Eco RRB Infra Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 4591/DEL/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 82023 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-11-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 18-11-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 05-08-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: VIVEK WADEKAR
• Assessee Lawyers: S KRISHNAN
• Keywords: Depreciation; Question of law; Wrong claim
• Section: 143(3)

Judgement Text

IN TH E INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : B : NEW DELHI BEFORE SHRI J.S. REDDY, ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE K. , JUDICIAL MEMBER ITA NO . 4591 / DEL / 201 3 ASSESSMENT YEAR : 200 6 - 0 7 M/S ECO RRB INFRA PVT. LTD. VS. DCIT, CIRCLE - 15(1), 2 - C & D, M - 6, UPPAL PLAZA, NEW DELHI. DISTT. CENTRE, JASOLA, NEW DELHI - 110025 (PAN AAACR 0233 R ) (APPELLANT ) (RESPONDENT) APPELLANT BY : SHRI S. KRISHNAN, ADVOCATE RESPONDE NT BY: SHRI VIVEK WADEKAR, CIT . D.R. ORDER PER SHRI GEORGE GEORGE K , J M : 1. TH IS APPEAL AT THE INSTANCE OF THE ASSESSEE IS DIRECTED AGAINST THE CIT(A) S ORDER DATED 10 . 06 .201 3 . THE RELEVANT ASSESSMENT YEAR IS 200 6 - 0 7 . 2. THE SOLITARY ISSUE THAT ARISE S FOR OUR CONSIDERATION IS WHETHER THE CIT(A) IS JUSTIFIED IN CONFIRMING THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT AMOUNTING TO RS.4,00,000/ - . 3 . BRIEF LY STATED THE FACTS OF THE CASE ARE AS FOLLOWS. THE A SSESSEE FOR THE YEAR UNDER DISPUTE , FILED RE TURN OF INCOME ON 18.11.2006 DECLARING AN INCOME OF RS.8,07,90,200/ - . ASSESSMENT U/S 143(3) OF ITA NO. 4591 /DEL /201 3 ASSESSMENT YEAR : 200 6 - 0 7 2 THE ACT WAS COMPLETED ON 31.12.2009 FIXING A T OTAL INCOME OF RS.12,98,55,406/ . THE ADDITIONS /DISALLOWANCE MADE IN THE ASSESSMENT ORDER ARE AS FOLLOWS: I) CLAIM OF DEDUCTION U/S 80IA OF RS.41,38,035/ - WAS DENIED. II) DISALLOWANCE OF DEPRECIATION ON WIND MILLS OF RS.4,38,00,000/ - III) EXCESS CLAIM OF DEPRECIATION OF RS.46,859/ - 4. ON FURTHER APPEAL, THE CIT(A) PARTLY ALLOWED ASSESSEE S APPEAL. SUBSEQUENT TO THE CIT(A) S ORDER , ASSESSING OFFICER LEVIED THE PENALTY OF RS.4,00,000/ - ON TWO ADDITIONS SUSTAINED BY THE CIT(A). THE RELEVANT FINDING OF THE ASSESSING OFFICER WHILE LEVYING THE PENALTY U/S 271(1)(C) READS AS UNDER: 4. DURING THE COURSE OF PENALTY PROCEEDIN GS THE ASSESSEE HAD FAILED TO FURNISH ANY PLAUSIBLE EXPLANATION TO SUBSTANTIATE ITS CLAIM OF MAKING A CORRECT CLAIM OF DEDUCTION U/S 80IA AND DEPRECIATION AS WELL AS FAILED TO EXPLAIN THAT THERE WAS NO WILLFUL ATTEMPT ON THE PART OF THE ASSESSEE TO MAKE A WRONG CLAIM. THE ASSESSEE HAD BY MEANS AS STATED ABOVE FURNISHED INACCURATE PARTICULARS TO THE EXTENT OF RS.11,90,423/ - (11,43,564/ - + 46859). AS PER PROVISIONS OF SECTION 271(1)(C) OF THE ACT, A PENALTY EQUIVALENT TO MINIMUM @ 100% OF TAX SOUGHT TO BE EVA DED I.E. RS.3,99,982/ - AND A MAXIMUM @ 300% OF TAX SOUGHT TO BE EVADED I.E. RS.11,99,946/ - IS IMPOSSIBLE. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE, A PENALTY OF RS.4,00,000/ - U/S 271(1)(C) IS IMPOSED. 5. AGGRIEVED BY THE LEVIED OF PENALTY, ASS ESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). THE CIT(A) CONFIRMED THE LEVY OF PENALTY IMPOSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT. THE ASSESSEE BEING AGGRIEVED IS IN APPEAL BEFORE US. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT IN THE QUA NTUM ASSESSMENT, THE TRIBUNAL FOR THE RELEVANT ASSESSMENT YEAR HAS RESTORED THE ISSUE OF DEDUCTION U/S 80IA OF THE ACT TO THE AO FOR DE NOVO CONSIDERATION. A S ITA NO. 4591 /DEL /201 3 ASSESSMENT YEAR : 200 6 - 0 7 3 REGARDS THE EXCESS CLAIM OF DEPRECIATION ON COMPUTE PERIPHERALS THE MATTER WAS DECIDED IN FAVOUR OF THE ASSESSEE. THE LD. COUNSEL FOR THE ASSESSEE HAS PLACED ON RECORD , THE COPY OF THE ORDER OF THE TRIBUNAL IN THE QUANTUM ASSESSMENT (ITA NO.400/D/2011 ORDER DATED 27.09.2013). THE LD. D.R. DID NOT HAVE ANY OBJECTION FOR REMANDING TH E CASE TO THE AO. 6 . WE HAVE HEARD RIVAL SUBMISSION AND PERUSED THE MATERIAL ON RECORD. PENALTY U/S 271(1)(C) OF THE ACT WAS IMPOSED ON ACCOUNT OF THE FOLLOWING TWO ADDITIONS/DISALLOWANCE: I) EXCESS CLAIM OF DEDUCTION U/S 80IA OF THE ACT RS.11,43,564/ - II) EXCESS CLAIM OF DEPRECIATION AMOUNTING TO RS. 46,859/ - ------------------- TOTAL RS.11,90,423/ - ------------------- 7. IN SO FAR AS, THE EXCESS CLAIM OF DEDUCTION U/S 80IA OF THE ACT , T HE TRIBUNAL IN THE QUANTUM ASSE SSMENT IN ITA NO.400/D/2011 ORDER DATED 27.09.2013 HAS RESTORED THE ISSUE TO THE AO. THE RELEVANT FINDING OF THE HON BLE TRIBUNAL AT PARA - 7 READS AS UNDER: 7. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IN OUR VIEW THE EN DS OF JUSTICE WILL MEET IF THE ASSESSEE AND REVENUE S GROUND ON THE ISSUE OF ALLOWABILITY OF DEDUCTION U/S 80 - IA AND CONNECTED ISSUE OF APPORTIONMENT OF EXPENSES ARE SET ASIDE AND RESTORED BACK TO THE FILE OF ASSESSING OFFICER TO DECIDE THE SAME AFRESH AFT ER THE HIGH COURT JUDGMENT IS PRONOUNCED IN THIS CASE FOR EARLIER YEARS. THE SETTING ASIDE WILL AVOID MULTIPLICITY OF LITIGATION AND COMPLICATIONS. ASSESSING OFFICER WILL GIVE EFFECT TO THE HIGH COURT S ORDER WHICH WILL CONCLUSIVELY DECIDE THE ISSUES ABOUT THE QUESTION OF LAW ADMITTED BY HON BLE HIGH COURT ON THIS SUBJECT. IN CONSIDERATION THEREOF WE SET ASIDE THE ISSUES BACK TO THE FILE OF ASSESSING OFFICER TO DECIDE THE SAME AFRESH ITA NO. 4591 /DEL /201 3 ASSESSMENT YEAR : 200 6 - 0 7 4 AFTER HIGH COURT S JUDGMENT IS PRONOUNCEMENT WHICH WILL DECIDE THE ISSUE. 8. THEREFORE, WITH REGARD TO IMPOSITION OF PENALTY ON EXCESS OF CLAIM DEDUCTION U/S 80IA OF THE ACT AMOUNTING TO RS.11,43,564/ - , WE RESTORE THE MATTER TO THE AO TO DECIDE THE SAME IN ACCORDANCE WITH LAW, AFTER DECISION IS TAKEN WITH REGARD TO THE QUANT UM ADDITION. 9. IN SO FAR AS THE ADDITION ON ACCOUNT OF EXCESS CLAIM OF DEPRECIATION, WE NOTICE THAT THE TRIBUNAL IN THE QUANTUM ASSESSMENT HAS ALLOWED THE CASE OF THE ASSESSEE. THE RELEVANT FINDING OF THE TRIBUNAL READS AS UNDER: 7. APROPOS THE REMAININ G ISSUES OF THE ASSESSEE FOR AY 2006 - 07 PERTAINS TO COMPUTER INTEGRALS AND PERIPHERALS. IT IS SETTLED LAW THAT THE ASSESSEE IS ELIGIBLE TO THE DEPRECIATION @ 60%. IN VIEW THEREOF, THIS GROUND OF THE ASSESSEE IN BOTH THE YEARS IS ALLOWED. 10. IN VIEW OF T HE TRIBUNAL S ORDER IN QUANTUM ASSESSMENT, WE HOLD THAT PENALTY IS NOT JUSTIFIED WITH REFERENCE TO ADDITION MADE ON ACCOUNT OF EXCESS CLAIM OF DEPRECATION. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. TH E DECIS ION WAS PRONOUNCED IN THE OPEN COURT ON 21 ST NOVEMBER , 201 4 . SD/ - SD/ - ( J.S. REDDY ) (GEORGE GEORGE K.) A CCOUNTANT MEMBER J UDICIAL MEMBER DATED: 21 ST NOVEMBER , 201 4 . AKS/ - ITA NO. 4591 /DEL /201 3 ASSESSMENT YEAR : 200 6 - 0 7 5 COPY FORWARDED TO 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST . REGISTRAR, ITAT, NEW DELHI