The Bombay High Court comprising of Justice K.R.Shriram and Justice M.M.Sathaye held that there is no finding in the order of Assessing Officer that explanation offered was found to be false or not bonafide.
BACKGROUND
The assessing officer had imposed a penalty because of certain disallowance in the order of the Assessing Office. That does not mean the penalty is automatically levieable. CIT (A) interfered and set aside a penalty levied by the Assessing Officer. This has been upheld by ITAT. The ITAT has extensively dealt with each item under which penalty was imposed and has given reasons why penalty was not leviable.
OBSERVATION
The court considered the order of the Assessing Officer and was satisfied that ingredients required to impose penalty have not been satisfied. There is no finding in the order of the Assessing Officer that the explanation offered was found to be false or not bonafide.
“We would add that even in the order of the Assessing Officer an observation that explanation is false or not bonafide is not enough. It has to be substantiated in detail with explanation as to why the Assessing Officer has come to a conclusion that the explanation offered was false or not bonafide,” the court said.
Case Title: Commissioner Of Income Tax Versus M/s Gujarat Ambuja Cements Limited
Citation: ITA No. 19 Of 2018
