Usha Ispat Limited, New Delhi V. ACIT, CC-18, New Delhi

ITA 234/DEL/2020

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 5439 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 6 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2001-2002
• Appeal Filed On: 12-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Documents seized
• Section: 132; 158BC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘H’, NEW DELHI Before Dr. B. R. R. Kumar, Accountant Member Sh. Anubhav Sharma, Judicial Member ITA No. 234/Del/2020 : Asstt. Year : 2001-02 Usha Ispat Ltd., B-2/100, Mohan Co-operative Industrial Estate, Badarpur, New Delhi-110044 Vs ACIT, Central Circle-18, New Delhi (APPELLANT) (RESPONDENT) PAN No. AAACU1007G Assessee by : None Revenue by : Sh. M. Baranwal, Sr. DR Date of Hearing: 12.07.2022 Date of Pronouncement: 20.07.2022 ORDER Per Dr. B. R. R. Kumar, Accountant Member: The present appeal has been filed by the assessee against the order of the ld. CIT(A)-27, New Delhi-16 dated 22.11.2019. 2. During the assessment proceedings u/s 158BC of the Income Tax Act, 1961 for the block period from 01.04.1990 to 14.02.2001, the additions were made on the basis of various documents seized during the curse of search from the premises at E-58, Sarita Vihar, New Delhi on account of unexplained share capital, unexplained purchases, unexplained freight & forwarding expenses and undisclosed income offered by the assessee before the settlement commission. Consequent to the assessment u/s 158BC, the assessment for A.Y. 2001-02, since, the assessee company has failed to furnish the return and ITA No. 234/Del/2020 Usha Ispat Ltd. 2 details of income for A.Y. 2001-02, the assessment for this period was completed on pro-rata basis on the basis of income assessed u/s 158BC of the Act for block period from 15.02.2001 to 31.03.2001 at total income of Rs.12,06,280/-. 3. The ld. CIT(A) confirmed the penalty order on the grounds that since the quantum addition has been confirmed there are no reasons to interfere with the findings in the penalty order. 4. We have gone through the material on record and find that, a. The assessee has not filed return of income. b. The addition has been made for the instant year on account of disallowance of purchases and freight and forward expenses. c. The disallowance has been made on a pro-rata basis on the basis of block assessment completed for the part of the Assessment Year. d. The search & seizure action u/s 132 was conducted on 14.02.2001. e. The relevant assessment pertains to the period 15.02.2001 to 31.03.2001 i.e. effectively post search period. 5. Hence, keeping in view the entire facts and circumstances that the assessment is only for the post search period of 45 days, and no evidence has been brought on record while disallowing the purchases and freight forwarding expenses which were merely based on the pro-rata disallowance pertaining to block period, keeping in view that assessment proceedings and penalty proceedings operate on different bedrock, since no case of concealment of income or/ furnishing of inaccurate particulars ITA No. 234/Del/2020 Usha Ispat Ltd. 3 of income has been brought out by the Revenue and since the ld. CIT(A) has confirmed the penalty order on sole reason that the addition has been confirmed, the penalty levied u/s 271(1) (c), during the instant year cannot be upheld. 6. In the result, the appeal of the assessee is allowed. Order Pronounced in the Open Court on 20/07/2022. Sd/- Sd/- (Anubhav Sharma) (Dr. B. R. R. Kumar) Judicial Member Accountant Member Dated: 20/07/2022 *Subodh Kumar, Sr. PS* Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR