ITAT remanded issue of penalty .

1. Effluent Channel Project Ltd was in the business of conveyance of industrial effluent and maintenance of channel.

2. It received membership contribution from its new members at Rs 2 crores in lieu of offering effluent disposal facility.

3. AO taxed the sum in the AY of receipt by following his line of action adopted in AY 2001-02, 2004-05 to 2008-09, rejecting the same as a capital receipt on the ground that it was yet to perform its part of obligation.

4.The same was accordingly adjusted as the brought forward sum resulting in addition of Rs. 39 lacs.

5. CIT(A) held that assessee had treated the amounts received in those years to be revenue receipts taxable on deferred basis over a period of 5 years.

6. Thus assessee ought to include l/5th of the contributions received for earlier years as taxable income in AY 2009-10.

7. It enhanced the return by Rs 17 lakhs.

8. CIT(A) initiated penalty proceedings u/s 271(1)(c) r.w.s. 274 for furnishing inaccurate particulars of income.

On appeal, the ITAT held as under:

9. A co-ordinate bench of a tribunal in similar cross appeals ITA Nos. 1945/Ahd/2011 and 1948/Ahd/2011 for assessment year 2008-09 decided on 24-07-2015 remits back the issue of assessment of assessee's above stated capital receipt contribution back to the assessing authority for reworking as per earlier order in assessment year 2001-02.

10. It further observes that the receipts received during the relevant accounting period are to be spread over for a period of five years instead of assessing the same in one assessment year.

11. The second issue of enhancement stands decided against assessee.