ITO, Namakkal V. Smt. D.Anbumani and Others,Legal Heirs of Late Shri S.Devadoss, Namakkal

ITA 1254/CHNY/2009

• Counselvise Citation: 125421714 RSA 2009
• Duration Of Justice: 2 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 11-10-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 07-08-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K GOPALAKRISHNAN
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI [BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER] I.T.A NO. 1254/MDS/2009 (ASSESSMENT YEAR : 2001-02 ) THE INCOME TAX OFFICER WARD I(2) NAMAKKAL VS SMT.D.AMBUMANI & OTHERS L/H OF LATE SHRI S.DEVADOSS PROP. BHARATHI AGENCIES NO.1A, PAVADI STREET P. VELUR TK NAMAKKAL DT [PAN AARPD5793L ] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K. GOPALAKRISHNAN, JCIT RESPONDENT BY : NONE DATE OF HEARING : 11.10.2011 DATE OF PRONOUNCEMENT : 11.10.2011 O R D E R PER HARI OM MARATHA, JUDICIAL MEMBER: THIS APPEAL OF THE REVENUE, FOR ASSESSMENT YE AR 2001-02, IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A), SALEM , DATED 29.5.2009. AT THE TIME OF HEARING, DESPITE SERVICE OF DUE NOTI CE, NO REPRESENTATION WAS MADE FROM THE SIDE OF THE RESPONDENT-ASSESSEE, THEREFORE, THIS APPEAL WAS HEARD EX-PARTE. ITA 1254/09 :- 2 -: 2. BRIEFLY STATED, THE FACTS LEADING TO THIS APPEAL AR E THAT THE ASSESSEE NAMELY, SHRI S.DEVADOSS, WHO IS THE PROPRI ETOR OF M/S BHARATHI AGENCIES, SINCE DECEASED, REPRESENTED BY S MT.D.AMBUMANI & OTHERS AS HIS LEGAL HEIRS, CARRIED ON THE BUSINESS IN THE NAME AND STYLE OF M/S BHARATI STORES AND BHARATI AGENCIES . THIS BUSINESS WAS CARRIED ON BY THE LATE ASSESSEE ALONGWITH HIS BROTH ER, SHRI S.PEETER. A SURVEY U/S 133A OF THE ACT WAS CONDUCTED ON 18.11.1 999 IN THE BUSINESS PREMISES OF THE ASSESSEE AND IT WAS NOTICE D THAT THE ASSESSEE HAD CONSTRUCTED A RESIDENTIAL HOUSE AND A GODOWN JO INTLY WITH HIS BROTHER DURING THE PREVIOUS YEAR RELEVANT TO ASSESS MENT YEAR 2001-02. THE ASSESSING OFFICER REFERRED THE MATTER OF VALUAT ION OF THIS PROPERTY TO THE DEPARTMENTAL VALUATION OFFICER(DVO) AND BASE D ON HIS REPORT, THE DIFFERENTIAL AMOUNT IN VALUATION FOUND AT ` 15,50,800/- WAS CONSIDERED AS ADDITION. THE SHARE OF THE ASSESSEE BEING 50%, THE ASSESSING OFFICER HAS MADE AN ADDITION OF ` 7,75,400/- ON THIS ACCOUNT. THE ASSESSING OFFICER ALSO MADE ANOTHER A DDITION OF ` 1,57,713/- TOWARDS UNPROVED TRADE CREDITORS. IN FI RST APPEAL, THE LD. CIT(A) HAS GIVEN PART RELIEF IN RESPECT OF ADDITION MADE ON ACCOUNT OF INVESTMENT IN THE PROPERTY. BEING NOT SATISFIED, S ECOND APPEAL WAS FILED AND THE HON'BLE ITAT, DIRECTED THE ASSESSING OFFICER TO APPLY THE STATE PWD RATES FOR VALUATION INSTEAD OF CPWD RATES APPLIED BY THE ITA 1254/09 :- 3 -: DVO. THE OTHER ADDITION OF ` 1,57,713/- WAS, HOWEVER, CONFIRMED BY THE LD. CIT(A) AGAINST WHICH THE ASSESSEE DID NOT F ILE ANY SECOND APPEAL BEFORE THE HON'BLE ITAT. CONSEQUENTLY, PENA LTY PROCEEDING U/S 271(1)(C) OF THE ACT WAS INITIATED AND A PENALT Y OF ` 2,83,960/- WAS IMPOSED VIDE ORDER DATED 203.2007. HOWEVER, TH E ASSESSEE WAS SUCCESSFUL IN GETTING THE ENTIRE PENALTY LEVIED ON ACCOUNT OF ADDITION MADE ON THE BASIS OF DVOS REPORT DELETED, BUT THE PENALTY BASED ON THE OTHER ADDITION OF ` 1,57,713/- WAS CONFIRMED. NOW, THE REVENUE IS IN APPEAL AGAINST THE DELETION OF PENALTY. 3. SINCE NOBODY CAME TO REPRESENT THE CASE OF THE RESPONDENT-ASSESSEE, WE ARE UNABLE TO ASCERTAIN AS TO WHETHER THE ASSESSEE HAS FILED ANY SECOND APPEAL AGAINST THE SU STAINED PENALTY OR NOT. THE DEPARTMENTAL REPRESENTATIVE WAS NOT AWARE OF THIS FACT EITHER. IN THE GIVEN FACTS AND CIRCUMSTANCES, AFTE R HEARING THE LD.DR IN THE LIGHT OF THE AVAILABLE EVIDENCE ON RECORD, WE A RE CONVINCED THAT PENALTY BASED ON ESTIMATED ADDITION MADE BY THE DV O WHICH IS ONLY AN OPINION OF CONCERNED OFFICER AND BECAUSE THE I TAT HAS DIRECTED THE ASSESSING OFFICER TO RECOMPUTE THIS ADDITION A FTER ADOPTING THE LOCAL PWD RATES INSTEAD OF CPWD RATES, THE IMPUGNED PENALTY WHICH IS THE SUBJECT MATTER OF REVENUES APPEAL, HAS TO BE D ELETED. IN OUR ITA 1254/09 :- 4 -: CONSIDERED OPINION, THE LD. CIT(A) HAS CORRECTLY DE LETED THE IMPUGNED PENALTY WHICH IS BASED ON DVOS REPORT, WHICH ALSO HAS BEEN FURTHER DILUTED BY THE TRIBUNAL. WE, THEREFORE, UPHOLD TH E ACTION OF THE LD. CIT(A) AND DISMISS THE APPEAL OF THE REVENUE. 4. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.10.2011. SD/- SD/- (DR. O.K. NARAYANAN) VICE-PRESIDENT (HARI OM MARATHA) JUDICIAL MEMBER DATED: 11 TH OCTOBER, 2011 RD COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR