D.C.I.T. CENT. CIR. - 3(4), CENT. RANGE - 3, Mumbai V. HEMAA BUILDERS & DEVELOPERS PVT. LTD., Mumbai

ITA 116/MUM/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4246 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2013-2014
• Appeal Filed On: 05-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ KUMAR SINGH LD
• Assessee Lawyers: RUTURAJ H GURJAR LD ARS
• Keywords: Bogus purchase
• Section: 271(1)(c); 143(3)

Judgement Text

1 ITA NO.116/MUM/2018 M/S. HEMAA BUILDERS & DEVELOPERS P. LTD. ASSESSMENT YEAR-2013-14 IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./ I.T.A. NO.116/MUM/2018 ( / ASSESSMENT YEAR: 2013-14) DY . COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 3(4) CENTRAL RANGE, ROOM NO.1915, 19 TH FLOOR AIR INDIA BUILDING, NARIMAN POINT MUMBAI-400 021 / VS. M/S. HEMAA BUILDERS & DEVELOPERS LTD. 511, VYAPAR BHAWAN, 49 P.D.MELLO RD. CARNAC BUNDER MUMBAI-400 009. '# ! ./ ! ./PAN/GIR NO. AAACH-2118-P ( /APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : MANOJ KUMAR SINGH-LD. DR / RESPONDENT BY : RUTURAJ H. GURJAR -LD.ARS. / DATE OF HEARING : 07/03/2019 / DATE OF PRONOUNCEMENT : 13/03/2019 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER):- 1. AFORESAID APPEAL BY REVENUE FOR ASSESSMENT YEAR [IN SHORT REFERRED TO AS AY] 2013-14 CONTEST THE ORDER OF LD. COMMISSIO NER OF INCOME-TAX 2 ITA NO.116/MUM/2018 M/S. HEMAA BUILDERS & DEVELOPERS P. LTD. ASSESSMENT YEAR-2013-14 (APPEALS)-51, MUMBAI, [IN SHORT REFERRED TO AS CIT (A)], APPEAL NO. CIT(A)- 51/IT-183/DCIT-CC-3(4)/2016-17 DATED 03/10/2017 QUA DELETION OF PENALTY U/S 271(1)(C) FOR RS.23.64 LACS AS LEVIED BY LD. AO VIDE ORDER DATED 30/09/2016. 2. FACTS LEADING TO IMPOSITION OF IMPUGNED PENALTY ARE THAT THE ASSESSEE BEING RESIDENT CORPORATE ENTITY STATED TO BE ENGAGED AS BUILDERS AND DEVELOPERS DURING IMPUGNED AY WAS ASSESSED U/S 143(3) ON 22/03 /2016 WHEREIN THE ASSESSEE HAS BEEN SADDLED WITH ESTIMATE D ADDITION OF 12.5% ON ACCOUNT OF ALLEGED BOGUS PURCHASES. CONSEQUENTLY, PENALTY PROCEEDINGS U/S 271(1)(C) WERE INITIATED AGAINST THE ASSESSEE I N THE QUANTUM ASSESSMENT ORDER. DURING PENALTY PROCEEDINGS, THE A SSESSEE SUBMITTED THAT THE ADDITION WAS MADE ONLY ON AN ESTIMATED BAS IS AND THE SAME WAS ACCEPTED TO AVOID LITIGATION AND TO BUY PEACE OF MI ND AND THEREFORE, THE PENALTY WAS NOT JUSTIFIED. HOWEVER NOT CONVINCED, L D. AO WORKED OUT PENALTY OF RS. 23.64 LACS AGAINST THE ASSESSEE. IT HAS BEEN SUBMITTED BEFORE US THAT THE QUANTUM ADDITIONS HAVE ALREADY A TTAINED FINALITY. 3. AGGRIEVED, THE ASSESSEE AGITATED THE PENALTY ON LEGAL GROUNDS AS WELL AS ON MERITS WITH SUCCESS BEFORE LD. CIT VIDE IMPUG NED ORDER DATED 03/10/2017 WHEREIN LD. CIT DELETED THE PENALTY ON L EGAL GROUNDS, INTER-ALIA, BY OBSERVING THAT ALTHOUGH THE PENALTY WAS INITIATE D FOR INACCURATE PARTICULARS OF INCOME, HOWEVER, THE SAME HAS FINALLY BEEN LEVIED ON THE CHARGE OF CONCEALMENT OF INCOME. RELIANCE WAS PLACED ON FOLLOWING JUDICIAL PRONOUNCEMENTS WHILE ARRIVING AT SUCH CONCLUSION: - 3 ITA NO.116/MUM/2018 M/S. HEMAA BUILDERS & DEVELOPERS P. LTD. ASSESSMENT YEAR-2013-14 NO. TITLE RENDERED BY CITATION 1. SAMSON PERINCHERRY HONBLE BOMBAY HIGH COURT ITA NO. 4625/MUM/2013 DATED 05/01/2017 2. KANBAY SOFTWARE INDIA P. LTD. PUNE TRIBUNAL 112 TTJ 721 3. MANJUNATH COTTON & GINNING FACTORY HONBLE KARNATAKA HIGH COURT 359 ITR 565 4. SSA EMERALD MEADOWS HONBLE KARNATAKA HIGH COURT ITA NO. 380 OF 2015 THE MATTER WAS FINALLY CONCLUDED BY FIRST APPELLATE AUTHORITY BY OBSERVING AS UNDER: - 5.12 FROM THE ABOVE FACTS, IT CLEARLY EMERGES THAT THE PENALTY WAS INITIATED BY THE AO ON THE CHARGE OF FURNISHING OF INACCURATE PARTICUL ARS OF INCOME WHEREAS IT HAS FINALLY BEEN LEVIED BY THE AO ON THE CHARGE OF CONCEALMENT OF PARTICULARS OF INCOME. THEREFORE, IN VIEW OF THE BINDING DECISION OF THE J URISDICTIONAL HIGH COURT IN THE CASE OF SAMSON PERINCHERRY (SUPRA), WHEREIN THE DECISION OF HONBLE KARNATAKA HIGH COURT IN THE CASE OF MANJUNATH COTTON AND GINNING FACTORY (S UPRA) WAS FOLLOWED AND WHICH HAS BEEN APPROVED BY THE HONBLE SUPREME COURT, PENALTY LEVIED BY THE AO IS CANCELLED CONSIDERING THE PENALTY HAS BEEN LEVIED ON A DIFFER ENT CHARGE THAN THE CHARGE FOR WHICH IT WAS INITIATED. ACCORDINGLY, THE GROUNDS OF APPEA L OF THE ASSESSEE ARE ALLOWED . AGGRIEVED THE REVENUE IS IN FURTHER APPEAL BEFORE U S. 4. THE LD. DEPARTMENTAL REPRESENTATIVE [DR] SUPPORT ED THE PENALTY AS LEVIED BY LD. AO ON THE GROUND THAT QUANTUM ADDITIO NS HAVE ALREADY BEEN CONFIRMED AND THE PENALTY WAS LEVIED AFTER PROVIDIN G SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO CONTEST THE SAME AND THEREFORE, NO PREJUDICE WAS CAUSED TO THE ASSESSEE. PER CONTRA, LD. AUTHORISED REPRESENTATIVE FOR ASSESSEE SUBMITTED THAT THE ADDITIONS WERE MADE ONL Y ON ESTIMATED BASIS AND SECONDLY NON-FRAMING OF SPECIFIC CHARGE VITIATE S THE PENALTY PROCEEDINGS AS PER THE SETTLED JUDICIAL PRINCIPLES. 4 ITA NO.116/MUM/2018 M/S. HEMAA BUILDERS & DEVELOPERS P. LTD. ASSESSMENT YEAR-2013-14 5. WE HAVE CAREFULLY HEARD THE RIVAL SUBMISSIONS AN D PERUSED RELEVANT MATERIAL ON RECORD. THE UNDISPUTED POSITION THAT EM ERGES IS THAT THE PENALTY WAS INITIATED BY LD. AO ON ACCOUNT OF FURNISHING OF INACCURATE PARTICULARS OF INCOME LEADING TO CONCEALMENT OF INCOME BY THE ASSE SSEE WHEREAS THE PENALTY HAS FINALLY BEEN LEVIED FOR CONCEALMENT OF INCOME . THESE TWO EXPRESSIONS I.E. FURNISHING OF INACCURATE PARTICULARS AND CONCEALMEN T OF INCOME, AS PER JUDICIAL PRONOUNCEMENTS OF HIGHER JUDICIAL AUTHORITIES, CARRY DIFFERENT CONNOTATIONS AND NON-FRAMING OF SPECIFIC CHARGE AGAINST THE ASSESSEE VITIATES THE PENALTY PROCEEDINGS. THE FIRS T APPELLATE AUTHORITY HAS RELIED UPON THESE JUDICIAL PRONOUNCEMENTS WHILE ARR IVING AT THE SAID CONCLUSION. NO CONTRARY DECISION OF HIGHER JUDICIAL AUTHORITY IS AVAILABLE ON RECORD. THEREFORE, NO INFIRMITY COULD BE FOUND IN T HE IMPUGNED ORDER AND WE FIND NO REASON TO INTERFERE WITH THE SAME. 6. RESULTANTLY, THE APPEAL STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH MARCH, 2019. SD/- SD/- (SAKTIJIT DEY) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 13/03/2019 SR.PS:-JAISY VARGHESE ! / COPY OF THE ORDER FORWARDED TO : 1. #' / THE APPELLANT 2. ()#' / THE RESPONDENT 5 ITA NO.116/MUM/2018 M/S. HEMAA BUILDERS & DEVELOPERS P. LTD. ASSESSMENT YEAR-2013-14 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. *+(, , , , / DR, ITAT, MUMBAI 6. +./0 / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI