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IN THE INCOME TAX APPELLATE TRIBUNAL

AHMEDABAD “B” BENCH

Before: Shri T.R. Senthil Kumar, Judicial Member And

Shri Narendra Prasad Sinha, Accountant Member

ITA No: 2286/Ahd/2025

Assessment Year: 2014-15

Chartered Speed Limited The DCIT,

S. No. 474, Sarkhej Circle-1(1)(1),

Bavla Highway, Vs Ahmedabad

Sanathal Circle, Sarkhej,

Ahmedabad-382210,

Gujarat

PAN: AADCC0802E

(Appellant) (Respondent)

Assessee Represented: Shri Atik Jain, A.R.

Revenue Represented: Shri Abhijit, Sr.D.R.

Date of hearing : 21-01-2026

Date of pronouncement : 28-01-2026

आदेश/ORDER

PER: T.R. SENTHIL KUMAR, JUDICIAL MEMBER

This appeal is filed by the Assessee as against the appellate

order dated 08-09-2025 passed by the Commissioner of Income Tax

(Appeals), National Faceless Appeal Centre, Delhi, (in short referred

to as “CIT(A)”), arising out of the partial confirmation of penalty

levied under section 271(1)(c) of the Income Tax Act, 1961

(hereinafter referred to as ‘the Act’) relating to the Assessment Year

2014-15.

I.T.A No. 2286/Ahd/2025 A.Y. 2014-15 2

Chartered Speed Ltd. Vs. DCIT

2. Brief facts of the case is that the assessee is Private Limited

Company engaged in the business of public transportation in

various cities and dealership business. For the Asst. Year 2013-14,

assessee filed its Return of Income on 10-09-2014 declaring total

income of Rs. 5,79,96,700/-. The return was taken for scrutiny

assessment and assessment was passed making following

disallowances:

(i) Disallowance u/s. 14A of Rs. 81,667/-

(ii) Disallowance of expenses for increased in authorized share

capital of Rs. 1,80,000/-

(iii) Disallowance u/s. 36(1)(iii) of Rs.21,26,536/-

The A.O. also initiated penalty proceedings.

3. Aggrieved against the assessment order, assessee filed an appeal

before Ld. CIT(A) who has deleted the addition made u/s. 14A of

the Act, however confirmed the remaining two additions. The

assessee has not preferred further appeal against the remaining

two additions. Thereafter the assessing officer proceeded with the

penalty proceedings and levied penalty of Rs.6,89,954/- on the

disallowance made u/s. 36(1)(iii) of the Act.

4. Aggrieved against the penalty order, assessee filed an appeal

before Ld. CIT(A) who has also confirmed the levy of penalty by

holding that the assessee has furnished inaccurate particulars of

income relating to the addition made u/s. 36(1)(iii) of the Act,

thereby upheld the levy of penalty amounting to Rs.6,89,954/-.

I.T.A No. 2286/Ahd/2025 A.Y. 2014-15 3

Chartered Speed Ltd. Vs. DCIT

5. Aggrieved against the same, the assessee is in appeal before us

raising the following Grounds of Appeal:

1. On the facts and circumstances of the case and law, the Ld. CIT(A) erred in

confirming the action of Ld. A.O. in levying penalty of Rs. 6,89,954/- u/s. 271(1)(c) of

the Income Tax Act, 1961.

2. Appellant craves leave to add further grounds or to amend or alter the existing

grounds of appeal on or before the date of hearing.

6. Heard rival submissions and perused the materials available on

record. The brief fact on the disallowance made u/s. 36(1)(iii) is the

assessee made addition (purchase) to the fixed assets in the nature

of commercial vehicles amounting to Rs.11,39,78,622/-. The

assessee was asked to furnish the details of date of acquisition,

source of funds and when the assets (Volvo buses) put to use and

compute the interest cost attributable to the loans taken by the

assessee and utilized towards acquisition of such assets. The

assessee explained that it purchased commercial vehicles which

are of two types (1) is ready to use Volvo bus and (2) body chassis

which were thereafter worked upon before the vehicle was put to

use. There were a time gap between the acquisition of the assets

and their original use in the second category of assets. The

assessee submitted that the date of acquisition, amount of loans,

date of put to use and interest details as follows:

Assets Amount of Date of Date of loan Date of Put Interest upto

Loan purchase to use assets put to use

as repayment

schedule of loan

Bus