ADIT (IT) 1(2), MUMBAI V. CONVERGYS INFORMATION MANAGEMENT GROUP INC., MUMBAI

ITA 4655/MUM/2013

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9463 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-03-2015
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 12-03-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 14-06-2013
• Court: TRIBUNAL
• Department Lawyers: IN CIRCUMSTANCES OF CA SE
• Keywords: Question of law

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, MUMBAI VK;DJ VIHYH; VF/KDJ.K] LH U;K;IHB EQACBZ BEFORE SHRI VIJAY PAL RAO , JUDICIAL MEMBER AND SHRI RAJENDRA, ACCOUNTANT MEMBER JH FOT; IKY JKO] U;KF;D LNL; ,OA JH JKTSUNZ] YS[KK LNL; DS LE{K ITA NO. 4655 /MUM/201 3 ASSESSMENT YEAR: - 2008 - 09 ASST. DIT (IT) - 1(2), ROOM NO. 119, 1 ST FLOOR, SCINDIA HOUSE, N.M. ROAD, BALLARD ESTATE MUMBAI 400 038. VS.` M/S. CONVERGYS INFORMATION MANAGEMENT GROUP INC. C/O PRICEWATERHOUSE COOPR S PVT. LTD. PWC HOUSE, PLOT NO. 18A, GURU NANAK ROAD, BANDRA (W) MUMBAI 400 050. APPELLANT / VIHYKFKHZ RESPONDENT / IZR;FKHZ ORDER PER VIJAY PAL RAO, JM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 21.03.2013 OF CIT(A) ARISING FROM THE PENALTY ORDER PASSED U/S 271(1)(C) OF THE INCOME TAX ACT. THE REVENUE IN THIS APPEAL HAS RAISED FOLLOWING GROUNDS: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE PENALTY OF RS. 15,06,204/ - LEVIED U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961? REVENUE BY / JKTLP DH VKSJ LS SHRI PREMANAND J. ASSESSEE BY / FU/KKZFJRH FD VKSJ LS MR. DHARMESH BATRA & MR. ALIASGAR RAMPURWALLA DATE OF HEARING 12.03.2015 DATE OF PRONOUNCEMENT 12.03.2015 ITA NO.4655/MUM/2013 ASSESSMENT YEAR: - 2008 - 09 2 | P A G E 2. WE HAVE HEARD THE LD. DR AS WELL AS LD. AUTHORIZED REPRESENTATIVE AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. AT THE OUTSET, WE NOTE THE ASSESSING OFFICER WHILE PASSING THE PENALTY ORDER DATED 30.08.2011 HAS PLACED RELIANCE ON THE IDENTICAL ADDITIONS /DISALLOWANCE MADE FOR THE A.Y. 2007 - 08 AND CONSEQUENTLY LEVIED PENALTY U/S 271(1)(C) FOR THE SAID ASSESSMENT YEAR 2007 - 08. THE CIT(A) HAS DELETED THE PENALTY IN PARA 4 OF THE IMPUGNED ORDER AS UNDER: - 04. IN THE COURSE OF APPEAL, THE ASSESSEE HAS SUBMI TTED THAT IDENTICAL RECEIPTS WERE ADDED AS INCOME IN THE PRECEDING A.Y TOO I.E., A.Y.2007 - 08. IN RESPECT OF THE SAID ADDITION, THE SIMILAR PENALTY UJS.271(1)(C) HAD BEEN IMPOSED BY THE AO IN THE EARLIER YEAR. HOWEVER, THE SAID PENALTY WAS DELETED BY THE CI T(A) VIDE HIS ORDER NO.CIT(A) - 10/ADIT(IT)1(1)/IT - 99/10 - 11 DATED 22.02.2011. IT IS FURTHER SUBMITTED THAT THE ORDER OF THE CIT(A) WAS UPHELD BY THE TRIBUNAL VIDE THEIR ORDER IN ITA NO.3561 JMUMJ20 11 DATED 31. 07.2012. THE ASSESSEE HAS ALSO FILED A COPY OF THE ORDER OF THE BOMBAY HIGH COURT IN THE REVENUE'S APPEAL AGAINST THE SAID ORDER OF THE TRIBUNAL. THE BOMBAY HIGH COURT HAD DECLINED TO ENTERTAIN THE QUESTION OF LAW IN THE SAID CASE AND DISMISSED THE APPEAL OF THE DEPARTMENT. IN VIEW OF THE ABOVE, THE AS SESSEE HAS SUBMITTED THAT AS THE FACTS OF THE CASE ARE IDENTICAL DURING THE RELEVANT PREVIOUS YEAR TOO, THE LEVY OF PENALTY UJS.271(1)(C) OF THE ACT WAS NOT WARRANTED IN THIS CASE. 3. THUS IT IS CLEAR THAT THE CIT(A) HAS FOLLOWED THE ORDERS OF THIS TRIBU NAL FOR A.Y. 2007 - 08 AND FURTHER THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT. WE FURTHER NOTE THAT FOR THE A.Y. 2007 - 08, THE APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THIS TRIBUNAL HAS BEEN DISMISSED BY THE HONBLE HIGH COURT VIDE ORDER DATED 27.02.2013 BY OBSERVING IN PARA 3 AS UNDER: - 3 IN APPEAL THE CIT(A) CANCELLED THE PENALTY LEVIED UPON THE RESPONDENT - ASSESSEE. ON THE FURTHER APPEAL BY THE REVENUE, THE TRIBUNAL HELD THAT EVEN THOUGH, THE ADDITION MADE IN THE QUANTUM PROCEEDINGS, HAD BEEN ACCAEPTED BY THE RESPONDENT - ASSESSEE YET THAT BY ITSELF WOULD NOT LEAD TO IMPOSITION OF ITA NO.4655/MUM/2013 ASSESSMENT YEAR: - 2008 - 09 3 | P A G E PENALTY UNDER SECTION 271(1)(C) OF THE SAID ACT. THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS IMPOSABLE ONLY IF THE RESPONDENT - ASSESSEE IS ABLE TO ESTAB LISH ITS BONA FIDE IN NOT DECLARING THE SAME AS INCOME. IN THE IMPUGNED ORDER, THE TRIBUNAL RECORDS THE FACT THAT THERE WERE CERTAIN DECISIONS PASSED BY A CO - ORDINATE BENCH WHICH WAS IN FAVOUR OF THE RESPONDENT - ASSESSEE. IN THE PRESENT FACTS, THE TRIBUNAL RECORDS A FINDING OF FACT THAT IN COMPUTATION OF INCOME FILED ALONG WITH THE RETURN OF INCOME, THE RESPONDENT - ASSESSEE HAD MADE COMPLETE DISCLOSURE OF THE NECESSARY PARTICULARS IN THIS REGARD AND CLAIMED THAT THE ASSESSEE WAS TREATING THE SAME AS REIMBUR SEMENT OF COST NOT HAVING ANY INCOME COMPONENT. THUS A FULL AND A PROPER DISCLOSURE WAS MADE IN REGARD TO THE LINK CHARGES RECEIVED BY IT. THEREFORE, IN VIEW OF THE DECISION OF THE SUPREME COURT IN THE MATTER OF CIT V/S. RELIANCE PETRO PRODUCTS REPORTED IN 322 ITR PAGE 158, THE TRIBUNAL UPHELD THE ORDER PASSED BY THE CIT(A), DELETING THE PENALTY. IN THE CIRCUMSTANCES AS THE DECISION OF THE TRIBUNAL IS BASED ON FINDING OF FACT, WE SEE NO REASON TO ENTERTAIN THE PROPOSED QUESTION OF LAW. 4. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES OF CASE AS WELL AS THE DECISION OF THIS TRIBUNAL WHICH WAS CONFIRMED BY THE HON'BLE JURISDICTIONAL HIGH COURT IN ASSESSEES OWN CASE, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE IMPUGNED ORDER OF CIT(A) IN DELETING THE PENA LTY. 5 . IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUCNED IN THE OPEN COURT ON THIS 1 2 TH DAY OF MARCH 2015 VKNS'K DH ?KKS'K.KK [KQYS U;K;KY; ES FNUKAD 1 2 EKPZ 2015 DKS DH XBZA SD/ - SD/ - ( RAJENDRA ) (VIJAY PAL RAO) ( ACCOUNTANT MEMBER / YS[KK LNL; ) (JUDICIAL MEMBER/ U;KF;D LNL; ) MUMBAI DATED 1 2.03.2015 SKS SR. P.S, ITA NO.4655/MUM/2013 ASSESSMENT YEAR: - 2008 - 09 4 | P A G E COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, C BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI