YATISH IMPEX P.LTD, MUMBAI V. ITO 9(3)(4), MUMBAI

ITA 4251/MUM/2012

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 4514 (ITAT-MUMBAI)
• Duration Of Justice: 8 year(s) 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2002-2003
• Appeal Filed On: 20-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rejection of books of accounts; Set aside
• Section: 271(1)(c); 133A; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI RAJESH KUMAR , AM AND SHRI AMARJIT SINGH, JM / I .T.A. NO. 4251 /MUM/20 1 2 ( / ASSESSMENT YEAR: 2002 - 03 ) YATISH IMPEX P. LTD. 215 HEMLOK APARTMENT 87, KI LACHA ND STREET, S. V. RD, KANDI VALI (W), MUMBAI - 67. / VS. ITO - 9(3)(4) MUMBAI. ./ ./ PAN/GIR NO. : AAACY1225C ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING : 14 / 12 / 20 20 / DATE OF PRONOUNCEMENT : 09 /0 2 / 2021 / O R D E R PER AMARJIT SINGH, J M: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINS T THE ORDER DATED 18 .0 6 .201 8 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 37 , MUMBAI [HEREINAFTE R REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y. 2011 - 12 WHERE IN THE PENALTY LEVIED BY THE AO HAS BEEN ORDERED TO BE CONFIRMED . 2 . THE ASSESSEE HAS RAI SED THE FOLLOWING GROUNDS: - 1. THAT THE LD. CIT(A) CONFIRMED THE PENALTY 271(1)(C) OF THE ACT RS.30,00,000/ - IS QUITE ILLEGAL. 2. THAT THE LD. CIT(A) DISMISSED THE APPEAL WITHOUT CONSIDERING THE PROPER FACTS OF THE CASE. ASSESSEE BY : NONE REVENUE BY: SHRI T. S. KHA LSA (SR. AR) ITA. NO. 4251 /M/201 2 A.Y. 20 02 - 03 2 3. THAT THUS THE CONFIRMATION OF PENALTY ON ESTIMATED ASSESSED INCOME IS QUITE ILLEGAL, ARBITRARY, UNWARRANTED UNJUSTIFIED AND BAD IN LAW. 4. THAT TH E APPELLANT FURTHER CREAVE, TO LEAVE, TO ADD, TO ALTE R AND/OR TO AMEND ANY OF THE AFORESAID GROUNDS OF APPEAL AS AND WHEN NECESSARY. ' 3 . THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME DECLARING TOTAL I N COME TO THE TUNE OF RS.1,95,722 / - ON 31.10.2002 . THE REAFTER THE CASE WAS SELECTED FOR SCRUTINY ON THE BASIS OF INFORMATION RECEIVED FROM THE ADDL. DIRECTOR OF INCOME TAX (INV.), UNIT V, MUMBAI THAT THE ASSESSEE COMPANY DURING THE CAPTIONED ASSESSMENT YEAR HAS CLAIMED BOGUS/NON - GENUINE COMMISSION/BROKERAGE PAID TO ONE COMPANY VIZ M/S. MOIRA STEEL LTD. AT 103, LAXMI TOWER, 576, M. G. ROAD, INDORE. A SURVEY ACTI ON U/S 133A WAS CARRIED OUT AT THE BUSINESS PREMISES OF M/S. MOIRA STEELS LTD. DURING THE COURSE OF SURVEY, A STATEMENT OF SHRI VIMAL TODI, DIRECTOR OF M/S. MOIRA STEEL LTD. WAS RECORDED IN WHICH HE ADMITTED THAT THE ASSESSEE HAS MADE THE PAYMENT TO THE TU NE OF RS.33,42,455/ - TO M/S. MOIRA STEEL LTD, IN THE FORM OF BOGUS/NON - GENUINE COMMISSION/BROKERAGE. ON THE BASIS OF INFORMATION, A NOTICE U/S 148 OF THE I. T. ACT WAS ISSUED. IN PURSUANCE OF NOTICE, T HE ASSESSEE FILED THE RETURN OF INCOME DECLARING TOTAL INCOME AT RS.1,95,722/ - ON 13.03.2008. THE ASSESSEE FAILED TO COOPERATE WITH T HE AO, THEREFORE, THE AO REJECTED THE BOOKS OF ACCOUNTS AND ASSESSED THE PROFIT @ 1% OF THE GROSS TURNOVER TO THE TUNE OF RS.77,53,444/ - U/S 144 OF THE ACT. PENALTY PROCEEDING WA S INITIATED. AFTER THE NOTICE OF PENALTY, THE PENALTY IN SUM OF RS. 3,00,000/ - WAS LEVIED. ITA. NO. 4251 /M/201 2 A.Y. 20 02 - 03 3 FEELING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO CONFIRMED THE PENALTY , THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 4 . WE HA VE HEARD THE ARGUMENT ADVANCED BY THE LD. REPRESENTATIVE OF THE DEPARTMENT AND HAS GONE THROUGH THE CASE FILED CAREFULLY. IT IS APPARENT ON RECORD THAT THE ASSESSMENT OF THE ASSESSEE WAS COMPLETED U/S 144 OF THE ACT REJECTING THE BOOKS OF ACCOUNTS AND SUBS EQUENTLY THE NET PROFIT OF THE ASSESSEE WAS ASSESSED @ 1% OF THE TURNOVER DECLARED. THE NET PROFIT WAS DETERMINED AT RS . 77,53,444/ - . THE ASSESSMENT WAS COMPLETED BY ESTIMATING THE PROFIT. NO PENALTY IS LEVIABLE WHERE THE ASSESSMENT WAS COMPLETED ON THE BA SIS OF THE ESTIMATION OF PROFIT . IN THIS REGARD , W E FIND SUPPORT OF THE DECISION OF HO N BLE GUJARAT HIGH COURT IN THE CASE OF NATIONAL TEXTILES VS. CIT 2001 164 CTR 2009 (GUJ) IN WHICH IT IS SPECIFICALLY HELD THAT THE NO PENALTY IS LIABLE TO BE SUSTAINABLE WHERE THE PROFIT WAS ESTIMATED. TAKING INTO ACCOUNT ALL THE FACTS AND CIRCUMSTANCES MENTIONED ABOVE , WE SET ASIDE THE FINDING OF THE CIT(A) ON THIS ISSUE AND DELETE THE PENALTY. 5 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 09 /0 2 /202 1 SD/ - SD/ - ( RAJESH KUMAR ) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATE D : 09 /0 2 /202 1 V IJAY PAL SING H ( SR. PS ) ITA. NO. 4251 /M/201 2 A.Y. 20 02 - 03 4 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, //TRUE COPY// / /(DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI