The Assistant Commissioner of Income Tax, Circle-2(1), Panaji., Panaji V. M/s Mohit Steel Industries (P) Ltd., Goa

ITA 234/PAN/2015

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1408 (ITAT-PANAJI)
• Duration Of Justice: 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 19-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K M MAHESH LD
• Assessee Lawyers: V SRINIVASAN
• Keywords: Reasonable cause
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI N.S. SAINI, HON'BLE ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, HONBLE JUDICIAL MEMBER ITA NO. 234/PNJ/2015 : (A.Y 2005 - 06) ASST. COMMISSIONER OF INCOME TAX, CIRCLE - 2(1), PANAJI, GOA. (APPELLANT) VS. M/S. MOHIT STEEL INDUSTRIES (P) LTD., PLOT NO. 342, KUNDAIM INDL. ESTATE, KUNDAIM, GOA (RESPONDENT) PAN : AABCM9713G ASSESSEE BY : V. SRINIVASAN, CA REVENUE BY : K.M. MAHESH, LD. DR DATE OF HEARING : 17/08/2015 DATE OF PRONOUNCEMENT : 17/08/2015 O R D E R PER GEORGE MATHAN : 1. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A), PANAJI - 1 IN ITA NO. 159/PNJ/11 - 12 DT. 20.2.2015 FOR THE A.Y 2005 - 06 AGAINST THE CANCELLATION OF PENALTY LEVIED U/S 271(1)(C) OF THE ACT. SHRI V. SRINIVASAN, CA REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI K.M. MAHESH, LD. DR REPRESENTED ON BEHALF OF THE REVENUE. 2. IT WAS SUBMITTED BY THE LD. DR THAT IN THE COURSE OF THE ASSESSMENT THE AO HAD MADE AN ADDITION OF RS. 1,13,21,750/ - IN RESPECT OF SHARE APPLICATION MONEY RECEIVED BY THE ASSESSEE BY INVOKING THE PROVISIONS OF SEC. 68 OF THE ACT. IT WAS THE SUBMISSION THA T ON APPEAL, THE SAID ADDITION HAD BEEN REDUCED TO 2 ITA NO. 234/PNJ/2015 (A.Y : 2005 - 06) RS. 19,21,750/ - . IT WAS THE SUBMISSION THAT THE ADDITION OF RS. 19,21,750/ - WAS ALSO CONFIRMED BY THE TRIBUNAL. IT WAS THE SUBMISSION THAT CONSEQUENTLY THE AO HAD LEVIED PENALTY U/S 271(1)(C) OF THE ACT ON ACCOUNT OF CONCEALMENT OF INCOME. IT WAS THE SUBMISSION THAT ON APPEAL THE LD. CIT(A) HAD DELETED THE PENALTY ON THE GROUND THAT THE DETAILS WERE AVAILABLE ON RECORD AND THERE WAS SUBSTANTIAL TIME GAP AND THERE WAS REASONABLE CAUSE FOR NOT BEING ABLE T O FURNISH FRESH CONFIRMATION IN RESPECT OF THE SHARE APPLICATION MONEY. IT WAS THE SUBMISSION THAT THE LD. CIT(A) ERRED IN CANCELLING THE PENALTY. IT WAS THE SUBMISSION THAT THE ORDER OF THE LD. CIT(A) WAS LIABLE TO BE REVERSED. 3. IN REPLY, THE LD. AR SUBMITTED THAT THE SHARE APPLICATION MONEY RELATED TO THE A.Y 1998 - 99, HOWEVER, ADDITION HAD BEEN MADE DURING THE RELEVANT A.Y 2005 - 06 AND THAT THOUGH THE ADDITION HAS BEEN CONFIRMED IN THE QUANTUM, STILL THE FACT REMAINS THAT THE SHARE APPLICATION MONEY H AS BEEN SHOWN IN THE ACCOUNTS OF THE ASSESSEE RIGHT FROM THE A.Y 1998 - 99 AND ALL THE DETAILS WERE ALSO AVAILABLE ON THE RECORDS. IT WAS THE SUBMISSION THAT JUST BECAUSE THE ADDITION HAS BEEN CONFIRMED DURING THE A.Y 2005 - 06 IN RESPECT OF THE SHARE APPLICA TION MONEY WHICH WAS RECEIVED DURING THE A.Y 1998 - 99, THE PENALTY COULD NOT BE LEVIED. HE VEHEMENTLY SUPPORTED THE ORDER OF THE LD. CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AT THE OUTSET, A PERUSAL OF THE DETAILS CLEARLY SHOW THAT THE SHARE APPLICATION MONEY RELATED TO THE A.Y 1998 - 99. THE SAME HAS BEEN ADDED BY INVOKING THE PROVISIONS OF SEC. 68 OF THE ACT DURING THE A.Y 2005 - 06. A PERUSAL OF THE ORDER OF THE TRIBUNAL SHOWS THAT THE TRIBUNAL WAS VERY MUCH AWARE OF THE FACT THAT THE SHARE A PPLICATION MONIES WERE OF EARLIER YEARS, HOWEVER, THE TRIBUNAL HAD HELD THAT BY EFFLUX OF TIME THE MONIES HAD BECOME THE ASSESSEES OWN MONEY. NOW, THE FACT REMAINS THAT THE SHARE APPLICATION MONEY RELATED TO THE A.Y 1998 - 99. ONCE IT IS CLEAR THAT THE 3 ITA NO. 234/PNJ/2015 (A.Y : 2005 - 06) AM OUNT HAS BEEN TREATED AS THE INCOME DURING THE RELEVANT ASSESSMENT YEAR ON ACCOUNT OF DISALLOWANCE WHICH IN FACT RELAT ED TO AN EARLIER ASSESSMENT YEAR, CLEARLY IT CANNOT BE SAID THAT THE CONCEALMENT HAS TAKEN PLACE DURING THE RELEVANT A.Y 2005 - 06. IN THE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE FINDING OF THE LD. CIT(A) IN CANCELLING THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT IS ON A RIGHT FOOTING AND DOES NOT CALL FOR ANY INTERFERENCE. 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. OR DER PRONOUNCED IN THE OPEN COURT ON 17/08/2015. S D / - (N.S. SAINI) ACCOUNTANT MEMBER S D / - ( GEORGE MATHAN ) JUDICIAL MEMBER PLACE : PANAJI / GOA DATED : 17/08/ 201 5 *SSL* COPY TO : (1) APPELLANT (2) RESPONDENT (3) CIT(A) CONCERNED (4) CIT CONCERNED (5) D.R (6) GUARD FILE TRUE COPY, BY ORDER , 4 ITA NO. 234/PNJ/2015 (A.Y : 2005 - 06) DATE INITIAL ORIGINAL DICTATION PAD & DRAFT ORDER ARE ENCLOSED IN THE FILE 1. DRAFT DICTATED ON 17/08/2015 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 1 8 /08/2015 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 18/08/2015 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 18/08/2015 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 18/08/2015 SR.PS 6. DATE OF PRONOUNCEMENT 17/08/2015 SR.PS 7. FILE SENT TO THE BENCH CLERK 18/08/2015 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER