M/s DCM Ltd., New Delhi V. Addl. CIT, New Delhi

ITA 217/DEL/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 4493 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2008-2009
• Appeal Filed On: 15-01-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ATIQ AHMAD SENIOR
• Keywords: Initiation of penalty proceedings
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F : NEW DELHI) BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.217/DEL./2016 (ASSESSMENT YEAR : 2008-09) M/S. DCM LIMITED, VS. ADDL. CIT, 6 TH FLOOR, VIKRANT TOWER, RANGE 7, 4, RAJENDRA PLACE, NEW DELHI. NEW DELHI 110 008. (PAN : AAACD1012E) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI V.P. GUPTA, ADVOCATE REVENUE BY : SHRI ATIQ AHMAD, SENIOR DR DATE OF HEARING : 20.09.2017 DATE OF ORDER : 28.09.2017 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : THE APPELLANT, M/S. DCM LIMITED (HEREINAFTER REFERR ED TO AS THE ASSESSEE COMPANY), BY FILING THE PRESENT APPE AL, SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 26.11.2015 PASSED BY THE COMMISSIONER OF INCOME-TAX-3, NEW DELHI QUA THE ASS ESSMENT YEAR 2008-09 ON THE GROUNDS INTER ALIA THAT :- 1 THAT THE CIT(A) ERRED IN DISALLOWING ALTERNATE CLAIM MADE BY THE APPELLANT ON ACTUAL PAYMENT BASIS IN RESPECT OF FOLLOWING ITEMS OF EXPENSES INCURRED IN RELATION TO REAL ESTATE ITA NO.217/DEL./2016 2 PROJECT WITHOUT APPRECIATING THAT CLAIM HAD BEEN MADE BY THE APPELLANT FOR THE REASON THAT DEPARTMENT HAS NOT ACCEPTED ALLOWABILITY OF EXPENSES ON ACCRUAL BASIS AND APPEALS IN RESPECT THEREOF ARE PENDING FOR ADJUDICATION BEFORE DELHI HIGH COURT. A) EXPENDITURE IN RESPECT OF APPROVALS AND PERMISSIONS- RS.57,21,000/- B) EXPENDITURE IN RESPECT OF REMOVAL OF SQUATTERS - 1,64,00,000/- 2 THAT THE CIT(A) ERRED IN DISALLOWING AN AMOUNT OF RS. 68904/- IN RESPECT OF BONUS & YARN CESS ACTUALLY PAID DURING THE YEAR OUT OF UNPAID AMOUNT OF EARLIER YEARS WHICH HAD BEEN DISALLOWED U/S 43B OF THE I.T. ACT. 3 THAT THE CIT(A) ERRED IN UPHOLDING THE INITIATION OF PENALTY PROCEEDINGS U/S 271 (1)( C) O F THE ACT IN THE FACTS AND CIRCUMSTANCES OF THE APPELLANT. 4 THAT THE ORDER PASSED BY THE ASSESSING OFFICER AND UPHELD BY CIT(A) IS BAD IN LAW. 5 THAT THE APPELLANT COMPANY CRAVES LEAVE TO ALTER, AMEND, VARY AND/OR ADD ANY OF THE GROUNDS OF APPEAL AT ANY TIME HEREIN AFTER. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICATION OF THE CONTROVERSY AT HAND ARE : ASSESSEE COMPANY IS INTO THE BUSINESS OF MANUFACTURING & TRADING OF COTTON YARN, IT INFRASTR UCTURE SERVICES AND DEVELOPMENT OF REAL ESTATE PROJECT. DURING THE ASSESSMENT PROCEEDINGS, REVISED STATEMENT OF COMPUTATION OF AS SESSABLE INCOME HAS BEEN FILED AFTER TAKING INTO ACCOUNT ADM ISSIBLE, ITA NO.217/DEL./2016 3 INADMISSIBLE, DEDUCTIONS ETC., CAPITAL GAIN ON COMP ENSATION OF RS.1,62,84,096/- AND INTEREST OF RS.2,00,402/- ON I NCOME-TAX REFUND COMPUTED THE TOTAL NET LOSS AT RS.12,93,60,6 46/-. AO NOTICED FROM THE STATEMENT OF COMPUTATION OF ASSESS ABLE REVISED INCOME THAT THE ASSESSEE HAS CLAIMED DEDUCTION OF R S.36,49,388/- ON ACCOUNT OF TAX DUTY PAID DURING THE YEAR OUT OF THE UNPAID TAX/DUTY IN THE EARLIER YEAR U/S 43B OF THE INCOME- TAX ACT, 1961 (FOR SHORT THE ACT). ASSESSEE WAS CALLED UPON TO FILE DETAILS OF THE DEDUCTIONS ALONG WITH SUPPORTING DOCUMENTS/PROOF OF PAYMENT WHICH WAS FILED VIDE LETTER DATED 16.12.2010 QUA TH E PAYMENT OF RS.35,80,484/- BUT FAILED TO SUBSTANTIATE THE BALAN CE AMOUNT OF RS.68,904/- WHICH HAS BEEN ADDED BY THE AO TO THE I NCOME OF THE ASSESSEE. AO ASSESSED THE TOTAL INCOME OF THE ASSE SSEE AT LOSS OF RS.8,18,08,220/-. 3. ASSESSEE CARRIED THE MATTER BY WAY OF FILING APP EAL BEFORE THE LD. CIT (A) WHO HAS PARTLY ALLOWED THE APPEAL. FEELING AGGRIEVED, THE ASSESSEE COMPANY HAS COME UP BEFORE THE TRIBUNAL BY WAY OF CHALLENGING THE IMPUGNED ORDER PASSED BY LD. CIT (A) . 4. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. ITA NO.217/DEL./2016 4 GROUNDS NO.1, 1(A) & 1(B) 5. AT THE VERY OUTSET, LD. AR FOR THE ASSESSEE FAIR LY CONCEDED THAT HE DOES NOT WANT TO PRESS GROUNDS NO.1, 1(A) & 1(B) HAVING BEEN ALREADY DECIDED AGAINST THE ASSESSEE BY THE TR IBUNAL IN ASSESSMENT YEARS 2003-04 AND 2010-11 IN ITA NO.1237 /DEL/2014 & ITA NO.1511/DEL/2014 VIDE ORDER DATED 29.07.2016. SO, GROUNDS NO.1, 1(A) & 1(B) ARE DETERMINED AGAINST TH E ASSESSEE. GROUND NO.2 6. AO DISALLOWED THE AMOUNT OF RS.68,904/- U/S 43B OF THE ACT ON THE GROUND THAT THE ASSESSEE HAS FAILED TO SUBST ANTIATE THE SAME BY FILING DETAILS ALONG WITH SUPPORTING DOCUMENTS/P ROOF OF PAYMENT. 7. LD. AR FOR THE ASSESSEE CHALLENGING THE IMPUGNED ORDER CONTENDED THAT SINCE THE TOTAL AMOUNT OF RS.36,49,3 88/- INCLUSIVE OF THE AMOUNT IN QUESTION OF RS.68,904/- HAS BEEN D ULY VERIFIED AND CERTIFIED IN THE TAX AUDIT REPORT, THE SAME IS LIAB LE TO BE ALLOWED. HOWEVER, ON THE OTHER HAND, LD. DR FOR THE REVENUE HAS RELIED UPON THE ORDER PASSED BY THE AO AS WELL AS LD. CIT (A). 8. WHEN UNDISPUTEDLY THE ASSESSEE HAS SUBSTANTIATED THE PAYMENT OF RS.35,80,484/- OUT OF THE TOTAL CLAIM OF RS.36,49,388/- ITA NO.217/DEL./2016 5 BY FILING DETAILS ALONG WITH DOCUMENTS IN THE FORM OF CHALLANS, DISALLOWED THE AMOUNT OF RS.68,904/- CANNOT BE ALLO WED MERELY ON THE BASIS OF TAX AUDIT REPORT. EVEN ASSESSEE HAS N OT COME UP BEFORE THE TRIBUNAL WITH SUPPORTING DOCUMENTS FOR PROOF OF BALANCE PAYMENT OF RS.68,904/-. SO, WE ARE OF THE CONSIDER ED VIEW THAT AO AS WELL AS LD. CIT (A) HAVE RIGHTLY DISALLOWED D EDUCTION OF RS.68,904/-. GROUND NO.3 9. GROUND NO.3 IS PREMATURE. GROUNDS NO.4 & 5 10. GROUNDS NO.4 & 5 ARE GENERAL IN NATURE, HENCE D O NOT REQUIRE ANY ADJUDICATION. 11. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, WE FI ND NO ILLEGALITY OR PERVERSITY IN THE IMPUGNED ORDER PASS ED BY THE LD. CIT (A), HENCE PRESENT APPEAL FILED BY THE ASSESSEE IS HEREBY DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THIS 28 TH DAY OF SEPTEMBER, 2017. SD/- SD/- (N.K. SAINI) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 28 TH DAY OF SEPTEMBER, 2017 TS ITA NO.217/DEL./2016 6 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT (A)-3, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.