ITO 22 (1)(3), MUMBAI V. CHIRAG J. MEHTA, MUMBAI

ITA 2265/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 1220 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-12-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 11-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJAY J SETHI
• Assessee Lawyers: PRAMITA RATHI
• Keywords: Bogus purchase; Tax effect; Revised return
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC , MUMBAI BEFORE SHRI C.N. PRASAD , HONBLE JUDICIAL MEMBER ITA NO . 2265 / MUM/201 9 ( A.Y: 2010 - 11 ) INCOME TAX OFFICER 22(1)(3 ) 314, 3 RD FLOOR PIRAMAL CHAMBERS, LALBAUG MUMBAI 400 012 V. SHRI CHIRAG J. MEHTA 103A NADIA APARTMENT 10 TH ROAD, TPS III SANTACRUZ(E), MUMBAI - 400055 PAN: AGKPM6888Q (APPELLANT) (RESPONDENT) ASSESSEE BY : PRAMITA RATHI DEPARTMENT BY : SHRI SANJAY J. SETHI DATE OF HEARING : 1 8.11.2020 DATE OF PRONOUNCEMENT : 08 .1 2.2020 O R D E R PER C.N. PRASAD (JM) THIS APPEAL IS FILED BY THE R EVENUE AGAINST THE O RDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 34 , MUMBAI [HEREINAFTER IN SHORT LD.CIT(A)] DATED 25.01.2018 FOR THE A . Y . 2010 - 11 IN DELETING THE PENALTY LEVIED U/S. 271(1)(C) OF THE ACT . 2 ITA NO. 2265/MUM/2019 (A.Y: 2010 - 11) SHRI CHIRAG J. MEHTA 2. REVENUE IN ITS APPEAL HAS RAISED FOLLOWING GROUNDS: ' 1. 'WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) IS CORRECT IN DELETING PENALTY HOLDING THAT THE ASSESSEE HAD MADE FULL AND COMPLETE DISCLOSURE OF ALL RELEVANT PARTICULARS IN ITS RETURN OF INCOME, REVISED RETURN AND SURVEY PROCEEDINGS AND HAS NOT FURNISHED ANY INACCURATE PARTICULARS O F INCOME. 2. THE LD. CIT(A) FAILED TO SEE THAT THE ASSESSEE HAD ORIGINALLY FILED RETURN OF INCOME ON 30.09.2010 AND THEN DURING SURVEY ON 04.12.2012 (APPROX. 2 YEARS LATER) ADMITTED ADDITIONAL INCOME AND BOGUS PURCHASES AND ACCEPTED THE SAME OF ADDITION IN ASSESSMENT ORDER PASSED ON 01.03.2013. 3. THE CIT(A) SHOULD HAVE SEEN THAT BUT FOR SURVEY CONDUCTED BY THE DEPARTMENT, THE ASSESSEE WOULD HAVE STUCK TO RETURNED INCOME ONLY AND THEREBY NOT WITHDRAWING THE BOGUS PURCHASES CLAIM.' 4. THE APPELLANT PRAYS THA T THE ORDER OF THE CIT(A) ON THE ABOVE GROUND BE REVERSED AND THAT OF THE ASSESSING OFFICER BE RESTORED. 5. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND WHICH MAY BE NECESSARY. 3. AT THE TIME OF HEARING, LD. AR SUBMITTED THAT T AX EFFECT ON THE ISSUE IN THE PRESENT APPEAL IS BELOW .50 LACS AND IN VIEW OF THE CBDT CIRCULAR NO. 17/2019 DATED 08.08.2019 IN F.NO.279/MISC.142/2007 - ITJ (PT), THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE . 4. ON THE OTHER HAND, LD. DR SUBMITTED THAT TH IS APPEAL IS FILED AGAINST DELETION OF PENALTY OF . 45,53,396 / - LEVIED U/S. 271(1)(C) OF THE ACT ON THE DISALLOWANCE MADE TOWARDS BOGUS PURCHASES FOR THE A.Y. 2010 - 11 . 3 ITA NO. 2265/MUM/2019 (A.Y: 2010 - 11) SHRI CHIRAG J. MEHTA 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE GROUNDS OF APPEAL IN TH ESE APPEAL S AND THE ORDERS OF THE AUTHORITIES BELOW . WE FIND THAT THE TAX EFFECT IN THIS APPEAL IS LESS THAN .5 0 LAKHS AND T HEREFORE THE APPEAL OF THE R EVENUE IS NOT MAINTAINABLE ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO. 17/2019 DATED 08.08.2019. WE ALSO OBSERVED THAT SINCE THE ISSUE IS IN RESPECT OF LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT NONE OF THE EXCEPTION IN THE CIRCULAR ARE APPLICABLE . ACCORDINGLY, THIS APPEAL IS DISMISSED FOR LOW TAX EFFECT. 6. IN THE RESULT, APPEAL OF THE R EVENUE IS DISMISSED. ORDER PRONOUNCED ON 08. 12. 2020 AS PER RULE 34(4) OF ITAT RULES BY PLACING THE PRONOUNCEMENT LIST IN THE NOTICE BOARD. SD/ - (C.N. PRASAD) JUDICIAL MEMBER MUMBAI / DATED 08/ 12/ 2020 GIRIDHAR, SR.PS 4 ITA NO. 2265/MUM/2019 (A.Y: 2010 - 11) SHRI CHIRAG J. MEHTA COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY// BY ORDER, (ASSTT. REGISTRAR) ITAT, MUM