DCIT, New Delhi V. M/s. Jasisa Tyres (P) Ltd., New Delhi

ITA 4348/DEL/2014

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4044 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2008-2009
• Appeal Filed On: 08-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law; Difference of opinion
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: D , NEW DELHI BEFORE SHRI R .K. PANDA , ACCOUNTANT MEMBER AND SMT. BEENA A PILLAI, JUDICIAL MEMBER ITA NO. 4348 /DEL/201 4 A.Y. 20 08 - 09 DCIT CIRCLE 4(1) NEW DELHI VS . JASISA TYRES P LTD. F - 1/10A, G 8 AREA OPP. BSES OFFICE HARI NAGAR NEW DELHI PAN: AAACJ 8241 K (APPELLANT) (RESPONDENT) APPELLANT BY SHRI AMIT JAIN, S R.D.R. RESPONDENT BY NONE DATE OF HEARING 0 8 .01.2018 DATE OF PRONOUNCEMENT 15.01.2018 ORDER PER BEENA A PILLAI, JUDICIAL MEMBER T HE PRESENT APPEAL HAS BEEN FILED BY REVENUE AGAINST ORDER DATED 12/05/14 PASSED BY LD. CIT (A) - 8, NEW DELHI FOR ASSESSMENT YEAR 2008 - 09 ON THE FOLLOWING GROUNDS OF APPEAL: ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 2 OF 8 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE PENALTY U/S 271(1)(C ) AMOUNTING TO RS.26,71,992/ - IMPOSED BY THE AO? 2. THAT THE ORDER OF THE LD.CIT(A) IS ERRONEOUS AND IS NOT TENABLE ON FACTS AND IN LAW. 3. THAT THE GROUNDS OF APPEAL ARE WIT HOUT PREJUDICE TO EACH OTHER. 4. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FOREGO ANY OF THE GROUNDS OF APPEAL ABOVE AT THE TIME OF THE HEARING . 2. B RIEF FACTS OF THE CASE ARE AS UNDER : A SSESSEE IS A COMPANY AND IS DERIVING INCOME FROM HOUSE RENT. DURING THE YEAR UNDER CONSIDERATION ASSESSEE FILED ITS RETURN OF INCOME ON 29/03/09 , DECLARING TOTAL INCOME OF RS.3,57,390/ - . THE CASE WAS PROCESSED UNDER SECTION 143 (1) OF THE INCOME TAX ACT, 1961 (THE ACT) AND IT WAS SELECTED FOR SCRUTINY. NOTIC ES UNDER SECTION 143 (2) AND 142 (1) OF THE ACT WAS ISSUED TO ASSESSEE IN RESPONSE TO WHICH REPRESENTATIVES OF ASSESSEE APPEARED DURING ASSESSMENT PROCEEDINGS AND FURNISHED DETAILS IN RESPON SE TO QUERIES RAISED . ASSESSING OFFICER PASSED ASSESSMENT ORD ER UNDER SECTION 143 (3) OF THE ACT ON 13/12/10 AND ASSESSED INCOME AT RS.91,70,263/ - . LD.AO MADE ADDITION OF RS.88,12,873/ - ON ACCOUNT OF LONG TERM CAPITAL GAIN , AS A GAIN ST THE LONG TERM CAPITAL LOSS OF RS.41,57,965/ - CLAIMED BY ASSESSEE. 2.1 . AGAINST TH E ASSESSMENT ORDER, ASSESSEE FILED APPEAL BEFORE LD.CIT(A) WHO CONFIRMED THE ADDITION MADE BY LD.AO. AGAINST THE ORDER OF LD.CIT(A) ASSESSEE PREFERRED APPEAL BEFORE THIS T RIBUNAL . ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 3 OF 8 THE TRIBUNAL DISMISSED ASSESSEE S APPEAL V IDE ORDER DATED 18/04/13 IN ITA NO . 22/DEL/2012. 2.2. THEREAFTER SHOW CAUSE NOTICE UNDER SECTION 271(1)(C) OF THE A CT WAS ISSUED TO ASSESSEE. LD.AO AFTER CONSIDERING SUBMISSIONS MADE BY ASSESSEE LEVIED A PENALTY OF RS.26,71,992/ - BEING 100 % OF THE TAX ON INCOME. 2.3 . AGGRIEVED BY THE ORDER OF LD.AO ASSESSEE PREFERRED APPEAL BEFORE LD. CIT (A) WHO DELETED THE PENALTY BY OBSERVING AS UNDER: 4.3 IN MY OPINION FILING OF A CLAIM WHICH IS NOT ACCEPTABLE AT THE TIME OF MAKING ASSESSMENT OF INCOME WOULD NOT AMOUNT TO FILI NG OF INACCURATE PARTICULARS . 4.4. THE AUDITORS REPORT DATED 05. 09. 2008 OF THE APPELLANT COMPANY CLEARLY MENTIONED OBSERVATIONS OF THE AUDITORS AS PER NOTES TO ACCOUNTS AS UNDER: 'THE COMPANY HAS SOLD A PROPERTY NO. 6, IDC, MEHRAULI ROAD, GURGAON OF RS. 9.00 CRORE OUT OF WHICH THE COMPANY HAS PAID RS. 80.00 LACS TO SH. ANUMOD SHARMA AGAINST THE SETTLEMENT OF RS. 15.00 LACS WAS RECEIVED IN ADVANCE. THE COMPANY HAS SOLD THE PROPERTY FOR THE SETTLEMENT OF THE LOAN OF M / S INDO JAPAN PHOTO FILM CO. LTD AS THE PROPERTY WAS ATTACHED BY FINANCIAL INSTITUTION BEING A TREATED COMMON DIRECTORS AND SHAREHOLDERS O F THE COMPANY. THIS SHOWS THAT THE F ACTS WERE EXAMINED BY THE AUDITORS AS REGARDS THE PAYMENT O F RS.80.00 LACS AND O F RS. 43,58,838/ - BEING PAYMENT MADE TO THE FINANCIAL INSTITUTION. IN MY OPINION THE DETAILS GIVEN IN THE RETURN WERE FILED BASED UPON THE ACTUAL PAYMENTS MADE BY THE APPELLANT AND CONSEQUENTLY THE CLAIMS WERE MADE WHILE CALCULATING THE CAPITAL GAIN TAX. IN MY OPINION THIS DOES NOT AMOUNT TO 'FILING INACCURATE PARTICULARS O F SUCH INCOME FURNISHED'. 4.5 I ALSO AGREE WITH THE APPELLANT THAT 'THE DISALLOWANCES MADE BY THE ASSESSING AUTHORITY IN THE ASSESSMENT ORDER UNDER SECTION 143(3) OF THE ACT WERE SOLELY ON ACCOUNT OF DIFFERENT VIEWS TAKEN ON THE SAME SET OF FACTS AND, THEREFORE, THEY COULD, AT THE MOST, BE TERMED AS DIFFERENCE OF OPINION BUT NOTHING TO DO WITH THE CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME.' MOREOVER THE NOTES ON ACCOUNT WHICH IS PART OF D ULY CERTIFIED AUDIT REPORT FOR THE SAID ASSESSMENT YEAR HAS VERY CLEARLY MENTIONED THE SUM OF RS.80,00,000 / - SO PAID TO MR. ANUMOD SHARMA. 4.6 THE APPELLANT ALSO CITED THAT THEIR CASE IS SIMILAR AND WELL COVERED WITH CIT AHMEDABAD VS. RELIANCE PETROPRODUCTS PVT LTD, ON 17 MARCH, 2010 DECIDE BY THE APEX ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 4 OF 8 COURT; AND THAT IN NONE OF THE PROCEEDINGS, IT HAS BEEN DECIDED AND MENTIONED THAT INACCURATE P ARTICULARS HAVE BEEN FILED OR DETAILS SUPPLIED BY THE APPELLANT COMPANY FOUND TO BE INACCURATE OR FALSE. THE OBSERVATION OF THE APEX COURT IS NARRATED HEREINABOVE AND I FULLY AGREE WITH THE SAID CONTENTION OF THE APPELLANT AND IN MY OPINION THE CASE HERE I S THAT OF DIFFERENCE OF OPINION WHICH DOES NOT CALL FOR LEVYING SUCH HARSH PENALTY IN THE MATTER IN THE GIVEN CIRCUMSTANCE AND FACTS OF THE CASE. 4.7 I ALSO OBSERVE THAT THE CASE LAWS CITED AS BELOW: - A. V.S.M.R. JAGDICHCHANDRAM (1997)227 ITR 240(SC) B. CIT VS. ZOOM COMMUNICATIONS PVT. LTD., 327 ITR 51 C. THAKUR V. HARI PRASAD VS CIT (1987) 167 ITR 603 (AP), D. UNION OF INDIAN VS DHARMENDRA TEXTILE PROCESSORS (2008) 166 TAXMAN 65 SC E. K.P. MADHUSUDAN VS.CIT, 251 ITR 99 BY THE ASSESSING OFFICER W HILE LEVYING THE PENALTY HAS ALTOGETHER DIFFERENT FACTS AS EXPLAINED ABOVE AT LENGTH CASE WISE AND I AFTER A THOROUGH READING IS OF THE OPINION THAT THEY DO NOT MATCH WITH THE FACT OF THE CASE OF THAT OF THE APPELLANT. 4.8 I ALSO NOTICE FROM THE COPIE S OF THE BALANCE SHEET AND THE AUDITOR'S REPORT THAT THE COMPANY IS NOT DOING ANY BUSINESS FOR THE PAST MANY YEARS BECAUSE OF LOSSES AND ILL HEALTH OF DIRECTORS BECAUSE OF OLD AGE AND THEY DO NOT HAVE EVEN A BANK ACCOUNT SINCE THERE ARE NO FUNDS. 4 .9 I FAIL TO UNDERSTAND AS TO WHY THIS IMPORTANT FACT WAS COMPLETELY OVERLOOKED, NOT CONSIDERED AND NOT EVEN REFERRED IN THE PENALTY ORDER DT. 28.04.2014 BY THE ASSESSING OFFICER. PENALTY PROCEEDINGS AND ASSESSMENT PROCEEDINGS ARE TWO SEPARATE PROCEEDINGS ALTO GETHER. 4.10 HOWEVER IRRESPECTIVE OF ALL ABOVE AND WITHOUT GOING IN TO DETAILS, THE ABOVE QUANTUM APPEAL HAS ALREADY BEEN ACCEPTED BY THE HON'BLE DELHI HIGH COURT AND THE FOLLOWING QUESTION OF LAW ARISES FOR CONSIDERATION: 'DID THE TRIBUNAL FALL INTO ER ROR IN HOLDING THAT THE DEDUCTION CLAIMED BY THE ASSESSEE DID NOT FALL WITHIN WHAT WAS PERMISSIBLE UNDER SECTION 48(I) OF THE INCOME TAX ACT?' 4.11 SINCE THE HON'BLE DELHI HIGH COURT VIDE ORDER DT.15/4/2014, A COPY OF WHICH HAS BEEN FILED BEFORE ME BY T HE APPELLANT, HAS ADMITTED THE APPEAL AND THE ISSUE HAS BECOME DEBATABLE; THEREFORE, IN MY OPINION AND IN VIEW OF THE CASE LAW CITED BY THE APPELLANT NO PENALTY COULD BE IMPOSED. ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 5 OF 8 3. AGGRIEVED BY THE ORDER OF LD.CIT (A) REVENUE HAS PREFERRED THIS APPEAL BEFORE US NOW. 3.1. LD.DR PLACED RELIANCE UPON THE ORDERS OF LD.AO AND LD.AR SUPPORTS THE ORDER OF LD. CIT (A). 4. WE HAVE PERUSED THE SUBMISSIONS ADVANCED BY BOTH THE SIDES IN THE LIGHT OF THE ORDERS PASSED BY AUTHORITIES BELOW. LD. CIT (A) WHILE DEALING WITH THE PENALTY HAS MADE CERTAIN CATEGORICAL OBSERVATIONS, RELEVANT EXCERPTS OF WHICH HAVE BEEN REPRODUCED HEREINABOVE. WHILE GOING THROUGH THE ORDER PASSED BY LD. CIT (A) WE ARE OF THE CONSIDERED VIEW THAT THE LD. AO HAS NOT MADE ANY ALLEGATIONS OF ASSESSEE FOR FURNISHING INACCURATE PARTICULARS. ADDITIONS IN FACT HAVE BEEN MADE ON ACCOUNT OF IMPROVEMENT AND TRANSFER EXPENSES INCURRED FOR THE PURPOSES OF THE PROPERTY SOLD. ASSESSEE HAS ALSO MADE CERTAIN PAYMENTS TO ONE MR. ANUM OD SHARMA TOWARDS THE DISPUTE IN THE PROPERTY SOLD UNDER A COMPROMISE AGREEMENT WHICH IS A PART OF RECORDS. FURTHER IT WOULD NOT BE INCORRECT TO HOLD THAT NO INFORMATION GIVEN IN THE RETURN WAS FOUND TO BE INCORRECT BY A SSESSING O FFICER AND DISALLOWANCE IS STRICTLY BECAUSE OF A DIFFERENCE OF OPINION BY LD. AO. 4.1 . IN THE LAST PART OF THE ORDER PASSED BY LD. CIT (A) IT HAS BEEN RECORDED THAT HON BLE DELHI HIGH COURT HAS ACCEPTED ASSESSEE S APPEAL AGAINST QUANTUM ORDER PASSED BY ITAT ON THE FOLLOWING QUEST ION OF LAW : D ID THE T RIBUNAL FALL INTO ERROR IN HOLDING THAT THE DEDUCTION CLAIMED BY ASSESSEE DID NOT FALL WITHIN WHAT WAS PERMISSIBLE UNDER SECTION 48 (I) OF THE I NCOME T AX A CT? ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 6 OF 8 4.2. HON BLE HIGH COURTS AND THIS TRIBUNAL HAS CONSISTENTLY HELD THAT ONCE QUESTION OF LAW HAS BEEN ADMITTED BY JURISDICTIONAL HIGH COURT , THE ISSUE BECOMES DEBATABLE AND NO PENALTY CAN BE LEVIED UNDER SUCH CIRCUMSTANCES. 4.3. ACCORDINGLY GROUNDS RAISED BY REVENUE STAND DISMISSED. 5. IN THE RESULT APPEAL FILED BY THE REVENUE STANDS DISMISSED . O RDER PASSED IN THE OPEN COURT ON 1 5 T H JANUARY, 2018. S D / - S D / - ( R .K. PANDA ) (BEENA A PILLAI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 1 5 T H JANUARY, 2018 *MV ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 7 OF 8 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER ASST. REGISTRAR ITAT, DELHI BENCHES, NEW DELHI ITA NO. 4348/DEL/2014 A.Y. 2008 - 09 DCIT VS. JASISA TYRES (P) LTD. NEW DELHI PAGE 8 OF 8 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON DRAGON 10.01.18 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 11 .01.18 SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR. PS/PS 6 KEPT FOR PRONOUNCEMENT SR. PS/PS 7 FILE SENT TO BENCH CLERK SR. PS/PS 8 DATE ON WHICH THE FILE GOES TO HEAD CLERK 9 DATE ON WHICH FILE GOES TO A.R. 10 DATE OF DISPATCH OF ORDER