Mamta Silk Mills Pvt.Ltd., Surat V. The Income tax Officer,Ward-1(3), Surat

ITA 1966/AHD/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 85674 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-02-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 17-02-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 08-08-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROOP CHAND
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH AHMEDABAD , CH CHCH CH BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER. ITA. NO.1966/AHD/2011 (ASSESSMENT YEAR:2005-06) MAMTA SILK MILLS PVT. LTD. K-1286, SURAT TEXTILE MARKET, RING ROAD, SURAT. APPELLANT VS. INCOME TAX OFFICER, WARD 1(3), SURAT RESPONDENT PAN: AABCM5904D /BY APPELLANT : WRITTEN SUBMISSION /BY RESPONDENT : SHRI ROOPCHAND, SR. D.R. !' /DATE OF HEARING : 17.02.2015 #$% !' /DATE OF PRONOUNCEMENT : 19.02.2015 ORDER PER SHAILENDRA KUMAR YADAV, J.M: THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-I, SU RAT, DATED 28.06.2011 FOR A.Y. 2005-06 ON THE FOLLOWING GROUND S: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE A S WELL AS LAW ON THE SUBJECT, THE LEARNED COMMISSIONER OF ITA NO. 1966/AHD/11 A.Y. 05-06 [MAMTA SILK MILLS PVT. LTD. VS. ITO] PAGE 2 INCOME TAX (APPEALS) HAS ERRED IN PARTLY CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN LEVYING PENA LTY U/S.271(1)(C) OF THE I.T. ACT, 1961 ON ACCOUNT OF DISALLOWANCE OF EXPENDITURE IN RELATION TO PAYMENT TO DIRECTORS OF RS.3,12,000/-. 2. LEARNED AUTHORIZED REPRESENTATIVE THROUGH WRITTE N SUBMISSION POINTED OUT THAT THE ISSUE PERTAINING TO PENALTY HAS BEEN SET ASIDE TO ASSESSING OFFICER BY OBSERVIN G AS UNDER: 4. AFTER HEARING BOTH THE SIDES, WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. ADMITT EDLY, BOTH THE DOCUMENTS WHICH WERE FURNISHED BEFORE US A RE NOT FURNISHED BEFORE ANY OF THE DEPARTMENTAL AUTHORITIE S BELOW. BE THAT IT MAY BE, THESE DOCUMENTS CANNOT BE CREATE D OR CANNOT BE CATEGORIZED AS AFTER-THOUGHT BECAUSE THES E ARE RECORDS OF THE THIRD PARTY. FROM THE RETURNS OF BOT H THE LADIES FURNISHED WITH THE INCOME-TAX DEPARTMENT, IT APPEARS THAT BOTH THE LADIES HAVE NO OTHER INCOME EXCEPT SA LARY INCOME FROM THE ASSESSEE COMPANY. BE THAT IT MAY BE , LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, IT WILL MEET THE ENDS OF JUSTICE, IF THE ORDER OF THE LD. L EARNED COMMISSIONER OF INCOME TAX(APPEALS) IS SET ASIDE AN D THE MATTER IS RESTORED TO THE FILE OF THE ASSESSING OFF ICER WITH THE DIRECTION THAT THE ASSESSING OFFICER WILL VERIFY TH E DOCUMENTS, NOW SUBMITTED BEFORE US AND IF REQUIRED, THE ASSESSING OFFICER MAY ASK THE ASSESSEE TO PRODUCE B OTH THE LADIES TO ASCERTAIN THE NATURE OF WORK DONE BY THEM IN THE COMPANY IN BOTH THE ASSESSMENT YEARS UNDER APPEAL A ND READJUDICATE THE DISALLOWANCE OF REMUNERATION AFRES H, IN ACCORDANCE WITH LAW. IN THE RESULT, GROUND NO. 3 FO R THE ASSESSMENT YEAR 2004-05 IS TREATED AS ALLOWED AND A PPEAL FOR THE ASSESSMENT YEAR 2005-06 IS TREATED AS ALLOW ED. 2.1 NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE. IN VIEW OF THIS, WE FIND THAT ISSUE ON QUANTUM WHICH IS ORI GINAL POINT OF PENALTY HAS BEEN SET ASIDE TO ASSESSING OFFICER AS DISCUSSED ABOVE. SO, IN THE INTEREST OF JUSTICE, WE RESTORE THE PENALTY MATTER TO ASSESSING OFFICER WITH DIRECTION TO DECID E THE SAME AS ITA NO. 1966/AHD/11 A.Y. 05-06 [MAMTA SILK MILLS PVT. LTD. VS. ITO] PAGE 3 PER FACT AND LAW INCLUDING OUTCOME OF QUANTUM PROCE EDING AFTER PROVIDING OPPORTUNITY OF BEING HEARD TO ASSES SEE. 3. AS A RESULT, APPEAL FILED BY THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS THE 19 TH DAY OF FEBRUARY, 2015. SD/- SD/- (ANIL CHATURVEDI) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 19/02/2015 TRUE COPY S.K.SINHA & & & & ' ' ' ' ('% ('% ('% ('% / COPY OF ORDER FORWARDED TO:- 1. +, / REVENUE 2. / ASSESSEE 3. // 0 / CONCERNED CIT 4. 0- / CIT (A) 5. '45 , , / DR, ITAT, AHMEDABAD 6. 589 :; / GUARD FILE. BY ORDER / & ,