SARDAR AJIT SINGH CHANDHOK, MUMBAI V. ADDL CIT 16(3), MUMBAI

ITA 457/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7774 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2010
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 29-01-2010
• Assessment Year: 2002-2003
• Appeal Filed On: 20-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NAVEEN GUPTA
• Assessee Lawyers: S S PHADKAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI T.R. SOOD, AM AND SMT. P. MADHAVI DEVI , JM I.T.A. NO. 457/MUM/2009 ASSESSMENT YEAR: 2002-03 SHRI SARDAR AJIT SINGH CHANDHOK, A/2, LAXMI BHAVAN, 4466, S.V. ROAD, OPERA HOUSE, MUMBAI 400 004. PAN: AAAPC 5139 J VS. THE ADDL. COMMISSIONER OF INCOME- TAX, MATRU MANDIR, GRANT ROAD, MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY :: SHRI S.S. PHADKAR RESPONDENT BY :: SHRI NAVEEN GUPTA O R D E R PER T.R. SOOD (AM): IN THIS APPEAL THE ASSESSEE HAS CHALLENGED THE ORD ER OF THE LEARNED CIT(A) FOR CONFIRMING THE PENALTY OF RS. 50,000/- U NDER SECTION 271E OF THE INCOME-TAX ACT, 1961. 2. AFTER HEARING BOTH THE PARTIES, WE FIND THAT THE PENALTY OF RS.50,000/- LEVIED BY THE ASSESSING OFFICER FOR RETURNING THE L OAN IN CASH TO NATIONAL MOTOR CO.(GUJARAT) IN VIOLATION OF THE PROVISIONS OF SECT ION 269T OF THE ACT AND THE SAME HAS BEEN CONFIRMED BY THE LEARNED CIT(A). 3. BEFORE US IT WAS SUBMITTED BY THE LEARNED COUNSE L FOR THE ASSESSEE THAT THE LOAN WAS TAKEN FROM ONE OF THE PROPRIETARY CONCERN OF THE ASSESSEE AND HAS BEEN RETURNED TO THE SAME. THEREFORE, NO LO AN HAS BEEN TAKEN FROM OUTSIDER BECAUSE ACCEPTING AND RETURNING OF LOAN FR OM ONE PROPRIETARY CONCERN TO ANOTHER PROPRIETARY CONCERN IS NOT COVERED BY TH E PROVISIONS OF SECTION 269SS AND 269T OF THE ACT. THEREFORE, PENALTY WAS WRONGLY LEVIED. 4. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE SUBMITTED THAT NO SUCH ARGUMENT WAS TAKEN BEFORE TH E LOWER AUTHORITIES AND, THEREFORE, THE ISSUE CANNOT BE DECIDED ON THE BASIS OF A NEW FACT. ITA NO.457/M/09 SARDAR AJIT SINGH CHANDHOK 2 5 WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFULL Y. WE AGREE WITH THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSE SSEE THAT IF THE LOAN WAS TAKEN FROM ONE OF THE PROPRIETARY CONCERN OF THE AS SESSEE AND RETURNED TO THAT CONCERN THEN THE PROVISIONS OF SECTION 269T WOULD N OT BE APPLICABLE. HOWEVER, AS POINTED OUT BY THE LEARNED DEPARTMENTAL REPRESEN TATIVE THIS FACT IS NOT EMERGING FROM RECORD. IN THE INTEREST OF JUSTICE, WE SET ASIDE THE ORDER OF THE LEARNED CIT(A) AND REMIT THE MATTER BACK TO THE FIL E OF THE ASSESSING OFFICER WITH DIRECTION TO VERIFY WHETHER THE LOAN WAS TAKEN AND RETURNED TO THE PROPRIETARY CONCERN AND IF YES, THEN PENALTY SHOULD NOT BE LEVIED. OTHERWISE, THE ASSESSING OFFICER MAY DECIDE THE ISSUE IN ACCOR DANCE WITH LAW. 6. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 2 ND DAY OF FEBRUARY, 2010 SD. SD. (P. MADHAVI DEVI) (T.R. SOOD ) JUDICIAL MEMBER ACCOUNTANT MEMBR MUMBAI, DATED THE 2 ND FEBRUARY, 2010. KN COPY TO: 1. THE ASSESSEE. 2. THE ADDL.CIT-16(3), MUMBAI 3. THE CIT-16, MUMBAI 4. THE CIT(A)-XVII, MUMBAI 5. THE DR, E BENCH, MUMBAI BY ORDER /TRUE COPY/ ASST. REGISTRAR, I.T.A.T.MUMBAI ITA NO.457/M/09 SARDAR AJIT SINGH CHANDHOK 3 S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 29.01.2010 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 29.01.2010 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/A M 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER