Shri Vipul K. Shah, Anand V. The Income tax Officer, Ward-1, Anand

ITA 1319/AHD/2011

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5985 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 year(s) 10 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 30-06-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 03-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH HEARING CONCLUDED O
• Section: 133A

Judgement Text

ITA NO.1319/AHD/2011 ASSESSMENT YEAR: 2004-05 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND MAHAVIR PRASAD JM] ITA NO.1319/AHD/2011 ASSESSMENT YEAR: 2004-05 VIPUL K. SHAH, ..................APPELLANT PROP. SHRIMAN FASHION, C/O. KIRAN PATEL & CO., CHARTERED ACCOUNTANTS, 3/4, RANGOLI COMPLEX, ANAND VV NAGAR ROAD, ANAND 388 001. [PAN : AHNPS 2765 A] VS. INCOME TAX OFFICER, WARD (1), ANAND . ............................RESPONDENT APPEARANCES BY ASEEM THAKKAR FOR THE APPELLANT V.K. SINGH FOR THE RESPONDENT HEARING CONCLUDED ON: 19.12.2017 ORDER PRONOUNCED ON : 08.03.2018 O R D E R PER PRAMOD KUMAR, AM: 1. THIS APPEAL FILED BY THE ASSESSEE APPELLANT IS D IRECTED AGAINST ORDER DATED 17.02.2011, PASSED BY THE LEARNED CIT(A), IN THE MA TTER OF PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT 1961 (THE ACT HER EINAFTER), FOR THE ASSESSMENT YEAR 2004-05. 2. THE GRIEVANCE RAISED BY THE APPELLANT IS AS FOLL OWS :- THE LEARNED CIT(A)-IV, BARODA, ERRED IN LAW AND ON FACTS IN CONFIRMING PENALTY LEVIED BY INCOME TAX OFFICER, WARD 1, ANA ND, OF RS.9,76,780/- U/S.271(1)(C) OF THE IT ACT, 1961. ITA NO.1319/AHD/2011 ASSESSMENT YEAR: 2004-05 PAGE 2 OF 3 3. TO ADJUDICATE ON THIS APPEAL, ONLY A FEW MATERIA L FACTS NEED TO BE TAKEN NOTE OF. THE ASSESSEE WAS SUBJECTED TO A SURVEY UNDER SECTIO N 133A OF THE ACT, AND IN THE STATEMENT RECORDED DURING THE SAID SURVEY PROCEEDIN GS, THE ASSESSEE ACCEPTED EXCESS STOCK TO THE EXTENT OF RS.29,50,102/-. THE ASSESSE E, HOWEVER, SUBSEQUENTLY POINTED OUT ERRORS IN THE EXCESS STOCK SO COMPUTED. THE AS SESSING OFFICER DID NOT YIELD TO THE SUBMISSIONS SO MADE BY THE ASSESSEE AND RELIED UPON THE STATEMENT OF THE ASSESSEE AS MADE DURING THE SURVEY. AN ADDITION OF RS.29,50 ,102/- WAS THUS MADE IN THE HANDS OF THE ASSESSEE. IT WAS IN THIS BACKGROUND THAT PE NALTY UNDER SECTION 271(1)(C) OF THE ACT WAS ALSO IMPOSED FOR CONCEALMENT OF INCOME. AG GRIEVED, ASSESSEE CARED THE MATTER IN APPEAL BEFORE THE LEARNED CIT(A) WHO CONF IRMED THE ACTION OF THE ASSESSING OFFICER BY OBSERVING AS FOLLOWS :- 4. I HAVE CONSIDERED APPELLANT'S SUBMISSIONS AND F ACTS OF THE CASE. APPELLANT'S SUBMISSIONS BEFORE ME ARE IDENTICAL TO SUBMISSIONS MADE BEFORE MY LEARNED PREDECESSOR CIT(A)-IV, BARODA AT THE TIM E OF QUANTUM ADDITION PROCEEDINGS. APPELLANT'S CONTENTION THAT THE DIFFER ENCE AROSE DUE TO MISTAKE IN COMPUTER WORKING WAS NOT FOUND TO BE ACCEPTABLE BY MY LEARNED PREDECESSOR, WHO NOTED THAT APPELLANT COULD NOT SUB MIT ANY EVIDENCE REGARDING FLAW IN WORKING DONE IN COMPUTER REGARDIN G DIFFERENCE IN BOOK STOCK ON THE DAY OF SURVEY. APPELLANTS CLAIM THAT RECON CILIATION OF STOCK COULD NOT BE DONE DUE TO NON PROVIDING OF OPPORTUNITY BY THE ASSESSING OFFICER WAS ALSO NO FOUND ACCEPTABLE BY NOTING THAT THE LETTER FILED SEEKING TIME TO RECONCILE WAS AN UNDATED APPLICATION NOT BEARING STAMP OF AO S OFFICE. APPELLANTS SUBMISSIONS DURING PRESENT PROCEEDINGS BEING IDENTI CAL TO SUBMISSIONS ALREADY CONSIDERED AT THE TIME OF QUANTUM APPEAL PR OCEEDINGS ARE NOT ACCEPTABLE. THE DECISIONS RELIED UPON BY THE APPEL LANT ON DIFFERENT FACTS CANNOT BE APPLIED IPSOFACTO TO APPELLANTS CASE. I T IS A CASE, WHERE APPELLANT FAILED TO SUBSTANTIATE EXPLANATION OFFERED IN RESPE CT OF THE ADDITION MADE TO THE INCOME OR TO PROVE THE EXPLANATION OFFERED WAS BONAFIDE. IN VIEW OF THIS, LEVY OF PENALTY U/S.271(1)(C) OF RS.9,76,780/- FOR FURNISHING INACCURATE PARTICULARS OF INCOME IS UPHELD. 4. AGGRIEVED, ASSESSEE IS IN FURTHER APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLIC ABLE LEGAL POSITION. WE FIND THAT THE ASSESSEE HAD AN EXPLANATION FOR THE VALUATION OF ST OCK AS ADOPTED BY HIM, IN VIEW OF THE ITA NO.1319/AHD/2011 ASSESSMENT YEAR: 2004-05 PAGE 3 OF 3 RECONCILIATION STATEMENT FILED BY HIM AND THE MERE FACT THAT THERE WERE TECHNICAL LAPSES IN SUBMISSION OF THIS STATEMENT AT AN EARLIER STAGE CANNOT BE DECISIVE FACTOR AGAINST THE ASSESSEE SO FAR AS PENALTY PROCEEDINGS ARE CONCERNE D. IN ANY EVENT, AS HELD BY HONBLE KERALA HIGH COURT IN THE CASE OF PAUL MATHE WS & SONS VS. CIT (263 ITR 101) A STATEMENT RECORDED UNDER SECTION 133A HAS NO EVIDEN TIARY VALUE AND, ACCORDINGLY, AN ADDITION MADE ON THAT BASIS, WHATEVER BE ITS LEGAL POSITION IN QUANTUM PROCEEDINGS, CANNOT BE LEGALLY SUSTAINABLE BASIS FOR PENALTY PRO CEEDINGS. WE FIND THAT IT IS A REASONABLE EXPLANATION AND IRRESPECTIVE OF WHETHER OR NOT IT IS GOOD ENOUGH TO BE OF HELP TO THE ASSESSEE IN QUANTUM PROCEEDINGS, THIS E XPLANATION TAKES THE ASSESSEES CASE OUT OF THE AMBIT OF CASES IN WHICH PENALTY UND ER SECTION 271(1)(C) OF THE ACT CAN BE IMPOSED. ON OUR PERUSAL OF THE RECONCILIATION ST ATEMENT AND HAVING REGARD TO THE FACT THAT NO SPECIFIC LEGALLY SUSTAINABLE DEFECTS COULD BE POINTED OUT IN THE SAME BY THE LEARNED DEPARTMENTAL REPRESENTATIVE AS WELL, WE ARE OF THE CONSIDERED VIEW THAT IT WAS NOT A FIT CASE FOR IMPOSITION OF PENALTY. WE, THER EFORE, DELETE THE IMPUGNED PENALTY. 6. IN THE RESULT, THE APPEAL IS ALLOWED. PRONOUNCE D IN THE OPEN COURT ON THIS 8 TH DAY OF MARCH, 2018. SD/- SD/- MAHAVIR PRASAD PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEM BER) DATED: 8 TH MARCH, 2018 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPOND ENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD