The ACIT, Circle-4, Baroda V. Smt. Hemlataben M.Shah, Baroda

ITA 315/AHD/2009

• Counselvise Citation: [2011] 119 COUNSELVISE.COM (IT) 6862 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 24-11-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 30-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B L YADAV
• Assessee Lawyers: SUNIL H TALATI
• Keywords: Deemed dividend
• Section: 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, D BENCH, AHMEDABAD BEFORE SHRI D. K. TYAGI, JUDICIAL MEMBER AND SHRI A. K. GARODIA, ACCOUNTANT MEMBER I.T.A. NO. 315/ AHD/2009 (ASSESSMENT YEAR 2003-04) DCIT, CIRCLE 4, BARODA VS. SMT. HEMLATABEN M SHAH 25, SAMPATRAO COLONY, R.C. DUTT ROAD, BARODA PAN/GIR NO. : AAACL3332K (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI B L YADAV, DR RESPONDENT BY: SHRI SUNIL H. TALATI, AR DATE OF HEARING: 24.11.2011 DATE OF PRONOUNCEMENT: 09.12.2011 O R D E R PER SHRI A. K. GARODIA, AM:- THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A) III, BARODA DATED 05.11.2011 FOR THE ASSESSM ENT YEAR 2003-04. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LEARNED CIT(A) ERRED IN DELETING I THE PENALTY LEVIED U/S 2 71(L)(C) OF RS. 5,64,173/, OVERLOOKING THE RATIO LAID DOWN BY THE A PEX COURT IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS 306 ITR 277 ( SC) \ WHEREIN IT WAS LAID DOWN THAT PENALTY U/S 271(L)(C) WAS CIVIL WRONG & MENS REA IS NOT REQUIRED TO BE ESTABLISHED. 2. THE APPELLANT CRAVES LEAVE TO ADD, TO AMEND OR ALTER THE ABOVE GROUNDS AS MAY BE DEEMED NECESSARY. I.T.A.NO.315 /AHD/2009 2 : RELIEF CLAIMED IN APPEAL. 3. THE ORDER OF THE CIT(A) ON THE ISSUES RAI SED IN THE AFORESAID GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFI CER BE RESTORED. 2. LD. D.R. OF THE REVENUE SUPPORTED THE PENALTY OR DER WHEREAS IT IS SUBMITTED BY THE LD. A.R. THAT IN QUANTUM PROCEEDIN GS, THE ADDITION MADE BY THE A.O. HAS BEEN DELETED AND, THEREFORE, N O PENALTY CAN SURVIVE. HE SUBMITTED A COPY OF THE TRIBUNAL DECISION IN QUA NTUM PROCEEDINGS IN I.T.A.NO. 2152/AHD/2006 DATED 13.10.2009. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW AND THE TRIBUNAL DECISION IN QUANTUM PROCEEDINGS. WE FIND THAT PENALTY HAS BEEN IMPOSED BY THE A.O. WITH REGARD TO THE ADDITION MAD E BY HIM OF RS.17,91,023/- AS DEEMED DIVIDEND U/S 2(22)(E) OF T HE ACT. OUT OF THIS, TRIBUNAL HAS ALLOWED RELIEF TO THE ASSESSEE IN QUAN TUM PROCEEDINGS OF RS.14,48,976/- AND THE BALANCE ADDITION OF RS.3,42, 047/- HAS BEEN CONFIRMED BY THE TRIBUNAL IN QUANTUM PROCEEDINGS AS PER PARA 7 OF THE TRIBUNAL ORDER IN QUANTUM PROCEEDINGS. HENCE, ON T HIS AMOUNT OF RS.14,48,976/- WHICH WAS DELETED BY THE TRIBUNAL IN QUANTUM PROCEEDINGS, THERE CAN BE NO PENALTY. FOR THE REM AINING AMOUNT OF RS.3,42,047/-, FOR WHICH THE ADDITION WAS CONFIRMED BY THE TRIBUNAL, WE FIND THAT IN THE IMPUGNED ORDER, THE PENALTY HAS BE EN DELETED BY LD. CIT(A) ON THIS BASIS THAT ALL THE INFORMATION WERE LYING WITH THE A.O. AND FROM THIS ONLY, THE A.O. MADE THE ADDITION AND HENC E, IT IS NOT A CASE OF CONCEALMENT OR FURNISHING OF ANY INACCURATE PARTICU LARS OF INCOME. WHILE HOLDING SO, LD. CIT(A) HAS FOLLOWED THE TRIBUNAL DE CISION OF AHMEDABAD BENCH OF THE TRIBUNAL RENDERED IN THE CASE OF MOLLY JOY KUTTY VS ITO IN I.T.A.NO. 169-171/AHD/2004. RELEVANT PORTION OF TH E TRIBUNAL ORDER HAS I.T.A.NO.315 /AHD/2009 3 BEEN REPRODUCED BY LD. CIT(A) AS PER WHICH THE TRIB UNAL HAD FOLLOWED THE DECISION OF HONBLE RAJASTHAN HIGH COURT RENDER ED IN THE CASE OF CHANDRAPAL BAGGA VS ITAT AND ANOTHER AS REPORTED IN 261 ITR 67 WHEREIN, IT WAS HELD BY THE HONBLE RAJASTHAN HIGH COURT THAT WHEN LOANS AND ADVANCES IS DEEMED TO BE INCOME OF THE AS SESSEE, BY VIRTUE OF THE PROVISIONS OF THE STATUTE WHICH IS ALSO DEPENDE NT UPON THE FACTS AND FIGURES AVAILABLE FROM THE SOURCES, OTHER THAN FROM THE ASSESSEE, NO PENALTY IS JUSTIFIED BECAUSE IT CANNOT BE SAID TO B E A CASE OF FURNISHING INACCURATE PARTICULARS OF INCOME OR CONCEALING THE INCOME AS SUCH. HENCE, IN OUR CONSIDERED OPINION, EVEN FOR THIS PAR T ADDITION CONFIRMED BY THE TRIBUNAL IN QUANTUM PROCEEDINGS, NO PENALTY IS JUSTIFIED IN THE FACTS OF THE PRESENT CASE AND HENCE, WE DECLINE TO INTERF ERE IN THE ORDER OF LD. CIT(A). 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. 5. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE M ENTIONED HEREINABOVE. SD/- SD/- (D. K. TYAGI) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD BY ORDER 6. THE GUARD FILE /TRUE COPY/ AR,ITAT,AHMEDABAD I.T.A.NO.315 /AHD/2009 4 1. DATE OF DICTATION 24.11 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 25/11.OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S. 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. ..