The DCIT, Circle-1, Surat V. M/s Leo Coats (India) Pvt.Ltd., Surat

ITA 492/AHD/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0466 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 28-02-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 12-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T SANKAR SRDR
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D AHMEDABAD BEFORE SHRI, A.K.GARODIA, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ITA NO.492/AHD/2010 ASSESSMENT YEAR :2006-07 DY. COMMISSIONER OF INCOME-TAX, CIRCLE-1, ROOM NO. 108, AAYAKAR BHAVAN, MAJURA GATE, SURAT V/S . M/S. LEO COATS (INDIA) PVT. LTD., SAMEER 2 ND , FLOOR, G-2/23, MUKTANAND NAGAR, OPP. SARDAR BRIDGE CIRCLE, ADAJAN ROAD, SURAT [ PAN NO. AABCL 0665G ] . / APPELLANT .. / RESPONDENT) /BY APPELLANT SHRI T. SANKAR, SR-DR /BY RESPONDENT NONE (WRITTEN SUBMISSION) /DATE OF HEARING 28-02-2013 /DATE OF PRONOUNCEMENT 08-03-2013 / // / O R D E R PER KUL BHARAT, JUDICIAL MEMBER:- THIS APPEAL OF REVENUE IS DIRECTED AGAINST THE ORD ER OF COMMISSIONER OF INCOME-TAX (APPEALS)-I, SURAT (CIT(A) FOR SHOR T) DATED 10-12-2009 PERTAINING TO ASSESSMENT YEAR (AY) 2006-07. THE REV ENUE HAS RAISED THE FOLLOWING GROUND OF APPEAL:- 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE PENALTY OF RS.2,67 ,974/- LEVIED IN RESPECT OF ADDITION OF RS.8,75,733/- MADE ON ACCOUN T OF CLOSING STOCK OF WORK IN PROGRESS. ITA NO.492/AHD/2010 A.Y. 2006-07 DCIT CIR-1 SRT V. M/S. LEO COATS (I) PVT. LTD. PAGE 2 2. BRIEFLY STATED FACTS ARE THAT ASSESSEE-COMPANY I S ENGAGED IN THE BUSINESS OF THE INDUSTRIAL AND DOMESTIC PAINTING AND THE CASE O F ASSESSEE WAS SELECTED FOR SCRUTINY ASSESSMENT U/S. 143(3) OF THE INCOME-TAX A CT, 1961 (HEREINAFTER REFERRED TO THE ACT) AND THE ASSESSMENT WAS COMPLETED VIDE OR DER DATED 04-12-2008. WHILE FINALIZING THE ASSESSMENT, THE ASSESSING OFFICER MA DE ADDITION ON ACCOUNT OF CLOSING STOCK NOT SHOWN AS WIP AMOUNTING TO RS.8,75,733/- A ND PENALTY PROCEEDINGS U/S. 271(1) OF THE ACT WAS SEPARATELY INITIATED. SUBSEQ UENTLY, A PENALTY ORDER DATED 29- 06-2009 WAS PASSED THEREBY THE PENALTY OF RS.2,67,9 74/- WAS IMPOSED FOR CONCEALING THE PARTICULARS OF INCOME. AGAINST THIS ORDER ASSESSEE FILED APPEAL BEFORE LD. CIT(A) WHO RELYING THE JUDGMENT OF HONBLE PUNJ AB AND HARYANA HIGH COURT RENDERED IN THE CASE OF CIT V. SSP (P) LTD. 219 CTR 486 (P&H) ALLOWED THE APPEAL OF ASSESSEE. 3. THE REVENUE BEING AGGRIEVED BY THIS ORDER OF LD. CIT(A) FILED APPEAL BEFORE THE TRIBUNAL. 4. NONE APPEARED ON BEHALF OF ASSESSEE, HOWEVER, WR ITTEN SUBMISSION ARE ON RECORD THOUGH THE ASSESSEE HAS PLACED RELIANCE AND SUBMISSION MADE BEFORE THE LD. CIT(A), THE ORDER OF LD. CIT(A) AND ALSO JUDGME NT OF HONBLE PUNJAB AND HARYANA HIGH COURT RENDERED IN THE CASE OF SSP (P) LTD. (SUPRA) AND VARIOUS OTHER DECISIONS OF THE HONBLE CO-ORDINATE BENCHES. IN SU PPORT ITS CONTENTION THAT PENALTY IS NOT JUSTIFIED. ON THE CONTRARY, LD. SR-DR SHRI T SANKAR FOR THE REVENUE RELIED ON THE PENALTY ORDER AND SUBMITTED THAT PENALTY IS JUS TIFIED. 5. WE HAVE HEARD LD. DR FOR THE REVENUE AND PERUSED THE MATERIALS AVAILABLE ON RECORD AND THE WRITTEN SUBMISSION FILED ON BEHAL F OF ASSESSEE. WE FIND THAT IT IS NOT DISPUTED THAT THE ASSESSEE HAD NOT INCLUDED THE DETAILS OF PURCHASES MADE IN THE LAST THREE DAYS OF THE FINANCIAL YEAR AND THE CONTE NTION OF ASSESSEE IS THAT THERE IS NO EFFECT ON THE REVENUE AS CLOSING STOCK OF THE PREVI OUS YEAR WOULD BECOME AS OPENING BALANCE OF THE NEXT YEAR. WE FIND FORCE INT O THE CONTENTION OF THE ASSESSEE. UNDER THE FACTS AND CIRCUMSTANCES OF THE PRESENT CA SE PENALTY IS NOT JUSTIFIED, MOREOVER, LD. CIT(A) HAS RIGHTLY RELIED UPON THE JU DGMENT OF HONBLE PUNJAB & HARYANA HIGH COURT AND REVENUE COULD NOT POINT OUT AS HOW THIS JUDGMENT OF HONBLE PUNJAB & HARYANA RENDERED IN THE CASE OF SSP (P) LTD. (SUPRA) IS NOT ITA NO.492/AHD/2010 A.Y. 2006-07 DCIT CIR-1 SRT V. M/S. LEO COATS (I) PVT. LTD. PAGE 3 APPLICABLE. UNDER THESE CIRCUMSTANCES, WE DO NOT FI ND ANY MERIT INTO THE GROUND RAISED BY REVENUE, HENCE, SAME IS REJECTED. 6. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE. SD/- SD/- (A.K.GARODIA) (KUL BHARAT) (ACCOUNTANT MEMBER) (JUDICIAL MEMBER) AHMEDABAD, *DKP !' #- 08/03/2013 *+, - ../ ../ ../ ../ 0/ 0/ 0/ 0/ / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. ','.2 3 / CONCERNED CIT 4. 3- / CIT (A) 5. /67 ...2, .2 , *+, / DR, ITAT, AHMEDABAD 6. 7:; <= / GUARD FILE. BY ORDER/ , /TRUE COPY/ >/* '? .2 , *+, - STRENGTHEN PREPARATION & DELIVERY O F ORDERS IN THE ITAT 1) DATE OF TAKING DICTATION 01/03 2) DIRECT DICTATION BY MEMBER STRAIGHT ON COMPUTER/LAPTOP/DRAGON DICTATE NO 3) DATE OF TYPING & DRAFT ORDER PLACE BEFORE MEMBER 01/03 4) DATE OF CORRECTION 04/03 5) DATE OF FURTHER CORRECTION - - 6) DATE OF INITIAL SIGN BY MEMBERS 06/03 7) ORDER UPLOADED ON - - 8) ORIGINAL DICTATION PAD-PART HAS BEEN ENCLOSED IN THE FILE YES 9) FINAL ORDER AND 2 ND COPY SEND TO BENCH CLERK ON 08/03