DCIT, Circle, Parwanoo V. M/s Stove Kraft India, Barotiwala

ITA 1346/CHANDI/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5350 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 08-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHISH ABROL
• Section: 14A

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES B, CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBER & MS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER ITA NO. 1346/CHD/2017 ASSESSMENT YEAR: 2012-13 DCIT, CIRCLE, VS. M/S STOVE KRAFT INDIA, PARWANOO. VILLAGE BURANWALA, BAROTIWALA, BADDI,DISTT. SOLAN (H.P.) PAN NO. AAZFS6497G (APPELLANT) (RESPONDENT) APPELLANT BY : SH. ASHISH ABROL RESPONDENT BY : SH. MANOJ KUMAR DATE OF HEARING : 08.01.2018 DATE OF PRONOUNCEMENT : 08.01.2018 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVENU E AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), [HEREINAFTER REFERRED TO AS CIT(A)], SHIMLA DATED 15.7.2017. 2. IN THIS APPEAL, THE REVENUE HAS AGITATED THE ACT ION OF THE CIT(A) IN DEALING THE PENALTY LEVIED BY THE ASSESSING OFFICE R U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 3. AT THE OUTSET, SHRI MANOJ KUMAR, LD. REPRESENTAT IVE OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSING OFFICER HAD LEVIE D PENALTY ON TWO ISSUES. 2 THE FIRST ISSUE WAS ON ACCOUNT OF DENIAL OF DEDUCTI ON UNDER RELEVANT OF SECTION 80IC OF THE ACT IN RESPECT OF SUBSTANTIAL E XPANSION. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THOUGH THE APPEAL OF THE ASSESSEE ON THE QUANTUM FOR THE YEAR UNDER CONSIDER ATION IS PENDING BEFORE THE HON'BLE HIMACHAL PRADESH HIGH COURT, BUT , THE ISSUE OTHERWISE HAS BEEN DECIDED BY THE HON'BLE HIMACHAL PRADESH H IGH COURT IN THE OWN CASE OF THE ASSESSEE FOR EARLIER ASSESSMENT YEARS I .E. 2010-11 AND 2011-12, WHEREIN THE HON'BLE HIGH COURT HAS HELD THAT THE IN ITIAL YEAR FOR CLAIMING DEDUCTION U/S 80IC ON ACCOUNT OF SUBSTANTIAL EXPANS ION WILL BE THE YEAR IN WHICH SUCH SUBSTANTIAL EXPANSION TOOK PLACE AND THE FACT THAT THE ASSESSEE HAD ALREADY AVAILED DEDUCTION U/S 80IC OF THE ACT ON THE ESTABLISHMENT OF THE UNIT WILL NOT HAVE ANY BEARING ON THE GRANT OF DEDUCTION ON ACCOUNT OF EXPANSION OF UNIT AS PER THE PROVISIONS OF THE I.T. ACT. THE LD. AR, THEREFORE, HAS SUBMITTED THAT THE PENALTY IS NOT LE VIABLE ON THIS ISSUE. 4. IN RELATION TO THE SECOND ISSUE, THE LD. AR HAS SUBMITTED THAT THE PENALTY HAS BEEN LEVIED BY THE ASSESSING OFFICER ON DISALLOWANCE U/S 14A OF THE ACT READ WITH RULE 8D OF THE I.T. RULES. HE HAS SUBMITTED THAT IN THIS CASE, THE DISALLOWANCE U/S 14A, WHICH WAS MADE BY THE ASSESSING OFFICER, BY MAKING CERTAIN DISALLOWANCES ASSUMING T HAT CERTAIN EXPENSES MIGHT HAVE INCURRED BY THE ASSESSEE IN MAKING THE I NVESTMENT, BUT, THAT ITSELF IPSO FACTO WOULD NOT BE ENOUGH TO CONCLUDE T HAT THE ASSESSEE HAD FURNISHED INACCURATE PARTICULARS OF INCOME OR HAS C ONCEALED ITS INCOME. 5. THE LD. DR, ON THE OTHER HAND, HAS RELIED ON THE ORDER OF THE ASSESSING OFFICER. 3 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIN D THAT THE PENALTY IN THIS CASE HAS BEEN LEVIED ON TWO ISSUES. HOWEVER , THE DISALLOWANCE RELATING TO BOTH THE ISSUES HAD BEEN MADE BY THE AS SESSING OFFICER WHILE ASSUMING / INTERPRETING CERTAIN PROVISIONS OF THE A CT. IT IS NOT THE CASE WHERE ANY FACT WAS CONCEALED BY THE ASSESSEE OF ITS INCOME NOR IT IS THE CASE OF FURNISHING OF INACCURATE PARTICULARS OF INC OME. WE, THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. CIT(A) W HILE DELETING THE PENALTY IN THIS CASE. 7. THERE IS NO MERIT IN THE APPEAL OF THE REVENUE A ND THE SAME IS ACCORDINGLY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 08.01.2018 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 4