The Jt.CIT.,(OSD)Circle-4, Ahmedabad V. Hetu Construction Pvt.Ltd., Ahmedabad

ITA 1291/AHD/2011

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 6881 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 28-11-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 02-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DINESH SINGH
• Assessee Lawyers: VIJAY L SHAH
• Keywords: Difference of opinion

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI N.S. SAIN I , ACCOUNTANT MEMBER ITA NO . 1291 / AHD/20 1 1 A. Y. 200 5 - 0 6 J CIT (OSD) , CIRCLE - 4 , AHMEDABAD. VS HETU CONSTRUCTION PVT. LTD., 5 - B VISHW ABHARTI SOCIETY, ELLISBRIDGE, AHMEDABAD. PAN: AAA CH 3869B (APPELLANT) (RESPONDENT) REVENUE BY : SHRI DINESH SINGH , SR.D.R. , ASSESSEE(S) BY : SHRI VIJAY L SHAH , A.R. / DATE OF HEARING : 28 / 1 1 /201 4 / DATE OF PRONOUNCEMENT: 23 / 1 2 /201 4 / O R D E R PER BENCH THIS IS AN A PPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) - VIII, AHMEDABAD DATED 03.01. 2011 . 2 . THE SOLE GROUND OF APPEAL TAKEN BY THE REVENUE IN THIS APPEAL IS THAT THE CIT(A) ERRED IN DELETING THE PENALTY OF RS. 1 2, 21 ,5 52 / - LEVIED BY THE AO U/S.271(1)(C) OF THE ACT . 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSING OFFICER DURING THE COURSE O F ASSESSMENT PROCEEDINGS OBSERVED THAT FROM THE TDS CERTIFICATE ISSUED BY M/S. BHARAT VIJAY MILLS LTD. , THE AMOUNTS PAID TO THE ASSESSEE WAS RS.80,76,810/ - BUT THE ASSESSEE HAS SHOWN RS.72,56,615/ - IN ITS BOOKS OF ACCOUNT . T HUS , THERE WAS A DIFFERENCE OF R S. 8,01,195/ - THIS ITA NO. 12 91 /AHD/201 1 J CIT (OSD) CIRCLE - 4, AHMED ABAD VS. HETU CONSTRUCTION PVT. LTD. FOR A.Y. 200 5 - 0 6 - 2 - DIFFERENCE AMOUNT WAS ADDED TO THE INCOME OF THIS ASSESSEE. SIMILARLY, THE ASSESSING OFFICER OBSERVED FROM THE TDS CERTIFICATE ISSUED BY CHIRIPAL PETROCHEMICALS LTD. THAT THE SAID COMPANY HAS MADE PAYMENT OF RS.1,06,79,243/ - BUT THE ASSES SEE HAS SHOWN RS.1,04,26,081/ - IN ITS BOOKS OF ACCOUNT. THUS , THERE WAS A DIFFERENCE OF RS.2,53,162/ - . T HE ASSESSEE EXPLAINED THAT THE DIFFERENCE INCLUDED RS.1,36,802/ - ON ACCOUNT OF SERVICE TAX . A FTER REDUCING THE SUM OF RS.1,36,802 FROM RS.2,53,162/ - T HE AO FOUND THAT THERE WAS DIFFERENCE OF RS.1,16,360/ - . THE AO ADDED THIS TO THE INCOME OF THE ASSESSEE. SIMILARLY, THE ASSESSING OFFICER FOUND THAT AS PER TDS CERTIFICATE NANDAN EXIM LTD. MADE PAYMENT OF RS.25,00,375/ - TO THE ASSESSEE BUT THE ASSESSEE IN IT S BOOKS OF ACCOUNT HAS SHOWN RS.22,08,260/ - . THUS, THERE WAS A DIFFERENCE OF RS.2,92,115/ - . T HIS WAS ADDED BY THE AO TO THE INCOME OF THE ASSESSEE. 4. ON APPEAL THE CIT(A) VIDE ORDER DATED 24.11.2008 UPHELD THE ADDITION MADE BY THE AO . 