Shri Narpatsingh A.Rathod, Surat V. The Income tax Officer,Ward-6(3), Surat

ITA 191/AHD/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9228 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 02-03-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 21-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LALA PHILIPS
• Keywords: Peak credit

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH BEFORE: S H RI PRAMOD KUMAR , ACCOUNTANT MEMBER AND SHR I S. S. GODARA , JUDICIAL MEMBER SHRI NARPATSINGH A. RATHOD, AT & POST UVA, RAJPUT FALIA, BARODOLI - 394601 DIST. SURAT PAN: AIPPR6964H (APPELLANT) VS THE ITO, WARD - 6(3), SURAT (RESPONDENT) REVENUE BY : MR. LALA PHILIPS , SR. D . R. ASSESSEE BY: WRITTEN SUBMISSION DATE OF HEARING : 02 - 03 - 2 016 DATE OF PRONOUNCEMENT : 04 - 03 - 2 016 / ORDER P ER : S. S. GODARA , JUDICIAL MEMBER : - THIS ASSESSEE S AP PEAL FOR A.Y. 2007 - 08 , AR I SES FROM ORDER OF THE CIT(A) - I, SURAT DATED 06 - 11 - 2012 IN APPEAL NO. CAS.I/TFR.6. 166/ 37 2/12 - 13 , IN PROCEEDING S UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . I T A NO . 191 / A HD/20 13 A S SESSMENT YEAR 200 7 - 08 I.T.A NO.191 /AHD/20 13 A.Y. 2007 - 08 PAGE NO SHRI NARPATSINGH A RATHOD VS. ITO 2 2. THE ASSESSEE S SOLE SUBSTANTIVE G ROUND CHA LLENGES SECTION 271(1)(C) PENALTY OF RS. 8,26,364/ - IMPOSED BY THE ASSESSING OFFICER IN HIS ORDER DATED 20 - 05 - 2011 AND AFFIRMED IN THE LOWER APPELLATE PROCEEDINGS. IT EMERGES FROM THE CASE FILE THAT THE ASSESSING OFFICER HAS FRAMED A REGULAR ASSESSMENT ON 30 - 12 - 2009 INTER ALIA DISALLOWING/ADDING PURCHASES OF RS. 7,51,807/ - , EXPENSES OF RS. 43,152/ - AND DIFFERENCE IN BANK ACCOUNT IN SALE OF RS. 17,31,629/ - ; RESPECTIVELY AGGREGATING TO RS. 25,26,588/ - . HE ALSO INITIATED THE IMPUGNED PENALTY PROCEEDINGS ALLE GING CONCEALMENT AND FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE ASSESSEE PREFERRED AN APPEAL. THE CIT(A) UPHELD ASSESSING OFFICER S ACTION IN HIS ORDER DATED 09 - 09 - 2010. THE ASSESSEE FILED ITA NO. 116/AHD/2011. A CO - ORDINATE IN ITS ORDER DATED 30 - 05 - 2015 PARTLY ACCEPTED THE SAME THEREBY RESTRICTING THE ABOVE STATED GROSS AMOUNT OF ADDITION TO RS. 2,05,643/ - ONLY ON THE BASIS OF PEAK CREDIT THEORY THEREBY ESTIMATING PROFITS @ 5% COMING TO RS. 1,15,892/ - . THE ADDITIONS IN QUESTION STOOD MODIFIED TO THE FORMER FIGURE ONLY. QUANTUM PROCEEDINGS SEEM TO HAVE ATTAINED FINALITY AT THIS STAGE. 3. WE COME TO THE IMPUGNED PENALTY PROCEEDINGS. THE ASSESSING OFFICER TREATED THE ABOVE STATED DISALLOWANCE S/ADDITION S AS CONCEALMENT OR FURN ISHING OF ACCURA TE PARTICULARS OF INCOME IN HIS PENALTY ORDER DATED 20 - 05 - 2011 WHICH IN TURN STANDS AFFIRMED IN THE LOWER APPELLATE ORDER UNDER CHALLENGE. I.T.A NO.191 /AHD/20 13 A.Y. 2007 - 08 PAGE NO SHRI NARPATSINGH A RATHOD VS. ITO 3 4. WE HAVE PERUSED ASSESSEE S WRITTEN SUBMISSIONS. THE REVENUE STANDS HEARD AT LENGTH. WE REITERATE THAT TRIBUNA L S ORDER ESTIMATING PEAK CREDIT/ESTIMATING PROFITS (SUPRA) HAS BEEN PASSED AFTER THE CIT(A) S ORDER UNDER CHALLENGE . WE OBSERVE IN THESE FACTS THAT ONCE THE ASSESSE S RELEVANT EXPLANATION IN QUANTUM PROCEEDINGS STAND PARTLY ACCEPTED AS STATED HEREINABOVE , WHAT REMAINS IS ONLY ESTIMATED PROFITS WHICH STAND ASSESSED IN ASSESSEE S HANDS. THE HON BLE JURISDICTIONAL HIGH COURT IN CIT VS. LALUBHAI JOGIBHAI PATEL IN 261 ITR 261 HOLDS THAT SUCH A PENALTY IS NOT TO BE IMPOSED ON ESTIMATED ADDITIONS. A CO - ORDINAT E BENCH OF THE TRIBUNAL IN SHRI OJASBHAI MEHTA VS. ITO ITA 296 AND 297/AHD/2013 DECIDED ON28 - 03 - 2013 SIMILARLY HOLDS THAT SUCH A PENALTY IS ALSO NOT BE LEVIED IN CASE OF PEAK CREDIT ADDITION. THE REVENUE FAILS TO POINT OUT ANY DISTINCTION ON FACTS OR LAW. WE ACCEPT ASSESSEE S WRITTEN SUBMISSIONS IN THESE FACTS AND CIRCUMSTANCES . THE IMPUGNED PENALTY IS DELETED. 5. THIS ASSESSEE S APPEAL IS ALLOWED. ORDER PR ONOUNCED IN THE OPEN C OURT ON 04 - 03 - 201 6 SD/ - SD/ - ( PRAMOD KUMAR ) ( S . S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD : DATED 04 /03 /2016 AK / COPY OF ORDER FORWARDED TO: - I.T.A NO.191 /AHD/20 13 A.Y. 2007 - 08 PAGE NO SHRI NARPATSINGH A RATHOD VS. ITO 4 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUAR D FILE. BY ORDER/ , / ,