Shri Bhanwarlal Sharma, Ahmedabad V. The ACIT, Circle- 12, Ahmedabad

ITA 2180/AHD/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 0173 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 25-10-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 28-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANTONY PARIATH
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER ./ ITA.NO.2180/AHD/2014 / ASSTT. YEAR: 2008-2009 BHANWARLAL SHARMA B-85, NETAJINAGAR NR. AMBAJI TEMPLE MEGHANINAGAR AHMEDABAD 380 016. PAN : AJQPS 4134 E VS ACIT, CIR.12 AHMEDABAD. ! / (APPELLANT) '# ! / (RESPONDENT) ASSESSEE BY : WRITTEN SUBMISSIONS REVENUE BY : SHRI ANTONY PARIATH, SR.DR / DATE OF HEARING : 25/10/2016 / DATE OF PRONOUNCEMENT: 27/10/2016 $%/ O R D E R ASSESSEE IS IN APPEAL AGAINST ORDER OF LD.CIT(A)-XX , AHMEDABAD DATED 30.5.2014 PASSED FOR THE ASTT.YEAR 2008-09. 2. SOLE GRIEVANCE OF THE ASSESSEE IS THAT THE LD.CI T(A) HAS ERRED IN CONFIRMING PENALTY OF RS.3,46,312/-. 3. IN RESPONSE TO THE NOTICE OF HEARING, THE ASSESS EE HAS FILED WRITTEN SUBMISSIONS. THE ASSESSEE HAS CONTENDED THAT PENAL TY HAS BEEN LEVIED WITH REGARD TO THE ADDITION OF RS.11,86,221/- WHICH REPR ESENTED VARIOUS EXPENSES VIZ. DEPRECIATION, INSURANCE EXPENSES, SALARY EXPEN SES, VEHICLE REPAIR AND MAINTENANCE. THESE ADDITIONS HAVE BEEN DELETED BY THE TRIBUNAL IN ITA NO.941/AHD/2012 PASSED FOR A.Y.2008-09. COPY OF THE TRIBUNALS ORDER ITA NO.2180/AHD/2014 2 DATED 13.8.2015 HAS BEEN PLACED ON THE RECORD ALONG WITH SUBMISSIONS. THE LD.DR WAS UNABLE TO CONTROVERT THIS CONTENTION OF T HE ASSESSEE. 4. I HAVE GONE THROUGH THE CASE RECORD. I FIND SEC TION 271(1)(C) OF THE ACT HAS A DIRECT BEARING ON THE CONTROVERSY, THEREFORE, WE TAKE NOTE RELEVANT PROVISION, WHICH READS AS UNDER: '271. FAILURE TO FURNISH RETURNS, COMPLY WITH NOTIC ES, CONCEALMENT OF INCOME, ETC. (1) THE ASSESSING OFFICER OR THE C OMMISSIONER (APPEALS) OR THE CIT IN THE COURSE OF ANY PROCEEDIN GS UNDER THIS ACT, IS SATISFIED THAT ANY PERSON (A) AND (B) ** ** ** (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. HE MAY DIRECT THAT SUCH PERSON SHALL PAY BY WAY OF PENALTY. (I)AND (INCOME-TAX OFFICER,)** ** ** (III) IN THE CASES REFERRED TO IN CLAUSE (C) OR CLA USE (D), IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM, A SUM WHICH SHALL NOT BE LE SS THAN, BUT WHICH SHALL NOT EXCEED THREE TIMES, THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF THE CONCEALMENT OF PARTICULARS OF HIS INCOME OR FRINGE BENEFIT THE FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME OR FRINGE BENEFITS: EXPLANATION 1- WHERE IN RESPECT OF ANY FACTS MATERI AL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT, (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OF FERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMM ISSIONER (APPEALS) OR THE CIT TO BE FALSE, OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS N OT ABLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXPLANATION IS BONA FI DE AND THAT ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATIO N OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM, THEN, THE AMOUNT ADDED OR DISALLOWED IN COMPUTING THE TOTAL INCOME OR SUCH PE RSON AS A RESULT THEREOF SHALL, FOR THE PURPOSES OF CLAUSE (C) OF TH IS SUB-SECTION, BE DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICU LARS HAVE BEEN CONCEALED.' 6. A PERUSAL OF SUB-CLAUSE (III) OF SECTION 271(1)( C) WOULD INDICATE THAT IN CASE AN ADDITION IS BEING MADE TO THE INCOME OF AN ASSESSEE, AND IT IS ITA NO.2180/AHD/2014 3 ESTABLISHED THAT THE ASSESSEE HAS CONCEALED OR FURN ISHED INACCURATE PARTICULARS QUA THAT ADDITION, THEN APART FROM TAX TO BE PAYABL E BY THE ASSESSEE, HE WOULD PAY AN AMOUNT EQUIVALENT TO THE TAX OR THREE TIMES OF THE TAX AS PENALTY UNDER SECTION 271(1)(C) OF THE ACT. MEANING THEREBY, THE PENALTY WOULD BE COMPUTED EQUIVALENT TO THE TAX OR THREE TIME OF THE TAX SOUGHT TO BE EVADED BY THE ASSESSEE ON THE ADDITIONS MADE TO HIS INCOME FO R WHICH HE HAS HELD GUILTY OF CONCEALMENT OF INCOME OR FURNISHING OF INACCURAT E PARTICULARS OF INCOME. IN THE PRESENT CASE, THE ADDITION ON WHICH PENALTY HAS BEEN IMPOSED BY THE AO HAS BEEN DELETED BY THE ITAT, AND THEREFORE, THE VERY ADDITION ON WHICH THE AMOUNT OF TAX SOUGHT TO BE EVADED WAS TO BE CAL CULATED, HAS BEEN EXTINGUISHED. IN VIEW OF THE ABOVE DISCUSSION, PE NALTY IS NOT IMPOSABLE UPON THE ASSESSEE, WHICH IS ACCORDINGLY DELETED, AND THE GROUNDS OF THE APPEAL OF THE ASSESSEE ARE ALLOWED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE COURT ON 27 TH OCTOBER, 2016 AT AHMEDABAD. SD/- (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 27/10/2016