Sahiwal Investment & Trading Co., New Delhi V. ITO, New Delhi

ITA 4913/DEL/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7073 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2006-2007
• Appeal Filed On: 30-07-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S RANA
• Keywords: Capital asset; Depreciation; Question of law
• Section: 32

Judgement Text

1 ITA NO. 49 13/DEL/2015 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIA L MEMBER ITA NO. 4913/DEL/2015 ( ASSESSMENT YEAR: 2006-07) SAHIWAL INVESTMENT & TRADING CO., 4 TH FLOOR, PUNJABI BHAWAN, 10, ROUSE AVENUE, NEW DELHI. PAN NO. AAACS0017J VS ITO WARD 22(2) NEW DELHI. APPELLANT RESPONDENT APPELLANT/ASSESSEE BY SH. M.P. RASTOGI, ADV. RESPONDENT/REVENUE BY SH. S.S. RANA, CIT DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 18.05.2015 PASSED BY THE PR. CIT(A)-8, NEW DELHI FOR AY 2006-0 7. 2. GROUNDS OF APPEAL ARE AS UNDER: 1. THAT THE CIT (APPEALS) HAS ERRED ON FACTS AND UNDE R LAW IN CONFIRMING THE PENALTY ORDER OF AO IN TREATING THE SALE OF BOUNDARY WALLS (REFERRED AS BUILDING) AS A SHORT TERM CAPI TAL ASSET AND CONSEQUENTLY HELD THE SAID BUILDING AS DEPRECIABLE ASSET U/S 50 OF THE INCOME TAX ACT, 1961. AS THE RESULT OF SUCH CO NFIRMATION BY THE CIT (APPEALS) A PENALTY OF RS. 10,74,878/- WAS HELD TO BE PAYABLE BY THE ASSESSEE U/S 271(1)(C) OF THE INCOME TAX ACT , 1961. 2. THAT THE CIT(A) HAS ERRED ON FACTS AND UNDER THE LA W IN UPHOLDING THAT THE ASSESSEE IS GUILTY OF CONCEALMENT OF INCOM E AND FURNISHING INACCURATE PARTICULARS OF INCOME U/S 271(1)(C ), WI THOUT PASSING A SPEAKING ORDER OF THE WRONG DOING OF THE ASSESSEE. DATE OF HEARING 21.06.2018 DATE OF PRONOUNCEMENT 18.07.2018 2 ITA NO. 4913/DEL/2015 3. THAT ON RECORD THE ASSESSEE HAS NEVER CLAIMED DEPRE CIATION U/S 32 OF THE INCOME TAX ACT, 1961 SINCE THE CONSTRUCTION OF BOUNDARY WALLS A FACT CONSISTENTLY ACCEPTED THE DEPARTMENT SINCE 2 000. HOWEVER, IN YEAR OF SALE IN AY 2006-07, THE FACT THAT BOUNDA RY WALLS HAS NOT BEEN DEPRECIATED U/S 32 OF THE IT ACT HAS BEEN CONS ISTENTLY OVERLOOKED BY THE AO/CIT(APPEALS) BOTH IN THE QUANT UM AND PENALTY PROCEEDINGS. 4. THAT THE FACT THE ASSESSEE WAS CLAIMING DEPRECIATIO N ON BOUNDARY WALLS UNDER COMPANIES ACT, 1956 HAD NO BEARING AS R EGARDS DETERMINATION OF TAXABILITY UNDER THE NORMAL PROVIS IONS OF THE INCOME TAX. 5. THAT THE ABOVE GROUNDS OF APPEAL ARE INDEPENDENT AN D WITHOUT PREJUDICE TO ONE ANOTHER. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR WITHDRAW ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING. ADDITIONAL GROUNDS : I. THAT THE PENALTY AS IMPOSED BY THE ASSESSING OFFIC ER U/S 271(1)(C ) OF THE INCOME TAX ACT, 1961 (THE ACT) VIDE ORDER DA TED 28 TH OCTOBER, 2013 IS BARRED BY TIME IN TERMS OF PROVISO TO SECTI ON 275(1)(A) OF THE ACT. II. THAT WITHOUT PREJUDICE TO ADDITIONAL GROUND NO. 1 A BOVE, IN THE ABSENCE OF SPECIFIC CHARGE POINTING OUT IN THE NOTI CE, THE SAID NOTICE IS VAGUE & CONSEQUENTLY THE LEVY OF PENALTY U/S 271 (1)(C ) OF RS. 10,74,878/- IS ARBITRARY, UNJUST AND ILLEGAL. III. THAT IN THE ABSENCE OF SATISFACTION AS CONTEMPLATED UNDER SECTION 271 OF THE ACT, THE LEVY OF PENALTY BY AO UNDER SEC TION 271(1)(C ), IN RELATION TO THE INCOME COMPUTED IN ACCORDANCE WITH THE DIRECTIONS OF THE ITAT, IS ARBITRARY UNJUST AND BAD IN LAW. 3. IN THIS CASE, ASSESSEE FILED ITS RETURN OF INCOM E AND HAD DECLARED LONG TERM CAPITAL GAIN ON SALE OF LAND AND BUILDING AT RS. 7,66,727/-. AT THE TIME OF ASSESSMENT PROCEEDINGS U/S 143(3), THE ASSESSING OFFICER ANALYSED THE LONG TERM CAPITAL GAIN DECLARED BY THE ASSESSEE ON LAND AND BUILDING SEPARATELY AND FOUND THAT LONG TERM CAPITA L GAIN CALCULATED ON BUILDING WAS ERRONEOUS. THE ASSESSEE HAS CLAIMED D EPRECIATION AGAINST THAT BUILDING AND ACCORDINGLY ON THESE FINDING, THE ASSESSING OFFICER TREATED THE CAPITAL GAIN ON BUILDING AS SHORT TERM CAPITAL GAIN U/S 50 OF THE IT ACT. HOWEVER, THE CIT (A) DIRECTED THE ASSE SSING OFFICER TO REFER THE PROPERTY FOR VALUATION BY THE DVO AND ACCORDING LY ON THE BASIS OF 3 ITA NO. 4913/DEL/2015 VALUATION, HE HOLD THAT AO COULD HAVE MADE AN ADDIT ION OF RS. 17,46,000/- WHICH IS THE DIFFERENCE BETWEEN THE AMO UNT AS PER DVOS REPORT AND AS SHOWN BY THE ASSESSEE. HE HAS ALSO D IRECTED TO ALLOW THE SET OFF OF LONG TERM CAPITAL LOSSES AGAINST THE CUR RENT LONG TERM CAPITAL GAINS. ON APPEAL BEFORE THE ITAT BY THE DEPARTMENT , IT WAS OBSERVED BY THE ITAT THAT BUILDING IS A DEPRECIABLE ASSET AND I T WAS ADMITTED BY THE AR OF THE ASSESSEE THAT DEPRECIATION HAS BEEN CLAIM ED ON THE VALUE OF BUILDING. SINCE THE CIT (A) HAS NOT CONSIDERED THE FULL FACTS AND HE HAS COMBINED THE ISSUE OF CAPITAL GAIN CALCULATED ON LA ND AND BUILDING TOGETHER, THE ITAT SET ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER TO TREAT THE TRANSACTION OF LAND AS LONG TERM CAPITAL GAIN AND BUILDING AS SHORT TERM CAPITAL GAIN U/S 50 AND ALLOW THE SET OF F OF LOSSES OF EARLIER YEARS ON ACCOUNT OF CAPITAL GAINS AGAINST THE LAND. AFTER CONSIDERING THESE ISSUES AT THE TIME OF PENALTY PROCEEDING, THE ASSESSING OFFICER HAS GIVEN FURTHER OPPORTUNITY TO THE ASSESSEE AND OBSER VED THAT AS PER SCHEDULE D (FIXED ASSETS) FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS ALONG WITH COPY OF AUDITED ACCOUNTS, IN WHICH IT WAS CLEARLY MENTIONED THAT THE DEPRECIATION UPTO 31.03.2005 WAS RS. 1,39,825/- AND DEPRECIATION FOR THE FY 2005-06 WAS RS. 35,677/ -. ON THE BASIS OF THESE FACTS, THE ASSESSING OFFICER HOLD THAT THE PL EADING OF THE ASSESSEE THAT NO DEPRECIATION WAS CLAIMED ON BUILDING WAS NO T FOUND ACCEPTABLE. THE ASSESSING OFFICER RELIED UPON THE FINDINGS OF F ACTS GIVEN BY THE ITAT WHICH IS THE FINAL FACT FINDING AUTHORITY THAT LD. AR OF THE ASSESSEE ADMITTED BEFORE THE TRIBUNAL THAT ASSESSEE CLAIMED THE DEPRECIATION ON BUILDING. AFTER CONSIDERING THESE FACTS, THE ASSES SING OFFICER GAVE THE FINDING THAT ASSESSEE CONCEALED THE PARTICULARS OF ITS INCOME AND ACCORDINGLY LEVIED THE PENALTY OF RS. 10,74,878/-. 4. AGGRIEVED BY THE PENALTY ORDER, THE ASSESSEE FIL ED APPEAL BEFORE THE CIT(A). THE CIT(A) DISMISSED THE APPEAL OF THE ASSE SSEE. 4 ITA NO. 4913/DEL/2015 5. THE LD. AR SUBMITTED THAT THE PENALTY LEVIED BY THE ASSESSING OFFICER IS TIME BARRED. IN THIS CASE, THE PENALTY PROCEEDINGS HAD BEEN INITIATED BY THE ASSESSING OFFICER VIDE HIS ORDER DATED 27.11.2008 A ND AGAINST WHICH THE CIT(A) PASSED THE ORDER IN QUANTUM PROCEEDINGS VIDE ORDER DATED 14.09.2010. AS PER THE PROVISO TO SECTION 275(1)(A) OF THE ACT, IT IS CLEAR THAT THE ORDER OF LEVY OF PENALTY HAS TO BE PASSED WITHIN ONE YEAR FR OM THE END OF THE FINANCIAL YEAR IN WHICH THE ORDER OF CIT(A) HAS BEEN RECEIVED . IN THE INSTANT CASE, THE CIT(A) HAD PASSED THE ORDER ON 14.09.2010 AGAINST W HICH THE REVENUE PREFERRED APPEAL HAVING ITA NO. 5488/DEL/2010. HENC E, THE ORDER OF THE PENALTY SHOULD HAVE BEEN PASSED BEFORE 31.03.2012, WHEREAS IN THE INSTANT CASE THE PENALTY HAS BEEN LEVIED BY THE ASSESSING O FFICER ON 28.10.2013, WHICH IS BARRED BY TIME. THE LD. AR FURTHER SUBMITT ED THAT THE NOTICE AS ISSUED BY THE ASSESSING OFFICER FOR THE PENALTY PRO CEEDINGS WAS VAGUE AND DOES NOT SPECIFY UNDER WHICH LIMB THE PENALTY HAS B EEN LEVIED BY THE ASSESSING OFFICER AND ACCORDINGLY NO PENALTY SHOULD BE LEVIED. THE LD. AR RELIED UPON THE FOLLOWING DECISIONS: 1. CIT VS. SSA EMERALD MEADOWS 242 TAXMAN 180 (SC) 2. CIT VS. MANJUNATHA COTTON & GINNING FACTORY 359 ITR 565 (KAR) IN THE INSTANT CASE, FROM THE PENALTY NOTICES AS IS SUED BY THE ASSESSING OFFICER FROM TIME TO TIME, IT IS NOT CLEAR UNDER WH ICH LIMB OF THE PROVISION HE HAS GRANTED THE OPPORTUNITY TO THE ASSESSEE. 6. THE LD. AR FURTHER SUBMITTED THAT IF WE LOOK AT THE ASSESSMENT ORDER DATED 27.11.2008, IT IS CLEAR THAT THE PENALTY PROC EEDINGS WAS INITIATED BY THE ASSESSING OFFICER ON ACCOUNT OF HIS TREATMENT OF MA RKET VALUE OF THE PROPERTY AT RS. 51,30,000/- AS DETERMINED BY THE REGISTERED VALUER AGAINST THE DISCLOSED SALE CONSIDERATION OF RS. 55,00,000/- BY THE ASSESSEE. IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER SEPARATELY ASSESSED THE VALUE OF THE BOUNDARY WALL MENTIONED IN THE SALE DEED AT RS. 4,0 0,00,000/- AS INCOME 5 ITA NO. 4913/DEL/2015 FROM OTHER SOURCES BUT ON APPEAL THE CIT(A) HELD TH AT THE SUM OF RS. 4,00,00,000/- IS PART OF THE SALE CONSIDERATION. SO MUCH SO, THE CIT(A) ALSO HELD THAT BECAUSE THE DVO ALSO WORKED OUT THE VALUE OF THE PROPERTY AT RS. 56,74,000/-, THE SALE CONSIDERATION AS