DCIT, Mohali V. M/s Aishani Developers Pvt. Ltd., Chandigarh

ITA 1256/CHANDI/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 5059 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 01-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVI SARANGA L
• Assessee Lawyers: YOGESH MONGA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 1256/CHD/2016 ASSESSMENT YEAR: 2008-09 THE DCIT, VS. M/S AISHANI DEVELOPERS PVT. LTD., CIRCE 6(1), CHANDIGARH MOHALI PAN NO. AAGCA3229G (APPELLANT) (RESPONDENT) APPELLANT BY : SH. RAVI SARANGAL RESPONDENT BY : SH. YOGESH MONGA DATE OF HEARING : 03.07.2017 DATE OF PRONOUNCEMENT : 14.07.2017 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENU E AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX(APPEALS)-2 [HER EINAFTER REFERRED TO AS CIT(A)], CHANDIGARH DATED 15.09.2016. 2. THE REVENUE IS AGGRIEVED BY THE ACTION OF THE CI T(A) IN DELETING THE PENALTY LEVIED BY ASSESSING OFFICER ON THE ASSESSEE U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 2 3. AT THE OUTSET, LD. AR OF THE ASSESSEE HAS STATE D THAT THE PENALTY U/S 271(1)(C) OF THE ACT HAVE BEEN IMPOSED BY THE ASSES SING OFFICER IN RELATION TO THE TWO ADDITIONS, THE FIRST BEING OF R S. 50 LAKHS MADE ON ACCOUNT OF DISALLOWANCE OF EXPENSES CLAIMED TO HAVE BEEN INCURRED BY THE ASSESSEE ON ACCOUNT OF FORFEITURE OF ADVANCE BY TH E LAND OWNERS PAID TO THEM FOR ACQUISITION OF LAND DURING THE COURSE OF REAL ESTATE BUSINESS OF THE ASSESSEE. THE SECOND ADDITION WAS MADE BY THE A SSESSING OFFICER OF RS. 4,35,000/- ON ACCOUNT OF MISC. CHARGES BECAUSE OF THE FAILURE OF THE ASSESSEE TO PRODUCE SUPPORTING VOUCHERS ETC. SO F AR AS THE PENALTY IMPOSED ON ACCOUNT OF DISALLOWANCE OF RS. 50 LACS W AS CONCERNED, THE CIT(A) DELETED THE PENALTY BECAUSE OF THE ABOVE S TATED QUANTUM ADDITION HAVE BEEN DELETED BY THIS TRIBUNAL VIDE ITS ORDER D ATED 5.1.2016 PASSED IN ITA NO. 174/CHD/2014. REGARDING THE PENALTY LEVIED ON ADDITION OF RS. 4,35,000/- ON ACCOUNT OF MISC. EXPENSES, THE LD. CI T(A) OBSERVED THAT SAID EXPENDITURE WAS OF THE NATURE OF THE PHOTOCOPY CHARGES, TYPING CHARGES, ADVOCATE FEE ETC. THAT THE SAID DISALLOWA NCE WAS MADE IN THE QUANTUM PROCEEDINGS ON ACCOUNT OF FAILURE OF THE AS SESSEE TO PRODUCE THE RELEVANT BILLS AND VOUCHERS, HOWEVER, IT WAS NOT A CASE WHEREIN IT WAS PROVED THAT THE ASSESSEE HAD PROVIDED INACCURATE PA RTICULARS OF INCOME RELATING TO THESE EXPENSES. HE OBSERVED THAT SUCH T YPE OF EXPENSES CANNOT BE PRESUMED TO BE ON ACCOUNT OF CONCEALMENT OF PART ICULARS OR FURNISHING OF INACCURATE PARTICULARS OF INCOME ON THE PART OF THE ASSESSEE. HE THEREFORE, RELYING UPON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS PVT. LTD [2010] 322 ITR 158 (SC) DELETED THE PENALTY ON THIS ACCOUNT. 3 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALS O GONE THROUGH THE RECORD. SO FAR AS THE ACTION OF THE CIT(A) IN DELET ING THE PENALTY IN RELATION TO THE ADDITION OF RS. 50 LACS IS CONCERNE D, IT IS AN ADMITTED FACT ON THE FILE THAT THE SAID ADDITION HAS BEEN DELETED BY THE TRIBUNAL IN AN APPEAL FILED BY THE ASSESSEE. (SUPRA). SINCE THE V ERY BASIS ON WHICH THE PENALTY WAS LEAVED HAS CEASED TO EXIST, THE CONSEQU ENTIAL PENALTY LO LEVIED, HAS NO LEGS TO STAND, THEREFORE, THE LD. CIT(A) HA S RIGHTLY DELETED THE PENALTY ON THIS ISSUE. SO FAR AS THE ISSUE IN RELAT ION TO DISALLOWANCE OF MISC. EXPENSES IS CONCERNED, WE FIND NO INFIRMITY I N THE ORDER OF THE CIT(A) WHILE HOLDING THAT THE DISALLOWANCE OF SUCH NATURE OF EXPENSES FOR WANT OF BILLS AND VOUCHERS WAS NOT A CASE OF FURNIS HING OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME. WE, THEREFORE, DO NOT FIND ANY MERIT IN THE PRESENT APPEAL OF THE REVENUE AND THE SAME IS ACCORDINGLY DISMISSED. ` IN THE RESULT, APPEAL PREFERRED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14.07.2017 SD/- SD/- ( ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 14TH JULY, 2017 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR