Sh. Harish Mehndiratta, Delhi V. ACIT, New Delhi

ITA 3942/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90964 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 27-04-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 21-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T VASANTHAN

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : C : NEW DELHI BEFORE SHRI R.S. SYAL, AM AND SHRI C.M. GARG, JM ITA NO.3942/DEL/2013 ASSESSMENT YEAR : 2009-10 HARISH MEHNDIRATTA, B-130, DERAWAL NAGAR, DELHI. PAN: AAFPM1422R VS. ACIT, CIRCLE 29(1), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VINAY BAHL, ADVOCATE DEPARTMENT BY : SHRI T. VASANTHAN, SR. DR DATE OF HEARING : 27.04.2015 DATE OF PRONOUNCEMENT : 27.04.2015 ORDER PER R.S. SYAL, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER PASSED BY THE CIT(A) ON 11.2.2013 CONFIRMING THE PENALTY OF R S.4,65,280/- IMPOSED BY THE ASSESSING OFFICER (AO) U/S 271(1)(C ) OF THE INCOME TAX ITA NO.3942/DEL/2013 2 ACT, 1961 (HEREINAFTER ALSO CALLED THE ACT) IN R ELATION TO THE ASSESSMENT YEAR 2009-10. 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE CLAIMED DEDUCTION FOR INTEREST EXPENSE AMOUNTING TO RS.15,5 0,918/-. THE AO NOTICED THAT THE SAID INTEREST WAS PAID IN RESPECT OF LOANS TAKEN FOR PURCHASE AND CONSTRUCTION OF PROPERTY AT NOIDA, WHI CH DID NOT FORM PART OF THE FIXED ASSETS OF THE ASSESSEE. THE AO MADE A DDITION FOR THIS SUM. THEREAFTER, PENALTY WAS IMPOSED W.R.T. SUCH DISALLO WANCE OF INTEREST, WHICH CAME TO BE UPHELD IN THE FIRST APPEAL. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE INSTAN T PENALTY HAS BEEN IMPOSED AND CONFIRMED WITH REFERENCE TO DEDUCTION F OR INTEREST EXPENDITURE CLAIMED BY THE ASSESSEE. THE ASSESSEE AGITATED BEFORE THE AO DURING THE PENALTY PROCEEDINGS THAT THE AMOUNT W AS NOT LIABLE TO BE DISALLOWED. HERE IS A CASE IN WHICH THE ASSESSEE C LAIMED DEDUCTION FOR A PARTICULAR SUM BY MAKING A COMPLETE DISCLOSURE ABO UT THE TRANSACTION. THE HONBLE SUPREME COURT IN THE CASE OF RELIANCE PETROPRODUCTS PVT. ITA NO.3942/DEL/2013 3 LTD. (2010) 322 ITR 158 (SC) HAS HELD THAT SIMPLY FOR THE REASON THAT THE AO DID NOT FIND THE CLAIM OF THE ASSESSEE TO BE SUS TAINABLE IN LAW UP TO A CERTAIN EXTENT, CANNOT BE A CASE FOR PENALTY U/S 2 71(1)(C), MORE SO, WHEN PARTICULARS FURNISHED BY THE ASSESSEE WERE NOT INAC CURATE. THE FACTS OF THE INSTANT CASE ARE, MUTATIS MUTANDIS, SIMILAR TO THOSE CONSIDERED AND DECIDED BY THE HONBLE SUPREME COURT IN THE ABOVE J UDGMENT. RESPECTFULLY FOLLOWING THE PRECEDENT, WE HOLD THAT THE AUTHORITIES BELOW ERRED IN IMPOSING AND CONFIRMING THE PENALTY U/S 2 71(1)(C) OF THE ACT. WE, THEREFORE, ORDER FOR THE DELETION OF PENALTY. 4. IN THE RESULT, THE APPEAL IS ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 27.04.201 5. SD/- SD/- [C.M. GARG] [R.S. SYAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED,27 TH APRIL, 2015. DK ITA NO.3942/DEL/2013 4 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.