NH SECURITIES LTD, MUMBAI V. ASST CIT CEN CIR 40, MUMBAI

ITA 3190/MUM/2012

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2724 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 19-01-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 08-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR P DANIEL
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI . . , !' , # , $ BEFORE S/SHRI B.R.BASKARAN, ACCOUNTANT MEMBER AND AMARJIT SINGH, JUDICIAL MEMBER / I.T.A. NO.3190/M/12 ( / ASSESSMENT YEAR: 2004-05) M/S. N. H. SECURITIES LTD., BHUPEN CHAMBERS, GROUND FLOOR, 9, DALAL STREET, FORT, MUMBAI 400023 / VS. ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 40, MUMBAI & ./ ' ./ PAN/GIR NO. : AAACS7140Q ( &( / APPELLANT ) .. ( )*&( / RESPONDENT ) ASSESSEE BY: SHRI. RAJIV KHANDELWAL DEPARTMENT BY: DR. P. DANIEL + / DATE OF HEARING: 31.08.2015 ,-. + /DATE OF PRONOUNCEMENT: 06.11.2015 / / O R D E R PER AMARJIT SINGH, JM: THE APPEAL IN ITA NO.3190/MUM/2012 FOR THE ASSESSME NT YEAR 2004-05 HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DA TED 17.02.2012 OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-36, MUMBAI [HE REINAFTER REFERRED TO AS THE LEARNED CIT(A)] PASSED IN APPEAL NO.CIT(A)-36/ AP.159/10-11. THE ASSESSEE HAS CHALLENGED THE CIT(A)S ORDER ON THE F OLLOWING GROUNDS OF APPEAL:- ITA NO.3190/M/12 ASSESSMENT YEAR: 2004-05 2 1. THE COMMISSIONER OF INCOME-TAX (APPEALS) - 36 , MUMBAI (HEREINAFTER REFERRED TO AS THE CIT(A)) ERRED IN UPHOLDING THE A CTION OF THE ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE 40, MUMB AI (HEREINAFTER REFERRED TO AS THE ASSESSING OFFICER) IN LEVYING PENALTY OF RS.2,75,000 UNDER SECTION 271(1)(C) OF THE ACT. THE APPELLANTS CONTEND THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) OUGHT NOT TO HAVE CONFIRMED THE LEVY OF THE IMPUGNED PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 2. THE CIT(A) ERRED IN UPHOLDING THE ACTION OF THE ASSESSING OFFICER IN LEVYING PENALTY ON THE BASIS OF INCOME-TAX, INCLUDI NG SURCHARGE. THE APPELLANTS CONTEND THAT SURCHARGE ON INCOME-TAX CANNOT BE CONSIDERED IN LEVYING THE PENALTY AS THE SAME IS NOT PART OF 'TAX '. 3. THE APPELLANTS CONTEND THAT THE IMPUGNED ORDER O F PENALTY IS BAD IN LAW AND REQUIRES TO BE QUASHED. 2. THE FACTS OF THE CASE ARE THAT THE AO DISALLOWED CERTAIN AMOUNT ON ACCOUNT OF SHARE TRADING LOSS IN THE ASSESSMENT U/S . 143(3) AND THIS DISALLOWANCE WAS CONFIRMED BY THE CIT(A). SUBSEQUENTLY, THE AO ISSUED SHOW CAUSE FOR LEVY OF PENALTY U/S. 271(1)(C) OF THE INCOME TAX AC T, 1961. THE APPELLANT DID NOT REPLY TO THE NOTICE, THEREFORE THE AO LEVIED TH E PENALTY AS THE APPELLANT HAD CONCEALED THE PARTICULARS OF HIS INCOME AND THERE W AS ABSENCE OF MATERIAL TO REBUT THE PRESUMPTION RAISED BY EXPLANATION 1 TO S ECTION 271(1)(C). THE AO LEVIED THE PENALTY @ 100% OF THE TAX SOUGHT TO BE E VADED. AT THE VERY OUTSET THE COUNSEL OF THE ASSESSEE HAS ARGUED THAT THE QUA NTUM ORDER WHICH HAS BEEN CONFIRMED BY THE CIT(A) HAS BEEN SET ASIDE AND REMA NDED BY THE TRIBUNAL VIDE ORDER DATED 02.08.2013, THEREFORE, IN THE SAID CIRC UMSTANCES THE PENALTY ORDER DOES NOT SURVIVE IN THE EYES OF LAW IN VIEW OF THE LAW SETTLED IN THE CASE OF CIT VS. KELVINATOR OF INDIA LTD. (2010) 187 TAXMAN 312( SC), GARWARE WALL ROPES LIMITED VS. ADDL.CIT, DATED 15.01.2014 IN ITA 5408/ M/12 & M/S. J. M. FINANCIAL LIMITED VS. ADDL. CIT 4(3), MUMBAI DATED 26.03.2014 IN ITA NO. 4521/M/12. ITA NO.3190/M/12 ASSESSMENT YEAR: 2004-05 3 3. ON THE OTHER HAND THE LEARNED DEPARTMENTAL REPRE SENTATIVE (DR) NO DOUBT STRONGLY SUPPORTED THE JUDGEMENT OF CIT(A) UNDER CH ALLENGE BUT NOWHERE PRODUCE ANY DISTINGUISHED FACTS ON RECORD. IN THE LIGHT OF ABOVE SAID SUBMISSION AND RECORD, WE OBSERVED THAT THE ORDER OF QUANTUM O N THE BASIS OF WHICH THE PENALTY HAS BEEN LEVIED AS ALREADY BEEN SET ASIDE B Y THE TRIBUNAL IN ITA 2784/M/08 A.Y. 2003-04 & ITA 2785/M/08 A.Y. 2004-05 , MUMBAI VIDE ORDER DATED 02.08.2013. SINCE THE QUANTUM ORDER DATED 12 .08.2013 IS NOWHERE IN EXISTENCE, THEREFORE, IN THE SAID CIRCUMSTANCE THE PENALTY ORDER UNDER CHALLENGED DOES NOT SURVIVE IN THE EYES OF LAW. 4. IN THIS REGARD WE ALSO FIND SUPPORT OF LAW SETTL ED IN CASE OF CIT VS. KELVINATOR OF INDIA LTD. (2010) 187 TAXMAN 312, (SC ), GARWARE WALL ROPES LIMITED VS. ADDL.CIT, DATED 15.01.2014 IN ITA 5408/ M/12 & M/S. J. M. FINANCIAL LIMITED VS. ADDL. CIT 4(3), MUMBAI DATED 26.03.2014 IN ITA NO. 4521/M/12. THEREFORE, WE SET ASIDE THE ORDER DATED 17.02.2012 PASSED BY CIT(A) UNDER CHALLENGED AS THE PENALTY IS NOT LEVIA BLE UNDER LAW. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HER EBY ALLOWED ACCORDINGLY. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON 6 TH NOVEMBER, 2015 SD/- SD/- (B.R.BASKARAN) (AMARJIT SINGH) / ACCOUNTANT MEMBER # /JUDICIAL MEMBER MUMBAI; 0 DATED : 6 TH NOVEMBER, 2015 MP MP MP MP ITA NO.3190/M/12 ASSESSMENT YEAR: 2004-05 4 / COPY OF THE ORDER FORWARDED TO : 1. &( / THE APPELLANT 2. )*&( / THE RESPONDENT. 3. 1 ( ) / THE CIT(A)- 4. 1 / CIT 5. 234 )# # , , / DR, ITAT, MUMBAI 6. 45 6 / GUARD FILE. / BY ORDER, *2 )# //TRUE COPY// / !' (DY./ASSTT. REGISTRAR) '# $ , / ITAT, MUMBAI