ITO, WARD-1(2), Thane V. Smt. MANISHA KIRAN SAVAR, MUMBAI

ITA 4564/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 6854 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-04-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2011-2012
• Appeal Filed On: 05-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bogus purchase; Tax effect
• Section: 271(1)(c)

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI SHRI SHAMIM YAHYA (AM) & SHRI AMARJIT SINGH (JM) I.T.A. NO. 4564/MUM/2019 (ASSESSMENT YEAR 2011-12) ITO, WARD 1(2) ROOM NO. 24, B-WING 6 TH FLOOR ASHAR IT PARK WAGLE INDUSTRIAL ESTATE THANE-WEST-400 604. VS. SMT. MANISHA KIRAN SAVAR PROP. M/S. SIDHHIVINAYAK ENTERPRISES 201, M.V. APARTMENT NEAR BHAKTI MANDIR ROAD HARI NIWAS CIRCLE THANE-400 602. PAN : AJNPS5410N (APPELLANT) (RESPONDENT) ASSESSEE BY NONE DEPARTMENT BY SHRI BHARAT ANDHALE DATE OF HEARING 04.03.2021 DATE OF PRONOUNCEMENT 01.04.2021 O R D E R PER SHAMIM YAHYA (AM) :- THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A) DATED 30.4.2019, WHEREIN PENALTY OF RS. 12,2 60/- LEVIED UNDER SECTION 271(1)(C) OF THE I.T. ACT HAS BEEN DELETED. 2. BRIEF FACTS OF THE CASE LEADING TO LEVY OF PENAL TY ARE THAT THE ASSESSING OFFICER IN THIS CASE MADE DISALLOWANCE OF 12.5% ON ACCOUNT OF BOGUS PURCHASES. THE ASSESSEE HAS SUPPLIED THE PURCHASE V OUCHERS AND THE PAYMENTS WERE SHOWN TO HAVE BEEN MADE BY BANKING CH ANNEL. HOWEVER, DRAWING ADVERSE INFERENCE FOR THE NON-PRODUCTION OF THE SUPPLIERS THE ASSESSING OFFICER DISALLOWED 12.5% OF THE BOGUS PUR CHASES. HOWEVER THE ASSESSING OFFICER DID NOT DOUBT THE SALE. PENALTY U NDER SECTION 271(1)(C) OF THE ACT WAS ALSO LEVIED. LEARNED CIT(A) DELETED THE PEN ALTY LEVIED. 3. AGAINST THIS ORDER THE REVENUE IS IN APPEAL BEFO RE US. SMT. MANISHA KIRAN SAVAR 2 4. WE HAVE HEARD LEARNED DEPARTMENTAL REPRESENTATIV E AND PERUSED THE RECORDS. AS CLEAR FROM THE FACTS RECORDED ABOVE, TH E DISALLOWANCE HAS BEEN MADE ON AN ESTIMATED BASIS ON ACCOUNT OF THE NON-PR ODUCTION OF SUPPLIERS BEFORE THE ASSESSING OFFICER. THE PURCHASE VOUCHERS WERE DULY PRODUCED AND THE PAYMENTS WERE MADE THROUGH BANKING CHANNEL. THE SALES ARE NOT DOUBTED. IN THESE BACKGROUND IN OUR CONSIDERED OPINION THE A SSESSEE CANNOT BE VISITED WITH THE REGOURS OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. AS A MATTER OF FACT, ON MANY OCCASIONS ON SIMILAR CIRCUMSTANCES IN QUANTUM PROCEEDINGS THE DISALLOWANCE ITSELF HAS BEEN DELETED. IN OUR CONSID ERED OPINION ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE ASSESSEE CANNOT B E SAID TO HAVE BEEN GUILTY OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICUL ARS OF INCOME. IN THIS REGARD WE DRAW SUPPORT FROM THE DECISION OF A LARGER BENCH OF THE HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN STEEL LTD. VS. STATE OF ORISSA (83 ITR 26), WHEREIN IT WAS HELD THAT THE AUTHORITY MAY NOT LEVY PENALTY IF THE CONDUCT OF THE ASSESSEE IS NOT FOUND TO BE CONTUMACIOUS. MOREO VER, IT IS ALSO NOTED THAT THE TAX EFFECT IN THIS CASE IS BELOW THE LIMIT FIXE D BY CBDT FOR FILING APPEAL BEFORE THE TRIBUNAL. THE PLEA THAT ADDITION WAS BAS ED ON SALES TAX DEPARTMENT HAS NOTHING TO DO WITH PENALTY UNDER SECTION 271(1) (C) OF THE ACT IN THIS CASE AS THE PENALTY IS BASED UPON ASSESSING OFFICERS OR DER. 5. IN THE BACKGROUND OF THE AFORESAID DISCUSSION AN D PRECEDENT WE CONFIRM THE ORDER OF LEARNED CIT(A). 6. IN THE RESULT, REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 1.4.2021. SD/- SD/- (AMARJIT SINGH) (SHAMIM YAHYA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED : 01/04/2021 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT SMT. MANISHA KIRAN SAVAR 3 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR) PS ITAT, MUMBAI