ACIT, Bijapur V. Sri Manoji J. Torgal, Bijapur

ITA 154/BANG/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 5132 (ITAT-BANGALORE)
• Duration Of Justice: 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-07-2010
• Assessment Year: 2001-2002
• Appeal Filed On: 10-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JACINTA ZIMIK VASHAI; GOPAL RAO
• Keywords: Right to appeal; Condonation of delay; TDS; Set aside
• Section: 271(1)(c); 43B; 143(3); 143(2); 264; 263; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUAL BANGALORE BENCH A BEFORE DR. O.K.NARAYANAN, VICE PRESIDENT AND SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA NOS.154(BANG)/2010 (ASSESSMENT YEAR: 1001-02 AND ITA NO.155(BANG)/2010 (ASSESSMENT YEAR: 2001-02) ASST. COMMISSIONER OF INCOME-TAX, CIRCLE 1, BIJAPUR. VS. APPELLANT SHRI MANOJI J. TORGAL, SHIKARKHANA ROAD, BIJAPUR. RESPONDENT APPELLANT BY: SHRI GOPAL RAO & SMT. JACINTA ZIMIK VASHAI. RESPONDENT BY: NONE. O R D E R PER SMT. MADHAVI DEVI, JM : THESE APPEALS BY THE REVENUE ARE DIRECTED AGAINST THE TWO DIFFERENT ORDERS OF THE CIT(APPEALS), BELGAUM, DATE D 27-11-2009 FOR THE ASSESSMENT YEAR 2001-02. 2. ITA NO.154(BANG)/2010 : THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE CIT(A) ERRED IN ADMITTING THE APPEAL, IGNO RING DELHI HIGH COURT DECISION IN 232 ITR 381, AS PER WH ICH ONCE PETITION U/S 264 WAS REJECTED BY CIT., APPEAL ORDER PASSED BY AAC WAS WITHOUT JURISDICTION AS OR DER OF ASSESSMENT HAD MERGED WITH ORDER OF CIT. ITA 154 & 155(BANG)/2010 PAGE 2 OF 11 1.1 THE CIT(A) ERRED IN ADMITTING THE APPEAL FILE D BY THE ASSESSEE THOUGH, ASSESSEES PETITION U/S 264 CHALLENGING THE SAME ADDITIONS MADE WAS ALREADY REJECTED BY CIT AND CONSEQUENTLY, ORDER OF AO HAS MERGED WITH THAT OF ORDER OF CIT WHICH CANNOT BE SUBJECT MATTER OF APPEAL BEFORE CIT(A). 1.2 THE CIT(A) ERRED IN IGNORING PROVISIONS OF SEC.264(4) AS PER WHICH ASSESSEE HAS TO WAIVE HIS RIGHT OF APPEAL TO CIT(A) BEFORE FILING APPLICATION U/S 264 AND ONCE PETITION U/S 264 WAS DISMISSED ASSESSE E CANNOT SEEK ALTERNATE REMEDY OF FILING APPEAL TO CI T(A) AND THAT TOO WITH REQUEST FOR CONDONATION OF DELAY OF 2 YEARS. 2. THE CIT(A) ERRED IN CONDONING THE DELAY OF 2 YEARS IN FILING APPEAL IGNORING THE FACT THAT ASSES SEE HAD FILED PETITION U/S 264 DURING THE SAME PERIOD F OR WHICH IT WAS CLAIMED THAT, HE WAS NOT IN A POSITION TO PURSUE APPEAL MATTERS IN VIEW OF DIFFICULT CONDITIO NS. 3. THE CIT(A) ERRED IN DELETING ADDITION MADE TOWARDS GOVERNMENT RENTALS U/S 43B AMOUNTING TO RS.56,85,000/- ON THE PLEA MADE THAT SAME WAS PAID BEFORE DUE DATE FOR FILING RETURN IGNORING THE FACT THAT, SUCH PAYMENT WAS NOT MADE BY ASSESSEE AND ALSO NO EVIDENCE WAS PRODUCED TO PROVE THAT SUCH PAYMENT WAS MADE BY OTHERS ON HIS BEHALF. 