DCIT, Circle-14(2), Hyderabad V. M/s Heramec Limited, Hyderabad

ITA 1473/HYD/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 8996 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-01-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITRA
• Assessee Lawyers: P RAVI SESHAGIRI RAO
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI D.MANMOHAN, VICE PRESIDENT AND SHRI B.RAMAKOTAIAH, ACCOUNTANT MEMBER ITA NO.1472/HYD/2014 : ASST. YEAR 2008 - 09 ITA NO.1473/HYD/2014 : ASST. YEAR 2009 - 10 DY. COMMISSIONER OF INCOME - TAX, CIRCLE 14(2), HYDERABAD V/S. M/S. HERAMEC LIMITED, HYDERABAD ( PAN - AABCH 3529 B ) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAJAT MITRA RESPONDENT BY : SHRI P.RAVI SESHAGIRI RAO DATE OF HEARING 19 . 01 .201 5 DATE OF PRONOUNCEMENT 19.01.2015 O R D E R PER D.MANMOHAN, VICE PRESIDENT PENALTY LEVIED UNDER S.221 OF THE INCOME - TAX ACT, 1961, HAVING BEEN CANCELLED BY THE COMMISSIONER OF INCOME - TAX( APPEALS), REVENUE IS IN APPEAL BEFORE US. 2. PENALTY OF RS .10,00,000 FOR EACH YEAR WAS LEVIED BY THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSEE DE F AULTED IN MAKING PAYMENT OF TAX WITHOUT ANY REASONABLE CAU SE . BEFORE THE CIT(A) , I T W AS SUBMI T TED T H A T THE ASSESSING OFFICER FAILED TO APP R ECI A TE THAT THERE WAS A REASONABLE AN D SUFFICIENT CAUSE FOR NON - PAYMENT; IN FACT, THE ASSESSEE C ANNOT B E TREATED AS AN ASSESSEE IN DEFAULT. IT DE SE RVES TO BE NOTICED T HAT DURIN G TH E COURSE OF PENALTY PROC E EDIN G S, THE ASSESSEE SUBMITTED I TA NO. 14 72 - 1473 /HYD/201 4 M/S. HERAMEC LI MITED, HYDERABAD 2 THAT THE ORD E R PASSED BY THE ASSESSING OFFICER TREATING THE ASSESSEE AS IN DEFAULT UN D ER S.201/201(1A) WAS CHALLENGED BEFORE THE CIT(A), BUT THE ASSESSING OFFICER DID NOT CONSIDER THE SAME AS A REASONABLE CAUSE IN VIEW OF THE FACT T HAT THE CIT(A) HAS ALREADY PASSED THE ORDER BY THE TIME OF COMPLETION OF P E NALTY PROCEEDINGS UNDER S.221 O F THE AC T. SUBSEQUENT THERETO, TH E M AT TER WAS TAKEN BEFORE THE INCOME TAX APPELLATE TRIBUNAL, HY D ERABAD BENCHES. VIDE O R DER DATED 4.6.2014 (ITA NO.1 342 & 1343/HYD / 2013), THE TRIBUNAL DELETED THE ADDITIONS MADE BY THE ASSESSING OFFICER UN D ER S.201/201(1A). S IN C E THE QUANTUM APPEAL IS DECIDED IN F A VOUR O F TH E ASSESSEE BY THE ITAT, THE LEARNED CIT(A) HELD T HAT THE VERY B A SIS FOR THE LEVY OF P E NALTY DOES N O T EXIST. HE , THEREFORE, CANCELLED THE PENALTY LEVIED UN D ER S . 221 OF THE ACT. 3. DESPITE THE FIN D IN G S OF THE LEARNED CIT(A), REVENUE PREFERRED APPEALS BEFORE THE TRIBUNAL CONTENDING , INTER ALIA , THAT THE COMMISSIONER (A) ERRED IN NOT HOL D IN G THE ASSESSEE IN DEFAULT. AT THE TIME OF HEARING, THE LEARNED COUNSEL APP E ARING ON BEHALF O F THE ASSESSEE PLACED BEFORE US, COPY OF THE ORD E R OF THE ITAT, A BENCH, FOR THE ASSESSMENT YEARS UN D ER CO NS I D ERATION TO SUB M I T THAT THE DEMAND RAISED BY THE ASSE SSING OFFICER, WHICH IS THE BASIS FOR LEVY OF PENALTY UN D ER S.221 NO LONGER SUBSIST AND THE SAID O R D E R O F THE TRIBUNAL HAS B E EN CONFIRMED BY THE HON'BLE HIGH COU R T OF JUDICATURE AT HYDERABAD (ITTA NO.677 OF 2014 DATED 27.11.2014 ). LEARNED DEPARTMENTAL REP RESENTATIVE , ON THE OTHER HAND, RELI E D ON THE ORDER PASSED BY THE ASSESSING OFFICER. 4. HAVING REGARD TO THE CIRC U M S TANCES OF THE CA S E, WE ARE OF T H E VIEW THAT THE O R DER PASSED BY THE LEARNED CIT(A) DOES NO T CALL FOR ANY INTERFERENCE. W E, THEREFORE, C ON F I R M THE ORDER OF THE CIT(A) AND D ISMI S S THE APPEALS FIL E D BY THE REVENUE. I TA NO. 14 72 - 1473 /HYD/201 4 M/S. HERAMEC LI MITED, HYDERABAD 3 5. IN THE RESULT, REVENUES APPEALS ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON 19 TH JANUARY, 2015 SD/ - SD/ - (B.RAMAKOTAIAH) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT DT/ - 19 TH JANUARY, 2015 COPY FORWARDED TO: 1. M/S. HERAMEC LIMITED, , 2 ND FLOOR, V.V.MANSION, DOOR NO.6 - 3 - 885/7/B/4, SOMAJIGUDA, HYDERABAD 500 482. 2. DY. COMMISSIONER OF INCOME - TAX CIRCLE 14(2) TDS, HYDERABAD 3. 4. COMMISSIONER OF INCOME - TAX(APPEALS) - II , HYDERABAD COMMISSIONER OF INCOME - TAX I, HYDERABAD 5. DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S