Smt. Madhuri Pradip Kawadiya, Ahmedabad V. The Dy. CIT, Circle-3(1)(2), Ahmedabad

ITA 109/AHD/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 6176 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-04-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 09-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S SHUKLA
• Assessee Lawyers: P B PARMAR
• Keywords: Corroborative evidences; Set aside
• Section: 271(1)(c)

Judgement Text

, A IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD ( CONVENED THROUGH VIRTUAL COURT ) BEFORE HONBLE MR. JUSTICE P. P. BHATT, PRESIDENT & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ I.T.A. NO. 109/AHD/2018 ( ASSESSMENT YEAR : 2013-14) MADHURI PRADIP KAWADIYA 302, PRESTIGE TOWER, B/H JUDGES BUNGALOWS, BODAKDEV, VASTRAPUR, AHMEDABAD / VS. DEPUTY COMMISSIONER OF INCOME-TAX CIRCLE-3(1)(2), AHMEDABAD ./ ./ PAN/GIR NO. : AEDPK8810M ( APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY : SHRI P. B. PARMAR, A.R. / RESPONDENT BY : SHRI S. S. SHUKLA, SR. D.R. DATE OF HEARING 13/04/2020 !'# / DATE OF PRONOUNCEMENT 22/04/2021 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTANCE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME TAX(APPEALS)-9, AHMEDABAD (CIT(A) IN SHORT), DATE D 06.11.2017 ARISING IN THE PENALTY ORDER DATED 29.06.2016 PASSE D BY THE ASSESSING OFFICER (AO) UNDER S. 271(1)(C) OF THE INCOME TAX A CT, 1961 (THE ACT) CONCERNING AY 2013-14. ITA NO. 109/AHD/18 [MADHURI P. KAWADIYA VS. DCIT] A.Y. 2013-14 - 2 - 2. AS PER GROUNDS OF APPEAL, THE ASSESSEE HAS CHALL ENGED THE IMPOSITION OF PENALTY OF RS.1,04,843/- LEVIED UNDER S. 271(1)(C) OF THE ACT ON ESTIMATED DISALLOWANCE OF VARIOUS EXPENSES O F RS.3,39,300/-. 3. WITH THE ASSISTANCE OF THE LEARNED AR FOR THE AS SESSEE AND ON PERUSAL OF CASE RECORDS, IT IS OBSERVED THAT THE AS SESSMENT IN THE INSTANT CASE WAS COMPLETED UNDER S.143(3) OF THE AC T DETERMINING TOTAL INCOME AT RS.41,96,910/- AS AGAINST THE INCOME FILE D IN THE RETURN OF RS.38,26,620/-. THE AO INTER ALIA DISALLOWED TRAVELLING AND VEHICLE EXPENSES, FUEL EXPENSES AND GAS EXPENSES HOLDING TH E SAME TO BE NON- BUSINESS PURPOSES AND IN THE ABSENCE OF SUPPORTING EVIDENCES. CONSEQUENTLY, PENALTY WAS ALSO IMPOSED ON THE GROUN D THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOM E AND FURNISHED INACCURATE PARTICULARS OF INCOME. IT IS THE CASE O F THE ASSESSEE THAT SIMILAR EXPENSES WERE INCURRED IN THE EARLIER YEARS WHERE THE DISALLOWANCE WAS EVENTUALLY RESTRICTED TO 30% OF TH E EXPENSES ON ACCOUNT OF INADEQUACY OF THE EVIDENCES IN THE QUANT UM PROCEEDINGS. THE DECISION OF THE CO-ORDINATE BENCH OF TRIBUNAL I N ITA NO.1551/AHD/2015 & ANR. FOR AY 2011-12 IN THE CASE OF THE ASSESSEE WAS REFERRED. IT WAS FURTHER SUBMITTED THAT QUANTU M ADDITIONS WERE NOT CHALLENGED IN THE INSTANT AY 2013-14 MERELY OWI NG TO SMALLNESS OF THE EXPENSES INCURRED. 4. WE FIND MERIT IN THE PLEA OF THE ASSESSEE FOR DE LETION OF THE PENALTY IMPOSED FOR MORE THAN ONE REASON; (I) DISAL LOWANCES MADE ARE IN THE REALM OF ESTIMATION WHEN SEEN IN CONJUNCTION WITH THE EARLIER ASSESSMENT YEARS; (II) AS STATED ON BEHALF OF THE A SSESSEE, NO PENALTY WAS IMPOSED UNDER S. 271(1)(C) OF THE ACT FOR SIMIL AR DISALLOWANCES IN THE PAST AND NO CHANGE IN THE FACTUAL MATRIX HAS BE EN BROUGHT TO OUR NOTICE; & (III) IN THE COURSE OF ASSESSMENT, SATISF ACTION WAS FORMED BY THE AO UNDER S.271(1B) OF THE ACT ALLEGING FURNISH ING OF INACCURATE PARTICULARS OF INCOME FOR THE PURPOSES OF INITIATI ON OF PENALTY PROCEEDINGS UNDER S. 271(1)(C) OF THE ACT. THE PEN ALTY WAS, HOWEVER, IMPOSED UNDER S. 271(1)(C) OF THE ACT OF THE ACT AL LEGING TWIN ITA NO. 109/AHD/18 [MADHURI P. KAWADIYA VS. DCIT] A.Y. 2013-14 - 3 - GROUNDS, NAMELY, CONCEALMENT OF PARTICULARS OF INC OME AND ALSO FURNISHING OF INACCURATE PARTICULARS OF INCOME. THUS, APPARENTLY THE SATISFACTION FORMED IN THE COURSE OF ASSESSMENT HAS EXPANDED AND BROADENED WHILE IMPOSING PENALTY. THIS REFLECTS FL APPABILITY AND CASUALNESS IN THE APPROACH OF THE AO AND ALSO NON-A PPLICATION OF MIND FOR INVOCATION OF PROCEEDINGS OF S. 271(1)(C) OF TH E ACT WHICH IS QUITE STRICT IN ITS NATURE. THE IMPOSITION OF PENALTY UND ER S. 271(1)(C) OF THE ACT IS NOT WARRANTED IN EVERY CASE AS A NECESSARY C ONCOMITANT TO EVERY ADDITION/DISALLOWANCE. THE STATUTORY DISCRETION VE STED WITH AO IN REGARD NEEDS TO BE EXERCISED IN JUST AND FAIR MANNE R. WHEN ALL FACTORS ARE COMBINEDLY SEEN, THE IMPOSITION OF PENALTY IN T HE CIRCUMSTANCES DOES NOT APPEAR JUSTIFIABLE IN THE LIGHT OF MITIGAT ING CIRCUMSTANCES RECORDED ABOVE. 5. HENCE, THE ORDER OF THE CIT(A) IS SET ASIDE AND THE AO IS DIRECTED TO DELETE THE PENALTY IN QUESTION. 6. IN THE RESULT, THE CAPTIONED APPEAL OF THE ASSES SEE IS ALLOWED. SD/- SD/- (JUSTICE P. P. BHATT) (PRADIP KUMAR KEDIA) PRESIDENT ACCOUNTANT ME MBER AHMEDABAD: DATED 22/04/2021 TRUE COPY S. K. SINHA !'#' / COPY OF ORDER FORWARDED TO:- &. / REVENUE 2. / ASSESSEE (. )*+ , / CONCERNED CIT 4. ,- / CIT (A) /. 012 33*+4 *+#4 56) / DR, ITAT, AHMEDABAD 7. 289 : / GUARD FILE. BY ORDER / 4 /5 *+#4 56) THIS ORDER PRONOUNCED ON 22/04/2021