STAR SEARCH TECHNOLOGIES P. LTD, MUMBAI V. ITO WD 2(3)(2), MUMBAI

ITA 3181/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55804 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2011
• Appeal Filed By: Assessee
• Bench Allotted: J
• Next Hearing Date: 17-10-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 23-04-2010
• Court: TRIBUNAL
• Department Lawyers: D S SUNDER SINGH
• Assessee Lawyers: S A KANJI
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL J BENCH: MUMBAI BEFORE SHRI R.S. PADVEKAR, JUDICIAL MEMBER AND SHRI RAJENDRA SINGH, ACCOUNTANT MEMBER ITA NO.3181/MUM/2010 (ASSESSMENT YEAR: 2006-07) STAR SEARCH TECHNOLOGIES PVT. LTD., 136, GREAT WESTERN BLDG., NAGINDAS MASTER ROAD EXTN. FORT, MUMBAI -400 001 ....... APPELLANT VS INCOME TAX OFFICER WARD 2(3)(2), ROOM NO.581A, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI -400 020 ..... RESPONDENT PAN: AAGCS 1492 M APPELLANT BY: SHRI S.A. KANJI RESPONDENT BY: SHRI D.S. SUNDER SINGH DATE OF HEARING: 17.10.2011 DATE OF PRONOUNCEMENT: 28.10.2011 O R D E R PER R.S. PADVEKAR, JM IN THIS APPEAL THE ASSESSEE HAS CHALLENGED THE IMPU GNED ORDER OF THE LD. CIT (A) -6, MUMBAI DATED 21.01.2010 FOR THE A.Y. 2006-07 IN WHICH THE PENALTY LEVIED BY THE A.O. U/S. 271(1) (C) HAS BEEN CONFIRMED. THE ASSESSEE HAS TAKEN THE FOLLOWING EF FECTIVE GROUND:- THE LEARNED AUTHORITIES BELOW ERRED IN LEVYING THE PENALTY U/S.271(1)(C) OF ` 2,35,362/-. THE LEARNED CIT (APPEALS) ALSO ERRED IN CONFIRMING THE PENALTY U/S.271(1)(C). THE APPELLANT PRAYS THAT PENALTY U/S.271(1)(C) OF ` 2,35,362/- MAY PLEASE BE DELETED. ITA 3181/MUM/2010 STAR SEARCH TECHNOLOGIES PVT. LTD. 2 2. WE HAVE HEARD THE PARTIES. THE ASSESSMENT OF TH E ASSESSEE WAS COMPLETED U/S.143(3) OF THE ACT DETERMINING THE TOT AL INCOME OF ` 1,92,167/-AS AGAINST LOSS RETURNED OF ` (-) 5,07067/- . THE A.O. MADE THE DISALLOWANCES ON THE FOLLOWING AMOUNTS:- (I) PRE-OPERATIVE EXPENSES ` 3,96,834/- (II) DEPRECIATION ON IP ` 3,02,400/- ----------------- ` 6,99,234/- =========== 3. THE A.O. INITIATED THE PENALTY PROCEEDINGS U/S.2 71(1)(C) OF THE ACT AND LEVIED THE PENALTY OF ` 2,35,362/- ON THE REASONS THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF IN COME IN RESPECT OF THE ABOVE ADDITIONS/DISALLOWANCE. 4. WE HAVE HEARD THE PARTIES. THE ASSESSEE HAS ALS O CHALLENGED THE DISALLOWANCE MADE BY THE A.O. BEFORE US AND WE HAVE RESTORED BOTH THE ISSUES TO THE FILE OF THE A.O. FOR FRESH A DJUDICATION BY SETTING ASIDE THE ORDER OF THE LD. CIT (A.) IN OUR OPINION AS THE BASE FOR LEVY OF PENALTY IS NOT SURVIVING HENCE THE PENALTY WILL ALS O NOT SURVIVE. AT THE SAME TIME, THE ADDITIONS HAVE NOT BEEN DELETED IN F AVOUR OF THE ASSESSEE BUT SENT TO THE A.O. FOR FRESH CONSIDERATI ON. IN THE CIRCUMSTANCES, WE GIVE LIBERTY TO THE A.O. TO INITI ATE OF PENALTY PROCEEDING AS PER THE PROVISIONS OF THE LAW, IF HE CONSIDERS SO, AFTER PASSING AN ORDER IN COMPLIANCE WITH THE DIRECTION O F THE TRIBUNAL IN QUANTUM APPEAL. 5. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED IN T HE ABOVE TERMS. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 28TH OCTOBER 2011. SD/- SD/- ( RAJENDRA SINGH ) ACCOUNTANT MEMBER ( R.S. PADVEKAR ) JUDICIAL MEMBER MUMBAI, DATE : 28TH OCTOBER, 2011 ITA 3181/MUM/2010 STAR SEARCH TECHNOLOGIES PVT. LTD. 3 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A)-6, MUMBAI. 4) THE CIT-2, MUMBAI. 5) THE D.R. J BENCH, MUMBAI. BY ORDER / / TRUE COPY / / ASSTT. REGISTRAR I.T.A.T., MUMBAI *CHAVAN ITA 3181/MUM/2010 STAR SEARCH TECHNOLOGIES PVT. LTD. 4 SR.N. EPISODE OF AN ORDER DATE INITIALS CONCERNED 1 DRAFT DICTATED ON 17.10.2011 SR.PS 2 DRAFT PLACED BEFORE AUTHOR 20.10.2011 SR.PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER