Ravjibhai Premjibhai Motisariya, RAJKOT-GUJARAT V. The Income Tax Officer, Ward-2(3), AMRELI

ITA 515/RJT/2013

• Counselvise Citation: 51524914 RSA 2013
• Duration Of Justice: 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 05-03-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 16-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR JAYANT B JHAVERI
• Assessee Lawyers: DR ADHIA
• Keywords: Bonafide mistake
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBULAL, SMC BENCH, RAJKOT BEFORE SHRI T. K. SHARMA, JM ITA NO. 515/RJT/2013 ASSESSMENT YEAR : 2009-10 RAVJIBHAI PREMJIBHAI MOTISARIYA, C/O. SITARA RECHARGE CORNER, OPP. SBS, NR. CHAVAND GATE, LATHI, DIST. AMRELI PAN : ANHPM 7481 K ( / APPELLANT) THE INCOME-TAX OFFICER, WARD 2(3), AMRELI / RESPONDENT / ASSESSEE BY SHRI D.R. ADHIA, AR / REVENUE BY DR. JAYANT B. JHAVERI, DR / DATE OF HEARING 05.03.2014 !'# / DATE OF PRONOUNCEMENT 07.03.2014 / ORDER THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER DA TED 06.09.2013 OF CIT (A)- IV, RAJKOT CONFIRMING THE PENALTY OF RS.23,800/- LE VIED BY THE ASSESSING OFFICER U/S. 271(1)(C) OF THE INCOME-TAX ACT FOR THE ASSESSMENT YEAR 2009-10. 2. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL, DOING BUSINESS OF MOBILE RECHARGE COUPON. FOR THE ASSESSMENT YEAR UND ER APPEAL, HE FILED THE RETURN OF INCOME DECLARING TOTAL INCOME AT RS.2,22,223/-. THE ASSESSING OFFICER FRAMED ASSESSMENT U/S 143(3) OF THE INCOME-TAX ACT ON 12.1 2.2011, WHEREIN HE MADE THE FOLLOWING TWO ADDITIONS/DISALLOWANCES:- I. INTEREST INCOME RECEIVED FROM VODAFONE ESSAR GUJ ARAT LTD. RS. 22,500/- II. DISCOUNT RECEIVED FROM VODAFONE ESSAR GUJARAT L TD. - RS.1,26,916/- TOTAL RS.1,49,416/- IN RESPECT OF AFORESAID ADDITIONS/DISALLOWANCES, IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER ALSO INITIATED PENALTY PROCEEDING S U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961. SUBSEQUENTLY, IN RESPECT OF AFORESAID A DDITIONS/DISALLOWANCES, THE ASSESSING OFFICER VIDE ORDER DATED 27.06.2012 IMPOS ED PENALTY OF RS.23,800/- BEING 100% TAX SOUGHT TO BE EVADED ON CONCEALED INCOME OF RS.1,46,416/-. ON APPEAL, IN THE IMPUGNED ORDER, LD. CIT(A) CONFIRMED THE PENALT Y OF RS.23,800/-, LEVIED BY THE 2 515-RJT-2013 RAVJIBHAI PREMJIBHAI MOTISARIYA (SMC) ASSESSING OFFICER U/S. 271(1)(C) OF THE INCOME-TAX ACT, FOR THE DETAILED REASON GIVEN IN PARAGRAPH 4 OF THE IMPUGNED ORDER, WHICH READS A S UNDER:- 4. COMING TO THE FACTS OF THE CASE, IT IS AN UNDIS PUTED FACT THAT THE APPELLANT HAS CONCEALED TWO ITEMS OF INCOME VIZ. I) INTEREST INCOME OF RS.22,500/- FROM VODAFONE ESSAR GUJARAT LTD. AND II ) DISCOUNTS RECEIVED AT RS.1,26,916/- FROM VODAFONE ESSAR GUJARAT LTD. IT A PPEARS FROM THE RECORD THAT THE APPELLANT HAS NOT PREFERRED AN APPEAL AGAI NST THE QUANTUM ORDER. AFTER DUE EXAMINATION OF THE FACTS ON RECORD AND AF TER CONSIDERATION OF THE EXPLANATION GIVEN BY THE APPELLANT DURING THE PENAL TY PROCEEDINGS, THE ASSESSING OFFICER WAS OF THE VIEW THAT THE APPELLAN T HAS DELIBERATELY WITHHELD THE INFORMATION PERTAINING TO THE RECEIPT OF INCOME FROM THE SAID COMPANY, SO AS TO EVADE TAXES INTENTIONALLY AS UNDERSTOOD IN TE RMS OF PROVISIONS CONTAINED U/S 271(1)(C) OF THE IT ACT, 1961. I CONCUR WITH TH E INFERENCE DRAWN BY THE ASSESSING OFFICER, THAT THIS IS A CLEAR CUT CASE OF CONCEALMENT WHICH ATTRACTS PENALTY U/S 271(1)(C) OF THE IT ACT, 1961. THEREFOR E, THE PENALTY LEVIED AT RS.23,800/- U/S 271(1)(C) OF THE IT ACT, 1961 BY TH E ASSESSING OFFICER FOR ASSESSMENT YEAR 2009-10 STANDS CONFIRMED. AGGRIEVED WITH THE ORDER OF LD. CIT(A) CONFIRMING T HE PENALTY OF RS.23,800/-, THE ASSESSEE IS NOW IN APPEAL BEFORE THIS TRIBUNAL. 