3.1 THE CIT(A) ERRED IN ALLOWING ABOVE RELIEF BY FOLLOWING KARNATAKA HIGH COURT DECISION IN 246 ITR 750 IGNORING THE FACT THAT SAID DECISION HAS NOT BECOME FINAL AND SLP HAS BEEN ADMITTED BY SUPREME COURT VIDE 264 ITR ST.139 4. FOR THESE AND SUCH OTHER GROUNDS THAT M AY BE URGED AT THE TIME OF HEARING, THE ORDER OF CIT(A ) ADMITTING THE APPEAL AND ALLOWING ABOVE RELIEF MAY BE SET ASIDE AD THAT OF THE AO RESTORED. 3. BRIEF FACTS ARE THAT THE ASSESSEE IS AN INDIVIDU AL ENGAGED IN THE BUSINESS OF DEALING IN ARRACK, LIQUOR AND BE ER. THE ASSESSEE HAS FILED HIS RETURN OF INCOME FOR THE REL EVANT ASSESSMENT YEAR ON 30-10-2001 DECLARING INCOME OF RS.7,57,120/-. DURING THE ASSESSMENT PROCEEDINGS U /S 143(3) OF ITA 154 & 155(BANG)/2010 PAGE 3 OF 11 THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO A S THE ACT FOR SHORT], VARIOUS NOTICES WERE ISSUED TO THE ASSESSEE . HOWEVER, THE ASSESSEE SOUGHT ADJOURNMENT ON ONE PRETEXT OR A NOTHER AND SINCE THERE WAS NO RESPONSE TO NOTICES U/S 143(2) A ND 142(1), THE AO PASSED EX-PARTE ASSESSMENT ORDER U/S 144 OF THE ACT ON THE BASIS OF THE MATERIAL AVAILABLE ON RECORD. HE OBSERVED FROM THE AUDIT REPORT U/S 44AB THAT AN AMOUNT OF RS.56,8 5,000/- IS DUE TO GOVERNMENT AS RENTAL. SINCE THE ASSESSEE HA S NOT GIVEN ANY DETAILS OF THE PAYMENT OF THIS RENTAL TO THE GO VERNMENT, HE MADE THE ADDITION U/S 43B OF THE ACT. HE THEREAFTE R OBSERVED THAT IN THE RETURN OF INCOME OF M/S.M.J.TORGAL & BR OS., THE ASSESSEE IS SHOWN DEBIT OF RS.87,93,447/- WHILE THE ASSESSEE SHOWS CREDIT TO M/S.M.J.TORGAL A TOTAL OF RS.1,12,1 6,314/-. OBSERVING THAT THE CREDIT SHOWN IS IN EXCESS BY RS. 24,22,867/- AND THE ASSESSEE HAS FAILED TO RE-CONCILE THE FIGUR ES, HE MADE THE ADDITION OF RS.24,22,867/- AS THE INCOME OF THE ASSESSEE AS NON EXISTING LIABILITY. THEREAFTER, HE CONSIDERED TDS CERTIFICATES ENCLOSED ALONG WITH RETURN OF INCOME, ACCORDING TO WHICH THE ASSESSEE HAS RECEIVED INTEREST FROM BANKS A SUM OF RS.19,33,741/- WHEREAS THE ASSESSEE HAS ACCOUNTED F OR ONLY RS.16,27,969/-. IN THE ABSENCE OF ANY EXPLANATION TO THE SHORT ACCOUNTAL, HE MADE THE ADDITION OF DIFFERENCE OF RS .3,05,772/- TO THE INCOME OF THE ASSESSEE. HE FURTHER OBSERVED FR OM THE PROFIT & LOSS ACCOUNT THAT AN AMOUNT OF RS.3,00,502/- IS S HOWN AS RECEIPT ON ACCOUNT OF SALE OF GRAPES AND THE SAID A MOUNT IS DEDUCTED WHILE COMPUTING TAXABLE INCOME. HE OBSERV ED THAT THE ITA 154 & 155(BANG)/2010 PAGE 4 OF 11 ASSESSEE HAS FAILED TO ACCOUNT THE SAME AS THE AGRI CULTURAL INCOME FOR RATE PURPOSES. HE, THEREFORE, CONSIDERE D THE AMOUNT OF RS.3,00,502/- AS AGRICULTURAL INCOME OF THE ASSE SSEE FOR RATE PURPOSES AND COMPUTED THE TAXABLE INCOME AT RS.94,7 1,260/-. 4. THEREAFTER, ON PERUSAL OF THE RETURN OF INCOME OF THE ASSESSEE, THE CIT OBSERVED THAT THE ASSESSEE HAS SH OWN NIL AGRICULTURAL INCOME AND HAS ALSO FAILED TO FILE ANY DETAILS OF AGRICULTURAL INCOME. HE, THEREFORE OBSERVED THAT T HE RECEIPT OF RS.3,00,502/- CANNOT BE CONSIDERED AS AGRICULTURAL INCOME WHICH IS CLAIMED AS EXEMPT AND TO THAT EXTENT, THE ORDER OF THE AO IS ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF REVEN UE. HE, THEREFORE, ISSUED SHOW CAUSE NOTICE U/S 263 TO ASSE SSEE WHICH REMAINED UN-SERVED AND RETURNED BY THE POSTAL DEPAR TMENT WITH THE REMARK DOOR LOCKED. THEREAFTER, FRESH SHOW C AUSE NOTICE DATED 3-2-2006 WAS SERVED ON THE ASSESSEE AND THE C HARTERED ACCOUNTANT SHRI R.J.NAIK ATTENDED AND SUBMITTED THA T THE SALE PROCEEDS OF GRAPES PERTAIN TO HUF OF THE ASSESSEE B UT HE IS NOT HAVING ANY EVIDENCE TO SUPPORT THE SAME. CONSIDERI NG THE SAID SUBMISSIONS, THE CIT CAME TO THE CONCLUSION THAT TH E AO HAS ERRED IN HOLDING THIS AMOUNT OF RS.3,00,502/- AS AG RICULTURAL INCOME. HE, ACCORDINGLY, SET ASIDE THE ASSESSMENT ORDER WITH A DIRECTION TO THE AO TO RE-FRAME THE ASSESSMENT ORDE R ON THE LIMITED ISSUE MENTIONED, AFTER GIVING DUE OPPORTUNI TY OF BEING HEARD TO THE ASSESSEE. 5. IN THE MEAN TIME, THE ASSESSEE FILED APPLICATION U/S 264 OF THE ACT TO THE CIT, STATING THAT THE ASSESSEE HA S NOT FILED ANY ITA 154 & 155(BANG)/2010 PAGE 5 OF 11 APPEAL BEFORE THE CIT(A) AGAINST THE ORDER OF THE A O U/S 144 AND AFTER THE EXPIRY OF TIME FOR FILING OF APPEAL, THE ASSESSEE HAS FILED A REVISION PETITION U/S 264 ALONG WITH PRESCRIBED F EE. THE CIT CONSIDERED THE ASSESSEES SUBMISSION ON THE VARIOUS GROUNDS RAISED THEREIN. HOWEVER, HE CONFIRMED THE ADDITION MADE BY THE AO ON THE GROUND THAT THE ASSESSEE HAS NOT BEEN ABL E TO SUBSTANTIATE HIS CLAIM WITH DUE EVIDENCE. SUBSEQUE NT THERETO, THE AO INITIATED ASSESSMENT PROCEEDINGS TO GIVE EFF ECT TO THE ORDER OF THE CIT U/S 263 AND 264 OF THE ACT BY ISSU E OF DUE NOTICE TO THE ASSESSEE. HOWEVER, THE ASSESSEE FAIL ED TO RESPOND TO ANY OF THE NOTICES ISSUED BY THE AO. THE AO, TH EREFORE, MADE THE ADDITION OF RS.3,00,502/- AS INCOME FROM UNDISC LOSED SOURCES AND BROUGHT IT TO TAX. IT IS AGAINST THIS ORDER OF THE AO U/S 144 READ WITH SEC.263 AND 264 THAT THE ASSESSEE FILED APPEAL BEFORE THE CIT(A) ALONG WITH APPLICATION FOR CONDON ING THE DELAY IN FILING APPEAL. THE DELAY IS OF 2 YEARS. 6. THE CIT(A), AFTER CONSIDERING THE ASSESSEES SUBMISSIONS AND THE REASONS FOR DELAY, CAME TO THE CONCLUSION THAT THE DELAY IS NOT WILFUL AND HAS TO BE CONDONED . THUS, HE ADMITTED THE APPEAL TO BE DECIDED ON MERITS. THERE AFTER, HE CONSIDERED THE ASSESSEES STATEMENT THAT THE GOVERN MENT RENTALS OF RS.56,85,000/- CANNOT BE ADDED TO THE INCOME OF THE ASSESSEE U/S 43B OF THE ACT IN VIEW OF THE DECISION OF THE K ARNATAKA HIGH COURT IN THE CASE OF CIT VS. SREE BALAJI & CO ., REPORTED IN 246 ITR 750 WHEREIN IT WAS HELD THAT RENTAL IS NOT IN T HE NATURE OF TAX, DUTY, CESS OR FEES TO WHICH THE PROVISIONS OF SECTION 43B ARE ITA 154 & 155(BANG)/2010 PAGE 6 OF 11 ATTRACTED, AFTER CONSIDERING THE SAME, HE DELETED THE DISALLOWANCE OF RS.56,85,000/-. AS REGARDS THE OTH ER ADDITION, THE CIT(A) HAS CONFIRMED THE SAME ON THE GROUND THA T THE ASSESSEE COULD NOT SUBSTANTIATE THE SAME. AGGRIEVE D BY THE ORDER OF THE CIT(A) IN DELETING THE DISALLOWANCE OF RS.56,85,000/-, THE REVENUE IS IN APPEAL BEFORE US. 7. NOTICES TO THE ASSESSEE HAVE BEEN SENT BY THE T RIBUNAL BUT THE SAME WERE RETURNED UN-SERVED AND THEREFORE, THE NOTICE HAS BEEN ORDERED TO BE SERVED THROUGH THE LEARNED D R. THE LEARNED DR HAS FILED BEFORE US THE COPY OF SERVICE OF NOTICE ON THE ASSESSEE BUT THERE IS NO REPRESENTATION ON BEHA LF OF THE ASSESSEE. THEREFORE, AFTER HEARING THE LEARNED DR AND AFTER CONSIDERING THE MATERIAL ON RECORD, THE APPEAL IS D ISPOSED OF AS UNDER: 8. THE LEARNED DR, WHILE SUPPORTING THE ORDER OF T HE AO, HAS RAISED A LEGAL GROUND THAT THE ORDER OF THE AO U/S 144 HAS MERGED WITH THE ORDER OF THE CIT U/S 264 OF THE ACT , AND THEREFORE, THE SAME IS NOT CHALLENGEABLE BEFORE THE CIT(A). FOR THIS PURPOSE, HE PLACED RELIANCE UPON CLAUSE (A) OF SUB-SECTION (4) OF SECTION 264 WHEREIN IT IS PROVIDED THAT THE CIT SHALL NOT REVISE ANY ORDER U/S 264 WHERE AN APPEAL AGAINST TH E ORDER LIES TO THE CIT(A) OR TO THE APPELLATE TRIBUNAL BUT HAS NOT BEEN MADE AND THE TIME WITHIN WHICH SUCH APPEAL MAY BE MADE H AS NOT EXPIRED, OR IN THE CASE OF AN APPEAL TO THE CIT(A) OR TO THE APPELLATE TRIBUNAL, THE ASSESSEE HAS NOT WAIVED HIS RIGHT OF APPEAL. THE LEARNED DR SUBMITTED THAT FROM THE ORD ER OF THE CIT ITA 154 & 155(BANG)/2010 PAGE 7 OF 11 U/S 264, IT IS CLEAR THAT THE ASSESSEE HAS NOT FILE D ANY APPEAL BEFORE THE CIT(A) AND HAS WAIVED HIS RIGHT OF APPEA L TO FILE SUCH APPEAL. IN SUCH CIRCUMSTANCES, ACCORDING TO THE LE ARNED DR, THE APPEAL TO THE CIT(A) IS NOT MAINTAINABLE. IN SUPPOR T OF HIS CONTENTION, HE PLACED RELIANCE UPON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. EURASIA PUBLISHING HOUSE (P)LTD . REPORTED IN 232 ITR 381. 9. AS REGARDS THE LEGAL GROUND IN GROUND NO.1 RAIS ED BY THE REVENUE THAT THE ASSESSMENT ORDER U/S 144 GOT M ERGED WITH THE CITS ORDER U/S 264 AND THE ASSESSEES PETITION CHALLENGING THE SAME ADDITION IS NOT MAINTAINABLE, WE AGREE WIT H THE LEARNED DR THAT THE ORDER U/S 144 DATED 26-3-2004 GOT MERGE D WITH THE ORDER OF THE CIT U/S 264 DATED 24-3-2006 AND THE JU DGMENT OF THE HONBLE DELHI HIGH COURT (CITED SUPRA) IS TO TH IS EFFECT. BUT, WE FIND THAT THE ASSESSEE HAS NOT CHALLENGED BEFORE THE CIT(A) THE ORDER U/S 144 DATED 26-3-2004 BUT HAS CHALLENGE D THE ORDER DATED 11-8-2006 U/S 144 GIVING EFFECT TO THE ORDER U/S 263 AND 264 OF THE ACT. THEREFORE, IT CAN BE SEEN THAT THER E IS FRESH APPLICATION OF MIND BY THE AO IN ACCORDANCE WITH TH E ORDER U/S 263 & 264 OF THE ACT FOR MAKING THE ASSESSMENT AND IT IS AMENABLE TO APPEAL BEFORE THE CIT(A). THEREFORE, T HIS GROUND OF APPEAL IS REJECTED. 9.1 AS REGARDS GROUND NO.2 WITH REGARD TO THE COND ONATION OF DELAY OF 2 IN FILING THE APPEAL, WE FIND THAT T HE ASSESSEE HAS GIVEN DETAILED REASONS AS TO THE CAUSE OF DELAY, BE ING CLOSURE OF THE BUSINESS AND THE FINANCIAL DIFFICULTIES OF THE ASSESSEE AND THE ITA 154 & 155(BANG)/2010 PAGE 8 OF 11 CIT(A) HAS CONSIDERED THE SAME AND HAS USED HIS DIS CRETIONARY POWERS TO CONDONE THE DELAY. WE FIND THAT THE REAS ONS GIVEN BY THE ASSESSEE ARE JUSTIFIED FOR CONDONATION OF DELAY IN FILING OF APPEAL AND THEREFORE, WE DO NOT SEE ANY REASON TO I NTERFERE WITH THE ORDER OF THE CIT(A) ON THIS ACCOUNT. 9.2 AS REGARDS GROUND NO.3 RELATING TO THE MERITS OF THE ORDER OF THE CIT(A) IN GIVING RELIEF BY DELETING TH E ADDITION MADE TOWARDS GOVERNMENT RENTALS U/S 43B AMOUNTING TO RS.56,85,000/-, WE FIND THAT THE CIT(A) HAS RELIED UPON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CA SE OF SREE BALAJI & CO. (SUPRA) AND THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE WITH THE SAME. THIS GROUND OF REVENUE IS REJECTED. 10. IN THE RESULT, THE ORDER OF THE CIT(A) IS UPHE LD AND THE REVENUES APPEAL IS DISMISSED. 11. ITA NO.155(BANG)/2010 : IN THIS APPEAL, THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. THE CIT(A) ERRED IN DELETING THE PENALTY BASED ON RELIEF ALLOWED BY HIM IN APPEAL FILED AGAINST ASSESSMENT ORDER OVERLOOKING THE FACT THAT, SUCH APPEAL CANNOT BE ENTERTAINED IN VIEW OF PROHIBITION CONTAINED IN SEC.264(4) OF IT ACT & IGNORING DELHI HIGH COURT DECISION IN 232 ITR 381. 2. THE CIT(A) ERRED IN CONDONING THE DELAY OF 2 YEARS IN FILING APPEAL IGNORING THE FACT THAT ASSES SEE HAD FILED PETITION U/S 264 DURING THE SAME PERIOD F OR WHICH IT WAS CLAIMED THAT, HE WAS NOT IN A POSITIO N TO PURSUE APPEAL MATTERS IN VIEW OF DIFFICULT CONDITIONS. 3. THE CIT(A) ERRED IN DELETING PENALTY RELATABLE T O ADDITION MADE TOWARDS GOVERNMENT RENTALS U/S 43B ITA 154 & 155(BANG)/2010 PAGE 9 OF 11 AMOUNTING TO RS.56,85,000/- THOUGH, SUCH PAYMENT WAS NOT MADE BY ASSESSEE AND ALSO NO EVIDENCE WAS PRODUCED TO PROVE THAT SUCH PAYMENT WAS MADE BY OTHERS ON HIS BEHALF. 3.1 THE CIT(A) ERRED IN ALLOWING ABOVE RELIEF BY FOLLOWING KARNATAKA HIGH COURT DECISION IN 246 ITR 750 IGNORING THE FACT THAT SAID DECISION HAS NOT BECOME FINAL AND SLP HAS BEEN ADMITTED BY SUPREME COURT VIDE 264 ITR ST. 139. 4. THE CIT(A) ERRED IN DELETING PENALTY RELATABLE TO UNDISCLOSED INTEREST INCOME BROUGHT TO TAX BY AO IGNORING THE HONBLE KARNATAKA HIGH COURT DECISIONS IN THE CASE OF CIT VS. K.P.SAMPATH REDDY (197 ITR 232) & M/S.PRANAM METALS, BELGAUM, VIDE ITA NO.1000/2006 DTED.9.12.2009 AND HONBLE SUPREME COURT DECISION IN THE CASE OF UNION OF INDIA VS. DHARMENDRA TEXTILES (306 ITR 277) WHEREIN IT IS HELD THAT, PENALTY PROCEEDINGS ARE ONLY CIVIL LIABI LITY AND WILLFUL CONCEALMENT IS NOT AN ESSENTIAL INGREDIENT. 5. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING, THE ORDER OF CIT(A) ADMITTING THE APPEAL AND ALLOWING ABOVE RELIEF MAY BE SET ASIDE AND THAT OF THE AO RESTORED. 12. BRIEF FACTS OF THE CASE ARE THAT PURSUANT TO T HE ASSESSMENT OF INCOME U/S 144 DATED 26-3-2004 THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND LE VIED PENALTY ON THE INCOME SOUGHT TO BE EVADED BY THE ASSESSEE A ND IMPOSED PENALTY OF RS.30,57,870/- BEING 100% OF THE TAX SOU GHT TO BE EVADED. ON APPEAL, THE CIT(A) HAS DELETED THE PENA LTY AS REGARDS THE GOVERNMENT RENTALS WHICH DISALLOWANCE H AS BEEN DELETED BY HIM AND ALSO ON THE DIFFERENCE IN INTERE ST OF RS.3,05,772/- AS PER TDS CERTIFICATES AND INTEREST DISCLOSED IN THE RETURN OF INCOME. HE CONFIRMED THE PENALTY AS R EGARDS NON- ITA 154 & 155(BANG)/2010 PAGE 10 OF 11 EXISTING LIABILITY OF RS.24,22,867/- AND THE AGRICU LTURAL INCOME OF RS.3,00,500/-. AGGRIEVED, REVENUE IS IN APPEAL BEF ORE US. 13. THE LEARNED DR PLACED RELIANCE ON THE ORDER OF THE AO. AS NONE APPEARED FOR THE ASSESSEE DESPITE SERVICE O F NOTICE BY THE LEARNED DR, WE DISPOSE OF THE APPEAL AFTER HEAR ING THE LEARNED DR. 14. WE FIND THAT THE CIT(A), IN HIS APPEAL, HAS DE LETED THE DISALLOWANCE U/S 43B OF RS.56,85,000/- AND IN THE R EVENUES APPEAL AGAINST SUCH DELETION VIZ., ITA 154/BANG/201 0, WE HAVE UPHELD THE ORDER OF THE CIT(A). THEREFORE, AS THE QUANTUM ADDITION ITSELF HAS GONE, THERE IS NO BASIS FOR LEV Y OF PENALTY U/S 271(1)(C) OF THE ACT ON THIS ISSUE. THE ORDER OF T HE CIT(A) IS THUS CONFIRMED ON THIS ACCOUNT. AS REGARDS THE DEL ETION OF ADDITION ON ACCOUNT OF DIFFERENCE IN INTEREST AS PE R TDS CERTIFICATE AND INTEREST DISCLOSED IN THE RETURN OF INCOME, WE FIND THAT THE CIT(A) HAS HELD THAT THIS IS A SIMPLE ACCOUNTING OR CALCULATION MISTAKE AND NOT WITH ANY MOTIVE TO SUPPRESS INTERES T INCOME, BECAUSE, HAD THE ASSESSEE ANY SUCH WILL TO CONCEAL, HE WOULD NOT HAVE ENCLOSED TDS CERTIFICATES ALONG WITH HIS R ETURN OF INCOME ENABLING THE AO TO DETECT THE DIFFERENCE. H E, THEREFORE, HELD THAT THE CONDITION PRECEDENT FOR IMPOSING PENA LTY AND INTENTION TO CONCEAL INCOME MUST BE EVIDENT. WE FI ND THAT THE FINDING OF THE CIT(A) IS REASONABLE AS THE ASSESSE E HIMSELF HAS ENCLOSED THE TDS CERTIFICATES AND ALSO RETURNED THE INTEREST INCOME. IF HE INTENDED TO AVOID TAXATION OF INTERE ST INCOME, NOTHING PREVENTED HIM FROM NOT ENCLOSING THE TDS CE RTIFICATES. ITA 154 & 155(BANG)/2010 PAGE 11 OF 11 THUS THERE IS NO INTENTION TO CONCEAL THE PARTICULA RS OF INCOME. IN VIEW OF THE SAME, WE FIND THAT THE ORDER OF THE CIT(A) IN DELETING PENALTY ON THIS ACCOUNT IS JUSTIFIED AND W E DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE CIT(A ). 15. IN THE RESULT, THE APPEAL OF THE REVENUE FAILS AND IS ACCORDINGLY DISMISSED. PRONOUNCED IN THE OPEN COURT ON 22ND JULY 2010 SD/- SD/- (DR. O.K.NARAYANAN) (SMT. MADHAVI DEVI) VICE PRESIDENT JUDICIAL MEMBER BANGALORE : D A T E D : 22 ND JULY, 2010 EKS COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) CONCERNED 4. THE CIT 5. THE DR, ITAT, BANGALORE 6. GUARD FILE BY ORDER ASSIS TANT REGISTRAR, ITAT, BANGALORE