K.Velavan, Erode V. ITO, Erode

ITA 1212/CHNY/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 8849 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 04-05-2016
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: S SRIDHAR ERODE
• Section: 131

Judgement Text

, - , IN THE INCOME TAX APPELLATE TRIBUNAL SMC-A BENCH : CHENNAI . . . , [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER ] ./ I.T.A.NO.1212/MDS/2016 / ASSESSMENT YEAR : 2009-10 SHRI K. VELAN 8/9 T.M.S. NAGAR KEEL THINDAL THINDAL POST, ERODE 638 001 VS. THE INCOME TAX OFFICER WARD 1(1) ERODE [PAN ACNPV 2715 N] ( ! / APPELLANT) ( '# ! /RESPONDENT) / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE (ERODE) /RESPONDENT BY : SHRI N. MADHAVAN, JCIT / DATE OF HEARING : 17 - 0 6 - 2016 / DATE OF PRONOUNCEMENT : 15 - 0 7 - 2016 / O R D E R THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-3, COIMBA TORE, DATED 29.2.2016 AND PERTAINS TO ASSESSMENT YEAR 2009-10 . 2. SHRI S. SRIDHAR, LD. COUNSEL FOR THE ASSESSEE SUBMI TTED THAT THE ASSESSING OFFICER LEVIED PENALTY U/S 271(1)(C ) OF THE ACT WITHOUT CONSIDERING THE ORDER OF THIS TRIBUNAL IN I.T.A.NO. 353/MDS/2014 DATED 20.6.2014 WHEREIN THE ADDITION OF ` 8 LAKHS WAS DELETED BY THIS TRIBUNAL. ACCORDING TO THE LD. COUNSEL, THE ASSES SING OFFICER LEVIED ITA NO.1212/16 :- 2 -: THE PENALTY ONLY ON THE BASIS OF THE SWORN STATEMEN T OF THE ASSESSEE RECORDED U/S 131 OF THE ACT ON 18.11.2011. THE SW ORN STATEMENT RELATES TO LOAN AND OTHER SOURCES IN ORDER TO MAKE THE INVESTMENT. THIS ADDITION MADE BY THE ASSESSING OFFICER WAS DE LETED BY THIS TRIBUNAL VIDE ORDER DATED 20.6.2014. THEREFORE, TH E CIT(A) IS NOT JUSTIFIED IN NOT FOLLOWING THE ORDER OF THIS TRIBUN AL. 3. ON THE CONTRARY, SHRI N. MADHAVAN, LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS NOT PRODUCED THE ORDER OF THIS TRIBUNAL BEFORE THE LOWER AUTHORITIES . REFERRING TO THE COPY OF THE ORDER OF THIS TRIBUNAL, WHICH AVAILABLE AT PAGE 28 OF THE PAPER BOOK, THE LD. DR SUBMITTED THAT THIS TRIBUNAL HAS NOT DELETED THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTEN T OF ` 8 LAKHS. IN FACT, THIS TRIBUNAL CONFIRMED THE ADDITION OF ` 8 LAKHS. HOWEVER, WHILE CONSIDERING THE PAYMENT OF ` 8 LAKHS MADE OUTSIDE THE BOOKS OF ACCOUNT , THIS TRIBUNAL FOUND THAT WHEN THESE TWO I TEMS ARE MEETING AT THE SAME POINT OF TIME, THE BENEFIT OF TELESCOPI NG CAN BE GIVEN TO THE ASSESSEE. IN OTHER WORDS, THIS TRIBUNAL FOUND THAT BOTH THE ADDITIONS OF ` 8 LAKHS AND ` 10 LAKHS CANNOT STAND SIMULTANEOUSLY. ACCORDINGLY, THIS TRIBUNAL DIRECTED THE ASSESSING O FFICER TO TELESCOPE THE ADDITION OF ` 10 LAKHS AND ` 8 LAKHS AND THE EFFECTIVE ADDITION SHALL BE ONLY ` 10 LAKHS. THIS ADDITION OF ` 10 LAKHS IS IN ADDITION TO 20% OF THE PROFIT ESTIMATED ON THE SALE OF MEDICINE. THER EFORE, ACCORDING TO ITA NO.1212/16 :- 3 -: THE LD. DR, THE ASSESSING OFFICER HAS RIGHTLY LEVIE D PENALTY U/S 271(1)(C) OF THE ACT. 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER S IDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSESSING OFFICER LEVIED PENALTY ON THE ADDITIONS OF ` 8 LAKHS AND ` 10 LAKHS. MOREOVER, THE ASSESSING OFFICER HAS ALSO LEVIED PENALTY IN RE SPECT OF PROFIT ON SALE OF MEDICINE TO THE EXTENT OF ` 5,00,735/-. WHEN THE MATTER TRAVELLED BEFORE THIS TRIBUNAL, THIS TRIBUNAL FOUND THAT THE ADDITIONS OF ` 10 LAKHS AND ` 8 LAKHS CANNOT STAND SIMULTANEOUSLY AND BY APPLYIN G THE PRINCIPLES OF TELESCOPING, THIS TRIBUNAL FOUND THAT ONLY EFFECTIVE ADDITION SHALL BE ` 10 LAKHS. ACCORDINGLY, THE ADDITION OF ` 8 LAKHS WAS DELETED BY APPLYING THE PRINCIPLES OF TELESCOPING. THIS TRIBUNAL HAS ALSO CONFIRMED THE ESTIMATION OF PROFIT @ 20% ON SA LE OF MEDICINE. THE ORDER OF THIS TRIBUNAL WAS NOT BROUGHT TO THE N OTICE OF THE ASSESSING OFFICER. IN FACT, THE PENALTY WAS LEVIED BY AN ORDER DATED 27.3.2014. HOWEVER, THIS TRIBUNAL PASSED THE ORDER ON 20.6.2014 MUCH AFTER THE ORDER OF THE ASSESSING OFFICER LEVYI NG PENALTY. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPIN ION THAT THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OFFICER A FTER CONSIDERING THE ORDER OF THIS TRIBUNAL IN ASSESSEES OWN CASE IN I .T.A.NO. 353/MDS/2014, DATED 20.6.2014. ACCORDINGLY, THE OR DERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ISSUE OF LEVY OF PENALTY IS REMITTED ITA NO.1212/16 :- 4 -: BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASS ESSING OFFICER SHALL RECONSIDER THE ISSUE AFTER CONSIDERING THE ORDER OF THIS TRIBUNAL DATED 20.6.2014 IN I.T.A.NO. 353/MDS/2014 AND THEREAFTER DECIDE THE SAME IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OP PORTUNITY TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JULY, 2016, AT CHENNAI. SD/- ( . . . ! ) (N.R.S. GANESAN) / JUDICIAL MEMBER '# / CHENNAI $% / DATED: 15 TH JULY, 2016 RD %&'' ()'*) / COPY TO: ' 1 . / APPELLANT 4. ' + / CIT 2. / RESPONDENT 5. ),-' . / DR 3. ' +'/! / CIT(A) 6. -0'1 / GF