5. T HEREAFTER , TH E AO LEVIED PENALTY OF RS.12,21,522/ - BEING 300% OF THE AMOUNT OF TAX SOUGHT TO BE EVADED FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 6 . THE ASSESSEE FILED APPEAL BEFORE THE CIT(A) AGAINST THIS LEVY OF PENALTY BY THE AO , T HE CIT(A) DELETED THE LEV Y OF PENALTY BY OBSERVING THAT JUST BECAUSE OF AN ADDITION CAME TO BE CONFIRMED IT DOES NOT AUTOMATICALLY LEAD TO IMPOSITION OF PENALTY . A FINDING HAS TO BE RECORDED IN THE PENALTY ORDER TO THE EFFECT THAT A PARTICULAR AMOUNT WAS THE INCOME OF THE ASSESSEE WHICH THE ASSESSEE FAILED TO DISCLOSE. THERE IS NO VARIATION ITA NO. 12 91 /AHD/201 1 J CIT (OSD) CIRCLE - 4, AHMED ABAD VS. HETU CONSTRUCTION PVT. LTD. FOR A.Y. 200 5 - 0 6 - 3 - WHATSOEVER WITH RESPECT TO THE INCOME DISCLOSED BY THE ASSESSEE AS PER ITS BOOKS OF ACCOUNT AND THE RETURN FILED. THE ADDITION S MADE ARE DUE TO THE DIFFERENCE OF OPINION IN THE MIND OF THE AO AN D THAT OF THE ASSESSEE AS TO THE INTERPRETATION OF THE ACCOUNTING NORMS. ANY ADDITION MADE INTERPRETING THE ACCOUNTING STANDARDS IN A PARTICULAR WAY WHEN ANOTHER INTERPRETATION IS POSSIBLE , DOES NOT AMOUNT TO CONCEALMENT OF INCOME NOR SUCH ADDITION IS LIAB LE TO PENALTY. HE PLACED RELIANCE ON THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS, 203 CTR 320 (SC). 7 . THE DR RELIED UPON THE ORDER OF THE ASSESSING OFFICER. 8 . THE AR OF THE ASSESSEE FILED BEFORE US A COPY OF THE ORDER OF THE TRIBUNAL PASSED IN THE QUANTUM APPEAL DATED 04.03.2011 IN ITA NO.218/AHD/2009 IN ASSESSMENT YEAR 2005 - 06. THE AR OF THE ASSESSEE REFERRED TO PARAGRAPHS 3 & 6 OF THIS ORDER AND SUBMITTED THAT THE TRIBUNAL RESTORED THE ISSUE OF ADDITION AT RS .8 ,01,195/ - BEING THE DIFFERENCE IN CONTRACT RECEIPTS FROM BHARAT VIJAY MILLS LTD. BACK TO THE FILE OF THE AO FOR FRESH ADJUDICATION OF THE ISSUE. THE AR SUBMITTED THAT THE ASSESSING OFFICER IN THE REMAND PROCEEDINGS SUSTAINED ADDITION OF RS.5,31,707/ - IN PA RAGRAPH 4 OF THE FRESH ASSESSMENT MADE , COPY OF WHICH IS PLACE D AT PAGE 17 OF THE PAPER BOOK. HE FURTHER ARGUED THAT ON APPEAL AGAINST THIS ADDITION BY THE ASSESSEE , THE CIT(A) DELETED THE ADDITION OF RS.5,31,706/ - IN PARAGRAPHS 2 & 3 OF ITS ORDER, COPY OF WHICH IS PLACED AT PAGE 23 OF THE PAPER BOOKS. THEREFORE, HE SUBMITTED THAT AS THE ADDITION ITSELF WAS DELETED , THEREFORE, THE LEVY OF PENALTY ON ALLEGED DIFFERENCE OF RS.8,01,195/ - DOES NOT SURVIVE. ITA NO. 12 91 /AHD/201 1 J CIT (OSD) CIRCLE - 4, AHMED ABAD VS. HETU CONSTRUCTION PVT. LTD. FOR A.Y. 200 5 - 0 6 - 4 - 9 . FURTHER, WITH REGARD TO THE ADDITION OF RS. 1,16,36 0/ - IN RESPECT OF CONTRACT RECEIPTS FROM CHIRIPAL PETROCHEMICALS LTD , T HE AR OF THE ASSESSEE SUBMITTED THAT THE TRIBUNAL VIDE ITS ORDER DATED 04.03.2011 SET ASIDE THIS ISSUE TO THE FILE OF THE AO FOR ADJUDICATING THE ISSUE AFRESH. THIS FINDING OF THE TRIBU NAL IS AT PARAGRAPHS 3 & 6 OF THE ORDER. HE FURTHER SUBMITTED THAT IN THE SET ASIDE PROCEEDINGS , THE ASSESSING OFFICER HIMSELF DELETED THE ADDITION WHILE MAKING A FRESH ASSESSMENT IN PARAGRAPH 5 OF THE ORDER , C OPY OF THIS ORDER IS PLACED AT PAGE 17 OF THE PAPER BOOK. I T WAS THE PRAYER THAT AS THE ADDITION MADE ITSELF WAS DELETED , THEREFORE , THE PENALTY LEVIED DOES NOT SURVIVE ON THIS AMOUNT OF RS.1,16,360/ - . 10. WITH REGARD TO THE ADDITION OF RS.2,92,115/ - IN RESPECT OF CONTRACT RECEIPTS FROM NANDAN EXIM LTD. , T HE AR OF THE ASSESSEE SUBMITTED THAT THE TRIBUNAL DELETED THIS ADDITION IN PARAGRAPHS 7 & 11 OF THE ORDER DATED 04.03.2011. THEREFORE, IT WAS THE SUBMISSION OF THE AR AS THE ADDITION ITSELF WAS DELETED; THEREFORE, THE PENALTY DOES NOT SURVIVE. 11 . AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE FIND THAT THE ADDITION MADE IN RESPECT OF RS.8,01,195/ - BEING DIFFERENCE IN CONTRACT RECEIPTS FROM BHARAT VIJAY MILLS LTD., DIFFERENCE OF RS.1,16,360/ - IN CONTRACT RECEIPTS FROM CHIRIPAL PETROCHEMICALS LTD. AND DIFFERENCE OF RS.2,92,15/ - IN CONTRACT RECEIPTS FROM NANDAN EXIM LTD . WERE DELETED BY THE CIT(A) OR BY THE AO OR BY THE TRIBUNAL. AS THE ADDITION MADE ITSELF WAS DELETED , THEREFORE , THE BASIS FOR LEVY OF PENALTY DOES NOT SURVIVE ; HENCE , THERE IS NO INFIRM ITY IN THE ORDER OF THE CIT(A) IN DELETING THE PENALTY OF ITA NO. 12 91 /AHD/201 1 J CIT (OSD) CIRCLE - 4, AHMED ABAD VS. HETU CONSTRUCTION PVT. LTD. FOR A.Y. 200 5 - 0 6 - 5 - RS.12,21,522/ - . WE FIND THAT THE HON BLE SUPREME COURT IN THE CASE OF K.C. BUILDERS VS. ACIT (2004) 265 ITR 562 (SC) HAS HELD THAT WHERE ADDITIONS ARE MADE IN THE ASSESSMENT ORDER ON THE BASIS OF WH ICH PENALTY FOR CONCEALMENT IS LEVIED, ARE DELETED, THERE REMAINS NO BASIS AT ALL FOR LEVYING PENALTY FOR CONCEALMENT. NO PENALTY WOULD SURVIVE IF ADDITION DID NOT SURVIVE. THUS, WE FIND NO INFIRMITY IN THE ORDER OF THE CIT(A) IN DELETING THE PENALTY LEVIE D U/S.271(1)(C) OF THE ACT. THUS, THIS GROUND OF THE REVENUE IS DISMISSED. 12 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. SD/ - SD/ - ( MUKUL KR. SHRAWAT ) ( N.S. SAINI ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 23 / 1 2 /20 1 4 PRABHAT KR. KESARWANI , SR. P . S . / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / TH E RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) - III, AHMEDABAD 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD