Kharkar Die Work Private Ltd., Nashik V. Deputy Commissioner of Income-tax,

ITA 1665/PUN/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9325 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 9 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-06-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-06-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 04-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Condonation of delay
• Section: 143(3); 68; 2

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI ANIL CHATURVEDI, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.1665/PUN/2014 / ASSESSMENT YEAR : 2008-09 KHARKAR DIE WORK PRIVATE LIMITED, D-91/1, MIDC, SATPUR, NASHIK 422 007. PAN NO.AACCK4603Q. . / APPELLANT V/S ASST.COMMISSIONER OF INCOME TAX, CIRCLE 1, NASHIK. . / RESPONDENT / APPELLANT BY : SHRI ABHAY AVCHAT / RESPONDENT BY : SHRI ACHAL SHARMA / ORDER PER ANIL CHATURVEDI, AM : THIS APPEAL OF THE ASSESSEE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) I, NASHIK, DATED 20.05.2014 FOR THE ASSESSMENT YEAR 2008-09. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER :- 2.1 ASSESSEE IS A COMPANY STATED TO BE ENGAGED IN THE BUSINESS OF MANUFACTURING OF DIES AND JIGS AND JOB WORK O N SHEET METAL. ASSESSEE FILED ITS RETURN OF INCOME FOR A.Y. 2008-09 O N 30.09.2009 DECLARING TOTAL LOSS OF RS.62,904/-. THE CASE WA S TAKEN UP FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WA S FRAMED / DATE OF HEARING : 20.06.2017 / DATE OF PRONOUNCEMENT: 21.06.2017 2 U/S 143(3) OF THE ACT ON 01.12.2010 AND THE TOTAL INCOME W AS DETERMINED AT RS.10,90,179/- WHICH INCLUDED AN ADDITION OF RS.11,53,083/- ON ACCOUNT OF UNEXPLAINED CREDIT IN THE FORM OF SHARE CAPITAL U/S 68 OF THE ACT. ON THE AFORESAID ADDITION OF RS.11,53,083/- THAT WAS MADE, PENALTY PROCEEDINGS U/S 271(1)(C) WERE INITIATED AND THEREAFTER VIDE ORDER DT.28.06.2 011, AO CONCLUDED THAT ASSESSEE HAS CONCEALED THE PARTICULAR S OF HIS INCOME AND WAS THEREFORE LIABLE FOR PENALTY U/S 271(1)(C) AND ACCORDINGLY LEVIED PENALTY OF RS.3,91,930/-. AGGRIEVED BY TH E ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A ), WHO VIDE ORDER DT.16.01.2014 DISMISSED THE APPEAL OF THE ASSES SEE. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE IS NOW IN A PPEAL BEFORE US AND HAS RAISED FOLLOWING GROUNDS : 1. WITHOUT CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED ASSESSING OFF I CER HAS ERRED IN LEVYING THE PENA L TY UNDER SECTION 271 ( 1) )( C ) OF RS . 3 , 91 , 930/- , CONSIDERING THE SHARE CAPITAL AT RS . 11 , 53 , 083/- AS UNEXP L A I NED CREDITS UNDER SECTION 68 OF THE INCOME TAX ACT , 196 1 . 2. WITHOUT CONSIDERING STATEMENT MADE BY THE SHAREHOLD ER ADM I TTING SHARE APPL I CATION MONEY , THE SHAREHOLDER BEING A TAXPAYER AND H AV I NG PAN , THE ASSESS I NG OFFICER WITHOUT CONSIDERING FACTS AND CIRCUMSTANCES OF THE CASE HAS ERRED IN LEVYING THE PENALTY UNDER SECTION 271 ( 1)(C ) OF THE INCOME TAX ACT , 1961 AND THE COMMISSIONER OF INCOME TAX ( APPEALS ) -I , NASHIK , HAS ERRED IN CONFIRMING THE PENALTY WITHOUT CONSIDE RING FACTS AND CIRCUMSTANCES OF THE CASE AND THE LAW OBTAINING , THE ASSESSING OFFICER HAS ERRED I N LEVYING THE PENA L TY AND THE LEARNED COMM I SSIONER OF INCOME TAX ( APPEALS ) -I , NASHIK HAS ERRED I N CONFIRMING THE SAME . 3. THE ASSESS I NG OFFICER HAS ERRED IN LEVYING THE PENALTY OF RS . 3 , 91 , 930/- UNDER SECTION 271 (1 )( C ) OF THE INCOME TAX ACT , 1961 AND THE COMMISSIONER OF INCOME TAX ( APPEALS ) -I , NASHI K , HAS ERRED I N CONFI R M I NG THE PENALTY , HE N CE THE PENALT Y NEEDS TO BE DROPPED . 4. THE ORDER UNDER SECTION UNDE R SECTION 271 (1 ) (C ) OF THE INCOME TAX ACT 1961 , DATED 20.05 . 2014 OF THE COMMISSIONER OF INCOME TAX (APPEALS) - I , NASHIK , IN CASE OF THE ASSESSEE BAD IN LAW . 3. THE CASE FILE REVEALS THAT THERE IS DELAY IN FILING OF APPEAL OF 47 DAYS BY THE ASSESSEE. BEFORE US, ASSESSEE HAS PRAY ED FOR CONDONATION OF DELAY AND HAS ALSO FILED THE AFFIDAVIT OF SHRI 3 DINESH SHRIPAD KOREGAV, THE DIRECTOR OF ASSESSEE COMPANY , WHEREIN THE REASON FOR DELAY IS INTER-ALIA STATED TO BE CH ANGE IN MANAGEMENT OF THE COMPANY. BEFORE US, LD.D.R. HAS URGED T HAT CONSIDERING THE REASONS STATED BY THE DIRECTOR OF ASSE SSEE AND IN THE INTEREST OF JUSTICE, THE DELAY BE CONDONED. LD.D.R. ON THE OTHER HAND, VEHEMENTLY OBJECTED TO THE PRAYER FOR CON DONATION. WE HAVE HEARD THE RIVAL SUBMISSIONS. CONSIDERING THE AVERMENTS MADE BY THE DIRECTOR OF ASSESSEE COMPANY, WE ARE OF THE VIEW THAT IN THE PRESENT CASE, DELAY NEEDS TO BE CO NDONED. WE ACCORDINGLY CONDONE THE DELAY AND ADMIT THE APPEAL. 4. BEFORE US, AT THE OUTSET, LD.A.R. SUBMITTED THAT THE SOLE CONTROVERSY IS WITH RESPECT TO LEVY OF PENALTY U/S 271(1)(C ) OF THE ACT. HE SUBMITTED THAT AGAINST THE QUANTUM ADDITION OF RS.11,53,083/-, ASSESSEE HAD PREFERRED APPEAL BEFORE TRIBU NAL. TRIBUNAL VIDE ORDER DT.28.04.2017 IN ITA 1664/PUN/2014 HA S SET ASIDE THE ORDER OF LD. CIT(A) AND DELETED THE ENTIRE A DDITION OF RS.11,53,083/-. HE THEREFORE SUBMITTED THAT SINCE THE QU ANTUM ADDITION ON WHICH THE PENALTY HAS BEEN LEVIED ITSELF HAS BEE N SET ASIDE BY TRIBUNAL, THE VERY BASIS OF LEVY OF PENALTY DOES NO T SURVIVE AND THEREFORE THE PENALTY LEVIED BY AO AND CONFIRM ED BY LD. CIT(A) BE DELETED. HE POINTED TO THE RELEVANT FINDING IN THE ORDER OF TRIBUNAL. LD.D.R. ON THE OTHER HAND DID NOT CO NTROVERT THE FACTUAL SUBMISSION MADE BY LD.A.R. BUT HOWEVER SUPPO RTED THE ORDER OF LD. CIT(A). 5. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATER IAL ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPEC T TO LEVY OF PENALTY U/S 271(1)(C) ON THE ADDITION OF RS.11,53,083/- AS UNEXPLAINED CREDIT U/S 68 OF THE ACT. WE FIND THAT THE 4 CO-ORDINATE BENCH OF THE TRIBUNAL IN ITA 1664/PUN/2014 DT.28.04.2017 HAS SET ASIDE THE ORDER OF LD. CIT(A) AND DE LETED THE ENTIRE ADDITION OF RS.11,53,083/-. IN SUCH A SITUATION, WE ARE OF THE VIEW THAT SINCE THE QUANTUM ADDITION ON WHICH IMPUGNED PENALTY HAS BEEN LEVIED HAS ITSELF HAS BEEN DELETE D, THE QUESTION OF LEVY OF PENALTY ON ACCOUNT OF CONCEALMENT OF INCOME OF SUCH ADDITION DOES NOT SURVIVE. WE THEREFORE DE LETE THE PENALTY AND THUS, THE GROUNDS OF THE ASSESSEE ARE ALLOWED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED ON THE 21 ST DAY OF JUNE, 2017. SD/- SD/- ( VIKAS AWASTHY ) ( ANIL CHATURVEDI ) / JUDICIAL MEMBER ! / ACCOUNTANT MEMBER PUNE; ! DATED : 21 ST JUNE, 2017. YAMINI ' # $%& '#$ / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3 . 4. 5. 6. CIT(A)-1, NASHIK CIT-1, NASHIK. &() $$*+,' *+, / DR, ITAT, A PUNE; )-.// GUARD FILE. / BY ORDER, // TRUE COPY // 0 1234 / ASSISTANT REGISTRAR, ' *+, / ITAT, PUNE.