SHOWN BY THE ASSESSEE IS CORRECT AND LONG TERM CAPITAL GAIN HAS TO BE COMPUTED ACCORDING LY. THE ITAT, ON APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF CIT(A) HE LD THAT BECAUSE THE ASSESSEE CLAIMED DEPRECIATION ON THE BUILDING (WALL ), HENCE THE GAIN IN RESPECT THERETO IS A SHORT TERM CAPITAL GAIN AND ACCORDINGL Y DIRECTED THE ASSESSING OFFICER TO COMPUTE THE GAIN IN RELATION TO THE BUIL DING/WALL AS SHORT TERM CAPITAL GAIN, BUT IN RESPECT OF THE LAND IT REMAINE D TO BE CONTINUED AS LONG TERM CAPITAL GAIN. ON THE BASIS OF SUCH DIRECTION O F THE ITAT, WHILE GIVING EFFECT TO THE ORDER OF THE ITAT, COMPUTED THE LONG TERM CAPITAL LOSS ON TRANSFER OF LAND AT RS. 15,68,804/- AND IN RESPECT OF THE BU ILDING HAS WORKED OUT THE SHORT TERM CAPITAL GAIN AT RS. 32,32,883/- AND AFTE R ADJUSTING THE ABOVE LOSS OF (-) 39,547/- HAS WORKED OUT THE TOTAL INCOME AT RS. 31,93,336/- AND THE LONG TERM CAPITAL LOSS AMOUNTING TO RS. 15,68,804/- . ON THE BASIS OF INCOME AS DETERMINED WHILE GIVING EFFECT TO THE ORDER OF I TAT IN ACCORDANCE WITH THE DIRECTIONS AS ISSUED TO THE ASSESSING OFFICER TO CO MPUTE THE SHORT TERM CAPITAL GAIN ON SALE OF BUILDING IN VIEW OF THE PRO VISIONS OF SECTION 50 OF THE INCOME TAX ACT, THE ASSESSING OFFICER LEVIED THE PE NALTY U/S 271(1)(C) OF THE ACT AT RS. 10,74,878/- VIDE ORDER DATED 28.10.2013. 7. THE LD. AR FURTHER SUBMITTED THAT IN THE INSTANT CASE, THE ASSESSING OFFICER LEVIED THE PENALTY NOT ON THE BASIS OF FOUN DATION GIVEN IN THE ORIGINAL ASSESSMENT ORDER DATED 27.11.2008 WHEREIN THE PENAL TY PROCEEDINGS WAS INITIATED ON ACCOUNT OF THE ADOPTION OF THE MARKET VALUE OF THE PROPERTY AT RS. 51,30,000/- FOR THE PURPOSE OF WORKING OUT A LONG T ERM CAPITAL GAIN, BUT ON ACCOUNT OF WORKING OUT A SHORT TERM CAPITAL GAIN, I N RESPECT OF BUILDING IN VIEW OF THE PROVISION OF SECTION 50 OF THE ACT AS D IRECTED BY THE ITAT. IN OTHER WORDS, THE VERY FOUNDATION BASED ON WHICH THE PROCE EDING U/S 271(1)(C) OF THE ACT WAS INITIATED AT THE TIME OF ORIGINAL ASSES SMENT IN HIS ORDER DATED 6 ITA NO. 4913/DEL/2015 27.11.2008, HAS BEEN TOTALLY SUBSTITUTED IN THE PEN ALTY PROCEEDINGS WHICH IS NOT PERMISSIBLE UNDER THE LAW. SO MUCH SO THE ORDER PASSED BY THE ASSESSING OFFICER ON THE BASIS OF DIRECTIONS OF APPELLATE AUT HORITIES DOES NOT AMOUNT TO SATISFACTION AS CONTEMPLATED U/S 271 OF THE ACT. TH E DIRECTION ISSUED BY ITAT AMOUNTS TO SATISFACTION OF ITAT AND NOT THAT OF THE ASSESSING OFFICER. THE LD. AR RELIED UPON THE FOLLOWING DECISIONS: 1. CIT VS. LAKHDHIR LAL JI 85 ITR 77 (GUJ) 2. CIT VS. MANU ENGINEERING WORKS 122 ITR 306 (GUJ) 3. GUJARAT CREDIT CORPORATION LTD. VS. ACIT 116 TTJ 619 (AHD) 4. CIT VS. ANAND BAZAR PATRIKA 116 ITR 416 5. CIT VS. SHADI RAM BAL MUKUND 84 ITR 183 AS FAR AS THE MERIT OF THE CASE IS CONCERNED, THE L D. AR SUBMITTED THAT THE PENALTY PROCEEDING ARE INDEPENDENT PROCEEDINGS FROM ASSESSMENT AND NO PENALTY CAN BE LEVIED MERELY ON THE BASIS OF FINDIN G GIVEN IN THE ASSESSMENT ORDER UNLESS COGENT MATERIAL IS BROUGHT ON RECORD T O PROVE ITS FALSITY. IN THE PENALTY PROCEEDINGS, THE ASSESSEE MAY FURNISH FRESH EVIDENCE WHICH SHOULD BE CONSIDERED TO PROVE THE BONAFIDE OF THE ASSESSEE . THE LD. AR RELIED UPON THE FOLLOWING DECISIONS: 1. CIT VS. KHODAY ESWARSA & SONS 83 ITR 369 (SC) 2. DEVSONS PVT. LTD. VS. CIT 329 ITR 483 (DEL) 3. PRASANNA ENTERPRISES VS. CIT 244 ITR 188 (KER) 8. THE LD. AR FURTHER SUBMITTED THAT THE VERY OBSER VATION OF THE TRIBUNAL THAT THE ASSESSEE CLAIMED DEPRECIATION ON THE BUILD ING AS ALLEGED TO HAVE BEEN ADMITTED BY THE COUNSEL IN THE PROCEEDING AND THEN INVOKING THE PROVISION OF SECTION 50 OF THE ACT, IS NOT CORRECT. THE FACT OF THE ASSESSEES CASE IS THAT THE 7 ITA NO. 4913/DEL/2015 SO CALLED BUILDING IS IN THE SHAPE OF WALL CONSTRUC TED AROUND THE FARM LAND. WHILE PREPARING THE PROFIT & LOSS ACCOUNT IN ACCORD ANCE WITH THE PROVISIONS OF THE COMPANY LAW, THE ASSESSEE HAD DEBITED THE DEPRE CIATION IN RESPECT OF SUCH BOUNDARY WALL IN THE PROFIT & LOSS ACCOUNT, BU T BECAUSE SUCH BUILDING WAS IN THE SHAPE OF WALL AROUND THE FARM LAND WHICH IS ONLY A CAPITAL ASSET NOT CONNECTING TO ANY BUSINESS, HENCE WHILE FILING THE INCOME TAX RETURN, IN ACCORDANCE WITH THE PROVISIONS OF THE INCOME TAX AC T, HAS IGNORED THE LOSS OCCASIONED BY SUCH DEPRECIATION SHOWN IN THE BOOKS OF ACCOUNT AND HAS DISCLOSED THE INCOME AT NIL WHICH IS VERIFIABLE FRO M THE INCOME-TAX RETURN FILED BY THE ASSESSEE AND ASSESSMENT THEREON COMPLE TED. SUCH FACT MAY BE VERIFIED FROM THE INCOME-TAX RETURN FROM THE A.Y. 2 001-02 ONWARDS BECAUSE WALL WAS CONSTRUCTED IN THE F.Y. 2000-01 AND ACCORD INGLY IT IS INCORRECT TO SAY THAT ANY DEPRECIATION U/S 32 OF THE ACT HAS EVER BE EN ALLOWED TO THE ASSESSEE. IT IS NOT CLEAR UNDER WHAT IMPRESSION THE ASSESSEE S COUNSEL STATED SO, BUT THE FACT REMAINS, AS IT IS CLEAR FROM THE RECORDS A LSO, NEITHER ANY DEPRECIATION WAS CLAIMED BY THE ASSESSEE IN RESPECT OF THE BUILD ING (WALL) NOR HAS BEEN ALLOWED BY THE INCOME TAX DEPARTMENT U/S 32 OF THE ACT. THEREFORE, MERELY BECAUSE THE ITAT HAS GAINED THE IMPRESSION ON THE B ASIS OF PROFIT & LOSS ACCOUNT AS MAINTAINED IN ACCORDANCE WITH THE COMPAN Y LAW, THE DEPRECIATION HAS BEEN DEBITED TO THE PROFIT & LOSS ACCOUNT, THAT DOES NOT MEAN THAT DEPRECIATION HAS ACTUALLY BEEN ALLOWED TO THE ASSESSEE. SECTION 50 OF THE ACT CONTEMPLATES ONLY THAT DEPRECIATION, WHI CH HAS BEEN ACTUALLY ALLOWED U/S 32 OF THE ACT WHILE COMPUTING THE INCOM E IN ACCORDANCE WITH THE PROVISIONS OF THE INCOME TAX ACT AND NOT OTHERWISE. 9. THE LD. AR FURTHER SUBMITTED THAT IN THE INSTANT CASE, NO DEPRECIATION HAS BEEN ACTUALLY ALLOWED TO THE ASSESSEE AND HENCE THE INVOCATION OF PROVISION OF SECTION 50 OF THE ACT FOR THE PURPOSE OF LEVY OF THE TAX IS NOT CORRECT AND IN SUCH CIRCUMSTANCES THE ASSESSEE CANN OT BE BRANDED TO HAVE CONCEALED INCOME/FURNISHING OF INACCURATE PARTICULA RS. HOWEVER, THE FACT REMAINS AS FAR AS THE PARTICULARS ARE CONCERNED, IT IS ON THE BASIS OF THE 8 ITA NO. 4913/DEL/2015 PARTICULARS AS PROVIDED BY THE ASSESSEE BY WAY OF F ILING OF THE COPY OF THE SALE DEEDS, ALL THE DISPUTES AND INFERENCE HAS BEEN MADE BY VARIOUS AUTHORITIES. THE ASSESSING OFFICER, ON THE BASIS OF THE PARTICUL ARS FURNISHED BY THE ASSESSEE, HAS INFERRED IN A DIFFERENT WAY THOUGH TH E CIT(A) HAS AGREED WITH THE ASSESSEE BUT THE ITAT HAS GIVEN ITS FINDING ON A DIFFERENT PLANK, WHICH WAS NOT BASICALLY THE ISSUE BEFORE THE ITAT AS IS C LEAR EVEN FROM THE GROUNDS OF APPEAL FILED BY THE REVENUE BEFORE ITAT. THEREFO RE, THE LD. AR FURTHER SUBMITTED THAT MERELY ON ACCOUNT OF THE TREATMENT O F THE CAPITAL GAIN AS SHORT TERM CAPITAL GAIN ON THE PORTION OF THE VALUE OF TH E BUILDING OF THE SALE CONSIDERATION INSTEAD OF LONG TERM CAPITAL GAIN AS CLAIMED BY THE ASSESSEE DOES NOT AMOUNT TO FURNISHING OF INACCURATE PARTICU LARS BECAUSE THE PARTICULARS AS FURNISHED BY THE ASSESSEE REMAINED T HE SAME. IT IS ONLY THE DIFFERENCE IN INFERENCE AS MADE BY EACH AUTHORITIES IN A DIFFERENT MANNER. THE LD. AR RELIED UPON THE HONBLE APEX COURT DECISION IN CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. 323 ITR 158 (SC). 10. THE LD. DR RELIED UPON THE PENALTY ORDER AND TH E ORDER OF THE CIT(A). THE LD. DR ALSO RELIED UPON THE FOLLOWING DECISIONS : I. UOI VS. DHARMENDRA TEXTILE PROCESSORS 295 ITR 24 4 (SC) II. R L TRADERS VS. ITO 2017-TIOL-2583-HC-DEL-IT III CIT VS. ZOOM COMMUNICATION P. LTD. 327 ITR 510 (DEL) IV. CIT VS. MOSER BAER INDIA LTD. 315 ITR 460 (SC) V. CIT VS. GOLD COIN HEALTH FOOD P. LTD. 304 ITR 30 8 (SC) VI. MAK DATA P. LTD. CIT 358 ITR 593 (SC) VII. B. A. BALASUBRAMANIAM & BROS. CO. VS. CIT 236 ITR 977 (SC) VIII. CIT VS. ESCORTS FINANCE LTD. 328 ITR 44 (DEL) 9 ITA NO. 4913/DEL/2015 11. WE HAVE HEARD BOTH THE PARTIES AND PERUSED ALL THE RELEVANT MATERIAL AVAILABLE ON THE RECORDS. SINCE THE ADDITIONAL GROU NDS ARE LEGAL IN NATURE AND CAN BE TAKEN AT ANY STAGE, WE ARE ADMITTING THE ADD ITIONAL GROUNDS FILED BY THE ASSESSEE. AS REGARDS THE ADDITIONAL GROUND (I) RELATING TO THE TIME BARRING PENALTY ORDER, IT CAN BE SEEN THAT THE ORIGINAL ASS ESSMENT ORDER WAS PASSED ON 27.11.2008 AND THE PENALTY WAS INITIATED IN THE SAME ORDER ITSELF. BUT SINCE THE EARLIER ASSESSMENT WAS QUASHED BY THE TRI BUNAL ON 27.04.2012, THE FRESH ASSESSMENT ORDER WAS PASSED ON 03.06.2013. TH EREAFTER THE PENALTY ORDER WHICH IS CHALLENGED BEFORE US IS PASSED ON 28 .10.2013. THUS, THE PENALTY ORDER IS WITHIN THE PARAMETERS PRESCRIBED B Y THE PROVISIONS OF THE INCOME TAX ACT, 1961, MORE SPECIFICALLY THAT OF SEC TION 275(1)(A) OF THE INCOME TAX ACT. THUS, ADDITIONAL GROUND NO. (I) IS DISMISS ED. 12. ADDITIONAL GROUND NO. (II) IS RELATING TO ABSEN CE OF SPECIFIC CHARGE POINTING OUT IN THE NOTICE. IT IS PERTINENT TO NOTE HERE THAT THE PENALTY ORDER IS BASED ON FURNISHING OF INACCURATE PARTICULARS BUT T HE NOTICE IS NOT SPECIFYING EXACTLY ON WHICH LIMB THE PENALTY U/S 271(1)(C) HAS BEEN INITIATED. FROM THE NOTICE DATED 30.06.2013 PRODUCED BY THE LD. AR DURI NG THE HEARING, IT CAN BE SEEN THAT THE ASSESSING OFFICER WAS NOT SURE UNDER WHICH LIMB OF PROVISIONS OF SECTION 271 OF THE INCOME TAX ACT, 1961, THE ASSESS EE IS LIABLE FOR PENALTY. THE ISSUE IS SQUARELY COVERED BY THE DECISION OF TH E HON'BLE SUPREME COURT IN CASE OF M/S SSA EMERALD MEADOWS. THE EXTRACT OF TH E DECISION OF THE HONBLE KARNATAKA HIGH COURT IN M/S. SSA EMERALD MEADOWS A RE AS UNDER WHICH WAS CONFIRMED BY THE HONBLE APEX COURT: 3. THE TRIBUNAL HAS ALLOWED THE APPEAL FILED BY TH E ASSESSEE HOLDING THE NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SE CTION 274 READ WITH SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) TO BE BAD IN LAW AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E., WHETHE R FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF INCOME. THE TRIBUNAL, WHILE ALLOWING THE APPEAL OF THE ASSE SSEE, HAS RELIED ON THE 10 ITA NO. 4913/DEL/2015 DECISION OF THE DIVISION BENCH OF THIS COURT RENDER ED IN THE CASE OF COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON A ND GINNING FACTORY (2013) 359 ITR 565. 4. IN OUR VIEW, SINCE THE MATTER IS COVERED BY JUDG MENT OF THE DIVISION BENCH OF THIS COURT, WE ARE OF THE OPINION, NO SUBS TANTIAL QUESTION OF LAW ARISES IN THIS APPEAL FOR DETERMINATION BY THIS COU RT. THE APPEAL IS ACCORDINGLY DISMISSED. THUS, ADDITIONAL GROUND NO. (II) OF THE ASSESSEES APPEAL IS ALLOWED. SINCE THE INCEPTION OF THE NOTICE ISSUED U/S 271(1)(C) HAS BE COME NULL AND VOID, THERE IS NO NEED TO COMMENT ON MERIT OF THE CASE. THE PENALT Y U/S 271(1)(C) OF THE ACT IS QUASHED. 13. IN RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18.07.2018 SD/- SD/- (R.K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDIC IAL MEMBER DATED: 18.07.2018 *KAVITA ARORA COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI 11 ITA NO. 4913/DEL/2015 DATE OF DICTATION 21.06.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 21.06.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 18.7.18 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 18.7.18 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 18.7.18 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 18.7.18 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 18.7 .18 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER