Kavita Rani, Delhi V. ITO, Ward- 34(1), New Delhi

ITA 109/DEL/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6732 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 04-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Assessee Lawyers: S GOYAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , DELHI BENCH SMC, NEW DELHI BEFORE SHRI BHAVNSH SAINI, JUDICIAL MEMBER ITA NO. 109/DEL./2018 ASSESSMENT YEAR : 2012-13 KAVITA RANI C-7/116, KESHAV PURAM, NEW DELHI, PIN- 110035 PAN : AGYPR2046R VS ITO, WARD-34(1) NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. S.GOYAL, CA REVENUE BY : SH. S.L.ANURAGI, SR. DR DATE OF HEARING :09.07.2018 DATE OF PRONOUNCEMENT : 09.07.2018 ORDER PER BHAVNESH SAINI, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE HAS BEEN DIRECTED AGAI NST THE ORDER OF LD. CIT(A)12, NEW DELHI DATED 13 TH OCTOBER, 2017 FOR ASSESSMENT YEAR 2012-13, CHALLENGING THE LEVY OF PENALTY U/S 271(1)(C) OF TH E IT ACT. 2. I HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PAR TIES AND PERUSED THE MATERIAL ON RECORD. ITA NO.109/DEL/2018 2 3. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSE E WAS RUNNING HER PROPRIETORY CONCERNS NAMELY M/S. GANGA RAM HAR PRASAD WHICH WER E INVOLVED IN TRADING IN FOOD GRAINS AND COMMISSION AGENT. ASSESSEE HAS SHOW N CREDITORS OF RS. 3,45,78,818/- IN THE NAME OF M/S. HOTI LAL CHUNNI L AL. BUT AS PER CONFIRMATION SUBMITTED BY THE CREDITORS WHEREIN THE CREDIT BALA NCE OF THE ASSESSEE WAS RS. 3,40,78,818/- AND AMOUNT OF DIFFERENCE WAS OF RS. 5 LACS WHICH WAS EXCESS SHOWN BY THE ASSESSEE. THE EXPLANATION OF THE ASSESSEE WA S CALLED FOR AS TO WHY ADDITION OF RS. 5 LAC BE NOT MADE TO WHICH ASSESSEE AGREED. THE AO ACCORDINGLY MADE ADDITION OF RS. 5 LACS. THE AO VIDE SEPARATE ORDER LEVIED T HE PENALTY ON THIS ADDITION U/S 271(1)(C) OF THE IT ACT. THE ASSESSEE CHALLENGED TH E PENALTY ORDER BEFORE THE LD. CIT(A) AND WRITTEN SUBMISSION OF THE ASSESSEE IS RE PRODUCED IN THE APPELLANT ORDER IN WHICH THE ASSESSEE EXPLAINED THAT THE DIFFERENCE OF RS. 5 LACS HAS OCCURRED DUE TO CLERICAL ERROR BY THE ACCOUNTANT. HE CREDITED A SUM OF RS. 5 LACS IN THE ACCOUNT OF M/S. HOTI LAL CHUNNI LAL ON 31 ST MARCH, 2012 AND DEBITED GANESH INTERNATIONAL BY RS. 5 LAC WHICH IS WRONGED ENTRY. THE SAID ENTRY WA S RECTIFIED IN THE NEXT YEAR. THE ASSESSEE FILED CONFIRMATION AND MATERIAL ON RECORD AND ALSO FILED COPY OF THE ACCOUNT OF BOTH THE PARTIES TO EXPLAIN THE DIFFERENCE. THE ASSESSEE EXPLAINED THE SAME POSITION BEFORE THE AO BUT THE ITO DID NOT AGREE AN D ASKED THE ASSESSEE TO SURRENDER THE ABOVE AMOUNT OTHERWISE HE WOULD LEVY THE PENAL TY. IT IS NOT A FIT CASE OF LEVY OF PENALTY BECAUSE THE ASSESSEE DID NOT CONCEAL THE PA RTICULARS OF INCOME OR FURNISHED ITA NO.109/DEL/2018 3 INACCURATE PARTICULARS OF INCOME. SEVERAL CASE LAWS WERE RELIED UPON IN SUPPORT OF THE ABOVE EXPLANATION. 