Section 271(1)(c) of the Income-tax Act, 1961—Penalty—Penalty deleted as the explanation rendered by the assessee was reasonable

Facts: "Whether Tribunal has erred in law and on facts in deleting the penalty under section 271 [1](c) with respect to claim of the assessee for deduction under section 36 [1] (viii) without appreciating that this is not a case of plausible claim based on a bona fide interpretation of law and the assessee was clearly not eligible for deduction claimed and the penalty was supported by the decision in Zoom Communication Private Limited ?"

Held, that Tribunal deleted the penalty primarily on the ground that the explanation rendered by the assessee was reasonable. Though quantum additions were confirmed till the stage of Tribunal, further appeal at the hands of the appellant is pending before the High Court. On the similar circumstances, in case of this very assessee, Revenue's appeal being Tax Appeal No. 515 of 2018 concerning penalty arising out of the same judgment of the Tribunal came to be dismissed by this Court on 11th June 2018. - PR. CIT V/s NATIONAL DAIRY DEVELOPMENT BOARD - [2018] 2 ITCD Online 110 (GUJ)