Ashok Kumar Sobti, Ludhiana V. ITO, W-1(1), Ludhiana

ITA 1006/CHANDI/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6620 (ITAT-CHANDIGARH)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 30-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH SR DR
• Keywords: Rejection of books of accounts
• Section: 271(1)(c)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH SMC,CHANDIGARH , BEFORE: SH. SANJAY GARG, JUDICIAL MEMBER ./ ITA NO. ITA NO. 1006/CHD/2018 / ASSESSMENT YEAR : 2008-09 SHRI ASHOK KUMAR SOBTI, 1511, SECTOR 32A, URBAN ESTATE, CHANDIGARH ROAD, LUDHIANA. THE ITO, WARD 1(1), LUDHIANA. ./ PAN NO: BTGPS8566R / APPELLANT / RESPONDENT ! ' / ASSESSEE BY : SHRI VIBHOR GARG # ! ' / REVENUE BY : SHRI MANJIT SINGH, SR.DR $ % ! &/ DATE OF HEARING : 24.12.2018 '()* ! &/ DATE OF PRONOUNCEMENT : 21.01.2019 !/ ORDER THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER DATED 16.05.2018 OF THE COMMISSIO NER OF INCOME TAX (APPEALS)-I, LUDHIANA [HEREINAFTER REFER RED TO AS CIT(A)] AGITATING THE CONFIRMATION OF THE PENALTY L EVIED BY THE AO U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 ( IN S HORT 'THE ACT'). 2. THE BRIEF FACTS RELATING TO THE ISSUE ARE THAT T HE ASSESSEE IS IN THE BUSINESS OF CIVIL CONTRACTOR. T HE ASSESSEE FILED ITS RETURN OF INCOME U/S 139(1) OF THE ACT DE CLARING GROSS PROFIT RATE @ 8%, HOWEVER SINCE THE ASSESSEE COULD NOT PRODUCE CERTAIN BILLS AND VOUCHERS WHEN DEMANDED BY THE AO, THE AO REJECTED THE BOOKS OF ACCOUNTS AND ESTIM ATED THE GROSS PROFIT RATE @ 12%. BEING AGGRIEVED BY THE AB OVE ORDER OF THE AO, THE ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A). ITA-1006/CHD/2018 PAGE 2 OF 3 3. THE LD. CIT(A) CONSIDERING THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE AND AFTER HEARING THE LD. REPRESENTATIVE OF THE ASSESSEE RESTRICTED THE ESTIM ATION OF GROSS PROFIT @ 10% OF THE TURNOVER. IN THE MEANTIM E, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND LEVIED THE IMPUGNED PENALTY OF RS. 1,35,586/- IN RE SPECT OF THE ADDITION CONFIRMED BY THE LD. CIT(A). THE ASSE SSEE UNSUCCESSFULLY CONTESTED THE AFORESAID LEVY OF PENA LTY BEFORE THE CIT(A). 4. BEFORE US, LD. COUNSEL FOR THE ASSESSEE HAS SUBM ITTED THAT THERE WAS NO ACT ON THE PART OF THE ASSESSEE O F CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THAT SINCE THE A SSESSEE WAS A CIVIL CONTRACTOR AND MOST OF THE PAYMENTS WER E MADE TO SMALL CONTRACTORS/PARTIES, HENCE THOSE PARTIES D ID NOT ISSUE BILLS AND VOUCHERS AND HENCE THE ASSESSEE COU LD NOT PRODUCE THE SAID BILLS AND VOUCHERS. HOWEVER, THER E WAS NO FACT ON THE FILE THAT THE ASSESSEE HAD FURNISHED IN ACCURATE PARTICULARS OF INCOME OR HAD CONCEALED HIS INCOME. THAT THE AFORESAID DISALLOWANCE AND CONSEQUENTLY ADDITION WA S MADE ON ESTIMATION BASIS BECAUSE OF CERTAIN LACK OF EVID ENCE, HOWEVER ANY FACT ON THE FILE OR EXPLANATION GIVEN B Y THE ASSESSEE HAS NOT BEEN DISPROVED BY THE AO. 5. THE LD. DR ON THE OTHER HAND, HAS RELIED UPON FI NDINGS OF THE LOWER AUTHORITIES AND HAS SUBMITTED THAT THE PENALTY HAS RIGHTLY BEEN LEVIED IN THIS CASE. 6. AFTER CONSIDERING THE RIVAL SUBMISSIONS, THIS BE NCH IS OF THE VIEW THAT THIS IS NOT A FIT CASE FOR LEVY OF PE NALTY U/S ITA-1006/CHD/2018 PAGE 3 OF 3 271(1)(C) OF THE ACT. THE LOWER AUTHORITIES HAVE N OT PROVED OR ESTABLISHED ON THE FILE ANY FACT WHICH CAN BE SAID TO BE AN ACT ON THE PART OF THE ASSESSEE TO CONCEAL HIS INCOME O R OF FURNISHING OF INACCURATE PARTICULARS OF INCOME. TH E ESTIMATED ADDITION IN THIS CASE HAS BEEN MADE BY TH E LOWER AUTHORITIES ON ACCOUNT OF FAILURE OF THE ASSESSEE T O FURNISH CERTAIN DOCUMENTS REGARDING WHICH ONE ASSESSEE HAS GIVEN EXPLANATION ALSO. HOWEVER, IT HAS NOT BEEN PROVED ON FILE THAT ANY FACT, SUBMISSION OR EVIDENCE FURNISHED BY THE ASSESSEE WAS FALSE OR INACCURATE INVITING PENAL ACT ION UNDER THE PROVISIONS OF SECTION 271(1)(C) OF THE ACT. 7. IN VIEW OF THIS, THE PENALTY LEVIED IN THIS CASE IS SET ASIDE. THE APPEAL OF THE ASSESSEE IS HEREBY ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT. SD/- ( ) (SANJAY GARG) / JUDICIAL MEMBER DATED: 21.01. 2019 POONAM (+ ! ,- .- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. $ / / CIT 4. $ / ( )/ THE CIT(A) 5. -01 2 , & 2 , 34516 / DR, ITAT, CHANDIGARH 6. 15 7% / GUARD FILE (+ $ / BY ORDER, 8 # / ASSISTANT REGISTRAR