K.V.M.Chitra, Thanjavur V. ACIT, CHENNAI

ITA 362/CHNY/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4789 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-07-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 05-07-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 01-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAMASWAMY
• Assessee Lawyers: K RAVI
• Section: 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH B CHENNAI BEFORE SHRI HARI OM MARATHA, J.M. AND SHRI N.S. SAINI, AM .. I.T.A. NO. 362/MDS/2011 ASSESSMENT YEAR 1996-97] K.V.M. CHITRA NO. 5,FIRST CROSS STREET PARISUTHAM NAGAR THANJAVUR 613 001. PAN : AEZPC 1863 J VS. THE ASSTT. COMMISSIONER OF INCOME-TAX, CHENNAI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI K. RAVI DEPARTMENT BY : SHRI RAMASWAMY, STANDING COUNSEL O R D E R PER N.S. SAINI, A.M :- THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER PASSED BY THE CIT(A)-I, CHENNAI DATED 01.12.2010. PAGE 2 OF 4 ITA. NO. 362/MDS/2011 2. IN THIS APPEAL, SOLE GROUND TAKEN BY THE ASSESSE E IS THAT THE LD. CIT(A) ERRED IN LAW AND IN FACTS IN CONFIRMING THE LEVY OF PENALTY U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 [IN SHORT, TH E ACT] OF RS. 46,635/-. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIAL AVAILABLE ON RECORD. BRIEF FACTS OF THE CASE ARE THAT ASSESSMENT WAS MADE ON 3 1.12.2007 U/S 144 OF THE ACT WHEREIN THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS DEBITED RS. 1,91,074/- AS REPAIRS AND SPARES A ND RS. 46,000/- AS ADMINISTRATION SALARY. THE ASSESSEE PAID MOST O F THESE AMOUNTS IN CASH AND COULD NOT PRODUCE THE VOUCHERS FOR ALL THE EXPENSES. HE, THEREFORE, MADE AN ESTIMATED DISALLOWANCE OF RS . 75,000/- FROM OUT OF THE REPAIRS AND SPARES EXPENSES AND RS. 25,000/- FROM OUT OF THE ADMINISTRATION SALARY AND MADE ADDITION OF RS. 1 LAKH TO THE INCOME OF THE ASSESSEE. THE ASSESSEE ACCEPTED THE ABOVE ADDITION AND DID NOT FILE APPEAL THERE AGAINST. PAGE 3 OF 4 ITA. NO. 362/MDS/2011 4. THEREAFTER, THE ASSESSING OFFICER LEVIED PENALTY OF RS. 46,635/- U/S 271(1)(C) OF THE ACT FOR CONCEALMENT O F PARTICULARS OF INCOME BY THE ASSESSEE. 5. ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A), WHO CONFIRMED THE ACTION OF THE ASSESSING OFFICER. 6. THE LD. A.R. SUBMITTED THAT AS ESTIMATED ADDITIO N WAS MADE TO THE INCOME OF THE ASSESSEE, THEREFORE, THE ASSESSEE WAS NOT LIABLE TO PENALTY U/S 271(1)(C) OF THE ACT. THE LD. D.R. ON THE OTHER HAND SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 7. WE FIND THAT IN THE INSTANT CASE, ADDITION WAS M ADE BY DISALLOWING THE EXPENSES OUT OF REPAIRS AND SPARES AND ADMINISTRATION SALARY AS THE ASSESSEE COULD NOT PRO DUCE ALL THE VOUCHERS RELATING TO THE EXPENDITURE INCURRED BY IT . IT IS NOT THE CASE OF THE ASSESSING OFFICER THAT THE EXPENDITURE CLAIMED BY THE ASSESSEE WAS BOGUS OR FALSE. THE ADDITION WAS MADE ONLY FOR THE REASON THAT THE ASSESSEE COULD NOT SUBSTANTIATE THE EXPENSES BY PRODUCING ALL THE RELEVANT VOUCHERS. IN THE ABSENC E OF ANY SUCH PAGE 4 OF 4 ITA. NO. 362/MDS/2011 FINDING THAT THE ASSESSEE HAS CLAIMED ANY FALSE OR BOGUS EXPENSES OR HAS INFLATED EXPENSES, IN ORDER TO NOT PAY TAX ON I TS INCOME, IN OUR CONSIDERED OPINION, NO PENALTY CAN BE LEVIED IN THE HANDS OF THE ASSESSEE U/S 271(1)(C) OF THE ACT. WE, THEREFORE, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE LEVY OF PENALTY OF RS. 46,635/- AND ALLOW THE APPEAL OF THE ASSESSEE. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE COURT ON 8 TH JULY 2011. SD/- SD/- ((HARI OM MARATHA ) (N.S. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 8 TH JULY, 2011. VL COPY TO: ASSESSEE/AO/CIT (A)/CIT/D.R./GUARD FILE