The ACIT, Circle-9, Surat V. M/s. Rakholiya Enterprise, Surat

ITA 1010/AHD/2012

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9739 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 06-07-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 09-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD (BEFORE SHRI ANIL CHATURVEDI, A.M. & SHRI S.S. GODA RA, J.M.) I.T. A. NO. 1010 /AHD/2012 (ASSES SMENT YEAR: 2005-06) THE A.C.I.T., CIRCLE-9, AHMEDABAD V/S M/S. RAKHOLIYA ENTERPRISE 2, SWAMINARAYAN NAGAR-1, OPP. PANI NI TANKI, VARACHHA ROAD, SURAT 395001 (APPELLANT) (RESPONDENT) PAN: AAGFR9872B APPELLANT BY : SHRI DINESH SINGH, SR. D.R . RESPONDENT BY : NONE ( )/ ORDER DATE OF HEARING : 06-07-2015 DATE OF PRONOUNCEMENT : 10 -07-2015 PER ANIL CHATURVEDI, ACCOUNTANT MEMBER 1. THIS APPEAL FILED BY THE REVENUE IS AGAINST THE ORD ER OF CIT(A)-V, SURAT DATED 03.01.2012 FOR A.Y. 2005-06. 2. IN THIS CASE, NONE APPEARED ON BEHALF OF ASSESSEE T HOUGH AS PER THE OFFICE RECORDS, THE NOTICE INTIMATING THE DATE OF HEARING WAS SERVED UPON THE ASSESSEE. WE THEREFORE PROCEED TO DECIDE THE APPEAL , EX PARTE QUA THE ASSESSEE ON THE BASIS OF MATERIAL ON RECORD. ITA NO 1010/ AHD/2012 . A.Y. 2005-0 6 2 3. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 4. ASSESSEE IS A PARTNERSHIP FIRM STATED TO BE ENGAGED IN THE BUSINESS OF CONSTRUCTION OF RESIDENTIAL UNITS. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2006-06 ON 21.10.2005 DECLARING TOTAL INCOME OF RS. 2,09,753/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESS MENT WAS FRAMED UNDER SECTION 143(3) VIDE ORDER DATED 17.12.2007 AND THE TOTAL INCOME WAS DETERMINED AT RS. 86,30,180/- BY MAKING VARIOUS ADD ITIONS AGGREGATING TO RS. 84,20,430/-. AGGRIEVED AGAINST THE QUANTUM ADDI TION, ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A) WHO GRANTED SUBSTANTIAL RE LIEF TO THE ASSESSEE AND CONFIRMED THE ADDITION TO THE EXTENT OF RS. 10,13,3 25/- ONLY AS AGAINST ADDITION OF RS. 84,20,430/- MADE BY THE A.O. ON THE ADDITIONS THAT WERE CONFIRMED BY LD. CIT(A), A.O VIDE ORDER DATED 24.03 .2010 HELD THAT ASSESSEE HAS FAILED TO DISCHARGE THE ONUS TO PROVIN G THAT THERE WAS NO CONCEALMENT OF INCOME AND HE ACCORDINGLY LEVIED PEN ALTY OF RS. 3,70,800/- U/S. 271(1)(C) OF THE ACT. AGGRIEVED BY THE PENALTY ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 03.01.2012 DELETED THE PENALTY BY HOLDING AS UNDER:- 7. I HAVE CONSIDERED THE REASONS GIVEN BY ASSE SSING OFFICER AND ALSO THE SUBMISSIONS OF APPELLANT. IN MY OPINION, THE ESTIMATED ADDITION DOES NOT NEC ESSARILY INDICATE' THAT EITHER THE ASSESSEE HAS CONCEALED HIS INCOME OR FURNISHED-INAC CURATE PARTICULARS OF INCOME. FURTHER ESTIMATION IS ALWAYS ESTIMATION HOWSOEVER; IT MAY B E SCIENTIFIC OR LOGICAL. HENCE, ON THE ADDITION MADE ON ACCOUNT OF ESTIMATION, PENA LTY PROCEEDINGS CANNOT BE INVOKED. THIS OPINION/OBSERVATION HAS BEEN HELD BY MANY HON' BLE COURTS OF THE COUNTRY. ACCORDINGLY, THE PENALTY IMPOSED ON THE ABOVE ESTIMATED ADDITION IS HEREBY DELETED AND THE APPEAL IS ALLOWED. ITA NO 1010/ AHD/2012 . A.Y. 2005-0 6 3 5. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), REV ENUE IS NOW IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD.CIT(A) HAS ERRED IN DELETING THE PENALTY LEVIED U/S.271(1)(C) OF THE AC T OF RS.3,70,000/- BY THE A.O. FOR CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF INCOME , WITHOUT APPRECIATING THE FACTS OF THE CASE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, THE LD.CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER ESPECIALL Y SO SINCE THE ORDER WAS PASSED ON ADDITION CONFIRMED IN APPEAL AND ASSESSEE HAD FAILE D TO OFFER ANY EXPLANATION TO THE SHOW CAUSE NOTICE ISSUED PRIOR TO LEVY OF PENALTY. 6. BEFORE US, LD. D.R. SUPPORTED THE ORDER OF A.O. 7. WE HAVE HEARD THE LD. D.R. AND PERUSED THE MATERIAL ON RECORD. IN THE PRESENT CASE CERTAIN ADDITIONS WERE MADE BY A.O AGA INST WHICH IN THE APPEAL ASSESSEE WAS GRANTED PARTIAL RELIEF BY THE LD. CIT( A). ON THE ADDITIONS THAT WERE CONFIRMED BY LD. CIT(A), PENALTY U/S. 271(1)(C ) WAS LEVIED BY A.O. WE FIND THAT LD. CIT(A) WHILE DELETING THE PENALTY HAS NOTED THAT THE PENALTY WAS LEVIED ON THE ADDITIONS THAT WERE MADE ON ESTIM ATION BASIS AND ON THOSE ADDITIONS HE HELD THAT THE PENALTY FOR CONCEALMENT OF INCOME U/S. 271(1(C) COULD NOT BE LEVIED. BEFORE US, REVENUE HAS NOT BRO UGHT ANY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF LD. CIT(A) NOR HAS POINTED OUT ANY FALLACY IN THE FINDINGS OF LD. CIT(A). IN VIEW OF T HE AFORESAID FACTS, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF LD. CIT(A) AND THUS THE GROUND OF REVENUE IS DISMISSED. ITA NO 1010/ AHD/2012 . A.Y. 2005-0 6 4 8. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 10- 07 - 2015. SD/- SD/- (S. S. GODARA) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT ,AHMEDABAD