ITO 8(3)(1), MUMBAI V. SAUNAY JEWELS P . LTD, MUMBAI

ITA 1203/MUM/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 75807 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 20-02-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 09-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PITAMBAR DAS
• Assessee Lawyers: MAYANK THOSAR

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, M UMBAI BEFORE S/SHRI B.R.MITTAL,(JM) AND B.R.BHASKARAN (AM ) . . , . . , ./I.T.A. NO.1203/MUM/2011 ( / ASSESSMENT YEAR : 2004-05) INCOME TAX OFFICER, 8(1)(3), ROOM NO.201, 2 ND FLOOR, AAYAKAR BHAVAN, MUMBAI-400020 / VS. M/S SAUNAY JEWELS PVT LTD., GJ-12, SDF-VIII, SEEPZ, SEZ, ANDHERI(E), MUMBAI-400096 ( % / APPELLANT) .. ( &% / RESPONDENT) ./ ./PAN/GIR NO. : AAECS3130Q % / APPELLANT BY : SHRI PITAMBAR DAS &% * /RESPONDENT BY : SHRI MAYANK THOSAR * - / DATE OF HEARING : 20.2.2014 * - /DATE OF PRONOUNCEMENT : 26.2.2014 / O R D E R PER B.R.MITTAL, JM: THE DEPARTMENT HAS FILED THIS APPEAL AGAINST THE ORDER OF LD. CIT(A) DATED 22.11.2010 FOR ASSESSMENT YEAR 2004-05 ON THE FOLLO WING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LEARNED C.I.T.(A) ERRED IN DELETING THE PENALTY AMOUNTING TO RS.6,28,832/- U/S 271(1)(C ) OF THE ACT, WITHOUT APPRECIATING THE FACTS OF THE C ASE, 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE PENALTY HOLDING THAT S INCE THE MATTER HAS BEEN RESTORED TO THE FILE OF AO, THE VERY BASIS OF PE NALTY DOES NOT EXIST AND HENCE, PENALTY LEVIED IS DELETED WITHOUT APPRECIATING THE FACT THAT FRESH ASSESSMENT HAD NOT BEEN FINALIZED PURSUANT TO THE REMITTED ORDER. THEREFORE, THE LD. CIT(A) HAS ERRED IN EXAMINING THE QUESTION OF LEVY OF PENALTY ON MERIT AND CANCELLING THE SAME. THIS VIEW IS SUPPORTED BY THE HONBLE MADRA S HIGH COURT IN THE CASE OF CIT V/S V RAMAKRISHNA SONS PVT LTD. (192 ITR 282) 3. THE APPELLANT PRAYS THAT THE ORDER OF THE LD C IT(A) ON THE ABOVE GROUND BE SET ASIDE AND THAT OF THE AO BE RESTORED I.T.A. NO. 1203/MUM/2011 2 2. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PAR TIES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BELOW. WE OBSERVE THAT THE TRIBUNAL IN THE QUANTUM APPEAL BEING ITA NO.5758/MUM/2007 (AY-2004-05) FILED BY THE DEP ARTMENT VIDE ORDER DATED 31.8.2010 RESTORED THE MATTER TO THE FILE OF THE A O IN RESPECT OF THE AMOUNT FOR WHICH THE PENALTY HAS BEEN LEVIED BY AO FOR AFRESH ADJUD ICATION. IN VIEW OF ABOVE, LD. CIT(A) HAS CANCELLED THE PENALTY BY THE IMPUGNED ORDER. 3. LD DR SUBMITTED THAT THE LD. CIT(A) INSTEAD OF CANCELLING THE PENALTY SHOULD HAVE SET ASIDE THE PENALTY ORDER WITH THE OPPORTU NITY TO THE AO TO CONSIDER TO PASS FRESH PENALTY ORDER AFTER PASSING FRESH ASSESSMENT ORDER AS PER DIRECTION OF ITAT. LD AR COULD NOT DISPUTE THE ABOVE CONTENTION OF THE LD . DR. 4. IN VIEW OF ABOVE, WE MODIFY THE ORDER OF THE LD. CIT(A) TO THE EXTENT THAT THE PENALTY ORDER OF AO IS SET ASIDE AS THE TRIBUNAL HAS RESTORED THE ISSUE IN THE QUANTUM APPEAL IN RESPECT OF WHICH THE PENALTY WAS LEVIED, TO THE FILE OF THE AO FOR HIS FRESH ADJUDICATION. HENCE, AO AFTER PASSING FRESH ASSE SSMENT ORDER IN THE QUANTUM PROCEEDINGS WILL BE AT LIBERTY TO INITIATE PENALT Y PROCEEDINGS, IN ACCORDANCE WITH LAW, IF HE SO DECIDES. 5. SUBJECT TO ABOVE OBSERVATIONS, THE APPEAL FILE D BY THE DEPARTMENT IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE DEPARTMENT IS D ISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 26TH FEBRUARY, 2014 . 1 2 26TH FEBRUARY, 2014 * SD SD ( . . , / B.R. BASKARAN ) ( . . /B.R.MITTAL) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI: ON THIS 26TH DAY OF FEBRARY,2014 . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. % / THE APPELLANT 2. &% / THE RESPONDENT. 3. 7 ( ) / THE CIT(A)- CONCERNED 4. 7 / CIT CONCERNED I.T.A. NO. 1203/MUM/2011 3 5. 8 &9 , - 9 , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) - 9 , /ITAT, MUMBAI