ITO 9(2)(3), MUMBAI V. COSMOS BRAND DISTRIBUTORS P. LTD, MUMBAI

ITA 4716/MUM/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2713 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 20-08-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 68; 144

Judgement Text

, , SMC , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, SMC MUMBAI , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER ITA NO.4716/MUM/2015 ASSESSMENT YEAR: 2009-10 INCOME TAX OFFICER-9(2)(3) ROOM NO. 601A AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 / VS. M/S. COSMOS BRAND DISTRIBUTORS PVT. LTD. 7 TH LEVEL, ARYSTON CENTRE OPP. J.W. MARRIOTT HOTEL JUHU ROAD, JUHU MUMBAI 400049 ( / REVENUE) ( /ASSESSEE) PAN. NO. AABCC6856G ! ' #$ / DATE OF HEARING : 15/07/2016 ' #$ / DATE OF ORDER: 15/07/2016 / REVENUE BY SHRI RAJESH OJHA, JCIT / ASSESSEE BY NONE ITA NO.4716/MUM/2015 M/S. COSMOS BRAND DISTRIBUTORS PVT. LTD. 2 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 29/05/2015 OF LD. COMMISSIONER OF INCOME TAX, MUMBAI DELETING PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING SHRI RAJESH OJHA, LEARNED D.R. CONTENDED THAT CONSEQUENT UPON DELETING THE ADDITIO N BY THE TRIBUNAL, THE LEARNED CIT(A) DELETED THE PENALT Y. ON THE OTHER HAND, NONE WAS PRESENT FOR THE ASSESSEE IN SP ITE OF ISSUANCE OF NOTICE UNDER REGISTERED AD ON 01.07.201 6. THE ASSESSEE NEITHER PRESENTED ITSELF NOR MOVED ANY ADJOURNMENT PETITION. IT SEEMS THAT THE ASSESSEE HA S NOTHING TO SAY, THEREFORE, I HAVE NO OPTION BUT TO PROCEED EX-PARTE, QUA THE ASSESSEE AND TEND TO DISPOSE OF T HIS APPEAL ON THE BASIS OF MATERIAL AVAILABLE ON RECORD . 3. I HAVE CONSIDERED THE SUBMISSIONS OF THE LEARNED D.R. AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE F ACTS IN BRIEF ARE THAT THE ASSESSEE DECLARED LOSS OF RS.2,14,46,185/- IN ITS RETURN FILED ON 30.11.2006. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND AN EX- PARTE ASSESSMENT UNDER SECTION 144 OF THE ACT WAS COMPLETED AT AN INCOME OF RS.20,85,470/- WHEREIN VA RIOUS ADDITIONAL AND DISALLOWANCES WERE MADE. THE ASSESSE E FILED APPEAL BEFORE THE LEARNED CIT(A) AND EX-PARTE ORDER WAS PASSED FOR NON-ATTENDANCE OF THE ASSESSEE. THE ASSE SSEE ITA NO.4716/MUM/2015 M/S. COSMOS BRAND DISTRIBUTORS PVT. LTD. 3 CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL WH EREIN VIDE ORDER IN ITA NO. 1526/MUM/2011 DIRECTED THE LE ARNED CIT(A) TO RE-ADJUDICATE THE APPEAL. IN THE MEANTIME THE ASSESSING OFFICER PASSED THE ORDER ON 27.02.2011 LE VYING PENALTY IN RESPECT OF VARIOUS ADDITIONS AND DISALLO WANCES. THE LEARNED ASSESSING OFFICER FINALLY LEVIED PENALT Y WITH RESPECT DISALLOWANCE OF UNSECURED LOANS WHICH WERE MADE UNDER SECTION 68 OF THE ACT. THE LEARNED CIT(A) WHI LE DISPOSING OF THE APPEAL OF THE ASSESSEE CONSIDERED THE ARGUMENTS AND FOUND THAT SINCE THE TRIBUNAL HAS RES TORED THE QUANTUM APPEAL AND DIRECTED THE CIT(A) TO RE- ADJUDICATE THE QUANTUM APPEAL AND ACCORDINGLY PURSU ANT TO THE DIRECTIONS OF THE TRIBUNAL THE APPEALS WERE REVIVED FOR RE-ADJUDICATION AND FINALLY VIDE ORDER DATED 29 .05.2015 THE ADDITION WAS FOUND UNSUSTAINABLE AND ACCORDINGL Y DELETED. THE LEARNED CIT(A) CANCELLED THE PENALTY A LSO. THE REVENUE IS AGGRIEVED AND IS IN APPEAL BEFORE THIS T RIBUNAL. 3.1 UNDER THE FACTS NARRATED HEREIN ABOVE, I AM OF THE VIEW THAT PENALTY IMPOSED U/S 271(1)(C) WILL NOT SURVIVE . MY VIEW FIND SUPPORT FROM THE DECISION IN K.C. BUILDERS VS ACIT (2004) 265 ITR 562 (SC) AND THE RATIO LAID DOWN IN CIT VS S.P. VIZ, 176 ITR 76 (PATNA). EVEN OTHERWISE, WHEN THE QUANTU M ADDITION IS DELETED, THERE REMAINS NO BASIS AT ALL FOR LEVYING THE PENALTY FOR CONCEALMENT OR FURNISHING INACCURAT E PARTICULARS. THE PENALTY CANNOT STAND ON ITS LEGS W HEN ADDITION ON THE BASIS OF WHICH THE PENALTY WAS IMPO SED REMAINS NO MORE IN EXISTENCE, THUS, I UPHELD THE ST AND OF THE ITA NO.4716/MUM/2015 M/S. COSMOS BRAND DISTRIBUTORS PVT. LTD. 4 LEARNED CIT(A), CONSEQUENTLY THE APPEAL OF THE REVE NUE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. D.R. AT THE CONCLUSION OF THE HEARI NG ON 15/07/2016. SD/- (JOGINDER SINGH) ! /JUDICIAL MEMBER ! MUMBAI; & DATED : 15/07/2016 AA? P.S / /. . . ' #$%&%'# / COPY OF THE ORDER FORWARDED TO : 1. ()*+, / THE APPELLANT (RESPECTIVE ASSESSEE) 2. -.+, / THE RESPONDENT. 3. / / 0 ( ()* ) / THE CIT-9, MUMBAI. 4. / / 0 / CIT(A)-16, MUMBAI, 5. 23 - , / ()*# (4 , ! / DR, SMC BENCH, ITAT, MUMBAI 6. 5 6!* / GUARD FILE. / BY ORDER, .2) - //TRUE COPY// / (DY./ASSTT. REGISTRAR) , ! / ITAT, MUMBAI