The ITO, Ward 8(4), Ahmedabad V. Vintron Insurance Services Pvt. Ltd., Ahmedabad

ITA 2007/AHD/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1441 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 10-06-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 29-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DEEPAK R SHAH
• Section: 43B; 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER ./ ITA.NO.2007/AHD/2013 / ASSTT. YEAR: 2008-2009 ITO, WARD - 8(4) AHMEDABAD. VS VINTROL INSURANCE SERVICES P.LTD. 402, SARTHAK, OPP: RAJPATH CLUB S.G. HIGHWAY AHMEDABAD. ! / (APPELLANT) '# ! / (RESPONDENT) REVENUE BY : SHRI PRASOON KABRA, SR.DR ASSESSEE BY : SHRI DEEPAK R. SHAH / DATE OF HEARING : 10/06/2016 / DATE OF PRONOUNCEMENT: 10/06/2016 $%/ O R D E R THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINS T THE ORDER OF THE LD.CIT(A)-XIV, AHMEDABAD DATED 24.5.2013 PASSED FOR THE ASSTT.YEAR 2008- 09. 2. SOLITARY GRIEVANCE OF THE REVENUE IS THAT THE LD .CIT(A) HAS ERRED IN DELETING THE PENALTY OF RS.12,60,918/- LEVIED UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT. 3. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE HAS FI LED ITS RETURN OF INCOME ON 30.9.2008 DECLARING TOTAL LOSS AT RS.4,34,645/- AN ASSESSMENT ORDER WAS PASSED UNDER SECTION 143(3) OF THE ACT ON 30.11.201 0 DETERMINING TOTAL INCOME AT RS.30,97,575/-. THE AO HAS MADE ADDITION OF RS.40,80,643/- ON ACCOUNT OF DISALLOWANCE UNDER SECTION 43B OF THE AC T. THE LD.AO HAS ITA NO.2007/AHD/2013 2 INITIATED PENALTY PROCEEDINGS, AND ULTIMATELY IMPOS ED A PENALTY OF RS.12,60,918/-. 4. ON APPEAL, THE LD.CIT(A) HAS DELETED THE PENALTY BY RECORDING THE FOLLOWING FINDING. 3.3 DECISION: I HAVE CAREFULLY CONSIDERED THE PENALTY ORDER AND T HE SUBMISSION MADE BY THE APPELLANT DURING THE COURSE OF APPELLATE PRO CEEDINGS. THE PENALTY HAS BEEN IMPOSED FOR DISALLOWANCES MADE U/S . 43B AND U/S. 40(A)(IA) OF THE I. T. ACT, 196,. THE AO HAS DECIDE D THAT THE APPELLANT WAS TO DEDUCT TDS U/S. 194-I FOR THE PAYMENTS MADE TO ROOFIT INDUSTRIES LTD. WHICH THE APPELLANT HAS CLAIMED AS ADMINISTRATIVE EXPENSES. THE AO ALSO FOUND THAT VAT AND CST LIABIL ITY WAS NOT PAID BEFORE FILING OF RETURN. THE AO HAS RELIED ON DIFFE RENT CASE LAWS: (I) RAGHUVIR SONI VS. ACT [250 ITR 255 (RAJ)] (II) KOMALCHAND JAIN VS. ITO [277 ITR 429] (III) CIT VS. MOHD. MOHTRAM FAROOQUI [259 ITR 132 (RAJ.)] (IV) CIT VS. A. SREENIVASA PAI [242 ITR 29 (KER)] (V) D M MANSAVI VS. CIT [86 ITR 557 (SC)] ; (VI) WESTERN AUTOMOBILES (INDIA) VS. CIT [112 ITR 1048 ( BOM,) I HAVE GONE THROUGH THE SUBMISSION OF APPELLANT AND THE FACTS OF THE CASE ON RECORD. IN MY OPINION THE APPELLANT HAD GIVEN ALL THE PARTICULARS REGARDING THE CLAIM IN THE RETURN OF INCOME AND THE ACCOUNTS WERE ALSO PRESENTED BEFORE THE ASSESSING O FFICER. IT WAS A MERE CLAIM BY HIM WHICH HE CONSIDERED TO BE ADMISSI BLE. THE ASSESSING OFFICER DID NOT ALLOW THE CLAIM. THE DISALLOWANCE MADE BY THE ASSESSING OFFICER DOES NOT MAKE THE CASE FIT FOR IM POSITION OF PENALTY. THE APPELLANT DID NOT FURNISH ANY INACCURATE PARTIC ULARS OR MISREPRESENTED ANY FACT IN HIS RETURN OF INCOME. HE MADE A CLAIM GIVING ALL THE FACTS. THEREFORE, THERE IS NO FURNIS HING OF INACCURATE PARTICULARS ON THE PART OF THE APPELLANT- AND IN TH E CIRCUMSTANCES THE DECISION OF HONOURABLE SUPREME COURT IN THE CASE OF RELIANCE PETRO PRODUCTS PVT. LTD REPORTED IN 322 ITR 158 IS CLEARL Y APPLICABLE. IN VIEW OF THIS, THE CASE LAWS RELIED BY AO ARE DISTINGUISH ED. ACCORDING TO ITA NO.2007/AHD/2013 3 SUPREME COURT DECISION (SUPRA), WHERE THERE IS NO F INDING THAT ANY DETAILS WERE SUPPLIED BY THE ASSESSEE IN ITS RETURN OF INCOME FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE THERE WAS NO QUESTI ON OF INVOKING THE PENALTY UNDER SECTION 271(L)(C). MERE MAKING OF CLA IM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO F URNISHING INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. C ONSIDERING THE ABOVE FACTS AND CIRCUMSTANCES, THE PENALTY IMPOSED BY THE ASSESSING OFFICER IS DELETED 'AND THE APPEAL IS ALLOWED. 5. THE LD.DR RELIED UPON THE ORDER OF THE AO. ON T HE OTHER HAND, THE LD.COUNSELF FOR THE ASSESSEE RELIED UPON THE ORDER OF THE LD.CIT(A). HE CONTENDED THAT THE ASSESSEE HAS DISCLOSED ALL THE D ETAILS CORRECTLY. THE DISALLOWANCES WERE MADE BY THE AO ON THE BASIS OF D IFFERENCE OF OPINION BETWEEN THE ASSESSEE AND THE AO WITH REGARD TO A PA RTICULAR CLAIM. HE RELIED UPON THE JUDGMENT OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS.L.G. CHAUDHAR, 33 TAXMANN.COM 156 (GUJ) AND NAYA N C. SHAH VS. ITO, 69 TAXMANN.COM 256 (GUJ). 6. I HAVE CONSIDERED RIVAL CONTENTIONS AND GONE THR OUGH THE RECORD CAREFULLY. THE CASE OF THE ASSESSEE IS THAT IT HAS ENTERED INTO AN AGREEMENT WITH ROOFIT INDUSTRIES LTD. IT BELIEVED THAT PAYME NT MADE TO ROOFFIT INDUSTRIES WAS ADMINISTRATIVE EXPENSES UNDER THE HE AD OPERATING CHARGES. THE AO WAS OF THE OPINION THAT THIS CANNOT BE REGARDED AS ADMINISTRATIVE CHARGES AS CLAIMED BY THE ASSESSEE. IT OUGHT TO HAVE DEDUC TED TDS ON THE ALLEGED PAYMENT MADE BY THE ASSESSEE. DUE TO THIS DIFFEREN CE, WITH REGARD TO THE UNDERSTANDING OF A TRANSACTION, HE MADE DISALLOWANC E. I AM OF VIEW THAT THE LD.CIT(A) HAS RIGHTLY APPRECIATED THE CONTENTIONS I N RIGHT PERSPECTIVE AND HAS RIGHTLY DELETED THE PENALTY, BECAUSE, THE AO HAS NO WHERE LEVELED ALLEGATION THAT THE ASSESSEE HAS FURNISHED ANY INACCURATE PART ICULARS OF INCOME. THE ITA NO.2007/AHD/2013 4 ADDITION WAS MADE ON ACCOUNT OF DIFFERENCE OF OPINI ON UPON A PARTICULAR TRANSACTION. THEREFORE, I DO NOT FIND ANY MERIT IN THIS APPEAL. IT IS DISMISSED. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE COURT ON 10 TH JUNE, 2016 AT AHMEDABAD. SD/- (RAJPAL YADAV) JUDICIAL MEMBER