1 itxa506-10 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.506 OF 2010 The Commissioner of Income Tax, Central II ..Appellant. V/s. M/s. STK Corporation ..Respondent. Mrs. Padma Diavkar for appellant. Mr. A.K. Jasani for respondent. CORAM : J.P. DEVADHAR AND MRS. MRIDULA BHATKAR, JJ. DATED : 11TH JANUARY, 2011 P.C. :- 1. A short question raised in this appeal is, whether the Tribunal was justified in deleting the penalty levied under Section 271(1) (c) of the Income Tax Act, 1961. The assessee engaged in the business of construction had paid municipal taxes and water charges in respect of the building constructed by it, to the appropriate authority and claimed deduction of the said amount. The claim for deduction was disallowed on the ground that the assessee is entitled to recover the amount from the Society as and when the building is completed and penalty was also levied. Though the disallowance of the claim is accepted by the 2 itxa506-10 assessee, the penalty levied under Section 271(1)(c) was challenged by filing an appeal. The Tribunal deleted the penalty on the ground that the assessee had made the claim bonafide, that the assessee had disclosed all relevant facts and there was no concealment. The Apex Court in the case of C.I.T. V/s. Reliance Petroproducts Pvt. Ltd. reported in 322 ITR 158 (S.C.) has held that making incorrect claim does not amount to concealment. Hence in the facts of the present case, deletion of the penalty cannot be faulted. The appeal is, therefore, dismissed with no order as to costs. (MRS. MRIDULA BHATKAR, J.) (J.P. DEVADHAR, J.)