IN THE HIGH COURT OF DELHI AT NEW DELHI 
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   ITA 603/2012  
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 CIT              ..... Appellant 
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 Through Mr. Sanjeev Sabharwal, sr. standing counsel with Ms. Gayatri 
 Verma, Adv. 
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 versus 
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 GOSWAMIS CREDITS and INVESTMENTS LTD         ..... Respondent 
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 Through Ms. Kavita Jha and Mr. Somnath Shukla, Advs. 
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 CORAM: 
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 HON'BLE MR. JUSTICE S. RAVINDRA BHAT 
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 HON'BLE MR. JUSTICE R.V.EASWAR 
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 O R D E R 
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    16.10.2012 
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 The revenue is aggrieved by the order dated 29.4.2011 of the ITAT 
 in ITA No.5093/Del/2010 whereby the Tribunal set aside the penalty 
 imposed upon the assessee.  Question of law sought to be urged is whether 
 the said order is contrary to Section 271(1)(c).  The assessee had filed 
 its return declaring a loss of `24,29,650/-;  this was assessed under 
 Section 143(3).  The Assessing Officer framed assessment on 1.12.2006. 
 In doing so, the Assessing Officer disallowed an amount of `65,97,597/- 
 under Section 14A.  This disallowance was confirmed by the Tribunal.  The 
 Assesisng Officer also initiated penalty proceedings for concealment of 
 income under Section 271(1)(c) and imposed the impugned penalty.  The 
 matter reached the Tribunal.  The Tribunal by the impugned order relied 
 upon its decision in DCIT Vs/ Nalwa Investments Ltd. and held that the 
 present case was covered by that order and accordingly allowed the 
 assessee?s appeal stating that the question of disallowance was a 
 debatable one, and therefore no penalty was imposable. 
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 2. This Court has considered the submissions.  It is brought to the 
 notice of the Court that in ITA 68/2012 i.e. CIT Vs. Jindal Equipment 
 Leasing and Consultancy Services Ltd., (the assessee in that case being a 
 sister concern of the present assessee) a similar order was set aside; 
 the Court had then observed as follows: 
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 ?5. The assessee in support of its contention had relied upon CIT versus 
 Raeeva Lochan Kanoria, (1994) 208 ITR 616 (Cal.), CIT versus Indian Bank 
 Limited, (1965) 56 ITR 77 (SC), CIT versus Maharashtra Sugar Mills 
 Limited, (1971) 82 ITR 452 (SC) and Rajasthan State Warehousing 
 Corporation versus CIT, (2000) 242 ITR 450 (SC). 
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 6. The CIT (Appeals) and the tribunal have considered the aforesaid 
 explanation given by the assessee to justify their claim why no 
 disallowance was mandated under Section 14A in the present case. They 
 have accepted that the explanation given by the assessee was genuine and 
 bona fide. The contention of the respondent assessee may have been 
 rejected in the quantum proceedings but when deciding whether or not 
 penalty for concealment should be imposed, the justification and 
 explanation why the assessee had made the claim, is to be examined. 
 Disallowance under the said Section have been subject matter of debate 
 and different views have been expressed. A legal contention which was 
 plausible and merited consideration was raised. Accordingly, the 
 appellate authorities have applied the explanation to Section 271(1)(c) 
 of the Act. Looking at the nature of explanation offered and the 
 provision in question i.e. Section 14A, which was incorporated by the 
 Finance Act, 2001 with retrospective effect from 1st April, 1962, we do 
 not think in the present case any substantial question of law arises in 
 view of the factual matrix involved. Accordingly, the appeal is 
 dismissed.? 
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 3. For the reasons mentioned above, no exception can be taken to the 
 impugned order of the Tribunal.  The same is in line with the order of 
 the Jindal Equipment Leasing and Consultancy Services Ltd. (quoted 
 above).  No substantial question of law arises for consideration.  Appeal 
 is therefore is dismissed. 
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 S. RAVINDRA BHAT, J 
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 R.V.EASWAR, J 
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 OCTOBER 16, 2012 
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 vld 
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 $ 5 
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