Jewel Consumer Care Pvt.Ltd., Baroda V. The Dy.CIT.,Circle-1(2), Baroda

ITA 1242/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85789 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 1998-1999
• Appeal Filed On: 26-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, A HMEDABAD (BEFORE SHRI ANIL CHATURVEDI, A.M. & SHRI KUL BHARA T, J.M. ) I.T. A. NO. 1242/AHD/2011 (ASSESSM ENT YEAR: 1998-99) JEWEL CONSUMER CARE PVT. LTD, (UNIT: JEWEL BRUSHES) SUBHAAG, B-15/16 RAMIN PARK, OLD PADRA ROAD, BARODA 390020 V/S THE D.C.I.T., CIRCLE-1(2), BARODA (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PARIN SHAH, A.R. RESPONDENT BY : SHRI B.L. YADAV, SR. D.R. ( )/ ORDER DATE OF HEARING : 16-03-2015 DATE OF PRONOUNCEMENT : 20 -03-2015 PER SHRI ANIL CHATURVEDI,A.M. 1. THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-I, BARODA DATED 22.02.2011 FOR A.Y. 1998-99. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 3. ASSESSEE IS A COMPANY STATED TO BE ENGAGED IN THE B USINESS OF MANUFACTURING OF TOOTH BRUSHES WHICH ARE ENTIRELY SUPPLIED TO 100 % SUBSIDIARY OF HINDUSTAN LEVER LTD. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 1998-99 DECLARING INCOME OF RS. 12,54,237/-. THE CASE WAS S ELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) VIDE ORDER DATED ITA NO 1242 /AHD/2011 . A.Y. 1998-9 9 2 23.03.2001 AND THE TOTAL TAXABLE INCOME WAS DETERMI NED AT RS.66,95,240/- AND INCOME U/S. 115JA AT RS. 12,54,237/- INTERALIA BY MAKING VARIOUS ADDITIONS TO THE INCOME WHICH ALSO INCLUDED ADDITIO N OF RS. 37,11,381/- ON ACCOUNT OF UNACCOUNTED SALES. THE AFORESAID ADDITIO N OF ACCOUNTED SALES WAS CONFIRMED BY CIT(A) AND ON THE AFORESAID ADDITION O N ACCOUNT OF UNACCOUNTED SALES, A.O VIDE ORDER DATED 26.03.2009 LEVIED PENALTY OF RS. 12,99,000/- U/S. 271(1)(C) OF THE ACT. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO V IDE ORDER DATED 22.02.2011 DISMISSED THE APPEAL OF THE ASSESSEE. AG GRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), ASSESSEE IS NOW IN APPEAL BEFO RE US AND HAS RAISED THE FOLLOWING GROUNDS:- 1.THE LEARNED CIT(A) HAS ERRED IN FACT AND IN LAW I N CONFIRMING THE PENALTY LEVIED U/S 271(L)(C) BY THE ID. AO ON THE GROUNDS THAT THE ASS ESSEE HAD CONCEALED INCOME OF RS. 37,11,381/- AND HAD FAILED TO SATISFACTORILY EXPLAI N BY ESTABLISHING ITS BONA-FIDE INTENTIONS. THE HON. CIT(A)-VI HAS FAILED TO APPRECIATE THAT TH E ASSESSEE WAS UNDER A BONA-FIDE BELIEF THAT AS THE DEVELOPMENTAL WORK AGAINST WHICH THE ADVANCE OF RS. 37,11,381/- WAS RECEIVED WAS PENDING, THE SAID AMOUNT WOULD CONSTIT UTE AN ADVANCE. THE LEARNED CIT(A) FURTHER FAILED TO APPRECIATE THAT A MAJOR PART OF T HE SAID ADVANCE WAS ADJUSTED AGAINST INCOME IN THE SUBSEQUENT YEAR AND DULY OFFERED TO T AX AND THE BALANCE WAS REFUNDED TO THE CUSTOMER. THE LEARNED CIT(A) HAS FAILED TO APPR ECIATE THAT THE SAID ACTIONS ITSELF SHOW THE BONA-FIDES OF THE ASSESSEE. THE LEARNED CI T(A) HAS FURTHER FAILED TO APPRECIATE THAT THE ADVANCE, WHICH WAS TREATED AS CONCEALED IN COME WAS IN FACT ALREADY TAXED IN THE PRIOR ASSESSMENT YEAR. THE LEARNED CIT(A)-I HAS ALSO FAILED TO APPRECIATE THAT ON A SIMILAR ISSUE ON SIMILAR FACTS IN RESPECT OF AY 1997-98, THE HON. CIT(A) HAD DELETED SUCH ADDITIONS, WHICH IN ITSELF POINTS TO A SITUATION THAT THE ASSESSEE HAD BONA-FIDE GROUNDS FOR ITS BELIEF AND ALSO TO THE FACT THAT ADDITION MADE THE ID. AO IN THE YE AR UNDER CONSIDERATION IS ON A DEBATABLE POINT ON WHICH TWO VIEWS ARE POSSIBLE. ITA NO 1242 /AHD/2011 . A.Y. 1998-9 9 3 4. BEFORE US, AT THE OUTSET LD. A.R. SUBMITTED THAT AG AINST THE ADDITION OF RS. 37,11,381/- WHICH WAS CONFIRMED BY LD. CIT(A), ASSE SSEE HAD PREFERRED APPEAL BEFORE HONBLE TRIBUNAL. HONBLE TRIBUNAL WH ILE DECIDING THE APPEAL OF THE ASSESSEE IN ITA NO. 1093/AHD/2008 ORDER DATE D 24.06.2011 HAD REMITTED THE ISSUE BACK TO THE FILE OF A.O TO RE-DE CIDE THE ISSUE AS PER THE DIRECTIONS GIVEN THEREIN. THE LD. A.R. THEREFORE SU BMITTED THAT SINCE THE QUANTUM ADDITION HAS BEEN SET ASIDE, THE PENALTY OR DER DOES NOT SURVIVE AND THE SAME MAY ALSO BE SET ASIDE TO A.O. LD. A.R. ALS O PLACED ON RECORD THE COPY OF THE AFORESAID DECISION AND POINTED TO THE R ELEVANT FINDINGS OF TRIBUNAL. LD. D.R. ON THE OTHER HAND DID NOT SERIOU SLY OBJECT TO THE SUBMISSION OF THE ASSESSEE TO REMIT THE ISSUE TO TH E FILE OF A.O TO DECIDE THE ISSUE IN THE LIGHT OF THE DECISION ON THE QUANTUM A DDITION. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE ADDITION THAT WAS MADE BY A.O WAS RES TORED BY THE CO-ORDINATE BENCH OF TRIBUNAL TO THE FILE OF A.O TO DECIDE THE ISSUE AFRESH. WE ARE THEREFORE OF THE VIEW THAT WHEN THE ISSUE OF QUANTU M ADDITION IS BEFORE A.O, THE ISSUE OF PENALTY ON THE SAME ADDITION SHOULD AL SO BE RESTORED TO THE FILE OF A.O FOR HIM TO DECIDE IT AFRESH IN LIGHT OF THE DECISION OF QUANTUM PROCEEDINGS. WE THEREFORE RESTORE THE ISSUE OF PENA LTY TO THE FILE OF A.O TO DECIDE IT AFRESH IN THE LIGHT OF THE DECISION ON QU ANTUM. WE THUS DIRECT ACCORDINGLY. IN THE RESULT, THIS GROUND OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ITA NO 1242 /AHD/2011 . A.Y. 1998-9 9 4 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 20 - 03 - 2015 . SD/- SD/- (KUL BHARAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,A HMEDABAD