ASST CIT 16(2), THANE V. A F FERGUSON & CO, MUMBAI

ITA 5224/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8208 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 05-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV
• Keywords: Difference of opinion
• Section: 143(3); 27; 6

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL BENCH A MUMBAI BEFORE HONBLE S/SHRI G S PANNU ( A M), AND PAWAN SINGH , ( JM ) I.T.A. NO. 5224/MUM/2015 ( / ASSESSMENT YEA R :2 009 - 10 ) ASSTT. COMMISSIONER OF INCOME TAX 16(2), ROOM NO. 440, 4 TH FLOOR, AAYAKAR BHAVAN, M K ROAD, MUMBAI - 400020 / VS. M/S A F FERGUSON AND CO., ALLAHABAD BANK BLDG, BOMBAY SAMACHAR MARG, MUMBAI - 400001 / REVENUE BY : SHRI RAJESH KUMAR YADAV / ASSESSEE BY : SHRI KETAN VED PAN : AA BFA5846M / DATE OF HEARING : 30.11. 2017 / DATE OF PRONOUNCEMENT : 30.11. 2017 / O R D E R PER G S PANNU, A. M: THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE O RDER OF THE LD.CIT(A) - 5, MUMBAI, DATED 10.8.2015 FOR THE ASSESSMENT YEAR 20 08 - 09 WHICH IS ARISING OUT OF ASSESSMENT ORDER PASSED BY THE AO U/S 271(1)(C), DATED 26.3.2014. 2. THE SOLITARY ISSUE IN THIS APPEAL RELATES TO THE LEVY OF PENALTY UNDER SECTION 27 1(1)( C) OF THE ACT AMOUNTING TO RS.12,10,000/ - WHICH HAS SINCE BEEN DELETED BY THE LD.CIT(A). 2 I.T.A. NO. 5224/ MUM/201 5 3. PERTINENTLY, THE RELEVANT FACTS ARE THAT IN THE ASSESSMENT ORDER PASSED U/S 143(3) OF THE ACT DATED 12.12.2011 TWO ADDITIONS WERE MADE, WHICH ARE RELEVAN T FOR OUR PURPOSES VIZ THE ADDITION ON ACCOUNT OF UN - RECONCILED AIR INFORMATION RS.54,89,270/ - AND ON ACCOUNT OF SUNDRY CREDITORS - RS.4,25,438/ - . IT HAS BEEN EXPLAINED THAT IN THE QUANTUM PROCEEDINGS, THE LD. CIT(A) VIDE ORDER DATED 28.12.2012 DELETED TH E ADDITION ON ACCOUNT OF UN - RECONCILE AIR INFORMATION TO THE EXTENT OF RS.23,08,301/ - . SUBSEQUENTLY, VIE ORDER DATED 26.3.2014, THE AO LEVIED PENALTY U/S 271(1)( C) OF THE ACT ON THE THEN SUBSISTING ADDITION ON ACCOUNT OF UN - RECONCILED AIR INFORMATION AND ON ACCOUNT OF SUNDRY CREDITORS. THE AO LEVIED THE PENALTY OF RS.12,02,030/ - WHICH EQUIVALENT TO 100% OF THE TAX SOUGHT TO BE EVADED ON SUCH INCOME. THIS PENALTY HAS BEEN DELETED BY THE LD.CIT(A), AGAINST WHICH THE REVENUE IS IN APPEAL BEFORE US. 4 . BEFORE US, IT HAS BEEN POINTED OUT THAT SO FAR AS THE ADDITION ON ACCOUNT OF UN - RECONCILED AIR INFORMATION IS CONCERNED, THE ENTIRE ADDITION HAS SINCE BEEN DELETED BY THE TRIBUNAL VIDE ITS ORDER DATED 17.10.2014 PASSED IN ITA NO.437/MUM/2013 AND THER EFORE THE PENALTY HAS RIGHTLY BEEN DELETED BY THE LD.CIT(A). IN SO FAR AS, THE PENALTY WITH REGARD TO THE ADDITION ON ACCOUNT OF SUNDRY CREDITORS OF RS.4,25,483/ - IS CONCERNED, THE LD.AR - ASSESSEE POINTED OUT THAT THE LD.CIT(A) GAS DELETED THE PENALTY FOL LOWING THE RATIO OF DECISION OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2004 - 05 3 I.T.A. NO. 5224/ MUM/201 5 PASSED IN ITA NO.8766/MUM/2010, DATED 23.7.2014, WHEREIN IN SIMILAR CIRCUMSTANCES, LEVY OF PENALTY HAS BEEN SET ASIDE. 5. IN THIS BACKGROUND, IN SO FAR A S THE DELETION OF PENALTY IN RELATION TO THE ADDITION ON ACCOUNT OF UN - RECONCILED AIR INFORMATION IS CONCERNED, THE FACTUAL MATRIX BROUGHT OUT BY THE LD.AR - ASSESSEE HAS NOT BEEN DISPUTED BY THE LD.DR, THEREFORE, TO THAT EXTENT THE ORDER OF THE LD.CIT(A) IS HEREBY AFFIRMED. 6 . SO FAR AS THE PENALTY LEVIED IN RELATION TO THE ADDITION OF RS.4,25,483/ - ON ACCOUNT OF SUNDRY CREDITORS IS CONCERNED, THE LD. DR POINTED OUT THAT THE ADDITION WAS MADE DURING THE ASSESSMENT PROCEEDINGS BECAUSE THE ASSESSEE HAD NOT TREATED THE BALANCE S AS INCOME DESPITE FOLLOWING THE CASH SYSTEM OF ACCOUNTING. ACCORDING TO HIM THE PENALTY WAS JUSTIFIABLY LEVIED BY THE AO. 7 . ON THIS ASPECT, WE FIND THAT THE LD.CIT(A) MADE NO MISTAKE IN DELETING THE PENALTY AS ON SIMILAR CIRCUMSTA NCES , THE TRIBUNAL VIDE ORDER DATED 23.7.2014 PASSED IN ASSESSEES CASE (SUPRA) HAD DELETED THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. AS PER THE TRIBUNAL, NO PENALTY IS LEVIABLE AS THERE WAS NO CONCEALMENT OR FURNISHING INACCURATE PARTICULARS OF IN COME ON THIS ASPECT. EVEN OTHERWISE, WE FIND THAT THE ADDITION ON ACCOUNT OF OUTSTANDING SUNDRY CREDITORS IS A RESULT OF MERE DIFFERENCE OF OPINION BETWEEN THE ASSESSEE AND THE REVENUE AND THIS IS NOT A FIT CASE FOR LEVY OF PENALTY FOR 4 I.T.A. NO. 5224/ MUM/201 5 CONCEALMENT OR FURNI SHING INACCURATE PARTICULARS OF ANY INCOME WITHIN THE MEANING OF SECTION 271(1)( C ) OF THE ACT. THUS, ON THIS ASPECT ALSO, IN OUR VIEW, THE LD.CIT(A) RIGHTLY DELETED THE PENALTY. 8 . RESULTANTLY, THE ORDER OF THE LD.CIT(A) IS AFFIRMED AND APPEAL OF THE REVENUE IS DISMISSED. THE ABOVE DECISION WAS PRONOUNCED IN THE OPEN COURT AFTER CONCLUDING THE HEARING OF THE BOTH THE PARTIES ON 30.11.2017. SD SD ( PAWAN SINGH ) ( G.S.PANNU ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 30. 1 1 . 2017 SR.PS:SRL: / 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 F ILE / BY ORDER, TRUE COPY / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI