Asstt. Commissioner of Income Tax-1, Kanpur V. M/s Maria Exports, Kanpur

ITA 309/LKW/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0552 (ITAT-LUCKNOW)
• Duration Of Justice: 1 year(s) 6 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2003-2004
• Appeal Filed On: 31-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K VISHWAKARMA
• Assessee Lawyers: PRADEEP SETH
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 309/LKW/2016 ASSESSMENT YEAR: 2003 - 04 ACIT - 1, LUCKNOW V. M/S MARIA EXPORTS 19, 150 FT. ROAD JAJMAU KANPUR T AN /PAN : AAFFM3042H (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI R. K. VISHWAKARMA, D.R. RESPONDENT BY: SHRI PRADEEP SETH, C.A. DATE OF HEARING: 12 12 201 7 DATE OF PRONOUNCEMENT: 14 12 201 7 O R D E R PER P ARTHA SARATHI CHA UDHURY, J.M : THIS APPEAL PREFERRED BY THE REVENUE EMANATES FROM THE ORDER OF THE LD. CIT(A) - I, KANPUR DATED 1/3/2016. 2 . THE SOLE GRIEVANCE IN THIS APPEAL RELATES TO THE DELETION OF PENALTY BY THE LD. CIT(A) UNDER SECTION 271(1)(C) OF THE ACT AMOUNTING TO RS .14 LAKHS IMPOSED BY THE ASSESSING OFFICER. 3 . THE FACTS IN THIS CASE ARE THAT THE ASSESSMENT UNDER SECTION 143(3) OF THE ACT WAS COMPLETED ON 30/3/2006 ON A TOTAL INCOME OF RS.71,38,693/ - AS AGAINST THE RETURNED INCOME OF RS.34,66,388/ - AFTER MAKING VARIOUS ADDITIONS AND DISALLOWANCES. IN THE ASSESSMENT ORDER, PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT WERE INITIATED IN RESPECT OF ADDITIONS EXCEPT ADDITIONS ON ACCOUNT OF TRAVEL EXPENSES AND [ ITA NO.309/LKW/ 2016 ] 2 CAR EXPENSES. THEREAFTER, THE ASSESSEE RECEIVED A SHOW CAUSE NOTICE REQUIRING THE ASSESSEE TO EXPLAIN WHY PENALTY MAY NOT BE IMPOSED. THE ASSESSEE FILED DETAILED REPLY WHEREIN ASSESSEE HAS DEALT WITH EACH AND EVERY ADDITION IN RESPECT OF WHICH PENALTY PROCEEDINGS WERE INITIATED AT LENGTH AND IN SUPPORT OF ITS SUBMISSION , PLACED RELIANCE ON VARIOUS JUDICIAL PRONOUNCEMENTS. THE LD. CIT(A) HAS HELD THAT THE ASSESSING OFFICER WHILE DRAFTING PENALTY ORDER HAS NOT ACCEPTED THE EXPLANATION OF THE ASSESSEE AND HAS NOT GIVEN ANY REASONING FOR NOT ACCEPTING THE SAME. THE ASSESSING OFFICER HAS NOT PROVEN THE EXPLANATION FURNISHED BY THE ASSESSEE TO BE FALSE NOR HAS HE BEEN ABLE TO ESTABLISH THAT BONA - FIDE OF ASSESSEE IS SUSPICIOUS. MERE NON - ACCEPTING AN EXPLANATION CAN BE A GROUND FOR MAKING ADDITION BUT TO PROVE CONCE ALMENT , THE ONUS IS ON THE ASSESSING OFFICER TO ESTABLISH FALSITIES AND MALAFIDE IN TERMS OF EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT. THE LD. CIT(A) FURTHER OBSERVED THAT ASSESSEE HAS DISCLOSED ALL MATERIAL FACTS IN RESPECT OF ITS INCOME AND HAS ALS O OFFERED PLAUSIBLE EXPLANATIONS ON ALL THE ISSUES. THE LD. CIT(A) HELD THAT THERE IS NO MISCHIEF OF CONSCIOUSLY AND DELIBERATELY CONCEALING THE PARTICULARS OF INCOME OR SUBMISSION OF INACCURATE PARTICULARS OF INCOME AND TH E PENALTY HAS BEEN LEVIED BY THE ASSESSING OFFICER MECHANICALLY, THEREFORE, HE DELETED THE PENALTY IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE ACT. 4 . WE HAVE PERUSED THE RECORD, ANALYZED FACTS AND CIRCUMSTANCES AND HAVE CONSIDERED THE JUDICIAL PRONOUNCEMENTS PLACED BEFO RE US. WE OBSERVE THAT PENALTY PROCEEDINGS ARE ENTIRELY DIFFERENT FROM ASSESSMENT PROCEEDINGS AND THE CRITERIA MENTIONED IN THE PENALTY PROVISIONS HAVE TO BE ADHERED TO STRICTLY BY THE AUTHORITY IMPOSING THE PENALTY. IF THE ASSESSEE HAS PROVIDED ANY FALS E INFORMATION OR HIS CONDUCT IS MALAFIDE , WHICH IF PROVED BY THE ASSESSING OFFICER , MAY BECOME A SUBJECT MATTER [ ITA NO.309/LKW/ 2016 ] 3 FOR IM POSITION OF PENALTY. IN THE PRESENT CASE, IT IS ON RECORD , AS APPEARING IN THE ORDER OF THE LD. CIT(A) , THAT THE ASSESSING OFFICER HAS NO T BROUGHT OUT ANY CLEAR CASE FOR IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. WE, THEREFORE, HOLD THAT THE LD. CIT(A) WAS CORRECT IN CANCELLING THE PENALTY . ACCORDINGLY , WE UPHOLD THE ORDER OF THE LD. CIT(A) DELETING THE PENALTY . 5 . IN THE RESU LT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14/ 12/ 201 7 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARATHI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14 TH DECEMBER , 2017 JJ: 1212 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPON DENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR