SUPER PRECAST PVT. LTD., MUMBAI V. I.T.O. 7(2)(4), MUMBAI

ITA 2614/MUM/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 75490 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 05-02-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 18-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ASHOK SURI
• Assessee Lawyers: DAMODAR KABRA
• Keywords: Depreciation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E , MUMBAI . . , , , BEFORE SHRI N.K.SAINI , AM AND SHRI AMIT SHUKLA , JM ITA N O. 2614 /MUM/20 1 2 : ASST.YEAR 200 6 - 200 7 M/S.SUPER PRECAST PRIVATE LIMITED 107, NIRMAN KENDRA, E MOSES ROAD FAMOUS STUDIO LANE, MAHALAXMI MUMBAI 400 011. PAN : AAFCS7995E / VS. THE INCOME TAX OFFICER WARD 7(2)(4) MUMBAI. ( / APPELLANT) ( / RESPONDENT) / APPELLANT BY : SHRI DAMODAR KABRA / RESPONDENT BY : SHRI ASHOK SURI / DATE OF HEARING : 05 . 02 .201 4 / DATE OF PRONOUNCEMENT : 05 .0 2 .20 1 4 / O R D E R PER N. K.SAINI (AM) : THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 02.12.2011 OF THE COMMISSIONER OF INCOME - TAX (APPEALS) - 13 , MUMBAI. 2. THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEAL RELATES TO THE CONFIRMATION OF PENALTY OF RS.36,500 LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ). 3. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESSEE CLAIMED DEPRECIATION OF RS.1,08,276 ON THE TRUCK PURCHASED ON 29.03.2006 FOR A SUM OF RS.7,21,838 AND CLAIMED THE AFORESAID DEPRECIATION ON THE ITA NO. 2614 /MUM/201 2 . M/S.SUPER PRECAST PRIVATE LIMITED . 2 SAID TRUCK. THE A.O. DID NOT ALLOW THE CLAIM OF THE ASSESSEE FOR DEPRECIATION AND MADE ADDITION OF RS.1,08,276. THE A.O. ALSO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND LEVIED THE PENALTY OF RS. 36,445. THE SAID PENALTY WAS CONFIRMED BY THE LEARNED CIT(A). NOW THE ASSESSEE IS IN APPEAL. 4 . THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE NEITHER FURNISHED INACCURATE PARTICULARS OF INCOME NOR CONCEALED THE INCOME AND MERELY ON TH IS BASIS THAT THE DEPRECIATION CLAIM WAS NOT ALLOWED, THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS NOT LEVIABLE. RELIANCE WAS PLACED ON THE JUDGMENT S OF HON BLE SUPREME COURT IN THE CASE OF PRICE WATERHOUSE COOPERS PVT. LTD. VS. CIT AND ANOTHER [ ( 20 12 ) 348 ITR 306 (SC)] AND CIT V . RELIANCE PETROPRODUCTS PVT. LTD. [ (2012) 322 ITR 158 (SC)] . 5 . IN HIS RIVAL SUBMISSIONS, LD. D.R. STRONGLY SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE ASSESSEE BY CLAIMING WRONG DEPRECIATI ON NOT ONLY CONCEALED THE INCOME, BUT ALSO FURNISHED INACCURATE PARTICULARS OF INCOME, THEREFORE, PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS RIGHTLY LEVIED BY THE AO AND CONFORMED BY THE LD. CIT(A). 6 . WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND CAREFULLY GONE THROUGH THE MATERIAL ON THE RECORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT THE CLAIM OF THE ASSESSEE FOR DEPRECIATION AT RS. 1,08,276 WAS DISALLOWED . THEREFORE, MERELY ON TH E BASIS THAT THE DEPRECIATION CLAIMED BY THE A SSESSEE WAS NOT ALLOW ED , IT CANNOT BE ITA NO. 2614 /MUM/201 2 . M/S.SUPER PRECAST PRIVATE LIMITED . 