Assistant Commissioner of Income-tax, V. M/s. Ghodawat Energy (I) Pvt. Ltd., Kolhapur

ITA 1170/PUN/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 9146 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2018
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 20-03-2018
• Assessment Year: 2005-2006
• Appeal Filed On: 31-05-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DR VIVEK AGGARWAL
• Assessee Lawyers: R G NAHAR
• Keywords: Depreciation; Onus to prove
• Section: 143(3); 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUNE , , , BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO . 1170 /P U N/201 6 / ASSESSMENT YEAR : 20 05 - 06 ASSISTANT COMMISSIONER OF INCOME TAX, ICHALKARANJI CIRCLE, ICHALKARANJI ....... / APPELLANT / V/S. M/S. GHODAWAT ENERGY (I) PVT. LTD., A/P CHIPRI, DISTT. - KOLHAPUR - 416101 / RESPONDENT ASSESSEE BY : SHRI R.G. NAHAR REVENUE BY : DR. VIVEK AGGARWAL / DATE OF HEARING : 20 - 0 3 - 2018 / DATE OF PRONOUNCEMENT : 23 - 0 3 - 201 8 / ORDER PER VIKAS AWASTHY, JM : TH IS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 2, KOLHAPUR DATED 16 - 03 - 2016 DELETING LEVY OF PENALTY U/S. 271(1)(C) O F THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) FOR THE ASSESSMENT YEAR 20 05 - 06. 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORDS ARE : THE ASSESSEE IS A PRIVATE LIMITED COMPANY ENGAGED IN MANUFACTURING OF PANMASALA, GHUTKHA AND ELECTRICITY. IN ASSESSMENT ORDER PASSED U/S. 2 ITA NO . 1170/PUN/2016, A.Y. 2005 - 06 143(3) R.W.S. 153A(B) OF THE ACT CERTAIN ADDITIONS/DIS ALLOWANCES WERE MADE BY ASSESSING OFFICER. ONE OF THE DISALLOWANCES WAS IN RESPECT OF EXCESS DEPRECIATION CLAIMED ON WINDMILL RS.8,92,27,300/ - . THE ASSESSEE FILED APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) ASSAILING THE ADDITIONS/DISALLOWANCE S. THE COMMISSIONER OF INCOME TAX (APPEALS) RESTRICTED THE DISALLOWANCES ON ACCOUNT OF EXCESS CLAIM OF DEPRECIATION TO RS.34,79,380/ - . THE ASSESSING OFFICER VIDE ORDER DATED 24 - 03 - 2014 LEVIED PENALTY OF RS.12,73,191/ - U/S. 271(1)(C) IN RESPECT OF DISALLO WANCE CONFIRMED BY THE COMMISSIONER OF INCOME TAX (APPEALS). AGAINST THE PENALTY ORDER, THE ASSESSEE FILED APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) VIDE IMPUGNED ORDER DELETED PENALTY. NOW, THE REV ENUE IS IN APPEAL AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. 3. DR. VIVEK AGGARWAL REPRESENTING THE DEPARTMENT SUBMITTED THAT A PERUSAL OF IMPUGNED ORDER WOULD SHOW THAT NO REASON W HATSOEVER HAS BEEN GIVEN BY THE COMMISSIONER OF INCOME TAX (APPEALS) FOR DELETING PENALTY LEVIED U/S. 271(1)(C) OF THE ACT. THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IS NON - SPEAKING AND THUS, IS LIABLE TO BE SET ASIDE. THE LD. DR FURTHER SUBMITTE D THAT THE ASSESSEE HAS CLAIMED EXCESS DEPRECIATION ON WINDMILL WHICH WAS DISALLOWED BY ASSESSING OFFICER. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED PART ADDITION. THE ASSESSING OFFICER HAS LEVIED PENALTY ON THE ADDITION CONFIRMED BY COMMISSIONER OF INCOME TAX (APPEALS). THEREAFTER, THE ASSESSEE HAS NOT CHALLENGED THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMING DISALLOWANCES OF EXCESS DEPRECI ATION . THUS, THE ADDITION OF RS. 34,79,380/ - HAS ATTAINED FINALITY. THE ASSESSING OFFICER HAS 3 ITA NO . 1170/PUN/2016, A.Y. 2005 - 06 RIGHTLY LEVIED PENALTY U/S. 271(1)(C) ON THE ADDITION SUSTAINED BY COMMISSIONER OF INCOME TAX (APPEALS). 4. ON THE OTHER HAND SHRI R.G. NAHAR APPEARING ON BEH ALF OF THE ASSESSEE SUBMITTED THAT IN PARA GRAPH 6 OF THE IMPUGNED ORDER THE COMMISSIONER OF INCOME TAX (APPEALS) HAS GIVEN REASONS FOR DELETING LEVY OF PENALTY. THE LD. AR VEHEMENTLY SUPPORTING THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) PRAYED FOR DISMISSING THE APPEAL OF REVENUE. 5. W E HAVE HEARD THE SUBMISSIONS MADE BY REPRESENTATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW . IN APPEAL THE REVENUE HAS ASSAILED THE ACTION OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. A PERUSAL OF IMPUGNED ORDER REVEALS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HAS NOT GIVEN REASONED FINDIN G FOR DELETING THE PENALTY. IN PARAGRAPHS 1 TO 4 OF THE IMPUGNED ORDER , THE COMMISSIONER OF INCOME TAX (APPEALS) HAS GIVEN BRIEF GIST OF FACTS OF THE CASE AND HAS REPRODUCED THE SUBMISSIONS MADE BY ASSESSEE. IN PARAGRAPH 5 OF THE ORDER THE COMMISSIONER O F INCOME TAX (APPEALS) HAS REFERRED TO THE DECISION OF TRIBUNAL, PUNE BENCH IN THE CASE OF EVERREADY INVESTMENT PVT. LTD. (SIC) AND THEREAFTER HAS CONCLUDED AS UNDER : 6. THE DECISION OF HONOURABLE SUPREME COURT IN THE CASE OF DILIP N. SHROF V/S JCIT, SPE CIAL RANGE, MUMBAI 291 ITR 519 THE DECISION IS MORE EXHAUSTIVE. IT WAS HELD BY THE HONOURABLE SUPREME COURT THAT A DUTY MAY BE ENJOINED ON THE ASSESSEE TO MAKE A CORRECT DISCLOSURE OF INCOME BUT IF THE DISCLOSURE IS BASED ON OPINION OF AN EXPERT, ONLY BEC AUSE HIS OPINION IS NOT ACCEPTED, THE SAME BY ITSELF MAY NOT BE SUFFICIENT FOR ARRIVING AT CONCLUSION THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS WARRANTING PENALTY UNDER SECTION 271(1)(C). SINCE BURDEN OF PROOF IN PENALTY PROCEEDINGS VARY FROM THA T IN THE ASSESSMENT PROCEEDINGS CANNOT BE AUTOMATICALLY BE ADOPTED. 4 ITA NO . 1170/PUN/2016, A.Y. 2005 - 06 6. WE ARE OF CONSIDERED VIEW THAT IN THE IMPUGNED ORDER THE COMMISSIONER OF INCOME TAX (APPEALS) HAS NOT GIVEN ANY SUSTAINABLE REASON FOR DELETING PENALTY LEVIED U/S. 271(1)(C) OF THE A CT. THE REASONING GIVEN BY COMMISSIONER OF INCOME TAX (APPEALS) IN CONCLUDING PARAGRAPH IS CRYPTIC AND LACKS CLARITY. HENCE, WE DEEM IT APPROPRIATE TO REMIT THIS APPEAL BACK TO THE FILE OF COMMISSIONER OF INCOME TAX (APPEALS) FOR PASSING A SPEAKING ORDER AFTER AFFORDING OPPORTUNITY OF HEARING TO THE ASSESSEE, IN ACCORDANCE WITH LAW. ACCORDINGLY, THE IMPUGNED ORDER IS SET ASIDE AND THE APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSE. 7. IN THE RESULT, THE APPEAL OF REVENUE IS ALLOWED FOR STATISTICA L PURPOSE. ORDER PRONOUNCED ON FRIDAY, THE 23 RD DAY OF MARCH, 2018 . SD/ - SD/ - ( / ANIL CHATURVEDI ) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 23 RD MARCH, 2018 RK / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 2, KOLHAPUR 4. / THE CIT - II, KOLHAPUR 5. , , , / DR, ITAT, B BENCH, PUNE. 6. / GUARD FILE. / / // TRUE COPY// / BY ORDER, / PRIVATE SECRETARY, , / ITAT, PUNE