3. AT THE TIME OF HEARING, ON BEHALF OF THE ASSESSE E, SHRI D.R. ADHIA, AR, APPEARED AND POINTED OUT THAT ON INTEREST INCOME OF RS.22,500/- THE VODAFONE ESSAR GUJARAT LTD. DID NOT DEDUCT TDS WHICH RESULTED IN N OT DISCLOSING THIS INCOME IN THE RETURN OF INCOME. THIS MISTAKE IS A BONAFIDE MISTAK E WITH NO INTENTION TO EVADE THE TAX; THEREFORE, ON THIS ADDITION PENALTY U/S 271(1) (C) IS NOT LEVIABLE. IN RESPECT OF ADDITION OF RS.1,26,916/-, THE LD. AUTHORIZED REPRE SENTATIVE OF THE ASSESSEE DREW MY ATTENTION TO PARAGRAPH 6 ON PAGE NO.2 OF THE ASSESS MENT ORDER FROM WHICH IT IS EVIDENT THAT THE ASSESSEE RECEIVED RS.21,20,954/- F ROM VODAFONE ESSAR GUJARAT LTD. BUT SHOWN RS.19,94,038/- IN THE LEDGER COPY; THUS, THERE IS A SHORT FALL OF RS.1,26,916/-. THE AMOUNT REMAINING TO BE SHOWN RS .1,26,916/-, I.E. ONLY ABOUT 6%. THE LD. AR OF THE ASSESSEE EXPLAINED THAT THIS WAS ALSO DUE TO MISTAKE ON THE PART OF THE ASSESSEE THAT BEFORE FINALIZING HIS ACCOUNT HE HAS NOT MADE CROSS VERIFICATION FROM VODAFONE ESSAR GUJARAT LTD. HE SUBMITTED THAT THIS WAS ALSO DUE TO A BONAFIDE MISTAKE AS WHEN A PERSON IS SHOWING 94% OF HIS RECE IPT, HE WILL NOT CONCEAL 6% THEREOF. THE LD. AR OF THE ASSESSEE ALSO SUBMITTED THAT THIS IS A PURE MISTAKE REAMIN TO BE RECONCILED DUE TO LATE RECEIPT OF STATEMENT A ND CLERICAL ERROR AT ACCOUNTING METHOD, FOR WHICH PENALTY U/S 271(1)(C) IS NOT LEVI ABLE. 3 515-RJT-2013 RAVJIBHAI PREMJIBHAI MOTISARIYA (SMC) 4. ON THE OTHER HAND, DR. JAYANT B. JHAVERI, DR, AP PEARED FOR THE REVENUE VEHEMENTLY SUPPORTED THE ORDER OF LD. CIT(A). THE L D. DR POINTED OUT THAT IT WAS DUTY OF THE ASSESSEE TO SHOW TRUE AND CORRECT INCOME AND SINCE THIS WAS NOT DONE, THE PENALTY OF RS.23,800/- WAS RIGHTLY LEVIED BY THE AS SESSING OFFICER AND CONFIRMED BY THE LD. CIT(A) IN THE IMPUGNED ORDER. 5. RIVAL SUBMISSIONS WERE CONSIDERED. IN RESPECT OF INTEREST INCOME, IT WAS THE DUTY OF THE PAYER TO DEDUCT TDS. IT APPEARS THAT TH E PAYER NAMELY VODAFONE ESSAR GUJARAT LTD. DEDUCTED NO TDS ON INTEREST INCOME OF RS.23,800/- AND DUE TO THIS MISTAKE, THE ASSESSEE HAS NOT SHOWN THIS INCOME IN THE BOOKS OF ACCOUNTS. SIMILARLY, DUE TO LATE RECEIPT OF STATEMENT AND CLERICAL ERROR AT ACCOUNTING METHOD, THE ASSESSEE HAS SHOWN LESS RECEIPT OF 1,26,916/- FROM VODAFONE ESSAR GUJARAT LTD. PRIMA-FACIE IT APPEARS THAT BOTH THESE MISTAKES ARE BONAFIDE FOR W HICH PENALTY U/S 271(1)(C) IS NOT LEVIABLE. I, THEREFORE, CANCEL THE PENALTY OF RS.23 ,800/- LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. THIS ORDER PRONOUNCED IN OPEN COURT ON THE DATE MEN TIONED HEREINABOVE. SD/- ( $.. &' / T. K. SHARMA) ( ) /JUDICIAL MEMBER *)& +) ,/ ORDER DATE:07.03.2014 !$ /RAJKOT *BT / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT- RAVJIBHAI PREMJIBHAI MOTISARIYA, C/O. SITARA RECHARGE CORNER, OPP. SBS, NR. CHAVAND GATE, LATHI, DIS T. AMRELI 2. / RESPONDENT- THE INCOME-TAX OFFICER, WARD 2(3), AMRELI 3. ,0,1 * * 2 / CONCERNED CIT-III, RAJKOT 4. * * 2- / CIT(A)-IV, RAJKOT 5 . 567 1, * 1#, !$ / DR, ITAT, RAJKOT 6 . 79 :; / GUARD FILE *)& / BY ORDER TRUE COPY PRIVATE SECRETARY, ITAT, RAJKOT