3 SAID THAT THE ASSESSEE CONCEALED THE INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME , PARTICULARLY WHEN ALL THE DETAILS RELATING TO ACQUIRING THE TRUCK AND THE RATE OF DEPRECIATION WERE FURNISHED TO THE AO. 7 . ON THE SIMILAR ISSUE, THE HON BLE SUPREME COURT IN THE CASE OF CIT V . RELIANCE PETROPRODUCTS PVT. LTD. (SUPRA) HAS HELD AS UNDER: - WHERE THERE IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS O R FALSE THERE IS NO QUESTION OF INVITING THE PENALTY UNDER SECTION 271(1)(C). A MERE MAKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. SUCH A CLAIM MA DE IN THE RETURN CANNOT AMOUNT TO FURNISHING INACCURATE PARTICULARS. 8 . SIMILARLY, THE HON BLE SUPREME COURT IN THE CASE OF PRICE WATERHOUSE COOPERS PVT. LTD. V . CIT AND ANOTHER (SUPRA) HELD AS UNDER: - THAT THE FACTS OF THE CASE WERE PECULIAR AND SOMEW HAT UNIQUE. NOTWITHSTANDING THAT THE ASSESSEE WAS A REPUTED FIRM AND HAD GREAT EXPERTISE AVAILABLE WITH IT, IT WAS POSSIBLE THAT EVEN THE ASSESSEE COULD MAKE A SILLY MISTAKE. THE FACT THAT THE TAX AUDIT REPORT WAS FILED ALONG WITH THE RETURN AND THAT I S UNEQUIVOCALLY STATED THAT THE PROVISION FOR PAYMENT WAS NOT ALLOWABLE UNDER SECTION 40A(7) OF THE ACT INDICATED THAT THE ASSESSEE MADE A COMPUTATION ERROR IN ITS RETURN OF INCOME. THE CONTENTS OF THE TAX AUDIT REPORT SUGGESTED THAT THERE WAS NO QUESTION OF THE ASSESSEE CONCEALING ITS INCOME OR OF THE ASSESSEE FURNISHING ANY INACCURATE PARTICULARS. APART FROM THE FACT THAT THE ASSESSEE DID NOT NOTICE THE ERROR, IT WAS NOT EVEN NOTICED EVEN BY THE ASSESSING OFFICER WHO FRAMED THE ITA NO. 2614 /MUM/201 2 . M/S.SUPER PRECAST PRIVATE LIMITED . 4 ASSESSMENT ORDER. ALL TH AT HAD HAPPENED WAS THAT THROUGH A BONA FIDE AND INADVERTENT ERROR, THE ASSESSEE WHILE SUBMITTING ITS RETURN, FAILED TO ADD THE PROVISION FOR GRATUITY TO ITS TOTAL INCOME. THE ASSESSEE SHOULD HAVE BEEN CAREFUL BUT THE ABSENCE OF DUE CARE, IN A CASE SUCH A S THE PRESENT, DID NOT MEAN THAT THE ASSESSEE WAS GUILTY OF EITHER FURNISHING INACCURATE PARTICULARS OR ATTEMPTING TO CONCEAL ITS INCOME. ON THE PECULIAR FACTS OF THIS CASE, THE IMPOSITION OF PENALTY ON THE ASSESSEE WAS NOT JUSTIFIED. 9 . IN THE PRESENT C ASE ALSO, THE ASSESSEE FURNISHED ALL THE DETAILS RELATING TO THE ASSETS I.E. THE TRUCK AND CLAIM ED THE DEPRECIATION . HOWEVER, MERELY ON TH E BASIS THAT AN INCORRECT CLAIM OF DEPRECIATION WAS MADE BY THE ASSESSEE, IT CANNOT BE SAID THAT IT WAS A CASE OF FURNISHING OF INACCURATE PARTICULARS OR CONCEALMENT OF INCOME. THEREFORE, BY KEEPING IN VIEW THE RATIO LAID DOWN IN THE AFORESAID JUDGMENTS , WE ARE OF THE VIEW THAT IT IS NOT A FIT CASE FOR LEVYING THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT. ACCORDIN GLY, THE IMPUGNED PENALTY LEVIED BY THE AO AND SUSTAINED BY THE LD. CIT(A), IS DELETED. 10 . IN THE RESULT, THE APPEAL IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 5 TH DAY OF FEBRUARY , 201 4 . 5 , 2014 SD/ - SD/ - ( AMIT S HUKLA ) ( N.K.SAINI ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 05 TH FEBRUARY , 201 4 . DEVDAS* ITA NO. 2614 /MUM/201 2 . M/S.SUPER PRECAST PRIVATE LIMITED . 5 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT , MUMBAI. 4. / CIT(A) - 13 , MUMBAI. 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, //TRUE C OPY// / ( DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI