M/s. CSB Solution Pvt. Ltd., New Delhi V. ACIT, New Delhi

ITA 2353/DEL/2014

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 4228 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 03-08-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 17-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N K BANSAL SENIOR
• Assessee Lawyers: DR RAKESH GUPTA; SOMIL AGARWAL S
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH B BB B : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI BEFORE SHRI BEFORE SHRI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT AND AND AND AND S SS SHRI SUDHANSHU SRIVASTAVA HRI SUDHANSHU SRIVASTAVA HRI SUDHANSHU SRIVASTAVA HRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO . .. . 2353/DEL/2014 2353/DEL/2014 2353/DEL/2014 2353/DEL/2014 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 2009 2009 2009 2009 - -- - 10 1010 10 M/S CSB SOLUTION PRIVATE M/S CSB SOLUTION PRIVATE M/S CSB SOLUTION PRIVATE M/S CSB SOLUTION PRIVATE LIMITED, LIMITED, LIMITED, LIMITED, R RR R- -- -40, NDSE 40, NDSE 40, NDSE 40, NDSE- -- -II, II,II, II, NEW DELHI NEW DELHI NEW DELHI NEW DELHI 110 049. 110 049. 110 049. 110 049. PAN : AABCE5459P. PAN : AABCE5459P. PAN : AABCE5459P. PAN : AABCE5459P. VS. VS. VS. VS. ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF ASSISTANT COMMISSIONER OF INCOME TAX, INCOME TAX, INCOME TAX, INCOME TAX, CIRCLE 3(1), CIRCLE 3(1), CIRCLE 3(1), CIRCLE 3(1), NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (APPELLANT) (RESPONDENT) APPELLANT BY : DR. RAKESH GUPTA AND SHRI SOMIL AGARWAL, ADVOCATES. RESPONDENT BY : SHRI N.K. BANSAL, SENI OR DR. DATE OF HEARING : 03.08.2016 03.08.2016 03.08.2016 03.08.2016 DATE OF PRONOUNCEMENT : 05.08.2016 05.08.2016 05.08.2016 05.08.2016 ORDER ORDER ORDER ORDER PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP : :: :- -- - THIS APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2009-1 0 IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-VI, NEW DELHI DATED 19 TH FEBRUARY, 2014. 2. THE ONLY GROUND RAISED IN THIS APPEAL BY THE ASSESSEE IS AGAINST THE LEVY OF PENALTY OF `4,34,230/- U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961. 3. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND H AVE PERUSED THE MATERIAL PLACED BEFORE US. WE FIND THAT PENALTY HAS BEEN LEVIED ON THE DISALLOWANCE OF COMMISSION OF `14,05,27 8/-. FROM A PERUSAL OF THE ASSESSMENT ORDER, WE FIND THAT THE ASSESSEE HAS CLAIMED ITA-2353/DEL/2014 2 THE COMMISSION EXPENSES AMOUNTING TO `56,21,113/-. DUR ING ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER, IN ORDER TO V ERIFY THE CLAIM OF THE ASSESSEE, ISSUED NOTICE U/S 133(6) TO TEN PAR TIES, OUT OF WHICH, SIX PARTIES SENT THE CONFIRMATION. HOWEVER, NO REPLY WAS RECEIVED IN RESPECT OF FOUR PARTIES. WHEN THESE FACTS WERE BROUGHT TO THE ASSESSEES REPRESENTATIVE, HE AGREED FOR THE ADHOC DI SALLOWANCE OF 25% OF TOTAL COMMISSION CLAIMED BY THE ASSESSEE. THUS, 25 % OF THE TOTAL COMMISSION EXPENSES AMOUNTING TO `14,05,278/- WAS DISALLOWED. IT WAS CONTENDED BY THE LEARNED COUNSEL FOR THE ASSESSEE APPEARING BEFORE US THAT THE ASSESSEES AUTHORIZED REPRESENTATIVE AC CEPTED THE DISALLOWANCE OF 25% OF THE COMMISSION SO AS TO BUY PEACE AND TO AVOID LONG DRAWN LITIGATION. HE STATED THAT THE ASSESSE E HAS FURNISHED CONFIRMATION OF ALL THE PARTIES TO WHOM THE COMMISSION WAS PAID. TDS WAS DULY DEDUCTED FROM ALL THE PERSONS. THAT SUMMON ISSUED U/S 133(6) WAS DULY COMPLIED WITH AND SIX PERSONS CONFIRMED HAVING RECEIVED THE COMMISSION. MERELY BECAUSE FOUR PERSONS DI D NOT FURNISH REPLY TO THE ASSESSING OFFICER IN RESPONSE TO SUMMONS, IT CANNOT BE SAID THAT THE CLAIM OF THE COMMISSION BY THE ASSESSEE WAS NOT GENUINE. THAT MERELY BECAUSE THE ASSESSEE AGREED FOR TH E ADDITION, IT, IN NO WAY, SADDLE THE ASSESSEE WITH THE PENALTY U/S 271(1 )(C) OF THE ACT. 4. AFTER CONSIDERING THE FACTS OF THE CASE AND ARGUMEN TS OF BOTH THE SIDES, WE ENTIRELY AGREE WITH THE CONTENTION OF THE L EARNED COUNSEL FOR THE ASSESSEE. IN OUR OPINION, IT IS NOT A FIT CASE FOR L EVY OF PENALTY U/S 271(1)(C). WHILE DOING SO, WE DRAW SUPPORT FROM THE DECISION OF HONBLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PE TROPRODUCTS PVT.LTD. (2010) 322 ITR 158 (SC). AS PER HONBLE APEX COURT, MERELY BECAUSE THE ASSESSEES CLAIM FOR ANY DEDUCTION IS NOT AC CEPTED BY THE REVENUE, PENALTY U/S 271(1)(C) OF THE ACT IS NOT ATTR ACTED. ON THE FACTS ITA-2353/DEL/2014 3 OF THE CASE, THE ABOVE DECISION OF HONBLE APEX COURT WOULD BE SQUARELY APPLICABLE. RESPECTFULLY FOLLOWING THE SAME, WE CANCEL THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 05.08.2016. SD/- SD/- (SUDHANSHU SRIVASTAVA (SUDHANSHU SRIVASTAVA (SUDHANSHU SRIVASTAVA (SUDHANSHU SRIVASTAVA ) )) ) ( (( ( G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL ) )) ) JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. COPY FORWARDED TO: - 1. APPELLANT : M/S CSB SOLUTION PRIVATE LIMITED, M/S CSB SOLUTION PRIVATE LIMITED, M/S CSB SOLUTION PRIVATE LIMITED, M/S CSB SOLUTION PRIVATE LIMITED, R RR R- -- -40, NDSE 40, NDSE 40, NDSE 40, NDSE- -- -II, NEW DELHI II, NEW DELHI II, NEW DELHI II, NEW DELHI 110 049. 110 049. 110 049. 110 049. 2. RESPONDENT : ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 3(1), NEW DELHI. CIRCLE 3(1), NEW DELHI. CIRCLE 3(1), NEW DELHI. CIRCLE 3(1), NEW DELHI. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR