BCD TRAVELS INDIA P.LTD, MUMBAI V. DCIT 9(2)(1) EARLIER ADDL CIT 8(1), MUMBAI

ITA 4161/MUM/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 2001 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 12-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: NIPUR AGARWAL
• Keywords: Set aside
• Section: 271(1)(c); 80IA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA, AM AND SHRI SANDEEP GOSAIN , JM ITA NO. 4161/ MUM/ 2018 (ASSESSMENT YEAR: 2009 - 10 ) M/S. BCD TRAVELS INDIA PVT. LTD. LEVEL 2, OFFICE NO.3 - B, B - WING, TIMES SQUARE, ANDHERI KURLA ROAD, MAROL, ANDHERI (EAST), MUMBAI - 400 059 VS. DY. CIT, RANGE 9(2)(1), (EARLIER ADDL. CIT - 8(1)), AAYAKAR BHAVAN, MUMBAI - 400 012 PAN/GIR NO. AAACF 1613 R ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : MISS NIPUR AGARWAL RESPONDENT BY : SHRI ASHISH KUMAR DATE OF HEARING : 22.07.2019 DATE OF PRONOUNCEMENT : 05.09. 2019 O R D E R PER SHAMIM YAHYA, A. M.: THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - 16 (LD.CIT(A) FOR SHORT) PERTAIN ING TO THE ASSESSMENT YEAR (A.Y.) 2009 - 10. 2. THE ISSUE RAISED IS THAT THE LD. CIT(A) ERRED IN CONFIRMING THE PENALTY OF RS.7,06,400/ - U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961 (THE ACT' FOR SHORT). 3. IN THIS CASE, IN THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER (.O. FOR SHORT) HAS DISALLOWED THE CLAIM OF DEDUCTION U/S. 80IA IN RESPECT OF ITS D IVISION OF MULTI NATIONAL S ERVICE CENTRE AT BANGALORE. AS AGAINST THE CLAIM OF DEDUCTION OF RS.1,60,06,372/ - , ON ACCOUNT OF CHANGE IN ALLOCATION OF COMM ON EXPENDITURE, THE A.O. ALLOWED A DEDUCTION OF RS.1,37,20,277/ - . THIS R EDUCTION OF RS.22,86,095/ - WAS DUE TO ALLOCATION OF COMMISSION 2 ITA NO. 4161/MUM/2018 M/S. BCD TRAVELS INDIA PVT. LTD. EXPENSES TO THE BANGALORE UNIT. ON THIS DISALLOWANCE, PENALTY U/S. 271(1)(C) W AS LEVIED. IN DOING SO, THE A.O. RELIED UPON THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF UNION OF INDIA V. DHARAMENDRA TEXTILE PROCESSORS , [2008] 306 ITR 277 (SC). HE REJECTED THE ASSESSEES RELIANCE UPON THE DECISION OF HON'BLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD ., (2010) 11 SCC 762 (SC ). 4. UPON THE ASSESSEES APPEAL IN THIS REGARD, HE CONFIRMED THE PENALTY. 5. AGAINST THIS ORDER, THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 6. WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. WE FIN D THAT IN THIS CASE THERE IS A R EDUCTION IN ALLOWANCE FOR SECTION 10A EXEMPTION BY ALLOCATION OF CERTAIN COMMON EXPENDITURE . THERE IS NO DOUBT ABOUT THE GENUINENESS OF THE EXPENDITURE. FROM THE MATERIAL AVAILABLE ON RECORD, THE ASSESSING OFFICER HAS DONE THE RE - ALLOCAT ION . H ENCE T HERE IS NO CASE THAT ANY PARTICULAR HAS BEEN WITHHELD. IN THIS VIEW OF THE MATTER, IN OUR CONSIDERED OPINION, WHEN THERE IS NO CASE OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INC OME. HENCE THE ASSESSEE CANNOT BE VISITED WITH THE RIGORS OF PENALTY U/S. 271(1)(C) OF THE ACT. THE DISALLOWANCE OF CLAIM OF THE ASSESSEE I PS O FACTO CANNOT LEAD TO LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. THIS VIEW IS DULY SUPPORTED BY HON'BLE APEX COURT DECISION IN THE CASE OF RELIANCE PETROPRODUCTS PVT. LTD . (SUPRA). FURTHERMORE, IN OUR CONSIDERED OPINION, THE ASSESSEES CONDUCT IS NOT CONTUMACIOUS SO AS TO WARRANT LEVY OF PENALTY. IN THIS REGARD, RELIANCE IS PLACED ON HON'BLE APEX COURT DECISION IN THE CASE STATE OF ORISSA VS. HINDUSTAN STEEL OF 83 ITR 23. 3 ITA NO. 4161/MUM/2018 M/S. BCD TRAVELS INDIA PVT. LTD. 7. ACCORDINGLY, IN THE BACKGROUND OF THE AFORESAID DISCUSSION AND PRECEDENT, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE PENALTY. IN THE RESULT, THIS APPEAL BY THE ASSESSEE STANDS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 05.09.2019 SD/ - SD/ - ( SANDEEP GOSAIN ) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 05.09.2019 ROSHANI , SR. PS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI