M/s. Vedant Enterprise, Bharuch V. The Jt.CIT.,Bharuch Range, Bharuch

ITA 1325/AHD/2008

• Counselvise Citation: 132520514 RSA 2008
• Duration Of Justice: 3 year(s) 11 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 04-01-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 11-04-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: C K MISHRA
• Assessee Lawyers: M K PATEL
• Keywords: Opportunity of being heard

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD , . .!'#$, % & BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ./ I.T.A. NO.1325/AHD/2008 ( ( ) ( ) ( ) ( ) / / / / ASSESSMENT YEAR : 2004-05) M/S.VEDANT ENTERPRISE BHAMWALAS GHREE KHUDIA OPP.PATEL SQUARE MARKET BHARUCH ( ( ( ( / VS. THE JCIT BHARUCH RANGE BHARUCH * % ./+, ./ PAN/GIR NO. : AAEFV 7057 Q ( *- / // / APPELLANT ) .. ( ./*- / RESPONDENT ) *- 0 / APPELLANT BY : SHRI M.K.PATEL, A.R. ./*- 1 0 / RESPONDENT BY : SHRI C.K.MISHRA, SR.D.R. (2 1 3% / / / / DATE OF HEARING : 04/01/2012 4') 1 3% / DATE OF PRONOUNCEMENT : 16/03/2012 5 / O R D E R PER SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER : THIS IS AN APPEAL AT THE BEHEST OF THE ASSESSEE W HICH HAS EMANATED FROM THE ORDER OF LEARNED CIT(APPEALS)-VI BARODA DATED 04/03/2008 PASSED FOR A.Y. 2004-05. THE ONLY GROUN D ARGUED BEFORE US IS REPRODUCED BELOW:- 1. THE LEARNED COMMISSIONER OF INCOME TAX (A) ERRE D IN FACT AND IN LAW IN CONFIRMING THE PENALTY OF RS.4,87,000/- L EVIED BY THE AO U/S.271D OF THE INCOME TAX ACT, 1961. ITA NO.1325/AHD /2008 M/S.VEDANT ENTERPRISE VS. JCIT ASST.YEAR - 2004-05 - 2 - 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING PENALTY ORDER PASSED U/S.271D OF THE I.T. ACT, 1961 DATED 31/07/ 2007 WERE THAT THE ASSESSEE HAS ALLEGEDLY ACCEPTED LOAN OF RS.4,87,000 /- FROM M/S.PH SHROFF AND M/S.PUNAMCHAND DEVCHAND SHROFF ON VARIOU S DATES. THE ALLEGATION OF THE ASSESSING OFFICER WAS THAT THOSE LOANS WERE ACCEPTED IN CASH IN CONTRAVENTION OF THE PROVISIONS OF SECTION 269SS OF THE I.T.ACT. CONSEQUENT THEREUPON THE IMPUGNED PENALTY WAS IMPOS ED. AT PRESENT, LD.AR MR.M.K.PATEL HAS PLACED BEFORE US AN ORDER OF ITAT SMC AHMEDABAD PRONOUNCED IN THE CASE OF ACIT VS. SHRI F.R.BHAMWALA IN ITA NO.1343/AHD/2004 FOR A.Y. 2000-2001, ORDER DATE D 17/02/2006, WHEREIN THE MATTER WAS RESTORED BACK AS PER THE FOL LOWING OBSERVATIONS:- 4. I HAVE HEARD BOTH THE SIDES AND PERUSED THE MA TERIAL PLACED ON RECORD. I FIND THAT IN THE CASE OF SHREENATH BU ILDERS (SUPRA) THE TRIBUNAL HAS HELD AS UNDER:- IT IS AN UNDISPUTED FACT THAT THE GENUINENESS OF T HE TRANSACTIONS IN RELATION TO WHICH PENALTIES HAVE BE EN IMPOSED HAD NOT BEEN DOUBTED BY THE DEPARTMENTAL AUTHORITIES. IT IS ALSO TRUE THAT THE LOANS / DEPO SITS AS WELL AS REPAYMENTS OF LOANS WAS A RESULT OF DISCOUNTING OF CHEQUES / DISHONOURING OF CHEQUES ISSUED BY THE ASSESSEE. BO TH THE SHROFFS FROM WHOM THE CHEQUES WERE DISCOUNTED BY TH E ASSESSEE OR TO WHOM THE PAYMENTS IN CASH WERE MADE ON ACCOUNT OF DISHONOURING OF CHEQUES ISSUED BY THE AS SESSEE, ARE REGULAR INCOME TAX ASSESSEES. THE DISCOUNTING OF CHEQUES WAS MADE BY THE ASSESSEE TO MEET URGENT BUS INESS NEEDS OF MAKING THE PAYMENTS TO THE LABOURERS FOR E NABLING THE ASSESSEE TO CARRY ON ITS BUSINESS OF WORKING AS A BUILDING CONTRACTOR AS THE PAYMENTS FOR THE STATE GOVERNMENT WHICH WERE DUE TO THE ASSESSEE WERE NOT FORTHCOMING. ITA NO.1325/AHD /2008 M/S.VEDANT ENTERPRISE VS. JCIT ASST.YEAR - 2004-05 - 3 - 5. THUS, THE TRIBUNAL HAS TAKEN THE VIEW THAT PENAL TY IS NOT LEVIABLE CONSIDERING THE FACTS OF THE SAID CASE. H OWEVER, IN THE CASE UNDER APPEAL BEFORE ME FROM THE PERUSAL OF THE PENALTY ORDER AS WELL AS THE ORDER OF THE CIT(A) THE RELEVANT FA CTS ARE NOT FORTHCOMING, I.E., WHETHER THE AMOUNT WAS RECEIVED BY THE ASSESSEE AS A LOAN OR IT WAS RECEIVED ON THE DISCOUNTING OF CHEQUES IS NOT CLEAR. THE CIT(A) HAS ACCEPTED THE ASSESSEES CONT ENTION THAT THE AMOUNT WAS RECEIVED ON DISCOUNTING OF CHEQUES BUT W ITHOUT GIVING ANY DETAILED FACTS, I.E., THE DATE ON WHICH THE CHE QUE WAS GIVEN TO THE SHROFF AND THE DATE ON WHICH AMOUNT WAS RECEIVE D BY THE ASSESSEE AND WHETHER ANY COMMISSION WAS PAID FOR DI SCOUNTING OF CHEQUE. IN VIEW OF ABOVE, IN MY OPINION, THE MATT ER NEEDS RE- EXAMINATION AT THE END OF THE AO. I THEREFORE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND RESTORE THE MATTER BAC K TO THE FILE OF THE AO. I DIRECT HIM TO RE-EXAMINE THE WHOLE ISSUE AND RECORD THE FACTUAL FINDING WHETHER THE MONEY WAS BORROWED BY T HE ASSESSEE OR IT WAS RECEIVED ONLY BY DISCOUNTING OF CHEQUE BY THE ASSESSEE. AFTER ASCERTAINING THE ABOVE FACTS, HE WILL RE-ADJU DICATE WHETHER THE ASSESSEE IS LIABLE FOR PENALTY U/S.271-D OR NOT . WHILE RE- ADJUDICATING THE ISSUE HE WILL FOLLOW THE PRINCIPLE LAID DOWN BY THE ITAT IN THE CASE OF SHREENATH BUILDERS (SUPRA). NE EDLESS TO MENTION THAT THE AO WILL ALLOW ADEQUATE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE WHILE RE-ADJUDICATING THIS IS SUE. 3. THE LD.AR HAS ALSO DRAWN OUR ATTENTION ON PAGE N OS.33 & 34 OF THE COMPILATION, WHEREIN AN ORDER OF THE REVENUE DE PARTMENT PASSED BY JCIT BHARUCH RANGE, BHARUCH DATED 26/09/2006 PRONOU NCED IN THE CASE OF F.R.BHAMWALA, THE PENALTY U/S.271D WAS DROPPED F OLLOWING THE DECISION OF ITAT IN THE CASE OF SHREENATH BUILDERS VS. DCIT (2000) 66 TTJ 113 (AHD.). IN SUPPORT OF THE CONTENTION THAT THE TRANSACTIONS WERE NOT EXACTLY CASH IN NATURE, THE RELEVANT ACCOUNTS A RE ALSO REFERRED. HOWEVER, CERTAIN FACTS AS INDICATED BY THE RESPECTE D CO-ORDINATE BENCH, RELEVANT PARA REPRODUCED HEREINABOVE, ARE REQUIRED TO BE PLACED ON RECORD, THEREFORE WE DEEM IT PROPER AS WELL AS JUST IFIABLE TO RESTORE THIS ITA NO.1325/AHD /2008 M/S.VEDANT ENTERPRISE VS. JCIT ASST.YEAR - 2004-05 - 4 - ISSUE BACK TO THE STAGE OF THE ASSESSING OFFICER TO BE DECIDED DE NOVO AS PER LAW. GROUND IS TREATED AS ALLOWED BUT FOR STAT ISTICAL PURPOSES. 4. IN THE RESULT, ASSESSEES APPEAL IS TREATED AS A LLOWED FOR STATISTICAL PURPOSES ONLY. SD/- S D/- ( . .!'#$ ) ( ) % ( A.K. GARODIA ) ( M UKUL KR. SHRAWAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 16/ 03 /2012 63..(, .(../ T.C. NAIR, SR. PS 5 1 .7 8 7) 5 1 .7 8 7) 5 1 .7 8 7) 5 1 .7 8 7)/ COPY OF THE ORDER FORWARDED TO : 1. *- / THE APPELLANT 2. ./*- / THE RESPONDENT. 3. 9 / CONCERNED CIT 4. 9() / THE CIT(A)-VI, BARODA 5. 7 >> >/ // / + + + + ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD 1. DATE OF DICTATION..5.3.12 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 5.3.12 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S .3.12 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .3.12 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 9. DATE OF DESPATCH OF THE ORDER