PROLIFIC VENTURES PRIVATE LIMITED, MUMBAI V. INCOME TAX OFFICER 10(3)(4), MUMBAI

ITA 41/MUM/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5793 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 04-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIJAY KUMAR SONI
• Keywords: Initiation of penalty proceedings

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 38/MUM/18 2003-04 PROLIFIC VENTURES PVT. LTD., WILSON HOUSE, NAGARDAS ROAD, ANDHERI (EAST), MUMBAI [PAN: AACCP5420E] INCOME TAX OFFICER- 10(3)(4), MUMBAI 39/MUM/18 2004-05 40/MUM/18 2005-06 41/MUM/18 2006-07 42/MUM/18 2007-08 43/MUM/18 2008-09 APPELLANT BY : SHRI ASHOK BANSAL, AR RESPONDENT BY : SHRI VIJAY KUMAR SONI, DR DATE OF HEARING : 29-01-2019 DATE OF PRONOUNCEMENT : 01-02-2019 O R D E R THESE ARE SIX APPEALS BY THE ASSESSEE, WHICH ARE DIRECTED AGAINST A COMBINED ORDER OF THE LD. COMMISSI ONER OF INCOME TAX (APPEALS)-17, MUMBAI, DATED 28-09-2017 FO R THE AYS. 2003-04 TO 2008-09. SINCE THE FACTS AND ISSUES I NVOLVED IN ALL THESE APPEALS ARE COMMON AND IDENTICAL, ALL THE SE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. PROLIFIC VENTURES PVT. LTD., : 2 : 2. THE GROUNDS RAISED BY THE ASSESSEE IN RESPECT OF A LL THESE APPEALS ARE AS UNDER: AY. 2003-04 : 1. THE AUTHORITIES BELOW HAVE ERRED IN PASSING THE ORDER/UPHOLDING THE ORDER U/S. 254 IN PURSUANCE OF THE HON. ITAT OR DER BUT ASSESSING THE TOTAL INCOME HIGHER AT RS. 16,61,779/- AS AGAIN ST THE ORIGINAL ASSESSED INCOME OF RS. 15,31,672/-. 2. THE AUTHORITIES BELOW HAVE ERRED IN DISREGARDING THE DECISION OF HON. ITAT (MUMBAI) DATED 24.05.2015 RENDERED IN APP ELLANTS OWN CASE FOR A.Y. 2009-10. 3. THE AUTHORITIES BELOW HAVE ERRED IN NOT GIVING E FFECT TO THE DECISION OF THE HON. ITAT (MUMBAI) FOR A.Y. 2003-04 CORRECTL Y. 4. THE LEARNED CIT (APPEALS) HAS ERRED IN SUPERSEDI NG THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHICH HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). 5. THE LEARNED ASSESSING OFFICER HAS ERRED IN INITI ATING PENALTY PROCEEDINGS IN A CASE WHICH HAS BEEN HIGHLY LITIGAT ED UP TO THE HON. SUPREME COURT. AY. 2004-05 : 1. THE AUTHORITIES BELOW HAVE ERRED IN PASSING THE ORDER/UPHOLDING THE ORDER U/S. 254 IN PURSUANCE OF THE HON. ITAT OR DER BUT ASSESSING THE TOTAL INCOME HIGHER AT RS. 29,62,410/- AS AGAIN ST THE ORIGINAL ASSESSED INCOME OF RS. 26,49,630/-. 2. THE AUTHORITIES BELOW HAVE ERRED IN DISREGARDING THE DECISION OF HON. ITAT (MUMBAI) DATED 24.05.2015 RENDERED IN APP ELLANTS OWN CASE FOR A.Y. 2009-10. 3. THE AUTHORITIES BELOW HAVE ERRED IN NOT GIVING E FFECT TO THE DECISION OF THE HON. ITAT (MUMBAI) FOR A.Y. 2004-05 CORRECTL Y. 4. THE LEARNED CIT (APPEALS) HAS ERRED IN SUPERSEDI NG THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHICH HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). 5. THE LEARNED ASSESSING OFFICER HAS ERRED IN INITI ATING PENALTY PROCEEDINGS IN A CASE WHICH HAS BEEN HIGHLY LITIGAT ED UP TO THE HON. SUPREME COURT. PROLIFIC VENTURES PVT. LTD., : 3 : AY. 2005-06 : 1. THE AUTHORITIES BELOW HAVE ERRED IN DISREGARDIN G THE DECISION OF HON. ITAT (MUMBAI) DATED 24.05.2015 RENDERED IN APP ELLANTS OWN CASE FOR A.Y. 2009-10. 2. THE AUTHORITIES BELOW HAVE ERRED IN NOT GIVING E FFECT TO THE DECISION OF THE HON. ITAT (MUMBAI) FOR A.Y. 2005-06 CORRECTL Y. 3. THE LEARNED CIT (APPEALS) HAS ERRED IN DISREGARD ING THE FACT THAT THE APPELLANT WAS IN FACT DOING BUSINESS AND NOT AD JUDICATING ON GROUND NO. 4 BEFORE HIM. 4. THE LEARNED CIT (APPEALS) HAS ERRED IN SUPERSEDI NG THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHICH HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). 5. THE LEARNED ASSESSING OFFICER HAS ERRED IN INITI ATING PENALTY PROCEEDINGS IN A CASE WHICH HAS BEEN HIGHLY LITIGAT ED UP TO THE HON. SUPREME COURT. AY. 2006-07 : 1. THE AUTHORITIES BELOW HAVE ERRED IN DISREGARDIN G THE DECISION OF HON. ITAT (MUMBAI) DATED 24.05.2015 RENDERED IN APP ELLANTS OWN CASE FOR A.Y. 2009-10. 2. THE AUTHORITIES BELOW HAVE ERRED IN NOT GIVING E FFECT TO THE DECISION OF THE HON. ITAT (MUMBAI) FOR A.Y. 2006-07 CORRECTL Y. 3. THE AUTHORITIES BELOW HAVE ERRED IN PASSING THE ORDER/UPHOLDING THE ORDER U/S. 254 IN PURSUANCE OF THE HON. ITAT OR DER BUT ASSESSING THE TOTAL INCOME HIGHER AT RS. 44,75,377/- AS AGAIN ST THE ORIGINAL ASSESSED INCOME OF RS. 44,74,710/-. 4. THE LEARNED CIT (APPEALS) HAS ERRED IN SUPERSEDI NG THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHICH HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). 5. THE LEARNED ASSESSING OFFICER HAS ERRED IN INITI ATING PENALTY PROCEEDINGS IN A CASE WHICH HAS BEEN HIGHLY LITIGAT ED UP TO THE HON. SUPREME COURT. AY. 2007-08 : 1. THE AUTHORITIES BELOW HAVE ERRED IN DISREGARDIN G THE DECISION OF HON. ITAT (MUMBAI) DATED 24.05.2015 RENDERED IN APP ELLANTS OWN CASE FOR A.Y. 2009-10. PROLIFIC VENTURES PVT. LTD., : 4 : 2. THE AUTHORITIES BELOW HAVE ERRED IN NOT GIVING E FFECT TO THE DECISION OF THE HON. ITAT (MUMBAI) FOR A.Y. 2007-08 CORRECTL Y. 3. THE LEARNED CIT (APPEAL) HAS ERRED IN SUPERSEDIN G THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHICH HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). 4. THE LEARNED ASSESSING OFFICER HAS ERRED IN INITI ATING PENALTY PROCEEDINGS IN A CASE WHICH HAS BEEN HIGHLY LITIGAT ED UP TO THE HON. SUPREME COURT. AY. 2008-09 : 1. THE AUTHORITIES BELOW HAVE ERRED IN DISREGARDIN G THE DECISION OF HON. ITAT (MUMBAI) DATED 24.05.2015 RENDERED IN APP ELLANTS OWN CASE FOR A.Y. 2009-10. 2. THE AUTHORITIES BELOW HAVE ERRED IN NOT GIVING E FFECT TO THE DECISION OF THE HON. ITAT (MUMBAI) FOR A.Y. 2008-09 CORRECTL Y. 3. THE LEARNED CIT (APPEAL) HAS ERRED IN SUPERSEDIN G THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHICH HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). 4. THE LEARNED ASSESSING OFFICER HAS ERRED IN INITI ATING PENALTY PROCEEDINGS IN A CASE WHICH HAS BEEN HIGHLY LITIGAT ED UP TO THE HON. SUPREME COURT. 3. AT THE OUTSET, IT WAS SUBMITTED BY THE LD. AR OF THE ASSESSEE THAT AS PER GROUND NO. 1 IN AYS. 2003-04, 2 004-05 AND GROUND NO. 3 IN A.Y. 2006-07 IN ITA NOS. 38/MUM/2018,39/MUM/2018 & 41/MUM/2018 RESPECTIVELY, THE ASSESSEE HAS RAISED A GRIEVANCE THAT THE TRIBUNAL CA NNOT ENHANCE THE INCOME WHILE DECIDING THE APPEAL OF THE A SSESSEE AND IN THESE THREE YEARS, THE ULTIMATE ASSESSED INCOME IS MORE THAN THE INCOME ORIGINALLY ASSESSED BY THE A. O. HE SUBMITTED THAT UPHOLDING THE ENTIRE ADDITION MADE BY THE A.O. PROLIFIC VENTURES PVT. LTD., : 5 : IN THE FINAL ASSESSMENT ORDER IS NOT JUSTIFIED. AT THIS JUNCTURE, THE BENCH WANTED TO KNOW AS TO WHETHER THIS ISSUE WAS R AISED BEFORE THE CIT (A) AND IF RAISED, WHAT IS THE DECISION OF THE CIT (A) ON THIS ASPECT. THE BENCH ALSO REQUIRED TO SEE THE ORIGINAL ORDER OF THE ASSESSMENT PASSED BY THE AO IN THESE THREE ASSESSMENT YEARS. THE BENCH FURTHER OBSERVED THAT IF THIS ISSUE WAS NOT RAISED BEFORE THE CIT(A) AND ORIGINAL A SSESSMENT ORDER IS NOT AVAILABLE ON RECORD, THEN THIS ISSUE IS TO BE RESTORED TO THE FILE OF CIT(A) IN ALL THESE THREE ASSESS MENT YEARS FOR DECIDING THIS ISSUE FIRST AND THEN HE SHOULD DECIDE THE ISSUE ON MERIT. 4. IN REPLY, BOTH SIDES AGREED FOR THIS PROPOSITION PUT FORWARD BY THE BENCH. ACCORDINGLY, IN THESE THREE YEAR S, THE ORDER OF CIT(A) IS SET ASIDE AND THE MATTER IS RESTORED BACK TO CIT(A) FOR A DECISION FIRST ON THIS ASPECT, WHICH IS R AISED BY THE ASSESSEE AS PER GROUND NO. 1 BEFORE THE TRIBUNAL IN AYS. 2003-04 AND 2004-05 AND GROUND NO. 3 IN AY. 2006-07 AND THEREAFTER A FRESH DECISION ON MERIT. IN VIEW OF THIS DECISION, NO ADJUDICATION ON MERIT IS CALLED FOR AT THE PRESENT S TAGE. 5. IN THE RESULT, ALL THE THREE APPEALS FOR THE AYS. 20 03-04, 2004-05 AND 2006-07 ARE ALLOWED FOR STATISTICAL PURPO SES. PROLIFIC VENTURES PVT. LTD., : 6 : 6. NOW I TAKE UP THE APPEAL OF ASSESSEE FOR THE AYS. 2 005- 06 IN ITA NO. 40/MUM/2018. FOR THIS YEAR, IT IS SUB MITTED BY THE LD. AR OF THE ASSESSEE THAT AS PER PARA NO. C AT PAG E NO. 17 OF THE IMPUGNED ORDER OF THE LD. CIT(A), IT IS STATED BY THE LD. CIT(A) THAT THE FACTS AND CIRCUMSTANCES OF THIS YEAR ARE IDENTICAL WITH THAT OF AY. 2003-04 AND APPEAL FOR A. Y . 2005 06 WAS DECIDED ON THE SAME LINE OF THE DECISION FOR AY. 2003- 04. 6.1. THEREAFTER, HE SUBMITTED THAT AN ADDITIONAL ISSUE W AS RAISED BY THE ASSESSEE BEFORE THE CIT (A) IN AY. 200 5-06 AS PER GROUND NOS. 4 & 5 IN RESPECT OF ALLOWING OF EXPENSES CLAIMED FOR EARNING OF COMMISSION INCOME. LD. CIT (A) HAS NOT DECIDED THIS ISSUE AT ALL IN AY. 2005-06. LD. DR FOR THE REVEN UE SUPPORTED THE ORDER OF THE LD. CIT (A). 7. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND F ORCE IN THE SUBMISSIONS OF THE LD. AR OF THE ASSESSEE BECAUSE I FIND THAT GROUND NO. 4 RAISED BY THE ASSESSEE BEFORE CIT (A ) IN AY. 2005-06 IS AS UNDER: 4. THE LEARNED CIT (APPEALS) HAS ERRED IN SUPERSE DING THE HON. ITAT (MUMBAI) BY FRESHLY ADJUDICATING AN ISSUE WHIC H HAD BEEN ALREADY DECIDED BY THE HON. ITAT (MUMBAI). PROLIFIC VENTURES PVT. LTD., : 7 : 7.1. IN AY. 2003-04, THERE WAS NO SUCH ISSUE RAISED BY THE ASSESSEE BEFORE THE LD. CIT (A) AND HENCE, IT IS APPA RENT THAT GROUND NO. 4 RAISED BY THE ASSESSEE BEFORE THE CIT (A ) IN AY. 2005-06 WAS NOT DECIDED BY HIM. HENCE, I FEEL IT PROP ER TO SET ASIDE THE ORDER OF CIT (A) IN A. Y. 2005 06 AND TO RESTORE THE MATTER TO HIS FILE FOR DECISION IN RESPECT OF GROUND N O. 4 RAISED BY THE ASSESSEE FOR BEFORE HIM IN THIS YEAR. I ORDER ACCORDINGLY. 8. IN THE RESULT, THE APPEAL FOR THE AY. 2005-06 IS ALL OWED FOR STATISTICAL PURPOSES IN THE TERMS INDICATED ABOVE. 9. IN RESPECT OF THE REMAINING TWO APPEALS I.E. FOR A YS. 2007-08 AND 2008-09 IN ITA NOS. 42/MUM/2018 AND 43/MUM/2018, IT IS SEEN THAT AS PER THE GROUNDS EXCEPT GROUND NO. 4 RAISED IN RESPECT OF INITIATION OF PENA LTY PROCEEDINGS RAISED IN THESE TWO YEARS AS REPRODUCED ABOVE, THE GROUNDS ARE GENERAL AND THERE IS NO SPECIFIC GRIE VANCE OF THE ASSESSEE IN THESE TWO YEARS. APART FROM THIS, THE G ROUND NO. 4 IN BOTH YEARS IN RESPECT OF INITIATION OF PENAL TY PROCEEDINGS IS A PREMATURE GROUND. WHEN THIS WAS POI NTED OUT BY THE BENCH TO THE LD. AR OF THE ASSESSEE, LD. AR H AD NOTHING TO SAY. LD. DR FOR THE REVENUE SUPPORTED THE ORDER(S) OF THE LD. CIT (A). PROLIFIC VENTURES PVT. LTD., : 8 : 10. IN VIEW OF THE ABOVE DISCUSSION, I FEEL IT PROPER TO DISMISS THESE TWO APPEALS FOR THE AYS. 2007-08 AND 2008-09 BE CAUSE I FIND THAT IN THESE TWO YEARS, THE GROUND NO. 4 RAISED REGARDING INITIATION OF PENALTY PROCEEDINGS IS A PRE MATURE GROUND AND THE REMAINING THREE GROUNDS ARE GENERAL IN NATURE, FOR WHICH NO ADJUDICATION IS CALLED FOR. 11. IN THE RESULT, THE APPEALS OF THE ASSESSEE FOR THESE TWO YEARS I.E., AYS. 2007-08 AND 2008-09 ARE DISMISSED. 12. TO SUM-UP, APPEALS IN AYS. 2003-04 TO 2006-07 AR E ALLOWED FOR STATISTICAL PURPOSES AND APPEALS IN AYS. 2 007-08 & 2008-09 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 ST DAY OF FEBRUARY, 2019 SD/- (A.K. GARODIA) /ACCOUNTANT MEMBER /MUMBAI; /DATED : 1 ST FEBRUARY, 2019 TNMM PROLIFIC VENTURES PVT. LTD., : 9 : / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. ' ! / THE RESPONDENT 3. # $ ( ) / THE CIT(A), MUMBAI 4. # $ / CIT, MUMBAI 5. '()*+ , #-*+#. , / DR, ITAT, MUMBAI 6. )/01 / GUARD FILE # / BY ORDER, ' //TRUE COPY// /# (DY./ASST. REGISTRAR) #-*+#., / ITAT, MUMBAI