The ITO, Ward-1(1), Surat V. Agarwal Rayons Pvt. Ltd., Surat

ITA 124/AHD/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50871 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2003-2004
• Appeal Filed On: 13-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Keywords: Depreciation

Judgement Text

-1- IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH 'D' [BEFORE SHRI T K SHARMA JM] [AND SHRI A KMOHAN ALANKAMONY JM] ITA NO.124/AHD/2010 (ASSESSMENT YEAR:-2003-04) THE INCOME-TAX OFFICER, WARD-1(1), SURAT V/S M/S AGARWAL RAYONS PVT. LTD., 504, EMPIRE STATE BLDG., RING ROAD, SURAT PAN: AADCA 7188 F [APPELLANT] [RESPONDENT] APPELLANT BY :- SHRI B L YADAV, DR RESPONDENT BY:- SHRI HARDIK VORA, AR DATE OF HEARING:- 25-10-2011 DATE OF PRONOUNCEMENT:- 25-10-2011 O R D E R PER T K SHARMA [JM] :- THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER DATED 12-11-2009 OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-I, SURAT [THE CIT(A)] FOR ASSESSMENT YE AR (AY) 2003-04, CANCELING THE PENALTY OF RS4,41,861/- LEVIED BY THE ASSESSING OFFICER [AO] U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO AS THE ACT]. 2 AT THE OUTSET, SHRI HARDIK VORA APPEARED ON BEHAL F OF THE ASSESSEE, POINTED OUT THAT THE PENALTY IN QUESTION U/S 271(1)(C) WAS LEVIED BY THE AO IN RESPECT OF DISALLOWANCE OF DEPR ECIATION OF RS.12,02,342/- OUT OF TOTAL DEPRECIATION OF RS.24,0 2,684/- CLAIMED AT 50% ON PLANT AND MACHINERY. THE LEARNED CIT(A) CONF IRMED THE DISALLOWANCE OF DEPRECIATION. HOWEVER, ON FURTHER A PPEAL OF THE ASSESSEE, THE ITAT C-BENCH VIDE ORDER DATED 09-07-2 010 IN ITA NO.3186/AHD/2007, DIRECTED THE AO TO ALLOW THE DEPR ECIATION AS CLAIMED. THE LEARNED COUNSEL FOR THE ASSESSEE ACCOR DINGLY CONTENDED THAT SINCE THE ADDITIONS MADE IN THE ASSE SSMENT ORDER ON THE BASIS OF WHICH PENALTY FOR CONCEALMENT IS LEVIE D, ARE DELETED, 2 THERE REMAINS NO BASIS AT ALL FOR LEVYING PENALTY F OR CONCEALMENT. THEREFORE, THE ORDER OF THE LEARNED CIT(A) CANCELIN G THE PENALTY OF RS.4,41,861/- BE UPHELD. 3 SHRI B L YADAV, LEARNED DR APPEARED ON BEHALF OF THE REVENUE, COULD NOT CONTROVERT THE AFORESAID SUBMISS IONS MADE BY THE LEARNED COUNSEL FOR THE ASSESSEE. 4 WE HAVE CAREFULLY GONE THROUGH THE ORDER OF THE A UTHORITIES BELOW. IT IS PERTINENT TO NOTE THAT THE PENALTY IN QUESTION U/S 271(1)(C) WAS LEVIED BY THE AO ON ACCOUNT OF DISALL OWANCE OF DEPRECIATION OF RS.12,02,342/-. IN QUANTUM APPEAL, THE ITAT C- BENCH VIDE ORDER DATED 09-07-2010 (SUPRA) HELD THAT THE ASSESSEE IS ENTITLED TO DEPRECIATION AS CLAIMED AND DELETED THE DISALLOWANCE OF RS.12,02,342/-. IT IS WELL SETTLED LAW THAT WHERE T HE ADDITIONS MADE IN THE ASSESSMENT ORDER ON THE BASIS OF WHICH PENAL TY FOR CONCEALMENT IS LEVIED, ARE DELETED, THERE REMAINS N O BASIS AT ALL FOR LEVYING PENALTY FOR CONCEALMENT. ON THIS GROUND, WE ARE INCLINED TO UPHOLD THE ORDER OF THE LEARNED CIT(A) CANCELING TH E PENALTY. 5 IN THE RESULT, THE REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE COURT TODAY ON 25-10-2011 SD/- SD/- (A MOHAN ALANKAMONY) ACCOUNTANT MEMBER (T K SHARMA) JUDICIAL MEMBER DATE : 25-10-2011 COPY OF THE ORDER FORWARDED TO: 1. M/S AGARWAL RAYONS PVT. LTD., 504, EMPIRE STATE BLDG., RING 3 ROAD, SURAT 2. THE INCOME-TAX OFFICER, WARD-1(1), SURAT 3. CIT CONCERNED 4. CIT(A)-I, SURAT 5. DR, ITAT, AHMEDABAD BENCH-D, AHMEDABAD 6. GUARD FILE BY ORDER DEPUTY REGISTRAR ASSISTANT REGISTRAR ITAT, AHMEDABAD