Arka Hotels Private Limited, Hyderabad V. Asst. Commissioner of Income Tax, Central Circle-1(1), Hyderabad

ITA 2231/Hyd/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1948 (ITAT-HYDERABAD)
• Duration Of Justice: 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 30-08-2018
• Assessment Year: 2013-2014
• Appeal Filed On: 26-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ESTHER MINGHAUVUNG
• Assessee Lawyers: G VENKATESWARLU
• Section: 115JB

Judgement Text

ITA NO 2 231 OF 2017 ARKA HOTELS P LTD HYDERABAD. PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD B BENCH, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA NO.2231/HYD/2017 (ASSESSMENT YEAR: 2013-14) M/S. ARKA HOTELS PRIVATE LIMITED HYDERABAD PAN: AABCA7646N VS ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1(1) HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI G. VENKATESWARLU FOR REVENUE : SMT. ESTHER MINGHAUVUNG, DR O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2013-14 AGAIN ST THE ORDER OF THE CIT (A)-1, HYDERABAD, DATED 3.10.2 017 DELETING THE PENALTY LEVIED BY THE AO U/S 271(1)(C) OF THE A CT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE CO MPANY ENGAGED IN THE BUSINESS OF RUNNING HOTELS, FILED IT S RETURN OF INCOME FOR THE A.Y 2013-14 ON 29.3.2014 DECLARING L OSS OF RS.66,17,064 AND PAID TAXES UNDER MAT AT RS.9,15,99 3. DURING THE ASSESSMENT PROCEEDINGS, THE AO MADE CERTAIN ADD ITIONS TO THE ASSESSED INCOME BUT SINCE THE INCOME UNDER 115JB WA S HIGHER, THE TAX WAS PAID ON THE BOOK PROFITS U/S 115JB OF T HE ACT. SINCE THE ADDITIONS WERE MADE TO THE RETURNED INCOME OF T HE ASSESSEE DATE OF HEARING: 30.08.2018 DATE OF PRONOUNCEMENT: 31.08.2018 ITA NO 2 231 OF 2017 ARKA HOTELS P LTD HYDERABAD. PAGE 2 OF 3 UNDER THE NORMAL PROVISIONS OF THE I.T. ACT, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND LE VIED THE MINIMUM PENALTY OF RS.24.00 LAKHS. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT (A) WHO CONFIRME D THE ORDER OF THE AO AND THE ASSESSEE IS IN SECOND APPEAL BEFORE US. 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THOUGH CERTAIN ADDITIONS WERE MADE TO THE RETURNED INCOME, THE INCOME COMPUTED AS PER THE NORMAL PROVISIONS OF THE ACT WAS LESS THAN THE INCOME COMPUTED U/S 115JB OF THE ACT AND T HEREFORE, THE INCOME OFFERED BY THE ASSESSEE U/S 115JB ALONE WAS BROUGHT TO TAX AND HENCE, THERE WAS NO ESCAPEMENT OF INCOME AND THE PENALTY U/S 271(1)(C) IS NOT ATTRACTED. HE ALSO DRE W OUR ATTENTION TO THE CBDT CIRCULAR NO.25/2015, DATED 31.12.2015 W HEREIN ALL THE INCOME TAX OFFICERS WERE DIRECTED NOT TO LEVY P ENALTY WHERE THE INCOME WAS ASSESSED U/S 115JB OF THE ACT. THE A SSESSEE HAS ALSO PLACED RELIANCE UPON THE DECISION OF THE COORD INATE BENCH OF THIS TRIBUNAL IN ITA NO.1654/HYD/2014 DATED 16.02.2 018 FOR THE A.Y 2010-11 WHEREIN THE TRIBUNAL HAS TAKEN NOTE OF THE CBDT CIRCULAR AND UNDER SIMILAR CIRCUMSTANCES HAS DELETE D THE PENALTY. IN THE CASE BEFORE US ALSO THERE ARE NO AD DITIONS MADE TO THE INCOME COMPUTED BY THE ASSESSEE U/S 115JB OF TH E ACT AND THE SAME HAS BEEN BROUGHT TO TAX AND THEREFORE, THE PENALTY IS NOT LEVIABLE. ASSESSEES APPEAL IS ACCORDINGLY ALLOWED. 4. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST AUGUST, 2018. SD/- SD/- (INTURI RAMA RAO) ACCOUNTANT MEMBER (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED 31 ST AUGUST, 2018. VINODAN/SPS COPY TO: ITA NO 2 231 OF 2017 ARKA HOTELS P LTD HYDERABAD. PAGE 3 OF 3 1 ARKA HOTELS PVT. LTD, 6-3-248/1/1/A, 4 TH FLOOR, BHASKAR PLAZA, ROAD NO.1, BANJARA HILLS, HYDERABAD 500034 2 ASSTT. CIT, CENTRAL CIRCLE 1(1) HYDERABAD 3 CIT (A) - 1, HYDERABAD 4 PR. CIT 1 HYDERABAD 5 THE DR, ITAT HYDERABAD 6 GUARD FILE BY ORDER