NEW WAYS MARKETING INDIA P.LTD, MUMBAI V. ITO WD 9(2)(3), MUMBAI

ITA 2235/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92882 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 18-06-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 20-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R C JAIN

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NO.2235/MUM/2013 ASSESSMENT YEAR: 2006-07 NEW WAYS MARKETING INDIA PVT. LTD. K K KHADARI & CO, CHARTERED ACCOUNTANTS, A-401, PEARL ARCADE, OPP J P ROAD, ANDHERI (W) MUMBAI-400058 / VS. ITO WD.9(2)(3), R. NO.225, 2 ND FLOOR, AAYAKAR BHAWAN, M.K.ROAD, MUMBAI-400020 ( ! ' /ASSESSEE) ( # / REVENUE) P.A. NO. AAACT2552M # / REVENUE BY DR. YOGESH KAMAT-DR ! ' / ASSESSEE BY SHRI R.C. JAIN $ #% & ' ' / DATE OF HEARING : 18/06/2015 & ' ' / DATE OF ORDER: 01/07/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 04/12/2012 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, NEW WAYS MARKETING INDIA PVT. LTD ITA NO.2235/MUM/2013 2 CONFIRMING THE PENALTY OF RS.13,69,208/- IMPOSED U/ S 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING OF THIS APPEAL, THE LD. COUNSEL FOR THE ASSESSEE, SHRI R.C. JAIN, ADVANCED HIS ARGUMENT S WHICH ARE IDENTICAL TO THE GROUND RAISED BY CONTEND ING THAT WHILE CONFIRMING THE PENALTY, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) DID NOT APPRECIATE THAT THE PR OOF FOR DAMAGE OF GOODS IN QUESTION WAS AVAILABLE ON RECORD OF THE DEPARTMENT AS IS EVIDENCED BY LETTER DATED 29/07/20 05 OF THE WAREHOUSE. IT WAS FURTHER CONTENDED THAT THE QUANTUM ADDITION ON THE BASIS OF WHICH PENALTY WAS IMPOSED HAS ALREADY BEEN DELETED BY THE TRIBUNAL FO R WHICH COPY OF THE ORDER DATED 12 TH JUNE, 2013 (ITA NO.3276/MUM/2011) WAS PRODUCED BY THE ASSESSEE. THI S FACTUAL MATRIX WAS NOT CONTROVERTED BY THE LD. DR, SHRI YOGESH KAMAT WITH THE HELP OF ANY POSITIVE MATERIAL AND HE MERELY DEFENDED THE IMPUGNED ORDER. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND T HAT THE TRIBUNAL IN THE AFORESAID ORDER CONSIDERED THE FACT S OF THE CASE, BASIS FOR MAKING THE ADDITION BY THE LD. ASSE SSING OFFICER, CONCLUSION DRAWN BY THE LD. COMMISSIONER O F INCOME TAX (APPEALS) AND FOUND THAT THE ASSESSING O FFICER EXAMINED SHRI RANJIT SINGH AMAR SINGH CHOUDHARY, ACCOUNTANT OF M/S AMAR WIRE ROPES PVT. LTD., IN WHO SE WAREHOUSE, THE ASSESSEE STOCKED THE KATHA IMPORTED FROM INDONESIA AND FINALLY CONCLUDED THAT THE REVENUE NEW WAYS MARKETING INDIA PVT. LTD ITA NO.2235/MUM/2013 3 AUTHORITIES WERE NOT JUSTIFIED IN HOLDING THAT THER E WAS SUPPRESSED SALES BY DRYING AND ADVERSE INFERENCE FO R MAKING THE ADDITION. MEANING THEREBY, THE ADDITION MADE BY THE ASSESSING OFFICER WAS DELETED. THERE IS NO DISPUTE THAT QUANTUM ADDITION HAS BEEN DELETED BY THE TRIBU NAL BY ACCEPTING THE CLAIM OF THE ASSESSEE, THEREFORE, WE ARE OF THE VIEW THAT THE BASIS ON WHICH THE PENALTY WAS LEVIED , REMAINS NO MORE IN EXISTENCE, CONSEQUENTLY, PENALTY CANNOT SURVIVE. OUR VIEW FURTHER FINDS SUPPORT FRO M THE DECISION AND THE RATIO LAID DOWN IN CIT VS S.P VIZ CONSTRUCTION COMPANY 176 ITR 47 (PATNA) AND K.C. BUILDERS VS ACIT 265 ITR 562 (SUPREME COURT). WE AR E OF THE VIEW WHERE THE PENALTY FOR CONCEALMENT OR FURNI SHING INACCURATE PARTICULARS WAS LEVIED AND AFTER DELETIN G THE QUANTUM ADDITION/ACCEPTING THE CLAIM OF THE ASSESSE E, THERE REMAINS NO BASIS AT ALL FOR LEVYING THE PENAL TY. ORDINARILY, PENALTY CANNOT STAND IN ITSELF IF THE A DDITION MADE IN THE ASSESSMENT ITSELF IS SET ASIDE OR CANCE LLED BY THE SUPERIOR AUTHORITY/COURT. THE PENALTY CANNOT S TAND BY ITSELF BECAUSE FALSE RESULT MAY BE PRODUCED BY T HE FALSITY OF ONE OR MORE OF THE CONSTITUENT ITEMS IN THE RETU RN. THE WORD INACCURATE PARTICULARS WOULD COVER FALSITY I N THE FINAL FIGURE AND ALSO THE CONSTITUENT ELEMENTS OR ITEMS. THEY SIMPLY WOULD MEAN INACCURATE IN SOME SPECIFIC OR DE FINITE RESPECT WHETHER IN THE CONSTITUENT OR SUBORDINATE I TEMS OF INCOME OR THE END RESULT. CONCEALMENT OR FURNISHIN G INACCURATE PARTICULARS IMPLIES SOME DELIBERATE ACT ON THE PART OF THE ASSESSEE IN WITHHOLDING THE TRUE FACTS FROM THE NEW WAYS MARKETING INDIA PVT. LTD ITA NO.2235/MUM/2013 4 AUTHORITIES. SINCE, THE BASIS OF LEVYING PENALTY R EMAINS NO MORE IN EXISTENCE, AFTER DELETION OF THE QUANTUM AD DITION BY THE TRIBUNAL, THEREFORE, FROM THIS ANGLE THE ASS ERTION OF THE ASSESSEE IS HAVING MERIT, CONSEQUENTLY, THE PEN ALTY SO IMPOSED U/S 271(1)(C) OF THE ACT IS DELETED. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON18/06/2015. S D/ - (RAJENDRA) SD/ - (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER $ % MUMBAI; ( DATED :01/07/2015 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. *+,- / THE APPELLANT 2. ./,- / THE RESPONDENT. 3. 0 0 $ 1' ( *+ ) / THE CIT, MUMBAI. P4. 0 0 $ 1' / CIT(A)- , MUMBAI 5. 3#4 .' , 0 *+' * 5 , $ % / DR, ITAT, MUMBAI 6. 6 7% / GUARD FILE. / BY ORDER, /3+' .' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , $ % / ITAT, MUMBAI