as follow:"The meaning. of the word "concealment"- as found in Shorter- Oxford
English Dictionary, third edition, Volume l, is as follows : -"In law, the intentional suppression of truth or fact known, to the
      injury or prejudice of if another.The Shorter Oxford Dictionary V edition, Volume 1 ('Oxford
      Dictionary') defines the word 'conceal' as 'keep out of sight or
      notice, keep secret, refrain from disclosing or divulging'

      As per Black's Law Dictionary, 'concealment' Is the act of
      refraining from disclosure; an act which prevents or hinders the
      discovery of something; act of removing from sight or notice;
      hiding. Further, 'Concealment' is an affirmative act far intended
      or known to be likely to keep another from learning, of a fact
      which he would otherwise have learned. Such affirmative action
      is always equivalent to a misrepresentation...[25) Based on the above judicial pronouncements and dictionary
meanings of the word 'conceal' and 'deliberate, it may be concluded
that for (deliberate) concealment of income, there should have been
'hiding of income or profit' or 'keeping of secret' some particulars that
resulted in income or profit being 'concealed'.26] Further, In the case ofCIT vs Mussadilal Ram Bharose(1987) 165
ITR 14 (SC), the apex court has held that it is for the fact-finding body
to judge the relevance and sufficiency of the materials. If such a fact-
finding body comes to the conclusion that tide assessee has
discharged the onus, it becomes a conclusion of fact. However, in the
present case, the Assessing Officer has nowhere concluded that the12ITA Nos .1 85 to 187 /Ran /20 16
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relevant materials placed by the appellant, were insufficient. In fact,
the Assessing Officer has accepted the facts and materials placed by
pot rejecting the same.[27] it Is a well-settled legal principle that merely because the
explanations or contention of assessee are no accepted, there is no
conclusive ground for levy of penalty. The said principle has been
upheld in tile fallowing judicial pronouncements -• The Hon'ble Allahabad High Court has held in the case ofCIT
     vs University Printers188 ITR 206 (All) that: "merely because
     the explanation offered by the assessee was rejected, It
     furnished no ground for levying penalty until and unless it was
     found that the amount of question constituted the concealed
     income of the assessee. Since there was no material except the
     fact that the explanation offered by the assessee was rejected,
     the Imposition of penalty Is not warranted."• Reference can be made to the pronouncement of the
     Allahabad High Court in the case ofCIT vs Devi Dayal Aluminium
     Industries (Pvt) Ltd.(1987) 17 ITR 683 (All) wherein it was held
     that 'the rejection of the explanation of the assessee did not
     render It false so as to attractsection 271(1)(c)."[28) In the case ofCIT v Reliance Petroproducts (P) Ltd.322 ITR 158
(SC) it has been held that "A glance of provision ofsection 271(1)(c )
would suggest that in order to be covered, there has to be
concealment of the particulars of the income of the assessee.
Secondly, the assessee must have furnished inaccurate particulars of
his income. The instant case was not the case of concealment of the
income. That was not the case of the revenue either. It was an
admitted position in the instant case that no information given in the
return was found to be incorrect or inaccurate. It was not as if any
statement made or any detail supplied was found to be factually
incorrect. Hence, at least, prima facie, the assessee could not be held
guilty of furnishing inaccurate particulars. The revenue argued that-
submitting an incorrect claim in law for the expenditure On interest
would amount to giving inaccurate particulars of such Income. Such
cannot be the interpretation of the concerned words. The words are
plain and simple. In order to expose the assessee to the penalty unless
the case is strictly; covered by the provision, the penalty provision
cannot be invoked. By any stretch of Imagination, making an incorrect
claim in law cannot tantamount' to furnishing of inaccurate particulars.
[Para 7]13ITA Nos .1 85 to 187 /Ran /20 16
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Therefore, it must be shown that the conditions undersection 271(1)(c
) exist before the penalty is imposed. There can be no dispute that
everything would depend upon the return filed, because that is the
only document, where the assessee can furnish the particulars of his
income. When such particulars are found to be inaccurate, the liability
would arise. [Para 81

The word 'particulars' must mean the details supplied in the return,
which are not accurate, not exact or correct not according to truth or
erroneous, In the instant case, there was no finding that any details
supplied by the assessee in its return were found to be incorrect or
erroneous or false. Such not being the case, there would be no
question of inviting the penalty undersection 271(1)(c). A mere
making of the claim, which is not sustainable in law by itself will not
amount to furnishing of inaccurate particulars regarding the income of
the assessee. Such claim made in the return cannot amount to the
Inaccurate particular. [Para 9]

