ITO, WD-47(3), KOLKATA, Kolkata V. Sri Ramanand Kedia, Howrah

ITA 1011/KOL/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1514 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 15-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Initiation of penalty proceedings
• Section: 144

Judgement Text

I.T.A. NO. 1011/KOL./2015 ASSESSMENT YEAR: 2007-2008 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA A BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 1011/KOL/ 2015 ASSESSMENT YEAR: 2007-2008 INCOME TAX OFFICER,................................ ...............................APPELLANT WARD-47(3), KOLKATA, 3, GOVERNMENT PLACE (WEST), KOLKATA-700 001 -VS.- SHRI RAMANAND KEDIA,............................... ..........................RESPONDENT 108/4/1, ADINATH APARTMENT, G.T. ROAD, HOWRAH-711 106 [PAN: AKCPK 4042 N] APPEARANCES BY: SHRI ROBIN CHOWDHURY, ADDITIONAL CIT, D.R., FOR THE DEPARTMENT N O N E, FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : JULY 25, 2017 DATE OF PRONOUNCING THE ORDER : JULY 31, 2017 O R D E R PER SHRI P.M. JAGTAP, A.M. .: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-14, KOLKATA DA TED 12.05.2015, WHEREBY HE CANCELLED THE PENALTY OF RS.38,99,856/- IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE AC T, 1961. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L, WHO IS ENGAGED IN THE BUSINESS OF TRADING OF CLOTHES UNDER THE NAME A ND STYLE OF HIS PROPRIETARY CONCERN M/S. RAVI TEXTILES. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY HIM ON 29.10.2007 DECLARING TOTAL INCOME OF RS.2,06,368/-. IN THE EX-PARTE ASSESSMENT COMPLETED UNDER SECTION 144 TO THE BEST OF HIS JUDGMENT VIDE AN ORD ER DATED 31.12.2009, THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED BY THE ASSESSING OFFICER AT RS.1,29,75,210/- AFTER MAKING THE FOLLOWING ADDI TIONS:- (I) LOAN TREATED AS UNEXPLAINED CASH CREDIT UNDER SECTION 68 RS. 1,22,500/ - I.T.A. NO. 1011/KOL./2015 ASSESSMENT YEAR: 2007-2008 PAGE 2 OF 3 (II) UNPROVED SUNDRY CREDITORS RS.1,26,36,671/ - (III) DISALLOWANCE OUT OF TELEPHONE EXPENSES RS. 9,671/ - PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) WERE A LSO INITIATED BY THE ASSESSING OFFICER IN RESPECT OF TWO ADDITIONS OF RS .1,22,500/- AND RS.1,26,36,671/- MADE TO THE TOTAL INCOME OF THE AS SESSEE AND SINCE THE EXPLANATION OFFERED BY THE ASSESSEE IN RESPONSE TO THE NOTICE ISSUED DURING THE COURSE OF THE SAID PROCEEDINGS WAS NOT F OUND ACCEPTABLE BY HIM, THE ASSESSING OFFICER IMPOSED PENALTY OF RS.38 ,99,856/- UNDER SECTION 271(1)(C) BEING 100% TAX SOUGHT TO BE EVADE D BY THE ASSESSEE ON THE SAID TWO ADDITIONS. 3. THE PENALTY IMPOSED BY THE ASSESSING OFFICER UND ER SECTION 271(1)(C) WAS CHALLENGED BY THE ASSESSEE IN THE APP EAL FILED BEFORE THE LD. CIT(APPEALS). MEANWHILE THE APPEAL FILED BY THE ASSESSEE IN THE QUANTUM PROCEEDINGS AGAINST THE ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 144 WAS DISPOSED OF BY THE LD. CIT(AP PEALS) VIDE AN APPELLATE ORDER DATED 13.03.2015, WHEREBY HE ANNULL ED THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER UNDER SECTION 144 BY TREATING THE SAME AS AB INITIO INVALID AND ALSO DELETED THE ADDITIONS MADE BY THE ASSESSING OFFICER TO THE TOTAL INCOME OF THE ASSESS EE IN THE SAID ASSESSMENT. TAKING NOTE OF THE SAID ORDER DATED 13. 03.2015 PASSED IN QUANTUM PROCEEDINGS, THE LD. CIT(APPEALS) CANCELLED THE PENALTY IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) ON THE GROUND THAT THE BASIS OF INITIATION OF PENALTY PROCEEDINGS ITSELF D ID NOT SURVIVE. 4. AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS), THE REVENUE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING, NONE HAS APPEARED ON BEH ALF OF THE ASSESSEE. THIS APPEAL OF THE REVENUE IS, THEREFORE, BEING DIS POSED OF EX-PARTE QUA THE RESPONDENT-ASSESSEE AFTER HEARING THE ARGUMENTS OF THE LD. D.R. AND PERUSING THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS OBSERVED THAT THE CORRESPONDING ASSESSMENT ORDER PASSED BY THE ASSESS ING OFFICER UNDER I.T.A. NO. 1011/KOL./2015 ASSESSMENT YEAR: 2007-2008 PAGE 3 OF 3 SECTION 144 HAVING BEEN ANNULLED BY THE LD. CIT(APP EALS) VIDE HIS APPELLATE ORDER DATED 13.03.2015 PASSED IN QUANTUM PROCEEDINGS, THE VERY BASIS OR FOUNDATION OF THE PENALTY IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) NO MORE SURVIVED AND THE SA ID PENALTY IS, THEREFORE, LIABLE TO BE CANCELLED HAVING NO LEGS TO STAND AS RIGHTLY HELD BY THE LD. CIT(APPEALS). AT THE TIME OF HEARING, THE L D. D.R. HAS NOT BEEN ABLE TO BRING ANYTHING ON RECORD TO SHOW THAT THE APPELL ATE ORDER DATED 13.03.2015 PASSED BY THE LD. CIT(APPEALS) IN THE QU ANTUM PROCEEDINGS HAS BEEN SUBSEQUENTLY SET ASIDE OR REVERSED BY THE TRIBUNAL. WE, THEREFORE, FIND NO JUSTIFIABLE REASON TO INTERFERE WITH THE IMPUGNED ORDER OF THE LD. CIT(APPEALS) CANCELLING THE PENALTY IMPO SED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) AND UPHOLDING THE S AME, WE DISMISS THIS APPEAL FILED BY THE REVENUE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN THE OPEN COURT ON JULY 31, 2017 . SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT ME MBER KOLKATA, THE 31 ST DAY OF JULY, 2017 COPIES TO : (1) INCOME TAX OFFICER, WARD-47(3), KOLKATA, 3, GOVERNMENT PLACE (WEST), KOLKATA-700 001 (2) SHRI RAMANAND KEDIA, 108/4/1, ADINATH APARTMENT, G.T. ROAD, HOWRAH-711 106 (3) COMMISSIONER OF INCOME TAX(APPEALS)-14, KOLKAT A; (4) COMMISSIONER OF INCOME TAX ,KOLKAT A (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, HEAD OF OFFICE/DDO INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.