M/s Anupam Texfeb Pvt. Ltd., Indore V. Assistant Commissioner of Income Tax, Khandwa, Khandwa

ITA 535/Ind/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 5114 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 24-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MITRA
• Section: 68

Judgement Text

PENALTY - ANUPAM TEXFEB/JDM BUILDERS AND DEVERLPERS ITA NOS.535 & 536 OF 2017 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO. 535/IND/2017 A.Y. 2010-11 M/S. ANUPAM TEXFAB PVT. LTD., BURHANPUR PAN AAICA 7806 P :: APPELLANT VS ACIT-KHANDWA :: RESPONDENT ITA NO. 536/IND/2017 A.Y. 2010-11 M/S. JDM BUILDERS & DEVELOPERS PVT. LTD., BURHANPUR PAN AAMCS 9359 P :: APPELLANT VS ACIT-KHANDWA :: RESPONDENT ASSESSEES BY SHRI PANKAJ SHAH, CA DEPARTMENT BY SHRI P.K. MITRA, SR. DR DATE OF HEARING 09.10.2018 DATE OF PRONOUNCEMENT 23.10.2018 O R D E R PER SHRI KUL BHARAT, JM PENALTY - ANUPAM TEXFEB/JDM BUILDERS AND DEVERLPERS ITA NOS.535 & 536 OF 2017 2 BOTH THESE ABOVE APPEALS ARE FILED BY THE ABOVE ASS ESSEES AGAINST THE ORDERS OF LD. CIT(A)-II, INDORE DATED 2 7.4.2017 CHALLENGING THE CONFIRMATION OF PENALTY AT RS.60,000/- & RS.80, 000/-, RESPECTIVELY, IMPOSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF T HE I.T. ACT. ITA NO.535/IND/2017 IN CASE OF ANUPAM TEXFAB P. LTD . 2. FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS A PRI VATE LIMITED CO. AND HAS INCOME FROM INTEREST DURING THE YEAR UNDER CONS IDERATION. DURING SURVEY ACTION, THE ASSESSEE SURRENDERED RS.40 LACS ON ACCOUNT OF UNEXPLAINED SHARE APPLICATION MONEY AND THE SAME WA S CONSIDERED AS OTHER INCOME IN THE P & L ACCOUNT AND ON THIS DECLA RED INCOME, CERTAIN EXPENSES OF RS.1,55,324/- WERE CLAIMED AS DEDUCTION S WHICH WERE SET OFF FROM THE INCOME DECLARED. HOWEVER, THE ASSESSIN G OFFICER DISALLOWED THE SAME AND IMPOSED THE PENALTY AT RS.60,000/- ON ACCOUNT OF FURNISHING INACCURATE PARTICULARS OF INCOME AND LD. CIT(A) ALSO CONFIRMED THE PENALTY ON THE GROUND THAT THE SET OFF WAS NOT INTENTION OF THE LEGISLATURE. 3. BEFORE US, LEARNED COUNSEL FOR THE ASSESSEE SUBM ITTED THAT THE YEAR UNDER CONSIDERATION IS PRIOR TO INSERTION TO S ECTION 115BBE IN THE I.T. ACT AND BASED ON CERTAIN JUDICIAL PRONOUNCEMEN TS, THE SAID ALLOWANCE OF EXPENSES FROM DECLARED INCOME WAS PERM ISSIBLE. HE RELIED ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS IN FAVOUR OF HIS PLEA: PENALTY - ANUPAM TEXFEB/JDM BUILDERS AND DEVERLPERS ITA NOS.535 & 536 OF 2017 3 I. DCIT VS. RADHEY DEVELOPERS INDIA LTD.; 329 ITR 1 (GUJ) II. SATISH KUMAR GOYAL; ITA NO.143/AGAINST/2014. THUS, HE SUBMITTED THAT NO PENALTY CAN BE SUSTAINED WHEN THE CLAIM IS SUPPORTED BY JUDICIAL PRONOUNCEMENTS AND ALSO WHEN DEBATABLE CLAIM/DIVERGENT VIEWS EXIST BETWEEN DIFFERENT JUDIC IAL AUTHORITIES ON AN ISSUE. 4. ON THE OTHER HAND, LD. SR. DR SUPPORTED THE ORDE RS OF THE REVENUE AUTHORITIES. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE O RDERS OF LOWER AUTHORITIES. WE FIND THAT IN THE IMPUGNED ORDER, TH E LD. CIT(A) HAS HIMSELF NOTED THAT SECTION 115BBE WAS NOT IN EXISTE NCE AT THAT POINT OF TIME. IN THE CASE OF SATISH KUMAR GOYAL (SUPRA), TH E ITAT, AGRA BENCH HAS ALLOWED BUSINESS LOSS SET OFF AGAINST DEEMED IN COME U/S 68 HOLDING AMENDED SECTION 115BBE AS PROSPECTIVE. HOWEVER, DIV ERGENT VIEWS OF VARIOUS JUDICIAL AUTHORITIES EXIST ON THIS ISSUE. T HUS, THE ISSUE HAS BECOME DEBATABLE AND THEREFORE, IN PRINCIPLE, THE L D. CIT(A) SHOULD HAVE DELETED THE PENALTY. ACCORDINGLY, WE DIRECT THE ASS ESSING OFFICER TO DELETE THE PENALTY. 6. IN RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED . PENALTY - ANUPAM TEXFEB/JDM BUILDERS AND DEVERLPERS ITA NOS.535 & 536 OF 2017 4 ITA NO.536/IND/2017 IN CASE OF JDM BUILDERS & DEVEL OPERS P. LTD. 7. BOTH THE PARTIES SUBMITTED THAT THE FACTS AND CI RCUMSTANCES ARE IDENTICAL TO THAT OF ANUPAM TEXFAB P. LTD. AND THE DECISION TAKEN IN THE CASE OF ANUPAM TEXFAB P. LTD. WILL PREVAIL IN THE C ASE OF PRESENT ASSESSEE TOO. THUS, FOLLOWING THE ABOVE ORDER IN TH E CASE OF ANUPAM TEXFAB P. LTD., WE DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY OF RS.80,000/- IN THE PRESENT APPEAL TOO. ACCORDINGLY, THIS APPEAL OF THE ASSESSEE IS ALSO ALLOWED. 8. FINALLY, BOTH THE APPEALS FILED BY THE RESPECTIV E ASSESSEES ARE ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT ON 23.10.201 8. SD/- ( MANISH BORAD) ACCOUNTANT MEMBER SD/- (KUL BHARAT) JUDICIAL MEMBER DATED : 23.10.2018 !VYAS! COPY TO: APPELLANT/RESPONDENT/CIT(A)/PR.CIT/DR, INDORE