The revenue contended that since the assessee had claimed excessive
deductions knowing that they were incorrect it amounted to
concealment of income. It was argued that the falsehood in accounts
can take either of the two forms: (i) an item of receipt may be
suppressed fraudulently; (ii) in item of expenditure may be falsely (or
in an exaggerated amount) claimed, and both types attempt to reduce
the taxable income and, therefore, both types amount to- concealment
of particulars. of one's income as well as furnishing of inaccurate
particulars of income. Such 1 contention could not be accepted as the
asessee had furnished all the details of its expenditure as well as
Income In Its return, which details, in themselves, were not found to
be inaccurate nor could be viewed as the concealment of income on Its
part. It was up to did authorities to accept its claim in the return pi-
not. Merely because the assessee had claimed the expenditure, which
claim not accepted or was not acceptable to the revenue, that, by
itself, would not attract the penalty undersection 271(1)(c). If the
contention of the revenue was accepted, then in case of every return
where the claim 'made was not accepted by the Assessing Officer for
any reason, the assessee would invite penalty undersection 271(1)(c),
That is clearly not the Intendment of the Legislature. [Para 10]

[29] Facts of the impugned order are similar to those in which the
above Judgment of the. Hon'ble Apex Court was delivered, Relying on
the Judgments cited and on appreciation of the facts of the case the
penalty cannot be sustained."14ITA Nos .1 85 to 187 /Ran /20 16
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                                     A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 318.    We find that the order of the CIT(A) is in conformity with the order of

the Hon'ble Supreme Court in the case ofCIT vs. Nalwa Sons Investmentltd,   order   dated    4.5.2012    in    Special         Leave         to     Appeal         (Civil)

No(s).18564/2011 , wherein, it was held as under:"In this context, Hon'ble Delhi High Court in its judgment dated
       26.8.2010 in ITA No.1420 of 2009 in the case of Nalwa Sons
       Investment Ltd. (available in MRS as 2010-LL-0826-2), held that when
       the tax payable on income computed under normal procedure is less
       than the tax payable under the deeming provisions ofSection 115JBof
       the Act, then penalty undersection 271(1)(c)of the Act could not be
       imposed with reference to additions /disallowances made under normal
       provisions. The judgment has attained finality.4. Subsequently, the provisions of Explanation 4 to sub-section (1) of
       `section 271of the Act have been substituted byFinance Act, 2015,
       which provide for the method of calculating the amount of tax sought to
       be evaded for situations even where the income determined under the
       general provisions is less than the income declared for the purpose of
       MATu/s 115JBof the Act. The substituted Explanation 4 is applicable
       prospectively w.e.f. 01.04.2016.5. Accordingly, in view of the Delhi High Court judgment and substitution
       of Explanation 4 ofsection 271of the Act with prospective effect, it is
       now a settled position that prior to 1/4/2016, where the income tax
       payable on the total income as computed under the normal provisions of
       the Act is less than the tax payable on the book profitsu/s 115JBof the
       Act, then penalty under 271(1)(c) of the Act, is not attracted with
       reference to additions /disallowances made under normal provisions. It
       is further clarified that in cases prior to 1.4.2016, if any adjustment is
       made in the income computed for the purpose of MAT, then the levy of
       penaltyu/s 271(1)(c)of the Act, will depend on the nature of adjustment.6. The above settled position is to be followed in respect ofsection
       115JCof the Act also.15ITA Nos .1 85 to 187 /Ran /20 16
                                                                          C.O. 10 & 11/ R an/ 16
                                     A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 37. Accordingly, the Board hereby directs that no appeals may
       henceforth be filed on this ground and appeals already filed, if any, on
       this issue before various Courts/Tribunals may be withdrawn/not
       pressed upon.19.    Hence, we confirm the order of the CIT(A) in deleting the penalty of

Rs.94,07,400/- leviedu/s.271(1)(c)of the Act and dismiss the ground of

appeal of the revenue.20.    In the result, appeal filed by the revenue is dismissed.Order pronounced on 28 /06/2018 under Rule 34(4) of ITAT Rules
       by putting in the Notice Board at Ranchi

                     Sd/-                                         sd/-(PAVAN KUMAR GADALE)                        (N.S Saini)
            JUDICIAL MEMBER                       ACCOUNTANT MEMBER

Ranchi; Dated 28 /06 /2018
B.K.Parida, SPS
Copy of the Order forwarded to :
1. The Appellant /Revenue: DCIT, Central
    Circle-1, Ranchi.
2. The respondent:/Assessee; M/s. Usha
    Martin Limited, Tatisilwai, Ranchi

3.    The CIT(A), Ranchi
4.    Pr. CIT, Ranchi
5.    DR, ITAT, Ranchi
6.    Guard file.                                                             BY ORDER,
      //True Copy//

                                                                               SR.PS, ITAT,
                                                                            CAMP AT RANCHI16ITA Nos .1 85 to 187 /Ran /20 16
                                          C.O. 10 & 11/ R an/ 16A ss e ss men t Y ea rs : 19 9 9- 2 00 0 , 2 00 1 - 02 & 200 2- 0 3