Sh. Praveen Soni S/o Sh. Parasmal Soni, JODHPUR V. ITO, JODHPUR

ITA 200/JODH/2010

• Counselvise Citation: 20023314 RSA 2010
• Duration Of Justice: 1 year(s) 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 30-11-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 05-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Assessee Lawyers: G R VERMA
• Keywords: Bonafide belief; Reasonable cause

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH (SMC), JODHPUR (BEFORE SHRI .N.L. KALRA , ACCCOUNTANT MEMBE R) ITA NO.200/JU/2010 ASSESSMENT YEAR : 2006-07 PAN: ARYPS 8037 L SHRI PRAVEEN SONI VS THE ITO S/O SHRI PARASMAL SONI WARD- 3 (4) PAPLI KA BASS, PIPAR CITY, JODHPUR JODHPUR (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI G.R. VERMA DEPARTMENT BY: SHRI G.R. KOKANI DATE OF HEARING: 08-12-2011 DATE OF PRONOUNCEMENT: 09-12-2011 ORDER PER N.L. KALRA, AM:- THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORD ER OF THE LD.CIT(A), JODHPUR DATED 18-01-2010 FOR THE ASSESSMENT YEAR 2006-07. 2.1 THE SOLITARY GRIEVANCE OF THE ASSESSEE IS THA T THE LD.CIT(A) HAS ERRED IN CONFIRMING THE PENALTY OF RS. 26,230/- U/S 271B OF THE ACT. 2.2 THE AO IN HIS ORDER HAS MENTIONED THAT THE ASSE SSEE IS ENGAGED IN TRANSPORT BUSINESS. HE HAS NO TRUCKS BUT HE MANAGES TRUCKS FO R THE PARTIES. THE PAYMENT IS DIRECTLY MADE TO THE TRUCK OWNERS AND THE ASSESSEE RECEIVED COMMISSION AND THE SAME IS CALLED BILTY CHARGES. THE AO VIDE LETTER DATED 21-10-2008 ASKED THE ASSESSEE TO EXPLAIN AS TO WHY ENTIRE RECEIPTS SHOULD NOT BE TREATED AS ASSESS EES INCOME AND TOTAL TURNOVER BE NOT 2 CONSIDERED AS EXCEEDING RS. 40.00 LACS . THE ASSESS EE FILED THE WRITTEN SUBMISSIONS VIDE LETTER DATED 31-10-2008. BEFORE THE AO , IT WAS SUB MITTED THAT FREIGHT IS RECEIVED BY THE TRUCK OWNER DIRECTLY FROM THE COMPANIES OR PARTIES FOR WHOM THE TRUCK HAS BEEN ENGAGED. THE ASSESSEE IS RECEIVING ONLY BILTY CHARGES. THE A O WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AND INITIATED PENALTY P ROCEEDINGS U/S 271B OF THE ACT. 2.3 THE LD.CIT(A) HAS CONFIRMED THE PENALTY ON THE GROUND THAT THE ASSESSEE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO ESTABLISH THAT TH E ASSESSEE WAS A TRANSPORT BOOKING AGENT. THE TDS CERTIFICATE SHOWED THAT THE PAYMENTS ARE MADE TO THE ASSESSEE AS RECIPIENT AND THE PENALTY WAS CONFIRMED BY THE LD.C IT(A). 2.4 I HAVE HEARD BOTH THE PARTIES. THE ASSESSEE IN THE REPLY TO SHOW CAUSE NOTICE HAS CLEARLY MENTIONED THAT HE WAS RECEIVING COMMISSION BY PROVIDING TRUCKS TO THE PARTIES WHICH REQUIRED SUCH TRUCKS FOR TRANSPORTATION. THE EXPLANATION OF THE ASSESSEE HAS NOT BEEN HELD AS INCORRECT OR FALSE. IF THE ASSESSEE HA S A REASONABLE CAUSE IN NOT GETTING THE ACCOUNTS AUDITED ON THE GROUND THAT TURNOVER DOES N OT BELONG TO HIM THEN PENALTY CANNOT BE IMPOSED. THE REASONABLE CAUSE IS A CAUSE WHICH I S ENTERTAINED BY THE PRUDENT BUSINESSMAN ON THE BASIS OF HIS UNDERSTANDING OF LA W AND ON THE BASIS OF CERTAIN FACTS. SUCH BONAFIDE BELIEF AND REASONABLE CAUSE ARE SUFFI CIENT FOR THE AO TO AVAIL OF HIS DISCRETIONARY POWER IN NOT IMPOSING THE PENALTY. I THEREFORE, FEEL THAT IT IS NOT A FIT CASE FOR IMPOSING PENALTY. THUS THE PENALTY IMPOSED BY T HE AO IS CANCELLED AND THE APPEAL OF THE ASSESSEE IS ALLOWED. 3 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 09-1 2-2011 SD/- (N.L. KALRA) ACCOUNTANT MEMBER JODHPUR DATED: 09 /12/2011 MISHRA COPY TO: 1. SHRI PRAVEEN SONI, JODHPUR 2. THE ITO, WARD- 3 (4), JODHPUR 3.THE LD. CIT (A) BY ORDER 4.THE CIT 5.THE D/R 6.THE GUARD FILE (ITA NO.200/JU/10) A.R.. ITAT: JODHPUR