4. THE LD. CIT(A) HOWEVER DID NOT ACCEPT CONTENTION OF THE ASSESSEE AND NOTED THAT NO EXPLANATION WAS OFFERED BY THE ASSESSEE FOR THE SAID DIFFERENCE AND ACCEPTED THE ADDITION BEFORE AO. THE ASSESSEE HAS INFLATED T HE LIABILITY BY RS. 5 LACS. THE EXPLANATION GIVEN NOW IS AN AFTER THOUGHT. THE APP EAL OF THE ASSESSEE WAS ACCORDINGLY DISMISSED. 5. AFTER CONSIDERING RIVAL SUBMISSION, I AM OF THE VIEW PENALTY IS NOT LEVIABLE IN THE FACTS AND CIRCUMSTANCES OF THE CASE. THE LD. CO UNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE AUTHORITIES BELOW AND F ILED COPY OF THE LEDGER ACCOUNT OF ALL THE ABOVE CONCERNED PARTIES AT PAGES 44 TO 4 9 OF THE PAPER BOOK. P B 68 IS SCHEDULE OF CURRENT LIABILITIES FILED WITH THE BALA NCE SHEET TO EXPLAIN THE ABOVE POSITION. ON THE OTHER HAND LD. DR RELIED UPON ORDE RS OF THE AUTHORITIES BELOW. IN THE INSTANT CASE THE AO MADE ADDITION OF RS. 5 LACS ON AGREED BASIS, HOWEVER, LATER ON ASSESSEE EXPLAINED THE DIFFERENCE OF RS. 5 LACS WAS ON ACCOUNT OF CLERICAL ERROR COMMITTED BY THE ACCOUNTANT WHICH IS RECTIFIED ABOV E. THERE WERE ENTRIES MADE IN THE A/C OF GANESH INTERNATIONAL WHICH IS EXPLAINED THROUGH COPIES OF VARIOUS LEDGER ACCOUNT FILED IN THE PAPER BOOK FROM PAGES 44 TO 49 AS ABOVE. IT IS WELL SETTLED LAW THAT QUANTUM AND PENALTY PROCEEDINGS ARE DISTINCT A ND DIFFERENT PROCEEDINGS. EVEN IF THE ASSESSEE DID NOT CHALLENGE THE ADDITION ON MERI T, THE ASSESSEE IS ENTITLED TO ITA NO.109/DEL/2018 4 EXPLAIN THAT PENALTY IS NOT LEVIABLE IN THE FACTS A ND CIRCUMSTANCES OF THE CASE. I AM SATISFIED WITH THE EXPLANATION OF THE ASSESSEE THAT IT WAS A CLERICAL ERROR COMMITTED FOR MAKING AN ENTRY OF RS. 5 LAC. THEREFORE IT IS N OT A CASE OF FILING INACCURATE PARTICULARS OF INCOME OR CONCEALING ANY PARTICULARS OF INCOME. IT IS WELL SETTLED LAW THE LEVY OF PENALTY IS NOT AUTOMATIC IN EACH AND EV ERY CASE BECAUSE IT WOULD TAKEN UPON THE FACTS AND MATERIAL BROUGHT ON RECORD. HOWE VER THE FACTS OF THE ABOVE CASE CLEARLY SHOWS THAT IT IS NOT A FIT CASE OF LEVY OF PENALTY. I ACCORDINGLY SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND CANCEL THE PENALTY U/S 271(1)(C) OF THE ACT. 6. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT.) SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DATED: 09 /07/2018 *BINITA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITA NO.109/DEL/2018 5 D ATE OF DICTATION 0 9 .0 7 .2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 0 9 .0 7 .2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 09 .0 7 .2018 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 09 .0 7 .2018 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 09 .0 7 .2018 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 09 .0 7 .2018 DATE ON WHICH THE FINAL ORDER IS UPLOADE D ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER **