Tribunal held that the assessee had shown all the expenses in the profit and loss account and there was no rejection of books of account and there was no such finding in the penalty order or the appellate order. There was no mandatory rule that for earning exempt income the assessee had to incur any expenditure. It is only when the Assessing Officer is satisfied about the type and amount of expenses which have been incurred specifically for earning the exempt income and had been debited to the profit and loss account for claiming expense against the revenue liable to be taxed. In the instant case the disallowance under section 14A was on estimated basis made proportionately out of the finance charges. There was no case of concealment of particulars of income or furnishing of inaccurate particulars of income since the amount had been duly debited as expenses in the profit and loss account. Since no intention or mens rea on the part of the assessee was apparent on the face of the record the Assessing Officer was not justified in levying the penalty  ( AY.2006-07)