KPMG JEWELLERY, MUMBAI V. ACIT 20(1), MUMBAI

ITA 2122/MUM/2010

• Counselvise Citation: 212219914 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2001-2002
• Appeal Filed On: 17-03-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHIMA GUPTA
• Assessee Lawyers: B V JHAVERI
• Keywords: Reassessment proceedings
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, A, MUMBAI BEFORE SHRI R V EASWAR, PRESIDENT AND SHRI R K PANDA, ACCOUNTANT MEMBER I T A NO: 2122/MUM/2010 (ASSESSMENT YEAR: 2001-02) M/S KMG JEWELLERY, MUMBAI APPELLANT (PAN: AAAFM0480A) VS ASSISTANT COMMISSIONER OF INCOME TAX RESPONDENT 20(1), MUMBAI APPELLANT BY: MR B V JHAVERI RESPONDENT BY: MS ASHIMA GUPTA O R D E R R V EASWAR, PRESIDENT: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE LEVY OF PENALTY OF ` 13,41,000/- IMPOSED UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961, FOR CONCEALMENT OF INCOME. 2. THE ORIGINAL ASSESSMENT WAS COMPLETED UNDER SECT ION 143(3) ON 30.03.2004. THEREAFTER THE ASSESSMENT WA S REOPENED ON THE GROUND THAT THE ASSESSEE WAS NOT ENTITLED TO CLAIM EXEMPTION UNDER SECTION 10A OF THE ACT. THE CLAIM WAS DISALLOWED AND THE REASSESSMENT WAS COMPLETED ON 15.12.2006 UN DER SECTION 143(3) READ WITH SECTION 147 ON A TOTAL INCOME OF ` 34,20,650/-. THE ASSESSEES APPEAL TO THE CIT(A) AGAINST THE REA SSESSMENT ORDER WAS UNSUCCESSFUL. AFTER THE ORDER OF THE CIT (A) THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS FOR CONCEALMENT OF ITA NO: 2122/MUM/2010 2 INCOME ON THE GROUND THAT THE ASSESSEE CLAIMED EXEM PTION UNDER SECTION 10A AMOUNTING TO ` 1,71,30,398/- DESPITE KNOWLEDGE THAT THE CONSTITUTION OF THE FIRM HAD CHANGED WITH EFFEC T FROM 01.04.2000 AND THUS THERE WAS A CONTRAVENTION OF SECTION 10A(9 ) OF THE ACT. AFTER REJECTING THE ASSESSEES EXPLANATION THE ASSE SSING OFFICER IMPOSED THE IMPUGNED PENALTY WHICH HAS ALSO BEEN CO NFIRMED BY THE CIT(A) BY ORDER DATED 14.12.2009. THE ASSESSEE IS IN APPEAL AGAINST THE AFORESAID ORDER. 3. AT THE TIME OF THE HEARING THE LEARNED COUNSEL F OR THE ASSESSEE BROUGHT TO OUR NOTICE THAT BY ORDER DATED 31.03.2011 IN ITA NO: 275/MUM/2008, THE TRIBUNAL HAS QUASHED THE REASSESSMENT PROCEEDINGS. A COPY OF THE SAID ORDER WAS FILED, FROM WHICH WE FIND THAT AFTER A DETAILED DISCUSSION THE REASSESSMENT HAS BEEN HELD TO BE VOID. SINCE THE REASSESSMENT ITSEL F HAS BEEN HELD TO BE VOID AB INITIO, THE PENALTY LEVIED ON THE BAS IS OF THE REASSESSMENT ORDER CANNOT SURVIVE. THE SAME IS ACC ORDINGLY CANCELLED AND THE APPEAL IS ALLOWED WITH NO ORDER A S TO COSTS. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF THE HEARING ON 19 TH APRIL 2011. SD/- SD/- (R K PANDA) (R V EASWAR) ACCOUNTANT MEMBER PRESIDE NT MUMBAI, DATED 19 TH APRIL 2011 SALDANHA ITA NO: 2122/MUM/2010 3 COPY TO: 1. M/S KMG JEWELLERY 203, DHARAM PALACE B, N S PATKAR MARG (HUGHES ROAD), MUMBAI 400 004 2. ACIT 20(1), MUMBAI 3. CIT-20, MUMBAI 4. CIT(A)-31, MUMBAI 5. DR A BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI