Parakh Kothi Limited, Kolkata V. ITO, Ward - 9(3), Kolkata , Kolkata

ITA 1214/KOL/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6997 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 8 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 01-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DHRUBAJYITI ROY
• Keywords: Rule of consistency; Reasonable cause
• Section: 271(1)(c); 201

Judgement Text

1 ITA NO.1214/KOL/2018 PARAKH KOTHI LIMITED, AY- 201 3-14 , B , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA ().. , .. !,'#$) [BEFORE SHRI P.M. JAGTAP, VICE PRESIDENT (KZ) & SHR I A. T. VARKEY, JM] ITA NO.1214/KOL/2018 ASSESSMENT YEAR: 2013-14 PARAKH KOTHI LIMITED (PAN: AABCP6867A) VS. INCOME-TAX OFFICER, WARD-9(3), KOLKATA APPELLANT RESPONDENT DATE OF HEARING 22.01.2020 DATE OF PRONOUNCEMENT 06.02.2020 FOR THE APPELLANT SHRI ANIL KOCHAR, ADVOCATE FOR THE RESPONDENT SHRI DHRUBAJYITI ROY, JCIT, SR. DR ORDER PER A. T. VARKEY, JM: THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A)-3, KOLKATA DATED 28-03-2018 FOR THE ASSESSMENT YEAR 2013-14 LEVYING PENALTY OF RS.2,82,208/- U/S. 271(1)(C) OF INCOME-TAX ACT, 1961 (HEREINAFTER REFE RRED TO AS THE ACT) . 2. BRIEFLY STATED FACTS OF THE CASE AS OBSER VED BY THE LD. CIT(A) ARE THAT THE ASSESSEE HAS CLAIMED ELECTRICITY EXPENSES AS A DEDUCTION U/S . 57 OF THE ACT. THESE ELECTRICITY EXPENSES PERTAIN TO THE COMMON AREA OF THE BUILDING WHICH HAS BEEN RENTED OUT BY THE ASSESSEE. THE STATUTORY DEDUCTION, IN THIS REGARD HAS ALREADY BEEN AVAILED BY THE ASSESSEE. THE ELECTRICITY EXPENSES TO CERTAIN EXTENT HAVE BEE N REIMBURSED BY THE TENANTS. THE ELECTRICITY EXPENSES PERTAINING TO THE COMMON AREA IS PART OF THE MAINTENANCE EXPENSES WHICH HAS ALREADY BEEN ALLOWED AS DEDUCTION TO THE ASSESSEE. ACCORDING TO LD. CIT(A), THE ASSESSEE HAS DELIBERATELY CLAIMED THE ELECTRICITY E XPENSES UNDER THE HEAD OTHER SOURCES. THIS ACCORDING TO HIM IS PATENTLY INCORRECT AS PER LAW. SO ACCORDING TO LD. CIT(A), BY CLAIMING THE ELECTRICITY EXPENSES AS DEDUCTIBLE EXP ENSES U/S. 57 OF THE ACT, THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME. ACCORD INGLY PENALTY PROCEEDING U/S. 271(1)(C) OF THE ACT WAS INITIATED FOR FURNISHING INACCURATE PARTICULARS OF INCOME AND THEREAFTER PENALTY LEVIED AT RS.2,82,208/-. AGGRIEVED THE ASS ESSEE IS BEFORE US. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROU GH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THOUGH THE TRIBUNAL HAS DISMISS ED THE QUANTUM APPEAL PREFERRED BY THE 2 ITA NO.1214/KOL/2018 PARAKH KOTHI LIMITED, AY- 201 3-14 ASSESSEE, IT IS NOTED THAT FOR AY 2003-04 THE ASSES SEE HAD RAISED SIMILAR CLAIM OF ELECTRICITY EXPENSES WHICH THOUGH WAS DISALLOWED BY THE AO, THE LD. CIT(A) TAKING INTO CONSIDERATION THE FACT OF THE CASE OF THE ASSESSEE WAS PLEASED TO ALLOW THE SAME AND IT IS NOTED THAT FROM AY 2003-04 ONWARDS, THE ASSESSEE HAD BEEN CONSISTEN TLY CLAIMING THE SAME EXPENSES UNDER THE SAME HEAD WHICH WAS ACCEPTED BY THE DEPARTMENT. WE NOTE THAT THE FACTS PERMEATING IN AY 2003-04 HAS BEEN CONSISTENTLY FOLLOWED BY THE AS SESSEE TILL THIS YEAR AND SINCE THE VERY SAME CLAIM OF THE ASSESSEE UNDER THE SAME HEAD WAS ALLOWED BY THE DEPARTMENT, EVEN THOUGH IN THIS AY 2013-14 THE STAND OF THE DEPARTME NT TO DISALLOW THE ASSESSEES CLAIM IN THE QUANTUM APPEAL HAS BEEN UPHELD BY THE TRIBUNAL, THE PENALTY LEVIED BY THE LD. CIT(A) FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME CANNOT BE SUSTAINED SINCE THERE WAS REASONABLE CAUSE FOR THE ASSESSEE TO CLAIM THE EXPE NSES UNDER THE HEAD OTHER SOURCES. BECAUSE AS PER THE PRINCIPLE OF CONSISTENCY THE ASS ESSEE WAS CLAIMING THE SAME EXPENSES UNDER THE HEAD OTHER INCOME AND ALLOWED FROM AY 2 003-04 (AFTER THE LD. CIT(A) HAS ALLOWED IT). SO, WE FIND THAT THERE IS REASONABLE CAUSE FOR THE ASSESSEE MAKING THE CLAIM AND IN ANY EVENT, THEREFORE, CANNOT BE A GROUND FOR IM POSING PENALTY U/S. 271(1)(C) OF THE ACT. SO, THE APPEAL OF THE ASSESSEE IS ALLOWED AND THE P ENALTY IS DIRECTED TO BE DELETED. 4. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOW ED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 6TH FEBR UARY, 2020. SD/- (P. M. JAGTAP) SD/-(ABY. T. VARKEY) VICE PRESIDENT JUDICIAL MEMBER DATED : 6 TH FEBRUARY, 2020 JD.(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1. APPELLANT M/S. PARAKH KOTHI LIMITED, C/O S. L. KOCHAR, ADVOCATE, 5, ASHUTOSH CHOWDHURY AVENUE, KOLKATA-700 019. 2 RESPONDENT ITO, WARD-9(3), KOLKATA. 3. 4. 5. CIT(A)-3, KOLKATA (SENT THROUGH E-MAIL) CIT- , KOLKATA. DR, ITAT, KOLKATA. (SENT THROUGH E-MAIL) BY ORDER, / TRUE COPY, ASSISTANT REGISTRAR