ACIT 20(3), MUMBAI V. SUN PHARMACEUTICAL INDUSTRIES, MUMBAI

ITA 180/MUM/2014

• Counselvise Citation: 18019914 RSA 2014
• Duration Of Justice: 1 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-06-2015
• Appeal Filed By: Department
• Bench Allotted: E
• Assessment Year: 2006-2007
• Appeal Filed On: 07-01-2014
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: VIJAY MEHTA

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E , BENCH MUMBAI . . , , BEFORE SHRI R.C.SHARMA , A M & MS. SUSHMA CHOWLA , J M ./ I TA NO. 179 TO 182 / MUM/20 1 4 ( / ASSESSMENT YEAR : 200 4 - 05 & 2006 - 07 TO 2008 - 09 ) ACIT 20(3), MUMBAI VS. M/S SUN PHARMACEUTICAL INDUSTRIES, GROUND FLOOR, ACME PLAZA, ANDHERI KURLA ROAD, ANDHEIR, MUMBAI - 400059 ./ ./ PAN/GIR NO. : A ATFS 9584 Q ( / APPELLANT ) .. ( / RESPONDENT ) /REVENUE BY : SHRI NEIL PHILIP /ASSESSEE BY : SHRI VIJAY MEHTA / DATE OF HEARING : 11 /0 6 / 2015 / DATE O F PRONOUNCEMENT 11 /06 /2015 / O R D E R PER R.C.SHARMA (A.M) : TH ESE ARE THE APPEALS FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) FOR ASSESSMENT YEARS 2004 - 05 & 2006 - 07 TO 2008 - 09 , IN THE MATTER OF PENALTY IMPOSED U/S.271(1)(C) OF THE AC T. 2. COMMON GROUNDS HAVE BEEN TAKEN IN ALL THE YEARS, THEREFORE, FOR THE SAKE OF BREVITY, ALL THE APPEALS ARE HEARD TOGETHER AND ARE NOW DECIDED BY THIS CONSOLIDATED ORDER. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FROM THE RECORD WE FOUND THAT PENALTY WAS IMPOSED U/S.271(1)(C) OF THE ACT WITH RESPECT TO THE ADDITION MADE ON ACCOUNT OF RAW MATERIAL PURCHASED FROM ITA NO S . 179 - 182 /1 4 2 SUN PHARMACEUTICALS, NOTIONAL SELLING AND DISTRIBUTION EXPENSES AND INTEREST INCOME ON BANK DEPOSITS/STAFF LOAN AS NOT ELIGIBLE FO R DEDUCTION U/S.80IB OF THE ACT. 4. BY THE IMPUGNED ORDER, THE CIT(A) DELETED THE PENALTY SO IMPOSED BY OBSERVING THAT ADDITION MADE ON ACCOUNT OF NOTIONAL SELLING AND DISTRIBUTION EXPENSES HAS BEEN DELETED BY THE TRIBUNAL IN QUANTUM PROCEEDINGS FOR THE A SSESSMENT YEARS UNDER CONSIDERATION. WITH REGARD TO THE PENALTY IMPOSED ON ACCOUNT OF ADDITION MADE FOR RAW MATERIAL PURCHASED WAS DELETED BY THE CIT(A) AFTER FOLLOWING THE DECISIONS OF TRIBUNAL IN ASSESSEES OWN CASE DATED 12 - 6 - 2012 FOR THE ASSESSMENT YEA R 2005 - 06. THE PENALTY IMPOSED IN ALL THESE YEARS UNDER CONSIDERATION ON ACCOUNT OF RAW MATERIAL PURCHASES WAS DELETED BY FOLLOWING THE ORDER OF TRIBUNAL DELETING THE PENALTY IN ASSESSMENT YEAR 2005 - 06 WITH REFERENCE TO THE SIMILAR ADDITIONS SO MADE. 5. IN THE ASSESSMENT YEAR 2006 - 07 , 2007 - 08 AND 2008 - 09, THE CIT(A) DELETED THE PENALTY BY OBSERVING THAT THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2005 - 06 , HELD THAT PENALTY IS NOT LEVIABLE IN RESPECT OF DISALLOWANCE U/S.80IB ON ACCOUNT OF INTERES T INCOME ON BANK DEPOSIT/STAFF LOAN AS THE ASSESSEE HAS FURNISHED ALL DETAILS AND IT IS MERELY A CLAIM WHICH IS FOUND TO BE NOT SUSTAINABLE IN THE LAW. 6. AGAINST THE ABOVE ORDER OF THE CIT(A), THE REVENUE IS IN APPEALS BEFORE US. 7. WE HAVE CONSIDERED RIV AL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AS WELL AS THE ORDER OF THE TRIBUNAL IN ITA NO S . 179 - 182 /1 4 3 ASSESSMENT YEAR 2005 - 06 IN QUANTUM PROCEEDINGS, WHEREIN THE ADDITION MADE ON ACCOUNT OF NOTIONAL SELLING AND DISTRIBUTION EXPENSES WAS DELETE D BY THE TRIBUNAL VIDE ORDER DATED 12 - 6 - 2012. SINCE THE ADDITION ON ACCOUNT OF NOTIONAL SELLING AND DISTRIBUTION HAS BEEN DELETED IN QUANTUM PROCEEDINGS, THE PENALTY ORDER PASSED WITH RESPECT TO SUCH ADDITION HAS NO LEGS TO STAND. WITH RESPECT TO THE ADDIT ION MADE ON ACCOUNT OF RAW MATERIAL PURCHASES, INTEREST INCOME ON BANK DEPOSIT/STAFF LO A N, THE TRIBUNAL HAS DELETED THE PENALTY AFTER OBSERVING THAT PENALTY IS NOT LEVIABLE IN RESPECT OF DISALLOWANCE U/S.80IB OF THE AC T ON ACCOUNT OF RAW MATERIAL PURCHASE S AS IT IS MERELY A CLAIM WHICH IS FOUND TO BE NOT SUSTAINABLE IN LAW. SIMILARLY THE PENALTY WITH RESPECT TO THE INTER E ST INCOME ON BANK DEPOSITS/STAFF L O A N WAS DELETED BY THE TRIBUNAL BY OBSERVING THAT PENALTY IS NOT LEVIABLE IN RESPECT OF DISALLOWANCE U/ S.80IB ON ACCOUNT OF INTEREST INCOME ON BANK DEPOSIT/STAFF LOAN AS THE ASSESSEE HAS FURNISHED ALL DETAILS AND IT IS MERELY A CLAIM WHICH IS FOUND TO BE N OT SUSTAINABLE IN LAW. RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2005 - 06, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT(A) FOR DELETING THE PE N ALTY IMPOSE D U/S.271(1)(C) OF THE ACT. 8 . IN THE RESULT, ALL APPEAL S OF THE REVENUE ARE DISMISSED. O RDER PRONOUNCED IN THE OPEN COURT ON THIS 11 /06 / 2 01 5 . SD/ - SD/ - ( ) ( SUSHMA CHOWLA ) ( . . ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 11 /06 /201 5 . . /PKM , . / PS ITA NO S . 179 - 182 /1 4 4 / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6 . / GUARD FILE. //TRUE COPY/