DCIT (LTU), New Delhi V. M/s. Hindustan Insecticides Ltd., New Delhi

ITA 4236/DEL/2016

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 0173 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 11 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2006-2007
• Appeal Filed On: 01-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIMA
• Assessee Lawyers: RAJESH ARORA
• Section: 271(1)(c); 143(3)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI C BEN CH, NEW DELHI [THROUGH VIDEO CONFERENCE] BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI K.N. CHARY, JUDICIAL MEMBE R ITA NO. 4236/DEL/2016 [A.Y 2007-08] THE DY.C.I.T. VS. M/S. HINDUSTAN INSECTICIDES L TD CIRCLE 1 LTU SECOND FLOOR, CORE 6, SCOPE NEW DELHI COMPLEX, 7, LODHI ROAD, NEW DELHI PAN: AAACH 0905 Q [APPELLANT] [RESP ONDENT] ASSESSEE BY : SHRI RAJESH ARORA, CA REVENUE BY : MS. ANIMA, SR. DR DATE OF HEARING : 20.07.2021 DATE OF PRONOUNCEMENT : 20.07.2021 ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF THE CIT(A)-22, NEW DELHI DATED 26.05.2016 PERTAINING T O A.Y 2007-08 . 2 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE REVEN UE IS THAT THE LD. CIT(A) ERRED IN DELETING THE PENALTY OF RS. 83,44,500/- IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 [HEREINAF TER REFERRED TO AS 'THE ACT' FOR SHORT]. 3. THE ROOTS FOR LEVY OF PENALTY LIE IN THE ASSESSM ENT ORDER DATED 23.12.2008 FRAMED U/S 143(3) OF THE ACT. THE ASSES SEE HAD RETURNED NIL INCOME IN ITS RETURN OF INCOME AND THE ASSESSIN G OFFICER DISALLOWED PRIOR PERIOD EXPENSES AMOUNTING TO RS. 6,14,000/- A ND RS. 2,41,76,107/- OUT OF R & D EXPENSES. PENALTY PROCE EDINGS WERE SEPARATELY INITIATED FOR DISALLOWANCE MADE IN THE A SSESSMENT ORDER. 4. DURING THE COURSE OF PENAL PROCEEDINGS, THE ASSE SSEE CLAIMED THAT IN SO FAR AS THE R & D EXPENSES ARE CONCERNED, THE EXPENSES WERE DISALLOWED AS THE SAME WERE CONSIDERED AS CAPITAL E XPENSES AND STRONGLY CONTENDED THAT THE CLAIM MADE BY THE ASSES SEE WAS A BONAFIDE CLAIM. IN SO FAR AS PRIOR PERIOD EXPENSES ARE CONCERNED, IT WAS BROUGHT TO THE NOTICE OF THE ASSESSING OFFICER THAT THE LIABILITY CRYSTALLISED DURING THE YEAR UNDER CONSIDERATION AN D HENCE THE CLAIM WAS BONAFIDE. 3 5. THE CONTENTION OF THE ASSESSEE DID NOT FIND ANY FAVOUR WITH THE ASSESSING OFFICER WHO WAS OF THE FIRM BELIEF THAT T HE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF ITS INCOME AND ACCORDINGLY LEVIED PENALTY OF RS. 83,44,500/-. 6. THE ASSESSEE AGITATED THE MATTER BEFORE THE LD. CIT(A) AND REITERATED WHAT HAS BEEN STATED DURING THE PENAL PR OCEEDINGS. 7. WE HAVE GIVEN THOUGHTFUL CONSIDERATION TO THE OR DERS OF THE FIRST APPELLATE AUTHORITY QUA THE GRIEVANCE OF THE REVENU E. WE ARE SURPRISED AND SHOCKED BY THE CALLOUS ATTITUDE OF TH E REVENUE IN FILING THIS APPEAL WHICH SHOWS NO APPLICATION OF MIND BY T HE ASSESSING OFFICER FOR THE SIMPLE REASON THAT THE LD. CIT(A) HAD DISMI SSED THE APPEAL OF THE ASSESSEE AND IT SHOULD HAVE BEEN THE ASSESSEE W HO SHOULD HAVE FILED THE APPEAL AND NOT THE REVENUE. WE ARE LEFT WITH NO CHOICE BUT TO DISMISS THIS APPEAL AS IRRELEVANT AND INFRUCTUOU S. 4 4. IN THE RESULT THE APPEAL OF THE REVENUE IN ITA NO. 4236/DEL/2016 IS DISMISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT IN THE PR ESENCE OF BOTH THE RIVAL REPRESENTATIVE ON 20.07.2021. SD/- SD/- [ K.N. CHARY ] [N.K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 20 TH JULY, 2021 VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI 5 DATE OF DICTATION ATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P S/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER