Soumya Prakash Pattnaik, Cuttack V. ACIT, Cuttack

ITA 429/CTK/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81463 (ITAT-CUTTACK)
• Duration Of Justice: 1 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 20-10-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 29-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: S N SAHU
• Keywords: Salary income; Reasonable cause

Judgement Text

I.T.A. NO. 4 29 / CTK ./20 1 3 ASSESSMENT YEAR: 200 5 - 20 0 6 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE SHRI S .V. MEHROTRA (ACCOUNTANT MEMBER) , AND SHRI GEORGE MATHAN (JUDICIAL MEMBER) I.T.A. NO. 4 29 / CTK / 20 1 3 ASSESSMENT YEAR : 200 5 - 20 0 6 SOUMYA PRAKASH PATTNAIK, ............... .... ....... .. .APP ELL ANT MADHUSUDAN AVENUE, TULSIPUR, CUTTACK [PAN : A LHPP 8117 H ] - VS. - ASSISTANT COMMISSIONER OF INCOME TAX , .... . RESPONDENT CIRCLE - 2( 2 ), CUTTACK APPEARANCES BY: SHRI S.N. SAHU , A .R. , FOR THE ASSESSEE SHRI S.C. MOHANTY , D.R , FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : OCTOBER 20 , 2 01 4 DATE OF PRONOUNCING THE ORDER : OCTOBER 22 , 201 4 O R D E R PER GEORGE MATHAN : TH IS IS AN APPEAL FILED BY THE ASSESSE E AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (A PPEALS) , CUTTACK IN I.T. APPEAL NO. 0 141 / 2010 - 1 1 DATED 2 4 . 07 .20 1 3 FOR THE ASSESSMENT YEAR 200 5 - 0 6 AGAINST THE CONFIRMATION OF LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT . 2 . SHRI S.N. SAHU , A .R. , REPRESENTED ON BEHALF OF THE ASSESSEE AND SHRI S.C. MOHANTY , D.R, REPRESENTED ON BEHALF OF THE REVENUE . I.T.A. NO. 4 29 / CTK ./20 1 3 ASSESSMENT YEAR: 200 5 - 20 0 6 PAGE 2 OF 3 3. AT THE TIME OF HEARING IT WAS SUBMITTED BY THE LD. AR THAT THE ASSESSEE IS AN INDIVIDUAL, WHO IS DRAWING SALARIED INCOME. IT WAS THE SUBMISSION THAT THE ASSESSEE IS A TEACHER TEACHING IN ORISSA ENGINE ERING COLLEGE. IT WAS T HE SUBMISSION THAT THE ASSESSEE WAS ENTITLED TO REIMBURSE OF RS.5,000/ - PER MONTH TO HIS HOSPITALITY ALLOWANCE AND RS.1,000/ - PER MONTH TOWARDS TELEPHONE ALLOWANCE. IT WAS THE SUBMISSION THAT THE ASSESSEE HAD NOT INCLUDED THE TWO ALL OWANCES WHEN FILING HI S RETURN OF INCOME AS THE SAID ALLOWANCES WERE IN THE NATURE OF REIMBURSEMENT OF THE EXPENSES INCURRED BY THE ASSESSEE. IT WAS THE SUBMISSION THAT THE ASSESSING OFFICER WHILE COMPLETING THE ASSESSMENT TREATED THE SAID TWO AMOUNTS AS I NCOME OF THE ASSESSEE. IT WAS THE SUBMISSION THAT IN THE PENALTY PROCEEDINGS, THE ASSESSEE HAD SUBMITTED THAT THE AMOUNTS WERE REIMBURSEMENT AND CONSEQUENTLY WAS NOT LIABLE TO BE TREATED AS THE INCOME OF THE ASSESSEE. THE ASSESSEE HAD ALSO PRODUCED BEFORE THE ASSESSING OFFICER THE COPY OF THE LETTER FROM THE ORISSA ENGINEERING COLLEGE DATED 06.09.2010, WHEREIN IT WAS SPECIFIED THAT THE SAID TWO AMOUNTS WERE REIMBURSEMENTS. IT WAS THE SUBMISSION THAT THE REPLY GIVEN BY THE ASSESSEE WAS NOT CONSIDERED AND PEN ALTY WAS LEVIED. IT WAS THE SUBMISSION THAT THE SAID LETTER SPECIFICALLY CLARIFIES THAT THE REMUNERATION IS RS.15,000/ - PER MONTH AND THAT THE REIMBURSEMENT WAS RS.5,000/ - PER MONTH FOR HOSPITALITY ALLOWANCE AND RS.1,000/ - PER MONTH TOWARDS TELEPHONE ALLO WANCE. IT WAS THE SUBMISSION THAT THE REIMBURSEMENTS WERE NOT PART OF THE INCOME OF THE ASSESSEE. IT WAS THE SUBMISSION THAT PENALTY LEVIED MAY BE DELETED. 4 . IN REPLY, LD. D . R . VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER AND LD. CIT(APPALS). 5 . WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERUSAL OF THE ASSESSMENT ORDER CLEARLY SHOWS THAT THE ASSESSING OFFICER HAS TREATED THE AMOUNT OF RS.5,000/ - PER MONTH TOWARDS HOSPITALITY ALLOWANCE REIMBURSEMENT AND RS.1,000/ - PER MONTH TOWARDS TELEPHONE ALL OWANCE REIMBURSEMENT AS THE SALARY INCOME OF THE ASSESSEE. ADMITTEDLY THE LETTER DATED 06.09.2010 WHICH HAS ALSO BEEN EXTRACTED BY THE ASSESSING OFFICER CLEARLY SHOWS THAT THE AMOUNTS ARE ONLY REIMBURSEMENT S . THE AMOUNTS HAVING BEEN SHOWN AS REIMBURSEMENT THE SAME CANNOT BE TREATED AS INCOME IN THE HANDS OF THE ASSESSEE ESPECIALLY UNDER THE HEAD SALARY. CONSEQUENTLY NON - INCLUSION OF THE SAME IN THE ASSESSEES RETURN OF INCOME COULD NOT BE TREATED AS CONCEALMENT OF INCOME. IN ANY I.T.A. NO. 4 29 / CTK ./20 1 3 ASSESSMENT YEAR: 200 5 - 20 0 6 PAGE 3 OF 3 CASE, THE ASSESSEE IS NOT IN APPEAL AGAINST THE ADDITION MADE IN THE ASSESSMENT ORDER, HOWEVER, THAT WOULD NOT BAR THE ASSESSEE FROM RAISING ITS PLEA OF REASONABLE CAUSE IN THE PENALTY PROCEEDINGS. A PERUSAL OF THE LETTER ISSUED BY THE ORISSA ENGINEERING COLLEGE CLEARLY MENTIONING THE SAME TO BE REIMBURSEMENT, THE SAME CANNOT BE TREATED AS THE SALARIED INCOME OF THE ASSESSEE, WHICH HAS BEEN CONCEALED BY THE ASSESSEE. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE PENALTY LEVIED BY THE ASSESSING OFFICER AND CONFIRMED BY THE LD. CIT(APPEALS) IS UNSUSTAINABLE AND CONSEQUENTLY DELETED. 6 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND OCTOBER , 2014. SD/ - SD/ - S .V. MEHROTRA GEORGE MATHAN ( AC COUNTANT MEMBER) ( JUDICIAL MEMBER) KOLKATA, THE 22 ND D AY OF OCTO BER , 201 4 COPIES TO : (1) THE ASSESSEE (2) THE DEPARTMENT (3) COMMISSIONER OF INCOME - TAX (APPEALS) (4) COMMISSIONER OF INCOME TAX ( 5 ) THE DEPARTMENTAL REPRESENTAT IVE ( 6 ) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL CUTTACK B ENCH, CUTTACK LAHA/SR. P.S.