M/s Pato Builders Pvt Ltd., V. ACIT,

ITA 32/RAN/2014

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8591 (ITAT-RANCHI)
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2014
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 24-01-2014
• Court: TRIBUNAL
• Department Lawyers: DEEPAK ROSHAN SENIOR
• Assessee Lawyers: S K PODDAR; M K CHOUDHARY S LD ARS
• Section: 234B

Judgement Text

1 ITA NOS.32 & 15/RAN/14 & CO NO.19/RAN/14 - M/S.PATO BUILDERS P.LTD INCOME TAX APPELLATE TRIBUNAL, CIRCUIT BENCH, RANCHI BEFORE HON'BLE SHRI H.L. KARWA, PRESIDENT , AND HON'BLE SHRI B.R. BASKARAN, ACCOUNTANT MEMBER ITA NO. 32 / RAN/201 4 A.Y . 200 6 - 07 M/S. PATO BUILDERS PVT.LTD VS. A .C.I.T, CC - II,JSR PAN: AILPP0228L ( RESPONDENT ) ( APPELLANT) ITA NO. 15/ RAN/201 4 A.Y 200 7 - 08 A.C.I.T, CC - II,JSR VS. M/S. PATO BUILDERS PVT.LTD PAN:ABWPP8560D ( APPELLANT ) ( RESPONDENT ) C.O NO. 19/ RAN/201 4 [ ITA NO.15/RAN/14 A. Y . 2007 - 08] M/S. PATO BUILDERS PVT.LTD VS. A.C.I.T, CC - II,JSR PAN: AILPP0228L ( CROSS OBJECTOR ) ( DEPARTMENT ) FOR THE APPELLANT : S/ SHR I S.K PODDAR & M.K CHOUDHARY, ADVOCATES, LD.ARS FOR THE RESPONDENT /DEPARTMENT : SHRI DEEPAK ROSHAN, SENIOR S.C.LD.DR DATE OF HEARING : 04 - 12 - 2014 DATE OF PRONOUNCEMENT: 04 - 12 - 2014 O R D E R SHRI B.R. BASKARAN, ACCOUNTANT MEMBER : THE ASSESSEE HAS FILED APPEAL CHALLENGING THE ORDER PASSED BY LD CIT(A) IN CONFIRMING THE PENALTY OF RS.25,000/ - LEVIED U/S 271A OF THE ACT 2 ITA NOS.32 & 15/RAN/14 & CO NO.19/RAN/14 - M/S.PATO BUILDERS P.LTD AND IT RELATES TO THE ASSESSMENT YEAR 20 06 - 07. THE REVENUE HAS FILED THE APPEAL AND THE ASSESSEE HAS FILED CROSS OBJECTION CHALLENGING THE ORDER PASSED BY LD CIT(A) FOR THE ASSESSMENT YEAR 2007 - 08. ALL THESE APPEALS WERE HEARD TOGETHER AND HENCE THEY ARE BEING DISPOSED OF BY THIS COMMON ORDER, FOR THE SAKE OF CONVENIENCE. 2. WE SHALL FIRST TAKE UP THE APPEAL FILED BY THE ASSESSEE FOR AY 2006 - 07. THE REVENUE CONDUCTED SURVEY OPERATION AT THE BUSINESS PREMISE S OF THE ASSESSEE ON 18.08.2008 AND AT THE TIME OF SURVEY, NO BOOKS OF ACCOUNTS WAS FO UND. A STATEMENT WAS RECORDED FROM THE ACCOUNTANT AND HE EXPRESSED HIS IGNORANCE ABOUT THE BOOKS OF ACCOUNT ON THE REASONING THAT HE HAD JOINED THE ASSESSEE COMPANY ONLY RECENTLY. IT APPEARS THAT THE ASSESSEE DID NOT PRODUCE THE BOOKS OF ACCOUNT DURING T HE COURSE OF ASSESSMENT PROCEEDINGS ALSO. ACCORDINGLY, THE AO CAME TO THE LOGICAL CONCLUSION THAT THE ASSESSEE DID NOT MAINTAIN BOOKS OF ACCOUNT AND ACCORDINGLY LEVIED A PENALTY OF RS.25,000/ - U/S 271A OF THE ACT. THE LD CIT(A) ALSO CONFIRMED THE PENALTY . 3. THE LD COUNSEL SUBMITTED THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND IT HAS MAINTAINED REGULAR BOOKS OF ACCOUNT AND THE SAME WAS ALSO AUDITED BY THE STATUTORY AUDITORS OF THE ASSESSEE COMPANY. HE FURTHER SUBMITTED THAT THE TAX AUTHORITIES HAVE ONLY PRESUMED THAT THE ASSESSEE DID NOT MAINTAIN BOOKS OF ACCOUNT. ON THE CONTRARY, THE LD D.R SUBMITTED THAT THE ASSESSEE DID NOT PRODUCE THE BOOKS OF ACCOUNT DURING THE COURSE OF ASSESSMENT PROCEEDING AND THE SURVEY TEAM ALSO DID NOT FIND ANY BOOKS AT THE TIME OF SURVEY OPERATION. 3 ITA NOS.32 & 15/RAN/14 & CO NO.19/RAN/14 - M/S.PATO BUILDERS P.LTD 4. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. THE QUESTION WHETHER THE ASSESSEE MAINTAINS BOOKS OF ACCOUNT OR NOT , IS A QUESTION OF FACT. WE NOTICE THAT THE ASSESSING OFFICER HAS REACHED CONCLUSION THAT THE A SSESSEE HAS NOT MAINTAINED BOOKS OF ACCOUNT , ONLY ON THE PRESUMPTION FOR THE REAS ON THAT THE SURVEY TEAM DID NOT FIND BOOKS OF ACCOUNT AND FURTHER THE LEDGER ACCOUNTS PRODUCED BEFORE HIM WERE NOT CONSIDERED BY THE AO TO BE SUFFICIENT. HOWEVER, IT IS A FAC T THAT THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND IT IS REQUIRED TO MAINTAIN BOOKS OF ACCOUNT, GET IT AUDITED AND FURNISH RELEVANT RETURNS BEFORE THE REGISTRAR OF COMPANIES. THE LD A.R FURNISHED THE DETAILS OF AUDIT REPORT AND FINANCIAL STATEMENTS TO S HOW THAT THE AUDITOR HAS DULY EXAMINED THE BOOKS OF ACCOUNT. THUS, WE NOTICE THAT THE ASSESSING OFFICER HAS ENTERTAINED THE BELIEF THAT THE ASSESSEE DID NOT MAINTAIN BOOKS OF ACCOUNT ONLY ON PRESUMPTIONS. HENCE, WE ARE OF THE VIEW THAT THE PENALTY LEVIED BY THE AO U/S 271A IS NOT SUSTAINABLE. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD CIT(A) AND DIRECT THE AO TO DELETE THE PENALTY OF RS.25,000/ - LEVIED BY THE AO. 5. WE SHALL NOW TAKE UP THE APPEAL FILED BY THE REVENUE FOR AY 2007 - 08. THE REVENUE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN DIRECTING THE AO TO LEVY INTEREST U/S 234B OF THE ACT BY FOLLOWING THE DECISION RENDERED BY THE HON BLE JHARKHAND HIGH COURT IN THE CASE OF AJAY KUMAR VERMA VS. ITO (2013) (1) TMI 140. SINCE THE DECISION RENDERED BY THE JURISDICTIONAL HIGH COURT IS BINDING ON THE AUTHORITIES, WE DO NOT FIND ANY INFIRMITY IN THE ORDER PASSED BY LD CIT(A) ON THIS ISSUE. 6. THE ASSESSEE HAS FILED CROSS OBJECTION ONLY TO SUPPORT THE ORDER OF LD CIT(A) ON THE ABOVE SAID ISSUE. SIN CE WE HAVE DISMISSED THE APPEAL OF 4 ITA NOS.32 & 15/RAN/14 & CO NO.19/RAN/14 - M/S.PATO BUILDERS P.LTD THE REVENUE, THE CROSS OBJECTION FILED BY THE ASSESSEE IS ALSO LIABLE TO BE DISMISSED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE FOR AY 2006 - 07 IS ALLOWED. THE APPEAL FILED BY THE REVENUE AND THE CROSS OBJE CTION FILED BY THE ASSESSEE FOR AY 2007 - 08 ARE DISMISSED. PRONOUNCED ACCORDINGLY ON 04 - 12 - 2014 SD/ - SD/ - [ H.L. KARWA ] [ B.R. BASKARAN ] PRESIDENT ACCOUNTANT MEMBER DT. 04 - 12 - 2014 PLACE : RANCHI PP, SR. PS COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT : 2 THE RESPONDENT: 3..THE CIT, 4.THE CIT(A), 5.DR, ITAT CIRCUIT BENCH, RANCHI 6. G UARD FILE. TRUE COPY, BY ORDER, ASSTT. REGISTRAR 5 ITA NOS.32 & 15/RAN/14 & CO NO.19/RAN/14 - M/S.PATO BUILDERS P.LTD 1. DATE OF DICTATION ............ ORDER DRAFTED BY HON'BLE.MEMBER 04 - 12 - 2014....................... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBE R ........................OTHER MEMBER ..... 12 - 2014........................ 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 DICTATING MEMBER FOR PRONOUNCEMENT........ ........................ 04 - 12 - - 2014................................................... 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 REGISTRAR FOR SIGNATURE ON THE ORDER ........................................................................... ...................... 9. DATE OF DESPATCH OF THE ORDER ..............................................................