The ACIT.(OSD), Circle-5, Ahmedabad V. Powersoft Consulting Pvt. Ltd., Ahmedabad

ITA 403/AHD/2011

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68060 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 10 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 16-12-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 14-02-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Assessee Lawyers: AASTI SHAH
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH BEFORE: SRI D.K TYAGI, JUDICIAL MEMBER AND SHRI T.R.MEENA, ACCOUNTANT MEMB ER ACIT (OSD), CIRCLE-5, AHMEDABAD (APPELLANT) VS POWERSOFT CONSULTING P. LTD 801 SAKRUT PARTH SARTHI AVENUE, NR. SAYAMAL SOC. 132FT RING ROAD, SATELLITE, AHMEDABAD (RESPONDENT) REVENUE BY: SRI P.L. KUREEL, SR.D.R. ASSESSEE BY: SRI AASTI SHAH, A.R. DATE OF HEARING : 16-12-2013 DATE OF PRONOUNCEMENT : 20-12-20 13 / ORDER PER : D.K. TYAGI, JUDICIAL MEMBER:- THIS IS THE REVENUES APPEAL AGAINST THE ORDER OF LD. CIT(A)-XI AHMEDABAD DATED 03-12-2010. ITA NO. 403/AHD/2011 ASSESSMENT YEAR 2004-05 I.T.A NO.403/AHD/2011 A.Y. 2004-05 PAGE N O ACIT VS. POWERSOFT CONSULTING P. LTD 2 2. THE REVENUE HAS TAKEN FOLLOWING GROUNDS OF APPEA L:- 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN RESTRICTING THE PENALTY OF RS. 22,65,700/- TO RS. 1 7,98,750/- LEVIED U/S. 271(1)(C) OF THE ACT. 3. BRIEF FACTS OF THE CASE ARE THAT ASSESSING OFFIC ER DURING THE ASSESSMENT PROCEEDINGS MADE FOLLOWING ADDITIONS:- (I) BUSINESS DEVELOPMENT EXPENSES RS. 50,13,780/- (II) CONSULTING SALARY RS. 10,63,274/- (III) INTEREST ON LOANS AND ADVANCES RS. 4,94,07 2/- (IV) DISALLOWANCE OF EXPENSES U/S. 14A WITH RESPECT TO EXEMPT DIVIDEND RS. 4,67,865/- (V) FOREIGN TRAVEL EXPENSES RS. 6,33,763/- ----------------- TOTAL RS. 76,72,754/- ----------------- IN APPEAL FOLLOWING ADDITIONS WERE CONFIRMED:- 1. BUSINESS DEVELOPMENT EXPENSES RS. 50,13,780/- 2. CONSULTING SALARY RS. 2,00,000/- 3. DISALLOWANCE U/S. 14A RS. 4,67,865/- 4. FOREIGN TRAVEL EXPENSES RS. 6,33,763/- SUBSEQUENTLY PENALTY U/S. 271(1)(C) OF THE ACT WAS LEVIED IN RESPECT OF ABOVE ADDITIONS. IN APPEAL PENALTY EXCEPT IN RESPECT OF ADDITION OF RS. 50,13,780/- (BUSINESS DEVELOPMENT EXPENSES) WAS DELETED BY LD. CIT(A). AGAINST SUCH DELETION NOW THE REVENUE IS IN APPEAL BEFORE US. I.T.A NO.403/AHD/2011 A.Y. 2004-05 PAGE N O ACIT VS. POWERSOFT CONSULTING P. LTD 3 4. AFTER HEARING BOTH THE PARTIES AND PERUSING THE RECORD, WE FIND THAT LD. CIT(A) HAS GIVEN RELIEF TO THE ASSESSEE BY DELE TING THE PENALTY IN RESPECT OF ADDITIONS OF CONSULTING SALARY AND FOREIGN TRAVE L EXPENSES BY FOLLOWING THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FO R A.Y. 2003-04 WHEREIN SIMILAR PENALTY WAS DELETED AND AS FAR AS PENALTY I N RESPECT OF DISALLOWANCE U/S. 14A WAS CONCERNED THE SAME WAS DELETED BY LD. CIT(A) BY FOLLOWING THE DECISION OF HONBLE APEX COURT IN THE CASE OF C IT VS. RELIANCE PETROPRODUCTS LTD REPORTED IN 322 ITR 158, THEREFOR E WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER OF LD CIT(A) AND THE SAME IS HEREBY UPHELD. 5. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (T.R. MEENA) ( D.K. TYAGI) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD : DATED 20/12/2013 AK / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,