The ACIT, Central Circle-1, Baroda V. M/s. Phlox Pharmaceuticals Ltd., Baroda

ITA 2191/AHD/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 9838 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 3 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-12-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 10-11-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 27-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SRHI S N SOPARMAR
• Section: 43B; 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIPKUMAR KEDIA, ACCOUNTANT MEMBER ./ ITA.NO.2191/AHD/2013 ASSTT.YEAR 2003-2004 ACIT , CENT . CIR . 1 BARODA. M / S . PHLOX PHARMACETUCIASL LTD . SPARC, TANDALJA ROAD BARODA. PAN : AABCP 2456 K AB / (APPELLANT) CD AB / (RESPONDENT) REVENUE BY : SHRI JAMES KURIAN, AR ASSESSEE BY : SRHI S.N. SOPARMAR, AR / DATE OF HEARING : 10/11/2016 / DATE OF PRONOUNCEMENT: 08/12/2016 EF/ O R D E R PER SHRI RAJPAL YADAV, JUDICIAL MEMBER: REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST OR DER OF THE LD.CIT(A)-III, BARODA DATED 11.6.2013 PASSED FOR TH E ASSTT.YEAR 2003-04. 2. SOLE GRIEVANCE OF THE REVENUE IS THAT LD.CIT(A) HAS ERRED IN DELETING PENALTY OF RS.26 LAKHS WHICH WAS IMPOSED UPON THE A SSESSEE BY THE AO UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961. ITA NO.2191/AHD/203 2 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FIELD ITS RETURN OF INCOME ON 29.11.2003 DECLARING TOTAL LOSS AT RS.10,16,52,9 23/-. AN ASSESSMENT ORDER WAS PASSED UNDER SECTION 143(3) OF THE ACT ON 20.3. 2006 WHEREBY BUSINESS LOSS OF THE ASSESSEE WAS REDUCED TO RS.6,10,04,785/ - AS AGAINST THE CLAIM MADE BY THE ASSESSEE. IT EMERGES OUT FROM RECORD THAT T HERE WERE UNPAID STATUTORY LIABILITIES WHICH WERE PAYABLE TO FINANCIAL INSTITU TIONS LIKE IDBI BANK, IVCF, STATE BANK OF INDIA ETC. THESE UNPAID STATUTORY LI ABILITIES COULD NOT BE ALLOWED AS DEDUCTION TO THE ASSESSEE. THEREFORE, I N THE COMPUTATION OF INCOME, THE ASSESSEE HAS ADDED BACK THESE LIABILITI ES OF RS.2,79,43,879/-. THE LD.AO FOUND AN ERROR IN THE COMPUTATION OF THIS AMO UNT. ACCORDING TO HIM, TOTAL LIABILITY COMES TO RS.3,50,03,879/-. WHEN TH IS FACT WAS BROUGHT TO THE NOTICE OF THE ASSESSEE DURING THE ASSESSMENT PROCEE DINGS, THEN IT WAS POINTED BY THE ASSESSEE THAT A CLERICAL MISTAKE HAS HAPPENE D WHILE CALCULATING THE TOTAL AMOUNT. THE ASSESSEE HAS POINTED OUT THAT TOTAL AM OUNT DISALLOWED UNDER SECTION 43B WAS RS.2,71,60,653/- PLUS RS.78,43,226/ -. WHILE TAKING THIS AMOUNT, FIGURE OF 4 WAS LEFT OUT. ASSESSEE TOOK FIGURE OF 7,83,226/- AND THIS HAS RESULTED INTO NON-INCLUSION OF RS.70,60,00 0/-. THE ASSESSEE HAS AGREED FOR ADDITION OF THIS AMOUNT AND REDUCTION OF ITS SH ORT TERM LOSS. THE LD.AO HAS INITIATED PENALTY PROCEEDINGS AND OBSERVED THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME TO THE EXTENT OF R S.70.60 LAKHS. HE ACCORDINGLY IMPOSED A PENALTY OF RS.26 LAKHS UPON T HE ASSESSEE. 4. ON APPEAL, THE LD.CIT(A) HAS DELETED PENALTY AFT ER MAKING REFERENCE TO LARGE NUMBER OF DECISIONS RENDERED BY THE ITAT AND HONBLE HIGH COURTS. 5. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD. IT EMERGES OUT FROM THE RECORD THAT IN AUD ITED ACCOUNTS ASSESSEE HAS SHOWN LIABILITY OF STATE BANK OF INDIA AT RS.78,43, 226/-. THERE IS NO ELEMENT OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICUL ARS ABOUT BASIC DETAILS. ITA NO.2191/AHD/203 3 ERROR HAS BEEN COMMITTED WHEN COMPUTATION OF INCOME WAS MADE. FIGURE OF RS.78,43,226/- WAS TAKEN AS 7,83,226 AND THIS HAS ENHANCED CLAIM OF LOSS MADE BY THE ASSESSEE. IT IS ALSO PERTINENT TO OBSE RVE THAT ASSESSEE HAS BEEN SUFFERING LOSS CONTINUOUSLY FROM PAST AND SUBSEQUEN T YEARS. IT IS A BIFR COMPANY AND ULTIMATELY TAKEN UP BY SUN PHARMACEUTIC ALS INDUSTRIES. THUS, THERE CANNOT BE ANY DELIBERATE ATTEMPT FOR FURNISHI NG INACCURATE PARTICULARS. IT WAS A MISTAKE AT THE END OF THE CLERICAL STAFF WHO MADE COMPUTATION OF TOTAL INCOME. THE LD.CIT(A) HAS CONSIDERED THIS ASPECT A ND ONLY THEREAFTER DELETED THE PENALTY. WE DO NOT SEE ANY REASON TO INTERFERE IN THE ORDER OF THE LD.CIT(A) ON THIS ISSUE, AND THIS GROUND OF APPEAL OF THE REVENUE IS REJECTED. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE COURT ON 8 TH DECEMBER, 2016 AT AHMEDABAD. SD/- SD/- (PRADIPKUMAR KEDIA) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER