The ITO, Ward-1(3), JAMNAGAR V. M/s. Indu Overseas Pvt. Ltd., JAMNAGAR

ITA 409/RJT/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0112 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-10-2016
• Appeal Filed By: Department
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 30-06-2014
• Court: TRIBUNAL
• Department Lawyers: D R CHHATRE
• Section: 115JB; 10B

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [ CONDUCTED THROUGH E-COURT AT AHMEDABAD ] .., ! '#$%,#&#''( BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ I.T.A. NO.409/RJT/2014 ( / ASSESSMENT YEAR : 2009-10) THE INCOME TAX OFFICER WARD-1(3), JAMNAGAR / VS. M/S.INDU OVERSEAS PVT.LTD. SP.SHED NO.23/1/A, STU, JAMNAGAR *#& ./ ./ PAN/GIR NO. : AAACI 7760 G ( *, / APPELLANT ) .. ( -*, / RESPONDENT ) *,.# / APPELLANT BY : SHRI D.R. CHHATRE, SR.DR -*,/.# / RESPONDENT BY : -NONE- ! 01/2& / DATE OF HEARING 23/09/2016 34 /2& / DATE OF PRONOUNCEMENT 26/10/2016 #/ O R D E R PER PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER : THE PRESENT APPEAL IS FILED BY THE ASSESSING OFFIC ER (AO) AGAINST THE ORDER DATED 16/04/2014 OF THE COMMISSIONER OF I NCOME-TAX (APPEALS)-JAMNAGAR [CIT(A) IN SHORT] AGAINST HIS AC TION TO CANCEL THE PENALTY OF RS.12,36,309/- UNDER SECTION271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT'). ITA NO.409/RJT/ 2014 ITO VS. M/S.INDU OVERSEAS PVT.LTD. ASST.YEAR 2009-10 - 2 - 2. NONE APPEARED ON BEHALF OF THE ASSESSEE IN SPITE OF SERVICE OF NOTICE OF HEARING. ACCORDINGLY, WE ARE CONSTRAINED TO PROCEED WITH THE HEARING IN THIS APPEAL PREFERRED BY THE REVENUE EX-PARTE IN THE ABSENCE OF THE ASSESSEE. 3. THE LD.DR FOR THE REVENUE SUBMITTED THAT THE ASS ESSEE-COMPANY HAS FILED THE RETURN OF INCOME FOR AY 2009-10 ON 30 /09/2009 DECLARING TOTAL INCOME OF RS.1,94,100/- UNDER THE NORMAL PRO VISIONS OF THE ACT. IT IS THE CASE OF AO THAT THE ASSESSEE-COMPANY IS 100% EXPORT ORIENTED UNIT AND CLAIMED DEDUCTION UNDER SECTION 10B OF THE ACT AT RS.1,12,53,175/- AGAINST THE CORRECT AMOUNT OF DEDU CTION OF RS.94,24,213/-. THE AO ACCORDINGLY MADE AN ADDITIO N OF RS.18,28,962/- TOWARDS THE AFORESAID DIFFERENCE IN THE ENTITLEMENT UNDER SECTION10B OF THE ACT. THE LD.DR, HOWEVER, ALSO POINTED OUT THAT THE ASSESSEE IS LIABLE TO PAY TAX UNDER SECTION115JB OF THE ACT ON BOOK PR OFIT OF RS.1,14,41,181/- SINCE THE TAX LIABILITY UNDER SECT ION115JB OF THE ACT EXCEEDS THE TAX LIABILITY UNDER THE NORMAL PROVISIO NS OF THE ACT. THE LD.DR CONTENDED THAT THE ASSESSEE HAS NOT DISCLOSE D THE PARTICULARS OF INCOME TRULY AND FULLY UNDER THE NORMAL PROVISIONS OF THE ACT RESULTING IN CONCEALMENT OF INCOME OF RS.18,28,962/-. HE THERE FORE SUBMITTED THAT THERE IS NO JUSTIFICATION FOR CANCELLATION OF THE P ENALTY BY THE CIT(A) ON THE IMPUGNED CONCEALMENT OF INCOME. ITA NO.409/RJT/ 2014 ITO VS. M/S.INDU OVERSEAS PVT.LTD. ASST.YEAR 2009-10 - 3 - 4. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS MAD E ON BEHALF OF THE REVENUE AND ALSO THE ASSESSMENT ORDER AS WELL A S THE PENALTY ORDER AND THE APPELLATE ORDER BY THE CIT(A) THERETO. 4.1. ON PERUSAL OF THE ORDER OF THE AUTHORITIES BEL OW, WE OBSERVE THAT THE ASSESSEE IS A PRIVATE COMPANY AND, IN THE INSTA NT CASE, THE TAX LIABILITY CALCULATED UNDER THE NORMAL PROVISIONS OF THE INCOM E TAX ACT IS LESS THAN THE TAX LIABILITY DETERMINED UNDER SECTION115JB OF THE ACT. THUS, REGARDLESS OF THE CORRECTNESS OF THE DEDUCTION CLAI MED UNDER SECTION10B OF THE ACT, THE ASSESSEE-COMPANY IS LIABLE TO TAX U NDER SECTION115JB OF THE ACT. WE ALSO OBSERVE THAT TAX LIABILITY UNDER SECTION115JB IS NOT ALTERED AND CONTINUES TO BE MORE THAN THE REVISED T AX LIABILITY ON ACCOUNT OF IMPUGNED ADDITION OF RS.18,28,962/- UNDER SECTIO N10B OF THE ACT UNDER THE NORMAL PROVISIONS OF THE INCOME TAX ACT. HENCE, THE TAX LIABILITY IMPOSED ON THE ASSESSEE HAS NOT CHANGED A T ALL OWING TO ANY ALLEGED EXCESS OR SHORTFALL IN DEDUCTION CLAIMED UN DER SECTION10B OF THE ACT. WE ALSO OBSERVE THAT THE ALLEGATION MADE BY T HE AO THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF IN COME BY WAY OF CLAIMING EXCESS DEDUCTION UNDER SECTION10B OF THE A CT HAS NO BEARING ON THE ULTIMATE TAX LIABILITY. WE ALSO SIMULTANEOUSLY OBSERVE THAT THE IMPUGNED ALLEGATION OF FURNISHING OF INACCURATE PAR TICULARS OF INCOME IS QUA THE NORMAL PROVISIONS OF THE ACT AND DOES NOT E XTEND TO THE TAX LIABILITY COMPUTED UNDER SECTION115JB OF THE ACT IN SO FAR AS THE ITA NO.409/RJT/ 2014 ITO VS. M/S.INDU OVERSEAS PVT.LTD. ASST.YEAR 2009-10 - 4 - IMPUGNED ASSESSMENT YEAR 2009-10 IS CONCERNED. THE REFORE, IN VIEW OF THE FACT THAT THE TOTAL INCOME ASSESSED UNDER THE N ORMAL PROVISIONS OF THE ACT IS LESS THAN THE BOOK PROFIT AND THEREBY SINCE THE TAX LIABILITIES HAS BEEN DETERMINED UNDER SECTION 115JB OF THE ACT, WE ARE OF THE CONSIDERED VIEW THAT PENALTY UNDER SECTION 271(1)(C ) OF THE ACT CANNOT BE IMPOSED WITH REFERENCE TO ADDITIONS MADE UNDER THE NORMAL PROVISIONS OF THE ACT. HENCE, THE CIT(A) WAS FULLY JUSTIFIED IN CANCELLING THE PENALTY IMPOSED BY AO. THUS, GROUNDS RAISED BY THE REVENUE ARE DEVOID OF ANY MERIT. 5. IN THE RESULT, REVENUES APPEAL STANDS DISMISSED . THIS ORDER PRONOUNCED IN OPEN COURT ON 26/10/2016 SD/- SD/- .. ! '#$% () (#&) ( S.S. GODARA ) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 26/ 10 /2016 ..0,.0../ T.C. NAIR, SR. PS / COPY OF THE ORDER FORWARDED TO : 1. *, / THE APPELLANT 2. -*, / THE RESPONDENT. 3. 8 2 ! 92 / CONCERNED CIT 4. ! 92 ( ) / THE CIT(A)-JAMNAGAR 5. :; 20 , , /DR,ITAT, RAJKOT 6. %<1 / GUARD FILE. / BY ORDER, -:2 2 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) %&, / ITAT, RAJKOT