M/s. Integra Engineering India Ltd., Panchmahal V. The ACIT.,Circle-1(2), , Baroda

ITA 2344/AHD/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1715 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 8 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 01-05-2017
• Assessment Year: 2005-2006
• Appeal Filed On: 19-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, C BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.2344/AHD/2014 %& ' ()'/ ASSTT. YEAR: 2005-2006 M/S.INTEGRA ENGINEERING INDIA LTD. POST BOX NO.55 CHANDRAPURA VILLAGE TAL. HALOL PANCHMAHAL 389 350 PAN : AABCS 8347 Q VS. ACIT, CIR.1(2) BARODA. ( APPLICANT ) ( RESPONENT ) ASSESSEE BY : NONE (WRITTEN SUBMISSIONS) REVENUE BY : SHRI PRASOON KABRA, SR.DR / DATE OF HEARING : 01/05/2017 / DATE OF PRONOUNCEMENT: 02/05/2017 67/ O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF THE A SSESSEE AGAINST ORDER OF THE LD.CIT(A)-I, BARODA DATED 10.6.2014 PASSED F OR THE ASSTT.YEAR 2005- 2006. 2. SOLE GRIEVANCE OF THE ASSESSEE IS THAT THE LD.CI T(A) HAS ERRED IN CONFIRMING PENALTY OF RS.4,30,075/- WHICH WAS IMPOS ED BY THE AO UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FILED ITS RETURN OF INCOME ON 27.10.2005 DECLARING TOTAL INCOME AT RS.1,82,86, 627/-. THE ASSESSMENT ITA NO.2344/AHD/2014 2 ORDER WAS PASSED ON 27.12.2007 UNDER SECTION 143(3) OF THE ACT AND INCOME OF THE ASSESSEE WAS DETERMINED AT RS.2,17,64,750/-. THE LD.AO THEREAFTER RECORDED REASONS AND REOPENED THE ASSESSMENT. HE P ASSED RE-ASSESSMENT ORDER ON 14.12.2010. THE LD.AO MADE AN ADDITION OF RS.2,77,574/- OUT OF SALE PROMOTION EXPENSES AND HE DISALLOWED A SUM OF RS.10,00,131/- OUT OF OTHER EXPENSES. HE INITIATED PENALTY PROCEEDINGS A ND ULTIMATELY IMPOSED PENALTY OF RS.4,30,075/- ON THESE TWO ADDITIONS. T HE ORDER OF THE AO DATED 30.3.2013 PASSED UNDER SECTION 271(1)(C) OF THE ACT WAS CHALLENGED BEFORE THE LD.CIT(A) WHO UPHELD IT BY WAY OF IMPUGNED ORDE R. 4. IT HAS BEEN BROUGHT TO OUR NOTICE THAT THE ASSES SEE CHALLENGED REOPENING OF THE ASSESSMENT BEFORE THE ITAT IN ITA NO.1922/AH D/2011 AND THE TRIBUNAL VIDE ORDER DATED 1.1.2016 ALLOWED THE APPE AL OF THE ASSESSEE AND QUASHED THE REASSESSMENT ORDER. COPY OF THE TRIBUN ALS ORDER HAS BEEN PLACED ON RECORD. THE LD.DR WAS UNABLE TO CONTROVE RT THIS FACT. 5. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. WE FIND THAT SUB-CLAUSE (III) O F SECTION 271(1)(C) PROVIDES MECHANISM FOR QUANTIFICATION OF PENALTY. IT CONTEM PLATES THAT THE ASSESSEE WOULD BE DIRECTED TO PAY A SUM IN ADDITION TO TAXES , IF ANY, PAYABLE HIM, WHICH SHALL NOT BE LESS THAN, BUT WHICH SHALL NOT E XCEED THREE TIMES THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF CONC EALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME. IN OTHER WORDS, THE QUANTIFICATION OF THE PENALTY IS DEPENDED UPON THE ADDITION MADE TO THE INCOME OF THE ASSESSEE. IN THE PRESENT CASE, ITAT IN ASSESSEES APPEAL IN ITA NO.1922/AHD/2011 (SUPRA) HAS QUASHED THE RE-ASSESSM ENT ORDER, AND THEREFORE, BASIS FOR VISITING THE ASSESSEE WITH PEN ALTY HAS BEEN EXTINGUISHED, AND IN SUCH A SITUATION NO PENALTY CAN BE IMPOSED U PON THE ASSESSEE UNDER ITA NO.2344/AHD/2014 3 SECTION 271(1)(C) OF THE ACT. THEREFORE, WE DELETE IMPUGNED PENALTY AND CANCEL ORDERS OF BOTH THE AUTHORITIES BELOW. APPEA L OF THE ASSESSEE IS, THUS, ALLOWED. 6. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 2 ND MAY, 2017 AT AHMEDABAD. SD/- SD/- ( MANISH BORAD ) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER