RL Steels & Energy Ltd, Faridabad V. JCIT Special Range - 7, New Delhi

ITA 1917/DEL/2020

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 5442 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 7 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2012-2013
• Appeal Filed On: 02-12-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 2; 43; 13; 22

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “F” DELHI BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER I.T.A. No.1917/DEL/2020 Assessment Year 2012-13 R.L. Steels & Energy Ltd., C/o Ankit Gupta B-64, 2 nd Floor, Nehru Ground, NIT Faridabad. Faridabad. v. JCIT, Special Range-7, New Delhi. TAN/PAN: AAACR5809B (Appellant) (Respondent) Appellant by: None Respondent by: Ms. Moninder Kaur, Sr.D.R Date of hearing: 13 07 2022 Date of pronouncement: 20 07 2022 O R D E R PER PRADIP KUMAR KEDIA, A.M.: The c apt io ne d ap p eal ha s be en f i le d at th e i ns ta nc e o f the ass es se e a ga in st t he or der of t he Co mmi s si on er of Inc o me Ta x (Ap pe al s) , De lhi -3 8 (‘C IT (A )’ i n sh ort ), d ate d 0 4.09. 2 02 0 ari si ng f ro m th e as se ss me n t ord er d at ed 2 6. 03 . 20 19 p as sed by t he Ass es si ng Of f icer ( AO ) u nd er Sec ti on 1 43 (3 ) of t he I nc o me Ta x A ct , 196 1 (t he Act ) co nc ern in g A Y 2 0 12- 13 . 2. As pe r i ts gr ou nd s of app ea l, th e a ss ess ee ha s c ha lle ng e d t he i mpo sit io n of p ena l t y of R s. 91 ,0 97 /-. 3. W h en t he ma tte r w as c all ed f o r he ar i ng, no n a pp ear ed f or t he As ses se e. Th e mat ter wa s a cc or di ngl y p roc ee de d e x- pa rte in th e abs en ce of th e as se sse e. On p er usa l of the o rd ers of the aut ho ri ti es I.T.A. No.1917/DEL/2020 2 bel ow , we ob ser ve tha t th e pe na lt y ha s bee n i mp ose d o n acc ou nt of dis al lo wa nc e of all eg ed in cor re ct cla i m b y w a y of exc es s dep re ci ati on o n Fu rna ce Rs .3 92 65 /-, ex ce ss de pre ciati on on pol lu ti on e qu ip me nts Rs .2 ,4 0, 99 5/- and di sal lo wa nc e of Rs. 30 0 un der S ec ti on 14 A of t he Ac t. I t i s s i mult an eo us l y n oti ced t ha t t he ass es se e ha s co nt end ed b ef or e lo w er au th or iti es t hat boo ks of acc ou nt a nd t he f in anc ia l st ate me nt s o f the ass es see ha s b een a ud it ed b y i nd ep en de nt st a tut or y a ud it or. S ig nif ic an tl y, a ll ma t eri al f ac ts and ma te ria l p ar tic ula rs rel at in g to a ddi ti on s of fixe d a sse ts un de r blo ck of f ixe d a sse ts u nd er t he hea d ‘p la nt a nd machi ne r y’ per ta in in g t o F urn a ce an d Po ll ut io n E qui p men t ha ve b ee n d is cl os ed and ac co un te d f or i n t he bo ok s of a cc ou nts a s w el l a s i n the In co me Tax R et urn . T he ass es se e h as ne it h er c on ce al ed no r f urni sh an y ina cc ur ate p ar ti cu la rs of inc o me or a n y othe r inf o rmat io n eve n in t he cou rs e of as se ss me nt p ro ce ed in gs u nd er S ec ti on 14 3(3 ) of the Ac t. The a ss es se e th ere f ore co nt en de d bef ore t he l ow er auth ori ti es t hat mer el y o n ac co un t of vie w ta ke n b y t he R ev en ue t o war d s el ig ib ili t y of ass es se e f or lo w er r at e of d ep rec ia t ion , s uc h a ct of as s ess ee do es not ta nt a mou nt t o a n y co nc eal me nt of in co me or f urni sh in g ina cc ur ate p ar ti cul ars t he re of per se . It is f urt her c on te nde d th at a mer e w ro ng /i na d miss ib le c la i m ca n not be e q uat ed w ith ac t of con ce al me nt et c. A ref er enc e to th e de c isi on of t he H on ’b l e S up re me Co urt i n CI T v s. R e lia nc e Pet ro pr od uc ts Pv t. Lt d. a s r ep o rted in 32 2 IT R 1 58 (SC ) wa s ma de. 4. W e st rai gh tw a y n ote t hat i n o rd er to att ra ct pe na lt y un der Sec ti on 2 71 (1 )( c) of the A ct, it i s nec es sa r y t ha t th e re mus t be con ce al me nt b y t he as se sse e of p art ic ula rs of h is inc o me or f urni sh in g of in ac cur at e pa rt ic ula rs the re of . Th e di sa ll ow anc e of cer ta in e xp en di tu re on e st i mate d b as i s on so me no tiona l ba si s is nei th er t he co nc e al men t of in co me par ti cul ar s of i nco me no r I.T.A. No.1917/DEL/2020 3 f urni sh in g of in ac c ura te p art ic ul ar s a s suc h. 5. Nee dl es s t o s a y, t o i nv oke S ect io n 2 71( 1) (c ), the en ti re t y of cir cu ms ta nc es mu s t r ea so na ble p oi nt to t he c onc lu sio n t ha t th e dis pu te d a mo un t r e pre se nt s i nc o me a n d t he a ss es se e h as co nce al ed the p art ic ul ar s o r f urn is he d ina cc ur at e pa rt icu la rs th er eof . A s no te d, the qu an tu m a dd it i on h as be en co nf ir me d o n th e p re mi s e th at th e ass es se e is n ot el ig ibl e f o r hig he r ra te of de pr eciat io n in t he f a ct s of the c ase . It is n o t t he ca se of t he Re ve nu e a ut ho riti es th at th e ass es se e ha s, i n f act, c on ce ale d t h e f act re la ti ng t o clai m of dep re ci ati on all ow a nce be yo n d a n y d o ubt . T he R ev en ue Au th ori ti es hav e det er mi ne d t h e l ow er cla i m of d e pre ci ati on e lig ib le to as ses se e on th e ba si s of re ap pre ci ati on of ex is ti ng f a ct s. 6. A c on sp ec tu s of E x pla na ti on -1 to S ec ti on 27 1( 1) (c ) of th e Act , ma kes i t c lea r tha t the s tat ut e v is ua li z es th e a ss es s men t p roc ee di ng s and pe na lt y pr oc ee din gs to be wh oll y dis ti nc t an d ind ep end en t of eac h o th er. W h il e t he A ss es si ng Of f ic er ma y be ju stif i ed in mak in g est i mat ed di sa llo w anc e i n q ua nt u m p roc ee di ng s, su ch d isa ll ow an ce of exp en se s a nd th a t to o on es ti ma ted bas is an d f urth er su bst an ti al l y red uc ed in t he ap p ell at e pr oc ee di ng s, cou ld no t au to ma tic al l y f al l wit hi n t he mi sc hief of Sec ti on 2 71 (1 )( c) of th e A ct on t h e gr ou nd s of co nc eal me nt e tc. Wh il e the c la i m to war ds e xp en ditur e ma y n ot b e f ound a cce pt ab le i n q ua nt u m p ro cee d ing s, s uc h dis allo w anc e pe r s e can no t in vi te ri go r s of pe na lt y. W h er e a ll mat eri al f act s re le va nt to the i ss ue we re p lac ed on re co rd , mi ti gat in g cir cu mstan ce s t o dis pr ov e an y cu l pab il it y of an y sor t ag ai ns t th e ass es se e is est ab li sh ed b y i mp lic at io n. Th e cl ai m of d ep rec ia tion a ll ow anc e, a t bes t, c an be t ak en as er ro ne ou s cl ai m b y th e a sse ssee . T he H on ’b le Del hi Hi gh Co urt in t he c as e of CI T (In ter n ati on al Ta xat io n ) v s. Gr ace ma c C or po r ati on , in IT A N o. 4 7/ 20 22 a nd C.M . No . I.T.A. No.1917/DEL/2020 4 12 83 3/2 02 2 ju dg m ent d ate d 15 t h Ma rch , 20 22 he ld th at pe nal t y un der S ect io n 27 1( 1)( c) is n ot le via bl e a s a ma tt er of c o urs e in th e abs en ce of a n y e le me nt of f als it y p e r se. 7. The H on ’bl e Ape x Co ur t i n t he cas e of C IT vs . R eli anc e Pet ro pr od uc ts Pvt . Ltd . a s re po rt ed i n 32 2 I TR 1 58 (S C ) he ld t ha t pen al t y un der Se cti on 27 1( 1)( c) i s no t l ev iab le f or a d h oc dis al lo wa nc e ma de on es ti ma te d ba sis in th e ab se nce of a n y el e men t of f alsi t y p er s e. It wa s ob se rv ed th at in th e a bs en ce of a n y f i nd ing tha t an y d eta il s su p pli ed b y t he a ss es s ee in it s ret ur n ar e f ound to b e inc or re ct or err on e ou s o r f als e, th er e is no qu es tio n of i nvi ti ng th e pen al t y un de r Se ct i on 2 71 (1 )( c) of t he Act . I t w as f ur th e r ob se rv ed tha t a me re ma ki n g of cl ai m, wh ic h is n ot su st ai na ble in l aw , b y its elf wi ll n ot a mo unt t o f urn is hi ng i nac cu ra te pa rt ic ul a rs re ga rd in g the i nc o me of the a sse ss ee . A v ar ia nce in de pr ec ia tio n cl a i m ma de i n the r et ur n do es not t hu s ta nt a mo unt t o f urn is hi ng inac cu ra te par ti cu lar s pe r se. 8. In vi ew of t he af o r esa id d eli be ra ti on s, th e i mpugn ed or d er of the C IT( A) i s s et asi de an d the A ss ess in g Of f icer is dir ec te d t o del et e t he p en al t y i n q ue st io n. 9. In th e res ul t, t he ap pea l of th e as se ss ee is a llow ed ex p ar te. Order pronounced in the open Court on 20/07/2022. Sd /- Sd /- [KUL BHARAT] [PRADIP KUMAR KEDIA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: /07/2022 Prabhat