ITO, New Delhi V. Sh. Rohit Khanna, New Delhi

ITA 4296/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97519 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 1
• Next Hearing Date: 30-09-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 06-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Keywords: Non-deduction of tax

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-I : NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER ITA NO.4296/DEL/2014 ASSESSMENT YEAR : 2010-11 ITO, WARD-26(2), NEW DELHI. VS. ROHIT KHANNA, G-5, SHAM NAGAR, NEW DELHI. PAN: AOAPK5490A (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI S.L. ANURAGI, SR. DR DATE OF HEARING : 30. 09.2015 DATE OF PRONOUNCEMENT : 30.09.2015 ORDER THIS APPEAL BY THE REVENUE ARISES OUT OF THE ORDER PASSED BY THE CIT(A) ON 25.6.2014 DELETING THE PENALTY OF RS.4,58 ,148/- IMPOSED BY THE AO U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 (H EREINAFTER ALSO CALLED THE ACT) IN RELATION TO THE ASSESSMENT YEA R 2010-11. ITA NO.4296/DEL/2014 2 2. I HAVE HEARD THE LD. DR AND PERUSED THE RELEVANT MATERIAL ON RECORD. THERE IS NO APPEARANCE FROM THE SIDE OF TH E ASSESSEE DESPITE NOTICE. I AM, THEREFORE, PROCEEDING TO DISPOSE OF THIS APPEAL EX PARTE QUA THE ASSESSEE. 3. IT IS OBSERVED THAT THE ASSESSEE PAID COMMISSION OF RS.14,65,940/- AND INCURRED ADVERTISEMENT EXPENSES AMOUNTING TO RS .53,688/-. DEDUCTION WAS CLAIMED FOR THESE TWO EXPENSES. THE AO DISALLOWED THESE TWO EXPENSES ON THE GROUND THAT TAX WAS REQUI RED TO BE DEDUCTED AT SOURCE U/S 194H AND 194C, RESPECTIVELY FOR THESE PA YMENTS, WHICH WAS NOT DONE. HE, THEREFORE, MADE DISALLOWANCE U/S 40( A) (IA) IN RESPECT OF THESE AMOUNTS. THEREAFTER, PENALTY WAS IMPOSED WHI CH CAME TO BE DELETED IN THE FIRST APPEAL. 4. IT IS OBSERVED THAT THE VERY BASIS OF PENALTY IS DISALLOWANCE OF TWO EXPENSES FOR NON-DEDUCTION OF TAX AT SOURCE. SECTI ON 271(1)(C) CAN BE INVOKED WHERE THE ASSESSEE CONCEALS HIS INCOME OR F URNISHES INACCURATE PARTICULARS OF HIS INCOME. HERE IS A CASE IN WHICH THE ASSESSEE CLAIMED DEDUCTION AFTER DUE PAYMENT OF THESE TWO EXPENSES A ND THIS FACT WAS ITA NO.4296/DEL/2014 3 PROPERLY DISCLOSED WHICH HAS NOT BEEN DISPUTED BY T HE AO. THE MERE FACT THAT THE ASSESSEE DID NOT DEDUCT TAX AT SOURCE MAY BE A GOOD GROUND FOR DISALLOWANCE IN ASSESSMENT, BUT CANNOT UNDER AN Y CIRCUMSTANCE BE CONSIDERED AS A CASE JUSTIFYING IMPOSITION OF PENAL TY U/S 271(1)(C). I, THEREFORE, APPROVE THE VIEW TAKEN BY THE LD. CIT(A) ON THIS SCORE. 5. IN THE RESULT, THE APPEAL IS DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 30.09.201 5. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED, 30 TH SEPTEMBER, 2015. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.