The ITO, Ward-9(4), Ahmedabad V. Mohd.Salim Hajibhai Gani Memon, Ahmedabad

ITA 2651/AHD/2010

• Counselvise Citation: 265120514 RSA 2010
• Duration Of Justice: 2 year(s) 10 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 09-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J P JHANGID
• Assessee Lawyers: VIPUL KANDHAR
• Keywords: Depreciation; Bonafide belief; Difference of opinion

Judgement Text

, , , , C, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, C BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ %& %& %& %& , , , , &' &' &' &' ( & ' ( & ' ( & ' ( & ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND TEJ RAM MEENA, ACCOUNTANT MEMBER) ITA NO.2651/AHD/2010 [ASSTT.YEAR : 2006-2007] THE ITO, WARD-9(4) AHMEDABAD. /VS. MOHD. SALIM HAJIBHAI GANI MEMON NR. ROZY CINEMA, SARANGPURA AHMEDABAD. PAN : ALLPM 2458 A ( (( (*+ *+ *+ *+ / APPELLANT) ( (( (,-*+ ,-*+ ,-*+ ,-*+ / RESPONDENT) ( . / &/ REVENUE BY : SHRI J.P. JHANGID, SR.DR 1% . / &/ ASSESSEE BY : SHRI VIPUL KANDHAR 2 . %3'/ DATE OF HEARING : 4 TH JULY, 2013. 456 . %3'/ DATE OF PRONOUNCEMENT : 02-08-2013 &7 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEAR 2006-2007 IS DIRECT ED AGAINST THE ORDER OF THE CIT(A)-XV, AHMEDABAD DATED 25.6.2010. ITA NO.2651/AHD/2010 -2 2. THE ONLY GROUND OF THE APPEAL OF THE REVENUE IS AS UNDER: 1. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE PENALTY OF RS.3,29,919/- LEVIED U/S.271(1)(C) O F THE ACT,. 3. THE LEARNED DR SUBMITTED THAT THE ASSESSEE HAS W RONGLY CLAIMED EXCESS AMOUNT OF DEPRECIATION, AND THEREFOR E, THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS RIGHTLY IMPO SED ON THE ASSESSEE. HE RELIED ON THE ORDER OF THE AO. THE L EARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS FILED ALL NECESSARY DETAILS AND MATERIAL FACTS WITH REGARD TO THE CLAIM OF DEPR ECIATION ON CERTAIN ASSETS AT THE TIME OF ASSESSMENT ITSELF BEFORE THE AO. THE ASSESSEE WAS UNDER BONAFIDE BELIEF THAT IT WAS ENTITLED TO A HIGHER RATE OF DEPRECIATION ON ITS CERTAIN ASSETS, AND THEREFORE, IT IS NOT A CASE FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. HE RELIED ON THE ORDER OF THE CIT(A). 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE AO AND THE CIT(A). WE FIND THAT ALL THE MATERI AL FACTS RELEVANT TO THE CLAIM OF THE ASSESSEE FOR GRANT OF DEPRECIATION HAVE BEEN FURNISHED BY THE ASSESSEE AT THE TIME OF ASSESSMENT ITSELF BE FORE THE AO. THE ASSESSEE HAS FILED EXPLANATION IN THIS REGARD AND H AS EXPLAINED THAT IT WAS UNDER BONA FIDE BELIEF THAT THE ASSESSEE IS ENTITLED TO HIGHER RAT E OF DEPRECIATION ON CERTAIN ASSETS. NOTHING HAS BEEN B ROUGHT ON RECORD ON BEHALF OF THE REVENUE TO SUGGEST THAT THE EXPLANATI ON OF THE ASSESSEE IS NOT BONA FIDE . IT IS A CASE OF DIFFERENCE OF OPINION BETWEEN TH E REVENUE AND THE ASSESSEE REGARDING THE CORRECT RATE OF DEPRECIATION APPLICABLE TO CERTAIN ASSETS OF THE ASSESSEE. THE CIT(A) HAS DELETED THE PENALTY IMPOSED BY FOLLOWING THE DECISION OF TH E HONBLE PUNJAB AND HARYANA HIGH COURT IN THE CASE OF CIT VS. SHAH ABAD ITA NO.2651/AHD/2010 -3 COOPERATIVE SUGAR MILLS LTD. VS. CIT, 322 ITR 73 AN D CIT V. M.M. GAJAMGADH, 290 ITR 168 (KAR). THEREFORE, WE FIND N O MISTAKE IN THE ORDER OF THE CIT(A) IN DELETING THE PENALTY, AND IN VIEW OF THE FACT THAT THE CONDUCT OF THE ASSESSEE IS BONA FIDE AND ALL MATERIAL FACTS RELATING TO THE CLAIM OF DEPRECIATION WERE FURNISHE D BY THE ASSESSEE AT THE TIME OF ASSESSMENT BEFORE THE AO, AND BEING A C LEAR CASE OF HONEST DIFFERENCE OF OPINION REGARDING THE CORRECT RATE OF DEPRECIATION APPLICABLE TO CERTAIN ASSETS OF THE ASSESSEE, WE HO LD THAT IT IS NOT A CASE FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT, WHICH WAS RIGHTLY CANCELLED BY THE CIT(A) AND THE GROUND OF T HE REVENUE IS DISMISSED. 5. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( %& %& %& %& / TEJ RAM MEENA) &' ( &' ( &' ( &' ( /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD