CIPLA LIMITED, MUMBAI V. DCIT, CENTRAL CIRCLE-2, MUMBAI

ITA 5113/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2537 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-11-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 05-02-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 10-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P MEENADR
• Assessee Lawyers: V MOHAN
• Keywords: Bogus purchase; Opportunity of being heard; Earning of tax free income
• Section: 14A

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA NO.5113/MUM/2013 ASSESSMENT YEAR- 2008-09 CIPLA LIMITED, MUMBAI CENTRAL, MUMBAI-400008 / VS. DCIT, CENTRAL CIRCLE-2, CGO BUILDING, 9 TH FLOOR, , M.K.MARG, MUMBAI-400020 ( /ASSESSEE) ( ! / REVENUE) PAN. NO. AAACC1450B / ASSESSEE BY SHRI V. MOHAN ! / REVENUE BY SHRI O.P. MEENA-DR ' !# $ % / DATE OF HEARING : 17/11/2015 $ % / DATE OF ORDER: 23/11/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DA TED 09/05/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. THE ONLY GROUND RAISED IN THIS APPEAL PERTAINS TO C ONFIRMING CIPLA LIMITED. ITA NO.5113/MUM/2013 2 THE PENALTY OF RS.38,80,657/- IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING OF THIS APPEAL, AT THE OUTSET, I T WAS POINTED OUT BY THE LD. DR THAT QUANTUM APPEAL IN TH IS CASE HAS BEEN SENT TO THE FILE OF THE ASSESSING OFFICER, THEREFORE, PENALTY APPEAL MAY ALSO BE SENT TO THE FILE OF THE ASSESSING OFFICER. THE LD. COUNSEL FOR THE ASSESSEE, CONTENDE D THAT SINCE THE ADDITION HAS BEEN SENT TO THE FILE OF THE ASSESSING OFFICER, THE PENALTY MAY BE DELETED. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. BEFORE CO MING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER THE RE LEVANT PORTION FROM THE ORDER OF THE TRIBUNAL DATED 25/07/ 2014 (ITA NO.6471/MUM/2010) FOR READY REFERENCE AND ANAL YSIS:- 2. THE LD CIT (A) HAS FURTHER ERRED IN UPHOLDING DISALLOWANCE OF ALLEGED BOGUS PURCHASES IN THE AMOUNT OF RS. 38,80, 657/-. WITHOUT PREJUDICE TO THE GENERALITY, THE LD CIT (A) HAS ERR ED IN ALLEGING UNCLARIFIED DISCREPANCIES. YOUR APPELLANT IS AGGRIE VED BY THE DENIAL OF OPPORTUNITY TO CLARIFY THE ALLEGED DISCREPANCIES . YOUR APPELLANT SEEKS THE OPPORTUNITY TO CLARIFY TO THE HONBLE TRI BUNAL THAT THE ALLEGED DISCREPANCIES ARE AMENABLE TO APPROPRIATE E XPLANATION WITH REFERENCE TO THE MATERIAL ON RECORD AND SUCH S UPPLEMENTARY MATERIAL WHICH MAY BE REQUISITIONED IN THE COURSE O F THE PROCEEDINGS. CIPLA LIMITED. ITA NO.5113/MUM/2013 3 3. THE LD CIT (A) HAS FURTHER ERRED IN UPHOLDING DI SALLOWANCE OF RS. 73,75,369/- UNDER SECTION 14A OF THE ACT WE NOTE THAT IN THE AFORESAID GROUND, RAISED BY THE ASSESSEE, DENIAL OF OPPORTUNITY TO CLARIFY THE ALLE GED DISCREPANCIES WAS RAISED BY THE ASSESSEE AND AFTER HEARING THE ASSESSEE AS WELL AS THE REVENUE FOLLOWING CONCL USION WAS ARRIVED AT BY THE TRIBUNAL. 7. REFERRING TO GROUNDS NO.2 & 3, LD COUNSEL FOR T HE ASSESSEE MENTIONED THAT THE SAID GROUNDS REQUIRE REVISIT TO THE FILE OF THE AO CONSIDERING THE FACT THAT THE ASSESSEE WAS NOT GIVE N A PROPER OPPORTUNITY TO CLARIFY THE ALLEGATIONS AGAINST THE BOGUS PURCHASES ON ONE SIDE AND THE ASSESSING OFFICER FAILED TO REC ORD HIS DISSATISFACTION WITH REGARD TO THE CLAIM OF THE ASS ESSEE THAT NO EXPENDITURE WAS INCURRED FOR EARNING OF THE EXEMPT INCOME AND THIS IS RELEVANT FOR THE ISSUE RAISED IN GROUND NO.3. CO NSIDERING THE CONCURRENCE OF BOTH THE PARTIES FOR REMANDING THESE TWO ISSUES TO THE FILE OF THE AO, WE ACCORDINGLY ALLOW THE GROUND S NO.2 AND 3 RAISED BY THE ASSESSEE FOR STATISTICAL PURPOSES. IF THE OBSERVATION MADE IN THE ASSESSMENT ORDER, L EADING TO ADDITION MADE TO THE TOTAL INCOME, CONCLUSION DR AWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, CONCLUSION DRAWN IN THE ORDER OF THE TRIBUNAL AND T HE ASSERTIONS MADE BY THE LD. RESPECTIVE COUNSEL, IF K EPT IN JUXTAPOSITION AND ANALYZED, WE NOTE THAT THE ASSESS EE WAS NOT PROVIDED PROPER OPPORTUNITY OF BEING HEARD AND TO CLARIFY THE STAND WITH RESPECT TO BOGUS PURCHASES, IN THAT SITUATION, CIPLA LIMITED. ITA NO.5113/MUM/2013 4 THE QUANTUM ADDITION WAS SENT TO THE FILE OF THE LD . ASSESSING OFFICER, THEREFORE, IN OUR VIEW, IT IS A CLEAR CUT CASE OF SENDING THE PENALTY APPEAL ALSO TO THE FILE OF T HE LD. ASSESSING OFFICER AS THE SAME SHALL GERMANE OUT OF THE SET- ASIDE PROCEEDINGS, PURSUANT TO THE DIRECTION OF THE TRIBUNAL. THEREFORE, THE APPEAL OF THE ASSESSEE IS ALSO REMAN DED TO THE FILE OF THE LD. ASSESSING OFFICER FOR FRESH ADJUDIC ATION IN ACCORDANCE WITH LAW. NEEDLESS TO MENTION HERE THAT DUE OPPORTUNITY OF BEING HEARD BE PROVIDED TO THE ASSES SEE. FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 17/11/2015. SD/- SD/- ( ASHWANI TANEJA ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER ' # MUMBAI; ' DATED : 23/11/2015 F| P.S/. .. %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. )*+, / THE APPELLANT 2. -.+, / THE RESPONDENT. 3. / / ' 0 ( )* ) / THE CIT, MUMBAI. 4. / / ' 0 / CIT(A)- , MUMBAI 5. 2!3 - , / )*% ) 4 , ' # / DR, ITAT, MUMBAI CIPLA LIMITED. ITA NO.5113/MUM/2013 5 6. 5 6# / GUARD FILE. / BY ORDER, .2* - //TRUE COPY// / (DY./ASSTT. REGISTRAR) , ' # / ITAT, MUMBAI.