A.C.I.T., Circle-2, Gwalior V. M/s Jagdish Prasad Sharma, Bhind

ITA 363/AGR/2013

• Counselvise Citation: 36320314 RSA 2013
• Duration Of Justice: 1 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 30-01-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 04-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: WASEEM ARSHAD
• Assessee Lawyers: RAJENDRA SHARMA
• Keywords: Difference of opinion; Change of opinion
• Section: 133(6)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA BEFORE : SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER ITA NO. 363/AGRA/2013 ASSTT. YEAR : 2005-06 A.C.I.T., CIRCLE 2, VS. M/S. JAGDISH PRASAD SHARM A, CONTRACTOR, GWALIOR. NAVADA BAGH, BHIND. (PAN : AADFJ 8620 N) (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI WASEEM ARSHAD, SR. D.R. RESPONDENT BY : SHRI RAJENDRA SHARMA, ADVOCATE DATE OF HEARING : 30.01.2014 DATE OF PRONOUNCEMENT OF ORDER : 31.01.2014 ORDER PER BHAVNESH SAINI, J.M.: THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LD. CIT(A), GWALIOR DATED 27.09.2013 FOR THE ASSESSMENT YEAR 2005-06, CHALLENGING THE CANCELLATION OF PENALTY U/S. 271(1) (C) OF THE IT ACT. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSE SSEE IS A FIRM AND THE PENALTY WAS LEVIED WITH REGARD TO THE AMOUNT OF RS. 11,25,261/- PAID ON 04.04.2005, BUT ACCRUED DURING THE ASSESSMENT YEAR 2005-06 AS PER INFORMATION RECEIVED U/S. 133(6) FROM PWD, VIDHISHA , AS THE MEASUREMENT DATE OF THIS WAS 03.01.2005 AND 17.01.2005. THE ASS ESSEE WAS FOLLOWING ITA NO. 363/AGRA/2013 2 MERCANTILE SYSTEM OF ACCOUNTING, THEREFORE, THE EXP LANATION OF THE ASSESSEE WAS CALLED FOR WHY THIS MOUNT BE NOT ADDED IN ASSES SMENT YEAR UNDER APPEAL, I.E., 2005-06. THE ASSESSEE EXPLAINED THAT IT HAS ADOPTED CASH SYSTEM FOR CONTRACT RECEIPTS AND MERCANTILE SYSTEM FOR OTHER RECEIPTS. SINCE THE ASSESSEE WAS FOLLOWING MERCANTILE SYSTEM OF ACC OUNTING, THEREFORE, ADDITION OF RS.11,25,261/- WAS MADE IN THE ASSESSME NT YEAR UNDER APPEAL. THE LD. CIT(A) CONFIRMED THE ADDITION ON MERITS. IT IS STATED THAT NO FURTHER APPEAL HAS BEEN FILED. THE PENALTY WAS ACCORDINGLY LEVIED FOR CONCEALMENT OF INCOME OF THIS AMOUNT. THE ASSESSEE SUBMITTED BE FORE THE LD. CIT(A) THAT THE LD. CIT(A) DELETED THE SAME ADDITION OF RS .11,25,261/- IN SUBSEQUENT ASSESSMENT YEAR VIDE HIS APPELLATE ORDER DATED 28.05.2009. IT WAS ALSO EXPLAINED THAT SINCE THE AMOUNT WAS RECEIV ED ON 04.04.2005, THEREFORE, THE ASSESSEE HAS ACCOUNTED FOR THE RECEI PTS AS AND WHEN SAME WAS RECEIVED AND THE SAME WAS SHOWN FOR TAXATION IN THE RETURN FILED FOR SUBSEQUENT ASSESSMENT YEAR 2006-07. THE ASSESSEE IS FOLLOWING SAME METHOD OF ACCOUNTING SYSTEM. THEREFORE, IT IS NOT A CASE OF CONCEALMENT OF INCOME. THE LD. CIT(A) ACCEPTED THE CONTENTION OF T HE ASSESSEE BECAUSE THE SAME AMOUNT IN QUESTION WAS OFFERED FOR TAXATIO N IN SUBSEQUENT ASSESSMENT YEAR 2006-07 AND THE ASSESSEE HAS DISCLO SED ALL PARTICULARS OF INCOME. THEREFORE, IT IS NOT A CASE OF CONCEALMENT OF INCOME, BUT THE ISSUE ITA NO. 363/AGRA/2013 3 IS WITH REGARD TO TAXABILITY OF INCOME WHETHER IN THE ASSESSMENT YEAR UNDER APPEAL 2005-06 OR IN SUBSEQUENT ASSESSMENT YE AR 2006-07. PENALTY WAS ACCORDINGLY CANCELLED. 3. ON CONSIDERATION OF THE RIVAL SUBMISSIONS, WE AR E OF THE VIEW, NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE LD. CIT(A). IT IS ADMITTED FACT THAT THE ASSESSEE HAS RECEIVED THE AMOUNT OF RS.11, 25,261/- ON 04.04.2005, THEREFORE, THE ASSESSEE UNDER THE BONA FIDE BELIEF HAS OFFERED THE SAME AMOUNT FOR TAXATION IN THE ASSESSMENT YEAR 2006-07. THE ASSESSEE EXPLAINED THAT IT IS FOLLOWING CASH SYSTEM OF ACCOU NTING FOR CONTRACT RECEIPTS, THEREFORE, THIS AMOUNT WAS OFFERED FOR TA XATION IN SUBSEQUENT ASSESSMENT YEAR. THOUGH THE CONTENTION OF THE ASSES SEE WAS NOT ACCEPTED AND THE ADDITION WAS MADE IN THE ASSESSMENT YEAR UN DER APPEAL, BUT WOULD SHOW THAT THE ASSESSEE DISCLOSED ALL PARTICULARS OF INCOME BEFORE THE AUTHORITIES BELOW AND THAT NOTHING WAS CONCEALED FR OM THE REVENUE DEPARTMENT. IN OUR VIEW, IT IS A CASE OF BONA FIDE CHANGE OF OPINION ABOUT TAXABILITY OF INCOME WHETHER IN ASSESSMENT YEAR U NDER APPEAL OR IN SUBSEQUENT ASSESSMENT YEAR AND AS SUCH ON DIFFERENC E OF OPINION, NO PENALTY SHOULD HAVE BEEN LEVIED AGAINST THE ASSESSE E. THE LD. CIT(A) ON PROPER APPRECIATION OF FACTS AND MATERIAL ON RECORD CORRECTLY DELETED THE ITA NO. 363/AGRA/2013 4 PENALTY. THE DEPARTMENTAL APPEAL HAS NO MERIT AND I S, ACCORDINGLY, DISMISSED. 4. IN THE RESULT, THE DEPARTMENTAL APPEAL IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (PRAMOD KUMAR) (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, AGRA 6. GUARD FILE SR. PRIVATE SECRETARY TRUE COPY