M/s. Balwinder Singh Engineer & Contractor, Bathinda V. The Assessing Officer, Bathinda

ITA 185/ASR/2010

• Counselvise Citation: 18520914 RSA 2010
• Duration Of Justice: 2 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2004-2005
• Appeal Filed On: 12-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SSH SUDHIR SEHGAL; A K JUNEJA ITP
• Keywords: Rectification of order; Difference of opinion
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.185 (ASR)/2010 ASSESSMENT YEAR:2004-05 PAN : M/S. BALWINDER SINGH ENGINEER & VS. THE ASSESSING OFFICER, CONTRACTOR, BATHINDA. WARD 1(1), BATHINDA. (APPELLANT) (RESPONDENT) APPELLANT BY:S/SH. SUDHIR SEHGAL & A.K. JUNEJA, ITP RESPONDENT BY:SH. TARSEM LAL, DR DATE OF HEARING:09/08/2012 DATE OF PRONOUNCEMENT:28/08/2012 ORDER PER BENCH ; THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE CIT(A), BATHINDA, DATED 15.01.2010 FOR THE ASSESSMENT YEAR 2004-05. 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APP EAL: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF T HE CASE AND IN LAW THE LD. CIT(A) ERRED IN UPHOLDING THE PENALTY O F CONCEALMENT IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 AT RS.2,87,641/- BY THE AO WARD 1(1), BATHINDA . 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW THE LD. CIT(A) ERRED IN GIVING A FINDING AS TO WHETHER THE PENALTY OF CONCEALMENT CAN BE IMPOSED BY INITIATING THE PENALTY 2 PROCEEDINGS DURING THE COURSE OF RECTIFICATION PROC EEDINGS U/S 154 OF THE ACT. 3. THE BRIEF FACTS IN THE PRESENT CASE ARE THAT RE TURN OF INCOME DECLARING TOTAL INCOME AT RS.73,220/- WAS FILED BY THE ASSESS EE FOR THE A.Y. 2004-05 ON 01.11.2004. THE AO NOTICED THAT THE ASSESSEE HAS SHOWN TOTAL PAYMENTS RECEIVED FROM CONTRACT WORK AT RS.49,97,660/- IN TH E P & L ACCOUNT WHEREAS TOTAL PAYMENTS AS PER TDS CERTIFICATE ISSUED WERE F OUND AT RS.57,97,660/-. THUS, A DIFFERENCE OF RS.8,00,000/- WAS FOUND. THE AO PASSED A RECTIFICATION ORDER U/S 154/155 ON 03.08.2007 AND ASSESSED THE IN COME OF THE ASSESSEE AT RS.8,73,220/-. PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT, WERE ALSO INITIATED FOR FURNISHING INACCURATE PARTICULARS OF INCOME/CONCEALMENT OF INCOME AND A SHOW CAUSE NOTICE U/S 274 R.W.S. 271 W AS ISSUED AND SERVED UPON THE ASSESSEE ON 03.08.2007. BEING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) AND THE CIT(A) VIDE ORDER DATED 18.01.2008 RESTRICTED THE ADDITION TO THE EXTENT OF 8% OF THE SAID GROSS RECEIPTS OF RS.8,00,000/- WHICH WORKED OUT TO RS.64,000/-. THE DEPARTMENT FILED AN APPEAL AGAINST THE ORDER OF THE CIT(A) AND THE ITAT VIDE ITS ORDER DATED 04.12.2008 IN ITA NO.259(ASR)/2008 ALLOWED THE APPE AL OF THE REVENUE. THE AO AFTER PROVIDING AN OPPORTUNITY OF BEING HEAR D TO THE ASSESSEE, IMPOSED THE PENALTY AMOUNTING TO RS.2,87,641/- BEIN G 100% OF THE AMOUNT OF TAX SOUGHT TO BE EVADED. 3 4. THE LD. CIT(A) CONFIRMED THE ACTION OF THE ASSES SING OFFICER. 5. THE LD. COUNSEL FOR THE ASSESSEE, ARGUED THAT NO PENALTY PROCEEDINGS CAN BE INITIATED AGAINST RECTIFICATION PROCEEDINGS U/S 154/155 OF THE ACT. IT WAS ALSO ARGUED THAT THERE IS A DIFFERENCE OF OPINI ON BETWEEN FIRST AND SECOND APPELLATE AUTHORITY AS TO WHAT CAN BE THE CORRECT I NCOME. THEREFORE, ON DIFFERENCE OF OPINION, NO PENALTY U/S 271(1)(C) CAN BE LEVIED. IT WAS ALSO ARGUED THAT THE ASSESSEE HAS GIVEN THE SUB-CONTRACT TO SH. SADAN NAND & SH. AJAIB SINGH AND PAYMENT OF RS.3,70,000/- AND RS.4,3 0,000/- HAD BEEN MADE AND THE NET CONTRACT RECEIPTS HAVE BEEN DECLARED IN THE PROFIT & LOSS ACCOUNT AFTER DEDUCTING THE SAID RS.8,00,000/- OUT OF THE G ROSS CONTRACT RECEIPTS AND THEREFORE, NOTHING HAS BEEN CONCEALED . THIS EXPLAN ATION HAS BEEN SUBMITTED BEFORE BOTH THE AUTHORITIES BELOW IN THE ASSESSMENT AS WELL AS IN THE PENALTY PROCEEDINGS. 6. THE LD. DR, SH. TARSEM LAL, ON THE OTHER HAND, A RGUED THAT THE ASSESEE GAVE NO SUCH NOTE ALONGWITH THE RETURN OF I NCOME THAT IT HAD EXCLUDED RS.8,00,000/- FROM TOTAL CONTRACT RECEIPTS . THE ASSESSEE CLAIMED CREDIT FOR TDS DEDUCTED OUT OF THE SAID AMOUNT, WHI CH SHOWS WILLFUL FURNISHING OF INACCURATE PARTICULARS OF INCOME. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE FACTS OF THE CASE. THERE IS NO DISPUTE TO THE FACT THAT THERE ARE TWO OPINIONS OF THE APPELLATE AUTHORITIES I.E. THE LD. CIT(A) IN THE ASSESSMENT PROCEEDINGS WHO HAD DELETED THE 4 ADDITION AND THE TRIBUNAL HAD RESTORED THE ADDITION . MOREOVER, THE ASSESSEE HAD SUBMITTED THE EXPLANATION DURING THE PENALTY PR OCEEDINGS AS WELL AS IN THE ASSESSMENT PROCEEDINGS THAT A SUM OF RS.8,00,00 0/- HAD BEEN EXCLUDED FROM THE GROSS CONTRACT RECEIPTS. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT THERE IS NO FURNISHING OF INACCURATE P ARTICULARS OF INCOME AND NO CONCEALMENT OF INCOME HAS BEEN MADE BY THE ASSESSE E AND THE AO CANNOT LEVY PENALTY U/S 271(1)(C) OF THE ACT AND PENALTY S O LEVIED IS DIRECTED TO BE DELETED. ACCORDINGLY, THE ORDER OF THE LD. CIT(A) I S REVERSED. THUS, ALL THE GROUNDS OF THE ASSESSEE ARE ALLOWED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN ITA NO.185(ASR)/2010 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 28TH AUGUST, 2012. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 28 TH AUGUST, 2012 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:M/S. BALWINDER SINGH ENGINEER & CONTRA CTOR, BATHINDA. 2. THE A.O. WAD 1(1), BATHINDA. 3. THE CIT(A) 4. THE CIT 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY 5 BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.