4A Financial Securities Ltd, New Delhi V. ACIT, Circle-1, , Noida

ITA 1036/DEL/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6936 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 12-02-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: IS DIRECTED AGAINS T PASSED
• Keywords: Wrong claim
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC NEW DELHI BEFORE MR. R.S. SYAL, VICE PRESIDENT ITA NO. 1036/DEL/2018 ASSESSMENT YEAR: 2013-14 M/S 4A FINANCIAL SECURITIES LIMITED, 109, DLF TOWER-A, JASOLA VIHAR NEW DELHI VS. DCIT CIRCLE-12(1) NEW DELHI PAN : AAACZ3020E (APPELLANT) (RESPONDENT) - O R D E R PER R.S.SYAL, V.P.: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) ON 25.9.2017 UPHOLDING THE PENALTY OF RS. 1, 28,300/- IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE IN COME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) IN RELATION TO THE A.Y. 2013-14. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE FILED RETURN DECLARING TOTAL INCOME OF RS. 22,66,770/-. THE ASSE SSING OFFICER MADE ADDITION OF RS.3,01,220/- UNDER SECTION 14A OF THE ACT READ WITH RULE 8D. ANOTHER ADDITION OF RS.1,13,790/- WAS MADE TOWARDS CLAIM FOR MEMBERSHIP APPELLANT BY SH. SARVESH SRIVASTAVA, CA RESPONDENT BY SH. ATIQ AHMED, SR. DR DATE OF HEARING 25.7.2018 DATE OF PRONOUNCEMENT 26.7.2018 2 ITA NO.1036 /DEL/2018 FEES AMOUNTING TO RS. 14,484/- AND INTEREST ON LATE PAYMENT RS.99,306/-. THESE TWO ADDITIONS FORMED THE BEDROCK OF THE EDIFI CE OF INSTANT PENALTY, WHICH CAME TO BE AFFIRMED IN THE FIRST APPEAL. 3. I HAVE HEARD BOTH THE SIDES AND PERUSED THE RELE VANT MATERIAL ON RECORD. IT IS EVIDENT FROM THE DISCUSSION MADE ABOVE THAT S UCH PENALTY HAS BEEN IMPOSED ON MAKING DISALLOWANCE OF CERTAIN EXPENSES. BUT FOR THAT, THERE IS NOTHING ON RECORD TO SHOW THAT THE ASSESSEE LODGED BOGUS CLAIMS IN RESPECT OF THESE EXPENSES. THAT APART, THE EXPENSES WERE C LAIMED BY THE ASSESSEE IN A BONA FIDE MANNER. THE MERE FACT THAT THE ABOVE DISALLOWANCES HAVE BEEN MADE DO NOT BRING A CASE WITHIN THE PARAMETERS SET OUT IN SECTION 271(1)(C) OF THE ACT. THE HONBLE SUPREME COURT IN CIT VS. RELIANCE PETROPRODUCTS PRIVATE LTD.(2010) 322 ITR 158 (SC) HAS HELD THAT A MERE MAKING OF A CLAIM WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF WILL NOT ATTRACT PENALTY 271(1)(C) OF THE INCOME-TAX ACT, WHEN THE ASSESSEE FURNISHES ALL THE RELEVANT PARTICULARS IN HIS RETURN WHICH ARE NOT FOUND TO BE INACCURATE. THERE IS NO DEARTH OF DECISIONS HOLDING THAT PENALTY UNDER SECTION 271(1) (C) CANNOT BE IMPOSED ON DISALLOWANCE OF EXPENSES, WHICH WERE NOT OTHERWISE BOGUS. I, THEREFORE, SET ASIDE THE IMPUGNED ORDER AND DIRECT TO DELETE THE P ENALTY. 3 ITA NO.1036 /DEL/2018 4. IN THE RESULT, THE APPEAL IS ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 26.7.2018.) SD/- (R.S. SYAL) VICE PRESIDENT N. MISHRA) DT.26.07.2018 SH COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR, ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 26.7.2018 PS 2. DRAFT PLACED BEFORE AUTHOR PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 7.2 018 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 7.2018 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 11. DATE OF UPLOADING 7.2018 *