Mostly when you claim a deduction and the same is denied by Assessing Officer, Assessing Officer seeks to levy penalty for concealment. In one such case of Eicon International (P.) Ltd, Assessee filed return claiming deduction u/s 80HHB.

Assessing Office in absence of requisite evidence regarding various conditions to be met for a allowing deduction under section 80HHB, found claim to be not bona fide and accordingly, while making assessment order, also levied a penalty under section 271(1)(c).

In an appeal before High Court, the question came up that whether even if Assessee was not entitled to claim a deduction under section 80HHB, it did not necessarily mean that Assessee had concealed its income with a view to gain any unforeseeable benefit.

High Court ruled the same I affirmative and deleted the penalty.