M.Karthikeyan, Kancheepuram V. DCIT Business Circle 1, Tambaram

ITA 1900/CHNY/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3136 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 08-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P MUTHUSHANKAR
• Keywords: Set aside
• Section: 271(1)(c)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !', $ '% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.1900/CHNY/2018 ' (' / ASSESSMENT YEAR : 2010-11 SHRI M. KARTHIKEYAN, PROP. OF M/S KAR CONSTRUCTIONS, 22A, OTHAVADAI STREET, ACHARAPAKKAM, KANCHEEPURAM DISTRICT-603 301. PAN : AFUPK 0941 F V. THE DEPUTY COMMISSIONER OF INCOME TAX, BUSINESS CIRCLE I, TAMBARAM RANGE, TAMBARAM 600 045. (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : NONE ,-*+ . / / RESPONDENT BY : SHRI P. MUTHUSHANKAR, JCIT 0 . 1$ / DATE OF HEARING : 03.10.2019 23( . 1$ / DATE OF PRONOUNCEMENT : 08.11.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -10, CHENN AI, DATED 19.01.2018 AND PERTAINS TO ASSESSMENT YEAR 2010-11, CONFIRMING THE PENALTY LEVIED BY THE ASSESSING OFFICER UNDER S ECTION 271(1)(C) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 2 I.T.A. NO.1900/CHNY/18 2. NO ONE APPEARED FOR THE ASSESSEE INSPITE OF SERV ICE OF NOTICE. THEREFORE, WE HEARD THE LD. DEPARTMENTAL R EPRESENTATIVE AND PROCEEDED TO DISPOSE THE APPEAL ON MERIT. 3. SHRI P. MUTHUSHANKAR, THE LD. D.R. SUBMITTED THA T THE ASSESSEE IS A CIVIL CONTRACTOR. THE ASSESSEE ENTER ED INTO VARIOUS SERVICE CONTRACTS FOR CONSTRUCTION. ACCORDING TO T HE LD. D.R., AS PER FORM 26AS IN THE DATABASE OF THE DEPARTMENT, IT WAS REFLECTED AS IF TAX WAS COLLECTED / DEDUCTED IN RESPECT OF M/S TERR A INFRA DEVELOPMENT LTD. AND M/S MAYTAS INFRA LTD. REFERR ING TO PAGE 5 OF THE PENALTY ORDER, THE LD. D.R. SUBMITTED THAT BOTH M/S TERRA INFRA DEVELOPMENT LTD. AND M/S MAYTAS INFRA LTD. ARE NOT ONE AND THE SAME. THEY ARE TWO DIFFERENT COMPANIES HAVING THE IR OWN TAN NUMBERS. IT IS ALSO AN ADMITTED FACT THAT THE ASSE SSEE HAD RENDERED SERVICE TO M/S MAYTAS INFRA LTD. ACCORDING TO THE LD. D.R., THE ASSESSEE CLAIMED BEFORE THE ASSESSING OFFICER THE A MOUNT RECEIVED FROM M/S TERRA INFRA DEVELOPMENT LTD. AND M/S MAYTA S INFRA LTD. ACCORDING TO THE LD. D.R., M/S MAYTAS INFRA LTD. IS A DIFFERENT ENTITY ALTOGETHER. IT HAS ITS OWN TAN NUMBER, THEREFORE, THE ASSESSEE CONCEALED THE RECEIPT OF AMOUNT FROM M/S MAYTAS INF RA LTD. ON A 3 I.T.A. NO.1900/CHNY/18 QUERY FROM THE BENCH WHETHER M/S MAYTAS INFRA LTD. HAS DEDUCTED TAX WHILE MAKING PAYMENT TO THE ASSESSEE? THE LD. D.R. SUBMITTED THAT TAX WAS DEDUCTED BY BOTH M/S TERRA INFRA DEVEL OPMENT LTD. AND M/S MAYTAS INFRA LTD. AND IT WAS CREDITED TO THE GO VERNMENT ACCOUNT. ACCORDING TO THE LD. D.R., M/S MAYTAS INF RA LTD. AND M/S TERRA INFRA DEVELOPMENT LTD. ARE TWO INDEPENDENT EN TITIES AND BOTH THE COMPANIES HAVE MADE THE PAYMENTS. THEREFORE, A CCORDING TO THE LD. D.R., THE ASSESSING OFFICER HAS RIGHTLY LEV IED PENALTY FOR NON-DISCLOSING THE RECEIPT FROM M/S MAYTAS INFRA LT D. 4. WE HEARD THE SUBMISSIONS OF LD. D.R. AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. FROM THE GR OUNDS OF APPEAL IT APPEARS THAT THE TURNOVER OF THE ASSESSEE AS REPORT ED IN PROFIT & LOSS ACCOUNT WAS 4,61,30,933/-. HOWEVER, AS PER FORM 26AS, IT WAS ONLY 4,36,51,471/-. WHEN THE ASSESSEE HAS DISCLOSED MOR E TURNOVER / RECEIPTS, IT IS NOT KNOWN HOW THE ASSESS EE CONCEALED ANY PART OF INCOME OR FURNISHED INACCURATE PARTICULARS? BOTH M/S TERRA INFRA DEVELOPMENT LTD. AND M/S MAYTAS INFRA LTD. HA VE DEDUCTED TAX WHILE MAKING THE PAYMENT. THE ASSESSEE INSTEAD OF DISCLOSING CONTRACT RECEIPT FROM TWO DIFFERENT COMPANIES, HAS FAILED TO ENTER CONTRACT RECEIPT IN THE NAME OF M/S MAYTAS INFRA LT D. THE FACT THAT 4 I.T.A. NO.1900/CHNY/18 THE ASSESSEE DISCLOSED 4,36,51,471/- AS A CONTRACT RECEIPT IS NOT IN DISPUTE. THE ASSESSMENT COMPLETED WAS ACCEPTED BY THE ASSESSEE AND THE TAX WAS PAID. MOREOVER, M/S MAYTAS INFRA L TD. DEDUCTED TAX WHILE MAKING THE PAYMENT. THEREFORE, IT CANNOT BE SAID THAT THE ASSESSEE CONCEALED ANY PART OF INCOME SAID TO BE RE CEIVED FROM M/S MAYTAS INFRA LTD. EVEN IF THE ASSESSEE HAS NOT DISCLOSED RECEIPT FROM M/S MAYTAS INFRA LTD., THIS IS ONLY OM ISSION. IT CANNOT BE CONSIDERED TO BE CONCEALED AS HELD BY APEX COURT IN PRICE WATERHOUSE COOPERS PVT. LTD. V. CIT (2012) 348 ITR 306. IN VIEW OF THE ABOVE, THIS TRIBUNAL IS OF THE CONSIDERED OP INION THAT THIS IS NOT FIT CASE FOR LEVY OF PENALTY UNDER SECTION 271( 1)(C) OF THE ACT. ACCORDINGLY, ORDERS OF BOTH THE AUTHORITIES BELOW A RE SET ASIDE THE PENALTY LEVIED BY THE ASSESSING OFFICER UNDER SECTI ON 271(1)(C) OF THE ACT IS DELETED. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 8 TH NOVEMBER, 2019 AT CHENNAI. SD/- SD/- (. !') ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 8 TH NOVEMBER, 2019. 5 I.T.A. NO.1900/CHNY/18 KRI. . ,167 87(1 /COPY TO: 1. *+/ APPELLANT 2. ,-*+/ RESPONDENT 3. 0 91 () /CIT(A)-10, CHENNAI-34 4. PRINCIPAL CIT- 7, CHENNAI 5. 7: ,1 /DR 6. ;' < /GF.