The ITO, Ward-1, Vapi V. Shri Ashraf I.Kherani, Vapi

ITA 332/AHD/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62905 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 06-08-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 03-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: INCOME TAX OFFICER WARD VAPI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD D BENCH BEFORE: SHRI D.K. TYAGI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT ME MBER I.T.A. NO.332/AHD/2010( BY REVENUE ) ASSESSMENT YEAR - 2005-06 WITH C.O. NO.104/AHD/2010( BY ASSESSEE ) THE INCOME TAX OFFICER, WARD-1 VAPI ( APPELLANT ) VS. SHRI ASHRAF I. KHERANI, 113, SKYLON COMPLEX, SILVASSA ROAD, VAPI PAN-ACPPK1871L ( RESPONDENT-ASSESSEE ) DEPARTMENT BY : SHRI T. SHANKAR, SR. D.R. ASSESSEE BY : SHRI KANDARP PATEL, A.R. DATE OF HEARING : 06.08.2012 DATE OF PRONOUNCEMENT : 09.08.2012 / ORDER PER : D.K. TYAGI, JUDICIAL MEMBER THESE REVENUES APPEAL AND C.O. FILED BY THE ASSESS EE ARE AGAINST THE ORDER OF LD. CIT(A), VALSAD DATED 12.09.2009. 2. REVENUE HAS TAKEN FOLLOWING GROUNDS OF APPEAL:- 1. THE LD. CIT(A) HAS ERRED IN LAW AND IN FACT IN DELE TING THE PENALTY IMPOSED U/S 271(1)(C) OF I.T. ACT ON AD DITION OF RS.12,51,800/- MADE ON ACCOUNT OF DISALLOWANCE U/S 40(A)(IA) OF IT ACT. 2. THE LD. CIT(A) ERRED IN LAW AND IN FACT IN RED UCING THE PENALTY IMPOSED U/S 271(1)(C) OF IT ACT ON ACCOUNT OF CAPITAL INTRODUCTION FROM RS.34,47,976/- TO RS.15,04,540/- 3. THE ASSESSEE HAS TAKEN FOLLOWING GROUND IN THE CROSS- OBJECTION:- THE LD. CIT(A) ERRED IN UPHOLDING THE PENALTY OF RS.19,43,526/- I.T.A. NO.332/AHD/2010 A. Y.2005-06 2 3. AT THE TIME OF HEARING, AT THE OUTSET, LD. COUN SEL OF THE ASSESSEE SUBMITTED THAT IN THE QUANTUM PROCEEDINGS THE ISSUE IN RESPECT OF ADDITIONS ON WHICH THE PENALTY U/S 271(1)(C) OF THE ACT HAS BEE N LEVIED BY THE A.O., HAS BEEN SET ASIDE TO THE FILE OF THE A.O. FOR FRESH AD JUDICATION. SINCE THE BASIS ON WHICH THE PENALTY WAS IMPOSED IS NO LONGER THERE, T HE PENALTY U/S 271(1)(C) MAY KINDLY BE QUASHED. LD. D.R. RELIED ON THE ORDE R OF THE LOWER AUTHORITIES. 4. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD, WE FIND THAT IN THE QUANTUM PROCEEDINGS THE ISSUE IN RESPECT OF ADDITIONS MADE BY THE A.O. AND SUSTAINED BY LD. CIT(A), WHICH WAS THE BASIS OF THIS PENALTY, HAS BEEN SET ASIDE TO THE FILE OF THE A.O. BY THE TRIBUNAL VIDE ITS ORDER PASSED IN ITA NO.2650/AHD/2008, DATED 08.10.2010. SINCE THE BASI S ON WHICH THE PENALTY WAS IMPOSED IS NO LONGER THERE, THE PENALTY HAS NO LEGS TO STAND AND THEREFORE, THE SAME IS HEREBY SET ASIDE. HOWEVER, IT IS MADE CLEAR THAT THE A.O. WILL BE AT LIBERTY TO RE-INITIATE THE PENALTY PROCEEDINGS, IF HE IS SO SATISFIED AFTER PASSING A FRESH ORDER IN THE QUANTUM PROCEEDINGS. 5. IN THE RESULT, THE C.O. FILED BY THE ASSESSEE I S ALLOWED AND THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 09 .08.2012 SD/- SD/- (ANIL CHATURVEDI) (D.K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER TRUE COPY N.K. CHAUDHARY, SR. P.S. I.T.A. NO.332/AHD/2010 A. Y.2005-06 3 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 6. THE GUARD FILE BY ORDER AR,ITAT,AHMEDABAD