DCIT Circle-5 (1), New Delhi V. M/s. Munjal Showa Ltd, Haryana

ITA 361/DEL/2009

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73955 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 11 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 06-01-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 30-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAMEER SHARMA
• Keywords: Royalty expenses
• Section: 143(3); 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI BENCH D, NEW DELHI BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI SHAMIM YAHIYA, ACCOUNTANT MEMBER ITA NO. 361/DEL./2009 ASSTT. YEAR : 2004-05 D.C.I.T. CIRCLE 5(1), VS. M/S. MUNJAL SHOWA LTD ., NEW DELHI. 9-11, MARUTI INDL. AREA, GURGAON (HARYANA) (PAN: AAACM 0070D) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHAMEER SHARMA, CIT/DR RESPONDENT BY : SHRI GAURAV JAIN, C.A. DATE OF HEARING : 06.01.2014 DATE OF PRONOUNCEMENT OF ORDER : 01.01.2014 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A) VIII, NEW DELHI DATED 24.11.2008 FOR THE ASSESSMENT YEAR 2004-05, CHALLENGING THE CANCELLATION OF PENALTY U/S. 271(1)(C) OF THE IT AC T. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSE SSEE IS ENGAGED IN THE BUSINESS OF MANUFACTURING AND SALE OF SHOCK ABSORBERS. ASSES SMENT U/S. 143(3) WAS PASSED AND INCOME WAS COMPUTED AT RS.38,91,62,777/- AFTER MAKING ADDITIONS/DISALLOWANCES OUT OF ROYALTY EXPENSES IN A SUM OF RS.2,29,41,576/- AND TECHNICAL FEES RS.4,25,169/-. FURTHER, DISALLOWANCE S OUT OF POWER AND FUEL EXPENSES AS PRIOR PERIOD EXPENSES WERE MADE. THE LD. CIT(A) SUSTAINED THE ADDITIONS ON ACCOUNT OF ROYALTY EXPENSES AND TECHNICAL FEES ON W HICH THE AO LEVIED THE PENALTY ITA NO.361/DEL/2009 2 U/S. 271(1)(C) OF THE IT ACT. THE LD. CIT(A) VIDE I MPUGNED ORDER CANCELLED THE PENALTY AND ALLOWED THE APPEAL OF THE ASSESSEE ON B OTH THESE ISSUES. 3. THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET S UBMITTED THAT THE APPEAL OF THE ASSESSEE ON QUANTUM HAS BEEN ALLOWED BY ITAT, DELHI D BENCH IN THE CASE OF SAME ASSESSEE IN ITA NO. 2619/2007 VIDE ORDER DATED 19.06.2013 AND BOTH THE ADDITIONS ON WHICH THE PENALTY WAS LEVIED HAVE BEEN DELETED. COPY OF THE ORDER IS PLACED ON RECORD. THE LD. DR DID NOT DISPUTE THE SA ME. 4. IN VIEW OF THE ABOVE FACTS AND ORDER OF THE TRIB UNAL, SINCE THE ADDITIONS ON WHICH THE PENALTY WAS IMPOSED HAVE BEEN DELETED BY THE TRIBUNAL, THEREFORE, PENALTY IS NOT LEVIABLE AGAINST THE ASSESSEE AND NO THING SURVIVES AGAINST THE ASSESSEE FOR LEVY OF PENALTY. THEREFORE, THE DEPART MENTAL APPEAL HAS NO MERIT AND IS ACCORDINGLY DISMISSED. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (SHAMIM YAHIYA) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER *AKS/- COPY OF THE ORDER FORWARDED TO : 1. APPELLANT 2. RESPONDENT 3. CIT(A), CONCERNED BY ORDER 4. CIT, CONCERNED 5. DR, ITAT, NEW DELHI 6. GUARD FILE ASSTT. REGISTRAR TRUE COPY