The DCIT, Bharuch Circle, Bharuch V. M/s. Jhagadia Copper Ltd, Bharuch

ITA 120/AHD/2010

• Counselvise Citation: 12020514 RSA 2010
• Duration Of Justice: 2 year(s) 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2004-2005
• Appeal Filed On: 12-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H P MEENA
• Assessee Lawyers: TUSHAR HEMANI
• Section: 27

Judgement Text

, , , , C , IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, C BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ # ## #. .. .% $% % $% % $% % $%, , , , &' ( &' ( &' ( &' ( & ' & ' & ' & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER) ITA NO.120/AHD/2010 [ASSTT.YEAR : 2004-2005] DCIT, BHARUCH CIRCLE BHARUCH. / VS. M/S.JHAGADIA COPPER LTD. TAL.-JHAGADIA 747, GIDC IND. ESTATE, JHAGADIA DIST BHARUCH. ( (( (*+ *+ *+ *+ / APPELLANT) ( (( (,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) ( . / &/ REVENUE BY : SHRI H.P. MEENA 12 . / &/ ASSESSEE BY : SHRI TUSHAR HEMANI 3 . 24'/ DATE OF HEARING : 21 ST JUNE, 2012 5%6 . 24'/ DATE OF PRONOUNCEMENT : 6-7-2012 &7 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEAR 2004-2005 IS DIRECTED AGAIN ST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-VI, BARODA DAT ED 6.10.2009. 2. THE ONLY EFFECTIVE GROUND OF REVENUES APPEAL RE ADS AS UNDER: 1.1 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE PENALTY OF RS.35,94,600/- LEVIED U/S.271(1)(C) OF THE ACT. 3. THE LEARNED DR HAS RELIED ON THE ORDER OF THE AO . THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS IMPOSED IN THIS CASE ON TH REE COUNTS VIZ. ACCRUED INTEREST INCOME OF RS.67.73 LAKHS, BANK INTEREST R ECEIVED OF RS.27.22 LAKHS AND INTEREST ON INCOME-TAX REFUND OF RS.5,24, 000/-. HE SUBMITTED THAT THE FIRST ISSUE OF ACCRUED INTEREST INCOME OF RS.67.73 LAKHS, THE ADDITION MADE BY THE AO IN THE QUANTUM APPEAL OF TH E ASSESSEE HAS BEEN ITA NO.120/AHD/2010 -2- DELETED BY THE TRIBUNAL IN ASSESSEES APPEAL FOR TH E RELEVANT ASSESSMENT YEAR 2004-2005 IN ITA NO.3741/AHD/2007 DATED 13.11. 2009. REGARDING THE SECOND ISSUE OF PENALTY LEVIED UNDER SECTION 27 1(1)(C) ON BANK INTEREST RECEIVED OF RS.27.22 LAKHS, THE LEARNED CO UNSEL OF THE ASSESSEE SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF TH E ASSESSEE WITH THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR EARLIER ASSTT.YEAR 2002- 2003 IN ITA NO.1191/AHD/2008 WHEREIN VIDE ORDER DAT ED 5.3.2010 PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT I N IDENTICAL FACTS WERE DELETED BY THE TRIBUNAL. REGARDING THE THIRD ISSUE OF INTEREST ON I.T.REFUND OF RS.5.24 LAKHS, THE LEARNED COUNSEL FO R THE ASSESSEE SUBMITTED THAT THE SAME WAS DISCLOSED IN THE AUDITE D ACCOUNTS OF THE ASSESSEE FILED ALONG WITH RETURN OF INCOME WHEREIN IN PRE-OPERATIVE EXPENSES THE INTEREST ON REFUND I.T.REFUND OF RS.5. 24 LAKHS WAS DISCLOSED IN SCHEDULE-H OF ITS ANNUAL ACCOUNTS DULY AUDITED B Y THE CHARTERED ACCOUNTANT. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS CAREFULLY A ND HAVE PERUSED THE ORDERS OF THE AO AND THE CIT(A) AND COPIES OF V ARIOUS DETAILS FILED IN THE COMPILATION BY THE ASSESSEE. WE FIND THAT IN T HE QUANTUM APPEAL OF THE ASSESSEE FOR THE ASSTT.YEAR 2004-05, THE TRIBUN AL VIDE ITS ORDER DATED 13-11-2009 (SUPRA) IN ASSESSEES OWN CASE HAS DELET ED THE ADDITION OF ACCRUED INTEREST INCOME AMOUNTING TO RS.67.73 LAKHS , AND THEREFORE THERE REMAINS NO BASIS FOR IMPOSITION OF PENALTY UNDER SE CTION 271(1)(C) OF THE ACT, WHICH IS ACCORDINGLY CANCELLED AND THE ORDER O F THE CIT(A) ON THIS ISSUE IS CONFIRMED. WITH REGARD TO THE SECOND ADDITION OF BANK INTEREST RECEIVED OF RS.27.22 LAKHS, WE FIND THAT THE ISSUE IS COVERED I N FAVOUR OF THE ASSESSEE WITH THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR EARLIER ITA NO.120/AHD/2010 -3- ASSESSMENT YEAR 2002-2003 VIDE ORDER DATED 5.3.2010 WHEREIN THE PENALTY LEVIED UNDER SECTION 271(1)(C) IN SIMILAR CIRCUMSTA NCES WAS CANCELLED BY THE TRIBUNAL. WE BEING IN AGREEMENT WITH THE CO-OR DINATE BENCH OF THE TRIBUNAL IN CANCELLING THE PENALTY LEVIED U/S.271(1 )(C) ON THE ASSESSEE FOR EARLIER A.Y.2002-2003, HOLD THAT THE CIT(A) WAS JUS TIFIED IN CANCELLING THE PENALTY ON THIS ISSUE. WITH REGARD TO THE THIRD ISSUE OF PENALTY LEVIED U/ S.271(1)(C) ON THE AMOUNT OF INTEREST ON I.T. REFUND OF RS.5.24 LAKHS, WE FIND THAT THE DETAILS THEREOF WERE DISCLOSED BY THE ASSESSEE UNDE R THE HEAD PRE OPERATIVE EXPENSES IN SCHEDULE-H OF THE AUDITED AC COUNTS OF THE ASSESSEE WHICH WERE FILED ALONG WITH ITS RETURN OF INCOME WI TH THE AO. EVEN, OTHERWISE, WE FIND THAT THE FACT OF INTEREST ON I.T .REFUND HAS TO BE ESSENTIALLY IN THE KNOWLEDGE OF THE INCOME-TAX DEPA RTMENT, AND THERE COULD BE NO QUESTION OF HIDING THE SAME, AND THERE BEING NO MATERIAL ON RECORD TO SUGGEST THAT THE CONDUCT OF THE ASSESSEE WAS MALA FIDE IN THIS REGARD, WE HOLD THAT NO PENALTY U/S.271(1)(C) WAS I MPOSABLE ON THE AMOUNT OF INTEREST ON INCOME-TAX REFUND ON THE ASSE SSEE, AND ACCORDINGLY THE ORDER OF THE CIT(A) ON THIS ISSUE IS CONFIRMED. IN NUTSHELL, THE ORDER OF THE CIT(A) IN CANCELLING THE PENALTY LEVIED U/S. 271(1)(C) IS CONFIRMED AND THE GROUNDS OF THE REVENUES APPEAL BEING DEVOI D OF ANY MERIT, ARE DISMISSED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( #.% $% /A.MOHAN ALANKAMONY) &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT