BERMACO ENERGY SYSTEMS LTD., NAVI MUMBAI V. DCIT CENT. CIR. - 47, (NOW ACIT CENT. CIR. 8(4)), MUMBAI

ITA 4978/MUM/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0301 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 04-08-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T A KHAN LD
• Assessee Lawyers: J P BAIRAGRA LD
• Section: 143(3)

Judgement Text

ITA NO 4978/MUM/2016 BERMACO ENERGY SYSTEMS LIMITED ASSESSMENT YEAR 2011-12 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI . . , , BEFORE SHRI D.T. GARASIA, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./I.T.A. NO.4978/MUM/2016 ( / ASSESSMENT YEAR: 2011-12) BERMACO ENERGY SYSTEMS LIMITED D-73/1 TTC INDUSTRIAL AREA MIDC, TURBHE NAVI MUMBAI MUMBAI 400 705 / VS. ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 8(4) 6 TH FLOOR,AAYKAR BHAVAN M.K.ROAD MUMBAI -400 020 ! ./ ./PAN/GIR NO. AAACB-2727-N ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) ASSESSEE BY : J.P.BAIRAGRA, LD. AR REVENUE BY : T.A.KHAN, LD. DR / DATE OF HEARING : 10/08/2017 / DATE OF PRONOUNCEMENT : 16/08/2017 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. IN THE CAPTIONED APPEAL FOR ASSESSMENT YEAR [AY ] 2011-12, THE ASSESSEE IS AGGRIEVED BY CONFIRMATION OF PENALTY U/ S 271(1)(C) FOR RS.1,57,790/- BY LD. COMMISSIONER OF INCOME TAX (AP PEALS)-47 [CIT(A)], MUMBAI ORDER DATED 11/05/2016. ITA NO 4978/MUM/2016 BERMACO ENERGY SYSTEMS LIMITED ASSESSMENT YEAR 2011-12 2 2.1 FACTS LEADING TO THE SAME ARE THAT THE ASSESSEE BEING RESIDENT CORPORATE ASSESSEE ENGAGED AS TURNKEY PROJECT MANAGEMENT CONSULTANTS AND DEALING IN SHARES HAS BEEN ASSESSED FOR IMPUGNED AY U/S 143(3) ON 30/03/2014 AT RS.3,65,76,520/- AS AGA INST RETURNED INCOME OF RS.2,84,98,859/- FILED BY THE ASSESSEE ON 24/05/ 2012. 2.2 DURING ASSESSMENT PROCEEDINGS, IT WAS NOTED THA T THE ASSESSEE CLAIMED SHORT TERM CAPITAL LOSS [STCL] ON SALE OF CERTAIN SHARES FOR RS.1,63,41,050/- WHICH OCCURRED DURING THE PERIOD O F 3 MONTHS FROM THE RECORD DATE FOR DIVIDEND ON THESE SHARES. ACCORDING LY, THE PROVISIONS OF SECTION 94(7) WERE INVOKED AND A DISALLOWANCE OF RS .5,10,643/- WAS MADE IN THE QUANTUM ASSESSMENT. THE ASSESSEE, WHILE ACCEPTING THE SAME, CONTENDED THAT THE ASSESSEE WAS NOT GUIDED IN THIS MATTER BY THE TAX CONSULTANT AND HENCE THE MATTER ESCAPED NOTICE. 2.3 CONSEQUENTLY, PENALTY PROCEEDINGS WERE INITIATE D U/S 271(1)(C) DURING QUANTUM ASSESSMENT AND FINALLY, AN AMOUNT OF RS.1,57,790/- HAS BEEN IMPOSED AS PENALTY U/S 271(1)(C) ON 24/09/2014 BY LD. AO FOR DELIBERATE CONCEALMENT AND FURNISHING OF INACCURATE PARTICULARS OF INCOME. DURING PENALTY PROCEEDINGS, THE ASSESSEE CONTENDED THAT THE SAID DISALLOWANCE ESCAPED ATTENTION DUE TO INADVERT ENT MISTAKE AND UPON BEING POINTED OUT BY THE LD. AO, THE ASSESSEE ACCEPTED THE DISALLOWANCE. HOWEVER, THERE WAS NO CONCEALMENT OF INCOME BY FURNISHING INACCURATE PARTICULARS SO AS TO ATTRACT PENALTY U/S 271(1)(C) SINCE FULL PARTICULARS THEREOF WERE FURNISHED IN TH E COMPUTATION OF INCOME. HOWEVER, NOT CONVINCED, LD. AO IMPOSED THE IMPUGNED PENALTY WHICH WAS FURTHER CONTESTED BEFORE LD. CIT(A) WITHO UT ANY SUCCESS VIDE IMPUGNED ORDER DATED 11/05/2016. THE LD. CIT(A) CON FIRMED THE SAME ITA NO 4978/MUM/2016 BERMACO ENERGY SYSTEMS LIMITED ASSESSMENT YEAR 2011-12 3 BY NOTING, INTER-ALIA, THAT THE ASSESSEE COULD NOT ADDUCE EVIDENCE TO SUPPORT THE CONTENTION THAT THERE WAS OMISSION ON T HE PART OF TAX ADVISOR. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 3. THE LD. REPRESENTATIVE FOR ASSESSEE [AR] ASSAILE D THE PENALTY ON TECHNICAL GROUNDS AS WELL AS ON MERITS. OUR ATTENTI ON HAS BEEN DRAWN TO THE NOTICE ISSUED U/S 274 READ WITH SECTION 271(1)(C) AS PLACED ON PAGE NO. 32 OF THE PAPER-BOOK TO CONTEND THAT THE APPROPRIATE CHARGE / LIMB FOR WHICH THE PENALTY WAS BEING LEVIED WAS NOT APPR OPRIATELY MARKED BY LD. AO WHICH, IN ITSELF, VITIATES PENALTY PROCEEDIN GS AS PER SEVERAL JUDICIAL PRONOUNCEMENTS. ON MERITS, LD. AR CONTENDE D THAT COMPLETE DETAILS OF SHORT TERM CAPITAL LOSS WAS FURNISHED BY THE ASSESSEE IN THE COMPUTATION OF INCOME AND THE MATTER OF DISALLOWANC E U/S 94(7) ESCAPED THE ATTENTION OF THE ASSESSEE SINCE THE SAME WAS NO T POINTED OUT BY THE TAX CONSULTANT. THE ASSESSEE, UPON REALIZING THE SA ME, ACCEPTED THE MISTAKE AND PAID THE DUE TAXES FORTHWITH AND HENCE, PENALTY WAS NOT JUSTIFIED. 4. PER CONTRA, LD. DR PLACED RELIANCE ON THE CONCLUSION OF LD. CIT (A) AND CONTENDED THAT THE ASSESSEE COULD NOT SUBSTANTI ATE THE FACT THAT THE SAME OCCURRED DUE TO INADVERTENT ERROR OR THERE WAS ANY OMISSION ON THE PART OF TAX CONSULTANT. 5. WE HAVE HEARD THE RIVAL CONTENTIONS. IT IS NOTIC ED THAT THE ASSESSEE SUFFERED SHORT TERM CAPITAL LOSS OF RS.163.41 LACS OUT OF WHICH AN AMOUNT OF RS.5.10 LACS ONLY WAS FOUND DISALLOWABLE U/S 94(7). THIS FACT, IN ITSELF, GIVES STRENGTH THE ARGUMENTS OF LD. AR T HAT THE ERROR CREPT IN DUE TO INADVERTENT MISTAKE. THIS FACT IS FURTHER FO RTIFIED BY THE CONDUCT OF ASSESSEE SINCE THE ASSESSEE ACCEPTED THE MISTAKE AT ASSESSMENT STAGE ITA NO 4978/MUM/2016 BERMACO ENERGY SYSTEMS LIMITED ASSESSMENT YEAR 2011-12 4 ITSELF AND PAID DUE TAXES FORTHWITH. THEREFORE, IT IS NOT THE CASE THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME SINCE THE WORKING OF SHORT TERM CAPITAL GAINS / LOSS WAS PROVIDED IN THE COMPUTATION OF INC OME. THE SECOND REASON TO CONCUR WITH THE STAND OF LD. AR IS SHOW CAUSE NOTICE DATED 30/03/2014 ISSUED U/S 274 READ WITH SECTION 271(1)(C), A PERUSAL OF WHICH REVEALS THAT THE APPROPRIATE CHARGE / LIMB IS NEITH ER TICKED NOR STRUCK-OFF WHICH, IN ITSELF, VITIATES PENALTY PROCEEDINGS AS P ER THE DECISION OF THIS TRIBUNAL RENDERED IN CHANDRU K.MIRCHANDANI VS. ITO [ITA NO. 5368/MUM/2014 DATED 05/04/2017]. HENCE, ON TOTALITY OF FACTS AND CIRCUMSTANCES, WE ARE INCLINED TO DELETE THE IMPUGN ED PENALTY. 6. RESULTANTLY, THE ASSESSEES APPEAL STANDS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH AUGUST, 2017. SD/- SD/- (D.T. GARASIA) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 16. 08.2017 SR.PS:- THIRUMALESH ! / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $%!# / THE RESPONDENT 3. , ( ) / THE CIT(A) 4. , / CIT CONCERNED 5. $'. , . , / DR, ITAT, MUMBAI 6. / / GUARD FILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI