MAN EQUIPMENT CO. P.LTD, MUMBAI V. DCIT CEN CIR 37, MUMBAI

ITA 1507/MUM/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5426 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 17-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 271(1)(c); 143(3); 153A; 27; 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B, MUMBAI BEFORE SHRI SANDEEP GOSAIN, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NOS.1507, 1508 & 1509/M/2016 ASSESSMENT YEARS: 2005-06, 2006-07 & 2007-08 M/S. MAN EQUIPMENT CO. P. LTD., 69, SVP ROAD, DONGRI, MUMBAI 400 009 PAN: AAACM9716E VS. DCIT, CENTRAL CIRCLE 37, MUMBAI (APPELLANT) (RE SPONDENT) PRESENT FOR: ASSESSEE BY : NONE REVENUE BY : SHRI JOTHILAKSHMI NAYAK, D.R. DATE OF HEARING : 14.05.2019 DATE OF PRONOUNCEMENT : 21.05.2019 O R D E R PER RAJESH KUMAR, ACCOUNTANT MEMBER: THE ABOVE TITLED THREE APPEALS HAVE BEEN PREFERRED BY THE ASSESSEE AGAINST THE ORDER DATED 25.01.2016 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER R EFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT YEAR 2005-06, 20 06-07 & 2007-08. 2. THE ONLY ISSUE RAISED BY THE ASSESSEE IS AGAINST THE CONFIRMATION OF PENALTY BY LD. CIT(A) AS IMPOSED BY THE AO UNDER SECTION 271(1)(C) OF THE ACT OF RS.1,46,370/- IN RESPECT OF ADDITIONAL INCOME OF RS.4,00,000/- DECLARED BY THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS AFTER FILING THE RETURN OF INCOME UNDER SECTION 153A OF THE ACT. ITA NOS.1507, 1508 & 1509/M/2016 M/S. MAN EQUIPMENT CO. P. LTD 2 3. THE FACTS IN BRIEF ARE THAT A SEARCH WAS CONDUCT ED ON ASSESSEE ON 13.02.2009 ON RANGARA GROUP OF CASES OF WHICH THE ASSESSEE WAS A GROUP ENTITY. DURING THE YEAR THE A SSESSEE FILED THE NIL RETURN OF INCOME ON 29.10.2005 DECLARING LO SS RS.29,138/-. THEREAFTER, IN RESPONSE TO NOTICE ISS UED UNDER SECTION 153A DATED 13.08.2009, THE ASSESSEE FILED I TS RETURN OF INCOME ON 26.11.2009 DECLARING A SAME INCOME WHICH WAS DECLARED IN THE ORIGINAL RETURN FILED BY THE ASSESS EE. THEREAFTER, THE ASSESSEE FILED A REVISED COMPUTATION OF INCOME DURING THE ASSESSMENT PROCEEDINGS DECLARING AN ADDITIONAL INCO ME BY STATING THAT DURING THE COURSE OF SEARCH, SOME LIST OF ENTRIES RECORDED ON BACKSIDE OF THE PAGE NO.3 THERE APPEARE D AN ENTRY OF RS.3,60,000/- WHICH COULD NOT BE EXPLAINED AND T HEREFORE SAME IS BEING OFFERED AS AN ADDITIONAL INCOME AMOUN TING TO RS.4,00,000/-. THE ASSESSEE SUBMITTED THAT IN THE RETURN OF INCOME FILED IN RESPONSE TO NOTICE UNDER SECTION 15 3A OF THE ACT SUCH ADDITIONAL INCOME WAS NOT DECLARED BY MISTAKE AND NOW BEING RECTIFIED BY FILING REVISED COMPUTATION OF IN COME. THEREAFTER, THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) READ WITH SECTION 153A OF THE ACT DATED 31.12.2010 ASSESSING THE TOTAL INCOME OF RS.4,00,000/- AND THE AO INITIA TED PENALTY PROCEEDINGS FOR CONCEALMENT OF PARTICULARS OF INCOM E AND FURNISHING OF INACCURATE PARTICULARS OF INCOME IN T HE ASSESSMENT ORDER AND ALSO ISSUED NOTICE UNDER SECTION 274 REA D WITH SECTION 271(1)(C) OF THE ACT. THEREAFTER, THE PENA LTY WAS LEVIED VIDE ORDER DATED 07.03.2014 PASSED UNDER SECTION 27 1(1)(C) ON THE GROUND THAT THE ASSESSEE HAS CONCEALED THE PART ICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOM E THEREBY ITA NOS.1507, 1508 & 1509/M/2016 M/S. MAN EQUIPMENT CO. P. LTD 3 MENTIONING BOTH THE CHARGES AND THUS A PENALTY OF RS.1,46,370/- WAS LEVIED. 4. IN THE APPELLATE PROCEEDINGS ALSO LD. CIT(A) AFF IRMED THE ORDER OF AO BY HOLDING THAT THE AO HAS CORRECTLY IN VOKED THE PROVISIONS OF EXPLANATION 5A TO SECTION 271(1)(C) I N RESPECT OF ADDITIONAL INCOME OF RS.4,00,000/- SHOWN BY THE ASS ESSEE IN THE REVISED COMPUTATION OF INCOME DURING THE COURSE OF ASSESSMENT PROCEEDINGS MUCH AFTER THE DATE OF SEARCH AND THUS JUSTIFIED THE IMPOSITION OF PENALTY. 5. AFTER HEARING BOTH THE PARTIES AND PERUSING THE MATERIAL ON RECORD, WE OBSERVE THAT IN THIS CASE THE PENALTY HA S BEEN INITIATED BY THE AO IN THE ASSESSMENT ORDER FOR BOT H THE CHARGES I.E. CONCEALMENT OF INCOME OR FOR FURNISHING OF INA CCURATE PARTICULARS OF INCOME. THUS THE AO HAS INITIATED PE NALTY UNDER BOTH THE CHARGES. SIMILARLY, THE PENALTY WAS IMPOS ED UNDER BOTH THE CHARGES IN THE PENALTY ORDER DATED 07.03.2 014 PASSED UNDER SECTION 271(1)(C) OF THE ACT. THOUGH THE NOT ICE ISSUED UNDER SECTION 274 READ WITH SECTION 271(1)(C) IS NO T BEFORE US SO WE ARE NOT ABLE TO COMMENT ON WHETHER THE ASSESSEE HAS MENTIONED BOTH THE CHARGES OR SPECIFIC LIMB WAS POI NTED OUT BUT AFTER PERUSAL OF THE ORDER OF ASSESSMENT PASSED UND ER SECTION 143(3) READ WITH SECTION 153A OF THE ACT DATED 31.1 2.2010 AND THE PENALTY ORDER UNDER SECTION 271(1)(C) DATED 07. 03.2014, WE OBSERVE THAT THE PENALTY WAS INITIATED FOR BOTH THE CHARGES AS WELL AS IMPOSED ON BOTH THE CHARGES WHICH IS NOT PE RMISSIBLE UNDER THE ACT AS BOTH THESE LIMBS ARE MUTUALLY EXCL USIVE. UNDER THESE CIRCUMSTANCES, WE ARE NOT IN A POSITION TO SUSTAIN THE ORDER OF LD. CIT(A) CONFIRMING THE PENALTY IMPO SED UNDER ITA NOS.1507, 1508 & 1509/M/2016 M/S. MAN EQUIPMENT CO. P. LTD 4 SECTION 271(1)(C) OF THE ACT AS THE SAME IS IN VIOL ATION OF THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE C ASE OF MRS. PIEDADE PERINCHERY (BOMHC) ITA NO.1310 OF 2014 DATE D 10.01.2017 & SHRI SAMSON PERINCHERY VS. CIT (BOM HC ) 392 ITR 4 DATED 05.01.2017. SIMILARLY, THE ISSUE HAS BE EN AFFIRMED BY THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. SSA'S EMERALD MEADOWS (KAR HC) 73 TAXMANN.COM 241 DATED 2 3. 11. 2015. WE THEREFORE RESPECTFULLY FOLLOWING THE DECI SION OF HONBLE BOMBAY HIGH COURT AND ALSO THE APEX COURT AS STATED HEREINABOVE, SET ASIDE THE ORDER OF LD. CIT(A) AND DIRECT THE AO TO DELETE THE PENALTY. ITA NO.158 & 159/M/2016 6. THE ISSUE RAISED BY THE ASSESSEE IN BOTH THESE A PPEALS IS COMMON AND IS AGAINST THE CONFIRMATION OF PENALTY OF RS.1,83,600/- IN A.Y. 2006-07 AND RS.7,34,400/- IN A.Y. 2007- 08. 7. WE HAVE ALREADY DECIDED THE SIMILAR ISSUE IN ITA NO.1507/M/2016 A.Y. 2005-06 (SUPRA), THEREFORE, OUR DECISION IN ITA NO.1507/M/2016 WOULD ,MUTATIS MUTANDIS, APPL Y TO THESE APPEALS AS WELL. ACCORDINGLY, THE APPEALS OF THE ASSESSEE ARE ALLOWED. 8. IN THE RESULT, ALL THE THREE APPEALS OF THE ASSE SSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21.05.2019. SD/- SD/- (SANDEEP GOSAIN) (RAJESH KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: .05.2019. * KISHORE, SR. P.S. ITA NOS.1507, 1508 & 1509/M/2016 M/S. MAN EQUIPMENT CO. P. LTD 5 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY /ASSTT. REGISTRAR, ITAT, MUMBAI.