The ACIT, Circle-11, Ahmedabad V. Shri Pratap Bhagwanji Thakkar, Ahmedabad

ITA 238/AHD/2014

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 0675 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 year(s) 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 28-08-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 23-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: H V VASA
• Keywords: Gross profit estimation; Corroborative evidences; Tax effect
• Section: 271(1)(c); 143(3); 40(a)(ia); 194C; 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH BEFORE: SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT M EMBER ACIT CIR-11, AHMEDABAD (APPELLANT) VS SHRI PRATAP BHAWANJI THAKKAR 4, ORIENTAL INDUSTRIAL ESTATE B/H BIKRAM MILLS, AMC INDUSTRIAL ESTATE, BAPUNAGAR, AHMEDABAD - 380024 PAN: ABW PT5 656 Q (RESPONDENT) ITA NO. 614/AHD/2014 ASSESSMENT YEAR: 2008-09 SHRI PRATAP BHAWANJI THAKKAR 4, ORIENTAL INDUSTRIAL ESTATE B/H BIKRAM MILLS, AMC INDUSTRIAL ESTATE, BAPUNAGAR, AHMEDABAD - 380024 PAN: ABW PT5 656 Q (APPELLANT) VS DCIT CIR-11, 1 ST FLOOR NARAYAN CHAMBERS, NR. NEJHRU BRIDGE, ASHRAM ROAD, AHMEDABAD- 380009 (RESPONDENT) ITA NO. 886/AHD/2017 ASSESSMENT YEAR: 2008-09 ITA NO. 238/AHD/2014 ASSESSMENT YEAR: 2008-09 I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 2 SHRI PRATAP BHAWANJI THAKKAR 4, ORIENTAL INDUSTRIAL ESTATE B/H BIKRAM MILLS, AMC INDUSTRIAL ESTATE, BAPUNAGAR, AHMEDABAD - 380024 PAN: ABW PT5 656 Q (APPELLANT) VS DCIT CIR-5(3), 1 ST FLOOR NARAYAN CHAMBERS, NR. NEJHRU BRIDGE, ASHRAM ROAD, AHMEDABAD- 380009 (RESPONDENT) REVENUE BY: SHRI S. K. DEV, SR. D.R. ASSESSEE BY: SHRI H. V. VASA, A.R. DATE OF HEARING : 21-02-2019 DATE OF PRONOUNCEMENT : 27-03-2019 /ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:- THESE THREE APPEALS FILED TWO BY ASSESSEE AND ONE B Y REVENUE FOR A.Y. 2008-09, ARISE FROM ORDER OF THE CIT(A)-XVI, AHMED ABAD DATED 27-11-2013, IN PROCEEDINGS UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. ITA NO. 238/AHD/2014 A.Y.2008-09 FILED BY REVENUE 2. AT THE OUTSET, AFTER GOING THROUGH THE GROUNDS O F APPEAL AND THE IMPUGNED ORDERS OF THE REVENUE AUTHORITIES BELOW, A QUERY WA S RAISED BY THE BENCH AS TO APPLICABILITY AND MAINTAINABILITY OF THE APPEAL FIL ED BY THE REVENUE IN VIEW OF RECENT CBDT CIRCULAR NO.3/2018 DATED 11.7.2018 REST RICTING THE FILLING OF THE APPEAL BY THE REVENUE WHERE THE TAX EFFECT IS BELOW RS.20 LAKHS, THE LD. DR DID I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 3 NOT DISPUTE THE SAME AND SUBMITTED THAT THE ISSUE I S LEFT TO THE TRIBUNAL TO BE DECIDED IN ACCORDANCE WITH LAW. 3. WE FIND THAT THE APPEAL OF THE REVENUE IS PRESEN TED ON 23.01.2014. ON 11.7.2018 THE CBDT HAS ISSUED INSTRUCTIONS BEARING NO. 3 OF 2018 UNDER FILE NO.F.NO.279/MISC.142/2007-ITJ(PT) PROHIBITING ITS S UBORDINATE AUTHORITIES FROM FILING OF THE APPEAL TO THE TRIBUNAL AGAINST THE OR DER OF THE CIT(A) WHERE THE TAX EFFECT BY VIRTUE OF THE RELIEF GIVEN BY THE CIT(A) IS LESS THAN RS.20 LAKHS. THE INSTRUCTIONS HAVE BEEN MADE APPLICABLE WITH RETROSP ECTIVE EFFECT, MEANING THEREBY, THESE INSTRUCTIONS ARE APPLICABLE ON PENDING APPEAL S ALSO. IN THE PRESENT CASE, TAX EFFECT ON THE TOTAL INCOME ASSESSED MINUS THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY TH E AMOUNT OF INCOME IN RESPECT OF THE ISSUE AGAINST WHICH APPEAL IS FILED, IS LESS THAN RS.20 LAKHS. FURTHER, THE CASE OF THE REVENUE DOES NOT FALL WITHIN THE AM BIT OF EXCEPTIONS PROVIDED IN THE CIRCULAR. THUS, KEEPING IN VIEW THE ABOVE CBDT CIRCULAR AND PROVISIONS OF SECTION 268A OF THE INCOME TAX ACT, WE ARE OF THE V IEW THAT THE PRESENT APPEAL OF THE REVENUE DESERVES TO BE DISMISSED. IT IS ACCORDI NGLY DISMISSED. HOWEVER, IT IS OBSERVED THAT IN CASE ON RE-VERIFICA TION AT THE END OF THE AO IT COMES TO THE NOTICE THAT THE TAX EFFECT IS MORE OR REVENUES CASE FALLS WITHIN THE AMBIT OF EXCEPTIONS PROVIDED IN THE CIRCULAR, THEN THE DEPARTMENT WILL BE AT LIBERTY TO APPROACH THE TRIBUNAL FOR RECALL OF THIS ORDER. SUCH APPLICATION SHOULD BE FILED WITHIN THE TIME PERIOD PRESCRIBED IN THE ACT. IN V IEW OF THE ABOVE, THE APPEAL OF THE REVENUE IS DISMISSED DUE TO LOW TAX EFFECT. 4. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 4 ITA NO. 614/AHD/2014 A.Y.2008-09 FILED BY ASSESSEE 5. THE APPEAL OF THE ASSESSEE HAS RAISED VARIOUS GR OUNDS OF APPEAL AGAINST THE DECISION OF LD. CIT(A)(XVI) AHMEDABAD IN CONFIRMING VARIOUS DISALLOWANCE MADE BY THE AO. 6. THE VARIOUS GROUNDS OF APPEAL RAISED BY THE ASSE SSEE ARE ADJUDICATED BY THIS COMMON ORDER AS UNDER: ADDITION MADE ON ACCOUNT OF LOW GROSS PROFIT :- 1. THE FIRST GROUND OF APPEAL IS AGAINST THE DECISI ON OF LD.CIT(A) IN RESTRICTING THE ADDITION ON ACCOUNT OF LOW GROSS P ROFIT FROM RS. 21,52,202/- TO RS. 7,97,112/- . THE BRIEF FACT IS THAT DURING THE COURSE OF ASSESSM ENT THE AO NOTICED THAT ASSESSEE HAS DISCLOSED GROSS PROFIT OF RS. 95,08,668/- AS AG AINST GROSS PROFIT OF RS. 1,01,15,704/- DISCLOSED IN THE PRECEDING ASSESSMENT YEAR. THERE WAS FALL OF GROSS PROFIT TO 5.96 PERCENTAGE FROM 7.31 PERCENTAGE DECL ARED IN THE PRECEDING YEAR. DURING THE COURSE OF ASSESSMENT THE ASSESSEE HAS EX PLAINED THAT MAIN REASON FOR FALL IN GROSS PROFIT WERE BECAUSE OF INCREASED IN E MPLOYEES EXPENSES, INCREASED IN ELECTRICITY EXPENSES, STORE OF SPARE EXPENSES ETC. IT WAS ALSO EXPLAINED THAT RAW MATERIAL CONSUMPTION HAS BEEN INCREASED FROM 81.2 P ERCENTAGE IN PRECEDING YEAR TO 83.25 PERCENTAGE DURING THE YEAR UNDER CONSIDERA TION. THE AO HAS NOT AGREED WITH THE SUBMISSION OF THE ASSESSEE. THE AO HAS MA INLY STATED THAT DETAILS ABOUT EMPTY BAGS SALE HAS NOT BEEN REFLECTED IN THE INCOM E SIDE. HE WAS OF THE VIEW THAT EMPTY BAGS SALE AND CONSUMPTION AFTER RECYCLING WAS NOT JUSTIFIED AND ELECTRIC CONSUMPTION VARIES PER KG. OF PRODUCTION ETC. THER EFORE, THE AO HAS ESTIMATED THE GROSS PROFIT @ 1.3 PERCENTAGE AND MADE ADDITION OF RS. 21,52,202 TO THE TOTAL INCOME OF THE ASSESSEE. I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 5 2. AGGRIEVED THE ASSESSEE HAS FILED APPEAL BEFORE T HE LD. CIT (A). THE LD.CIT(A) HAS PARTLY ALLOWED THE APPEAL OF THE AS SESSEE AND RESTRICTED THE GROSS PROFIT ADDITION @ 0.5 PERCENTAGE TO THE AMOUNT OF R S. 7,97,112/-. 3. WE HAVE HEARD THE RIVAL CONTENTION ON THIS ISSUE . IT IS NOTICED THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND APPELLATE PROCEEDINGS THE ASSESSEE HAS FURNISHED VARIOUS DETAILS WITH SUPPORTING EVIDENCES OF PURCHASE OF RAW MATERIAL AND DETAIL OF INCREASED IN VARIOUS EXPENSES I.E. EM PLOYEE EXPENSES, ELECTRICITY EXPENSES, SPARE EXPENSES ETC. THE ASSESSEE HAS ALS O PROVIDED DETAIL OF CONSUMPTION OF RAW MATERIAL, WORK IN PROGRESS, FINI SHED GOODS ETC. THE ASSESSEE HAD ALSO BROUGHT TO THE NOTICE OF THE AO THAT ALL T HE RAW MATERIAL WERE PURCHASED FROM RELIANCE INDUSTRIES, IPCL WHICH WERE SUBJECT T O MODVAT CREDITS BY EXCISE AUTHORITIES AFTER DUE VERIFICATION. THE ASSESSEE H AD EXPLAINED THAT PURCHASES WERE FULLY VOUCHED AND PRODUCTION AND SALES WERE VERIFIE D BY THE EXCISE AUTHORITIES. THERE WERE INCREASED IN THE REMUNERATION AND WAGES TO EMPLOYEES AND RATE OF ELECTRICITY HAD ALSO GONE UP. IT WAS ALSO EXPLAINE D THAT EMPTY BAGS ON THE BASIS OF WHICH ADDITION WAS MADE WAS NOT A RAW MATERIAL BUT A KIND OF SCRAPE WASTE TO THE ASSESSEE. THE ASSESSEE HAS ALSO EXPLAINED THAT PLA STIC BAGS WERE WASTE WHICH CANNOT BE RECYCLED. IT WAS ALSO EXPLAINED THAT EMP TY BAGS WERE ALSO USED FOR SUPPLYING MATERIAL FROM MACHINE TO MACHINE AND ALSO USED FOR SLEEPING PURPOSES BY THE LABOURERS. NO SALE OF SCRAPE OR WASTAGE WAS REALIZED IN THE A.Y. 2008-09 AND ONLY SALE OF RS. 18,272/- FROM SUCH WASTE MATER IAL WAS REALIZED IN A.Y. 2007- 08. AFTER CONSIDERING THE AFORESAID FACTS AND DETA ILS OF SUBMISSION SUBMITTED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT AND AP PELLATE PROCEEDINGS WE OBSERVE THAT AO HAS MADE ADDITION ON ACCOUNT OF LOW GROSS P ROFIT COMPLETELY ON ESTIMATED BASIS WITHOUT DISPROVING THE MATERIAL FAC T STATED BY THE ASSESSEE IN HIS SUBMISSION. WE HAVE ALSO OBSERVED THAT AO HAS FAIL ED TO POINT OUT ANY SPECIFIC I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 6 DEFECT IN THE BOOKS OF ACCOUNT OF THE ASSESSEE AND IN THE ACCOUNTING SYSTEM ADOPTED BY THE ASSESSEE. THEREFORE, WE CONSIDER TH AT DECISION OF THE AO TO REJECT THE BOOKS OF ACCOUNT WAS NOT JUSTIFIED. AFTER CON SIDERING THE ABOVE FACTS AND CIRCUMSTANCES WE ARE NOT INCLINED WITH THE DECISION OF LD. CIT (A) IN RESTRICTING THE DISALLOWANCE ON ACCOUNT OF LOW GROSS PROFIT ON THE GROUND THAT ASSESSEE COULD HAVE RECYCLED THE USED BAGS MATERIAL, THEREFORE WE DELETE THE IMPUGNED ADDITION. ACCORDINGLY, THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 7. THE OTHER GROUND OF APPEAL OF THE ASSESSEE PERTA INING TO DISALLOWANCE OF VARIOUS EXPENSES ARE ADJUDICATED AS UNDER:- ADDITION U/S. 40(A)(IA):- DURING THE COURSE OF ASSESSMENT THE AO NOTICED THAT ASSESSEE HAS NOT DEDUCTED TAX DEDUCTED AT SOURCE ON PAYMENT OF RS. 2 2,100/- AS PROFESSIONAL FEES TO THE AUDITOR. THEREFORE, THE SAME WAS DISALLOWED U/ S. 40(A)(IA) OF THE ACT. THE LD. CIT(A) HAS SUSTAINED THE ADDITION. WE HAVE HEARD T HE RIVAL CONTENTION. THE ASSESSEE COULD NOT SUBSTANTIATE WITH RELEVANT MATER IAL THAT THE TAX WAS DEDUCTED ON THE AFORESAID PAYMENT THEREFORE, THIS GROUND OF APP EAL OF THE ASSESSEE IS DISMISSED. DISALLOWANCE OF LORRY RENT:- DURING THE COURSE OF ASSESSMENT THE AO NOTICED THAT THE ASSESSEE HAS PAID LORRY RENT OF RS. 7,87,670/- AND FREIGHT RS. 4,50,9 47/- . THE TOTAL ADDITION OF RS. 12,38,617/- WAS MADE BECAUSE OF NON-DEDUCTION OF TA X ON THE AFORESAID PAYMENT. THE ASSESSEE FILED APPEAL BEFORE LD. CIT(A), THE LD . CIT(A) HAS RESTRICTED THE ADDITION TO THE AMOUNT OF RS. 7,24,497/-. I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 7 ON THIS ISSUE WE HAVE HEARD THE RIVAL CONTENTION AN D PERUSED THE MATERIAL ON RECORD AND THE SUBMISSION OF THE ASSESSEE. IT IS NOTICED THAT LD. CIT(A) HAS CONSIDERED THE CASES WHERE BOTH THE INDIVIDUAL AMOU NT AS WELL AS THE GROSS AMOUNT WAS LESS THAN 20,000/- AND RS. 50,000/- RESPECTIVE LY, THEREFORE, RESTRICTED THE DISALLOWANCE TO THE EXTENT OF RS. 7,24,497 FROM RS. 12, 38, 617 WHICH WAS DISALLOWED BY THE ASSESSING OFFICER. AFTER CONSIDER ING THE MATERIAL ON RECORD AND FACT OF THE CASE WE OBSERVE THAT LD. CIT(A) HAS RIG HTLY RESTRICTED THE ADDITION TO THE AMOUNT OF RS. 7,24,497/- ON WHICH THE ASSESSEE COULD NOT SUBSTANTIATE WITH PROPER EVIDENCES FOR NOT DEDUCTING OF TAXES. THERE FORE, THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED. 8. LATE PAYMENT CHARGES (INTEREST) RS. 1,37,747:- THE AO HAS MADE ADDITION OF RS. 1,37,747/- ON THE G ROUND THAT ASSESSEE HAS PAID INTEREST ON WHICH TAX WAS NOT DEDUCTED. T HE LD. CIT(A) HAS SUSTAINED THE ADDITION. WE HAVE HEARD THE RIVAL CONTENTION O N THIS ISSUE. AFTER PERUSAL OF THE MATERIAL ON RECORD WE CONSIDER THAT THIS WAS A KIND OF PAYMENT OF INTEREST ON ACCOUNT OF LATE PAYMENT AND THE ASSESSEE COULD NOT SUBSTANTIATE WITH RELEVANT EVIDENCES WHY NO TAX WAS DEDUCTED, THEREFORE, WE UP HOLD THE DECISION OF LD. CIT(A) ON THIS ISSUE. ACCORDINGLY THIS GROUND OF T HE ASSESSEE IS DISMISSED. 9. MACHINERY REPAIR EXPENSES RS. 66,547:- DURING THE COURSE OF ASSESSMENT THE AO HAS DISALLOW ED AM AMOUNT OF RS. 1,23,741/- ON ACCOUNT OF MACHINERY REPAIR EXPENSES FOR NOT DEDUCTING TAX UNDER SECTION 194C OF THE ACT. ON APPEAL THE LD. CIT(A) HAS RESTRICTED THE ADDITION TO THE AMOUNT OF RS. 66,547/- AFTER PROVIDING RELIEF I N RESPECT OF THOSE CASES WHERE THE TOTAL AMOUNT PAID WERE LESS THAN 20,000/- AND R S. 50,000/- RESPECTIVELY. WE HAVE HEARD THE RIVAL CONTENTION AND PERUSED THE MAT ERIAL ON RECORD ON THIS ISSUE. I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 8 WE JUSTIFY THE DECISION OF LD. CIT(A) IN RESTRICTIN G THE AFORESAID ADDITION AFTER CONSIDERING THE RELEVANT MATERIAL AS THE ASSESSEE COULD NOT SUBSTANTIATE WITH RELEVANT EVIDENCES WHY NO TAX WAS DEDUCTED, THEREFO RE, THIS GROUND OF APPEAL IS DISMISSED. 10. DISALLOWANCE OF AUDIT FEES OF RS. 28,090:- DURING THE ASSESSMENT PRECEDING THE AO HAS DISALLOW ED AUDIT FEES OF RS. 28,090/- ON THE GROUND THIS AUDIT FEES WAS IN RESPE CT OF PAYMENT FOR WHICH TAX WAS DEDUCTED ON 27.09.2008 AND PAYMENT CHALLAN WAS FOR ASSESSMENT YEAR 2009-10. THE LD. CIT(A) HAS SUSTAINED THE AFORESAID ADDITION STATING THAT THE PAYMENT PERTAIN TO ASSESSMENT YEAR 2009-10. WE HAVE HEARD THE RIVAL CONTENTION AND COULD NOT FIND ANY ERROR IN THE DECISION OF LD. CIT(A) AS IT IS CLEAR THAT THIS PAYMENT WAS PERTAINED TO ASSESSMENT YEAR 2009-10 AND THE ASSES SEE COULD NOT SUBSTANTIATE WITH RELEVANT EVIDENCES THE AFORE SAID DEVIATION. THERE FORE, THIS GROUND OF APPEAL OF THE ASSESSEE IS DISMISSED. 11. DISALLOWANCE OF TELEPHONE AND VEHICLE EXPENSES:- THE AO HAS DISALLOWED 20 PER CENT OF THE EXPENSES P ERTAINING TO TELEPHONE AND VEHICLE STATING THAT THE PERSONAL USE OF TELEPH ONE AND VEHICLE CANNOT HAVE RULED OUT. IN THE APPEAL THE LD. CIT(A) HAS RESTRIC TED THE DISALLOWANCE TO THE 10 PER CENT OF THE TOTAL CLAIM. WE HAVE HEARD THE RIV AL CONTENTION AND MATERIAL ON RECORD CAREFULLY WE DO NOT FIND ANY INFIRMITY IN TH E DECISION OF LD. CIT(A) FOR WANT OF RELEVANT SUPPORTING EVIDENCES. THEREFORE T HIS GROUND OF APPEAL IS DISMISSED. I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 9 12. ADDITION UNDER SECTION 68 OF THE ACT:- DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AO NOTICED THAT ASSESSEE HAS TAKEN LOAN OF RS. 1 LAC AND RS. 1.5 LAC RESPECT IVELY FROM SMT. DAMYANTIBEN & HEMALBHAI RESPECTIVELY FOR WHICH NO CONFIRMATION, D ETAIL OF IDENTITY AND CREDIT WORTHINESS OF THE PARTIES WERE PROVIDED. THEREFORE , HE HAS MADE ADDITION U/S. 68 OF THE ACT TO THE AMOUNT OF RS. 2,50,000/-. ON APP EAL THE LD. CIT(A) HAS CONFIRMED THE ADDITION STATING THAT ASSESSEE HAS FA ILED TO DISCHARGE THE RESPONSIBILITY PLACED UPON HIM U/S. 68 OF THE ACT. BEFORE US IT WAS SUBMITTED THAT AFORESAID DEPOSITS WERE RECEIVED BY ACCOUNT PAYEE C HEQUES WHICH WERE EVIDENCED FROM THE BANK STATEMENTS. IT WAS ALSO SUBMITTED TH AT DETAILS OF PAN NO. WERE ALSO FURNISHED BY THE DEPOSITORS AND THEY WERE FILLING T HEIR RETURN OF INCOME. IT IS STATED IN THE SUBMISSION THAT THE DEPOSITORS COULD NOT BE PRODUCED BECAUSE OF STRAINED RELATIONSHIP WITH THE ASSESSEE. IN THE LIGHT OF THE ABOVE FACTS AND CIRCUMSTANCES WE CONSIDER IT APPROPRIATE TO RESTORE THIS ISSUE TO THE FILE OF THE AO FOR DEC IDING DE NOVO AFTER VERIFICATION OF THE DETAILS TO BE FURNISHED BY THE ASSESSEE AND EXA MINATION OF THE DEPOSITORS BY ISSUING OF SUMMONS U/S. 131 OF THE ACT. THEREFORE , THIS ISSUE IS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR ADJUDICATING AS D IRECTED ABOVE AFTER AFFORDING ADEQUATE OPPORTUNITY TO THE ASSESSEE. ACCORDINGLY T HIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ITA NO. 886/AHD/2017 A.Y.2008-09 FILED BY ASSESSEE 13. THIS SOLITARY GROUND OF APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE DECISION OF LD. CIT(A) IN CONFIRMING THE PENALTY U/ S. 271(1)(C) OF THE ACT LEVIED BY THE AO IN RESPECT OF ADDITION OF RS. 2,50,000/- MADE U/S. 68 OF THE ACT. THE I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 10 AO HAS ADDED THE AFORESAID AMOUNT U/S. 68 OF THE AC T ON THE GROUND THAT ASSESSEE HAS FAILED TO FULFILL THE REQUIREMENT OF SEC. 68 OF THE ACT. THE LD. CIT(A) HAS CONFIRMED THE AFORESAID ADDITION. THE AO HAS INIT IATED PENALTY U/S. 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICULAR OF INC OME. 14. VIDE ORDER U/S. 271(1)(C) OF THE ACT DATED 27.0 3.2015 THE AO HAS IMPOSED A PENALTY OF RS. 6,95,122/- ON THE GROUND THAT ASSE SSEE HAS FURNISHED INACCURATE PARTICULAR OF INCOME. 15. THE LD. CIT(A) HAS CONFIRMED THE PENALTY LEVIED BY THE AO ON THE GROUND THAT ASSESSEE HAS FAILED TO PROVE IDENTITY, CREDIT WORTHINESS AND GENUINENESS OF THE TRANSACTION. WE HAVE HEARD THE RIVAL CONTENTION AN D PERUSED THE MATERIAL ON RECORD ON THIS ISSUE. SINCE WE HAVE RESTORED THE Q UANTUM ADDITION ON THE BASIS OF WHICH THE IMPUGNED PENALTY WAS LEVIED TO THE FILE O F THE AO FOR ADJUDICATING A FRESH AS SUPRA VIDE ITA 614/AHD/2014, THEREFORE, TH E IMPUGNED PENALTY HAS BECOME INFRUCTUOUS AT THIS STAGE. ACCORDINGLY THIS GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 16. IN THE RESULT THE APPEAL ITA NO.238/AHD./2014 OF THE REVENUE IS DISMISSED. THE APPEAL ITA NO.614/AHD/2014 OF THE ASSESSEE IS P ARTLY ALLOWED AND APPEAL ITA NO. 886/AHD/2017 OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27-03- 2019 SD/- SD/- (RAJPAL YADAV) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 27/03/201 TRUE COPY / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE I.T.A. NOS. 238&614/AHD/2014 & 886 /AHD/2018 A.Y. 2008-09 PAGE NO 11 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,