SCOUT EXIM PVT. LTD., NEW DELHI V. ITO, WARD- 22(3), NEW DELHI

ITA 5373/DEL/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3306 (ITAT-DELHI)
• Duration Of Justice: 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 21-08-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K JIWANI
• Keywords: Bogus purchase; Initiation of penalty proceedings
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.5373/DEL./2017 ASSESSMENT YEAR 2013-2014 M/S. SCOUT EXIM PVT. LTD., C/O. ANIL JAIN DD & CO. CHARTERED ACCOUNTANTS, 611, SURYA KIRAN BUILDING, 19, K.G. MARG, NEW DELHI 110 001. PAN AAOCS3670H VS. THE INCOME TAX OFFICER, WARD 22(3) NEW DELHI 110 002. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI ANIL JAIN, C.A. FOR REVENUE: SHRI V.K. JIWANI, SR.D.R. DATE OF HEARING : 05.03.2018 DATE OF PRONOUNCEMENT : 08 .03.2018 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-30, NEW DELHI, DATED 02 ND JUNE, 2017, FOR THE A.Y. 2013-2014, CHALLENGING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE I.T. ACT, 1961. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE A.O . PASSED THE ASSESSMENT ORDER UNDER SECTION 143(3) AND CONSI DERED THE 2 ITA.NO.5373/DEL./2017 M/S. SCOUT EXIM PVT. LTD., NEW DELHI. ISSUE OF BOGUS PURCHASES AND ON SURRENDER BY ASSESS EE OF 5% OF THE ALLEGED PURCHASES, MADE ADDITION OF RS.6,17, 000/-. THE A.O. NOTED IN THE ASSESSMENT ORDER THAT HE WAS SATI SFIED THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS AND T HEREBY, CONCEALING THE PARTICULARS OF ITS INCOME AND RENDER ING ITSELF LIABLE FOR INITIATION OF PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT R.W.S. 274 OF THE I.T. ACT, 19 61. THE A.O. IN THE PENALTY ORDER HAS MENTIONED THAT HE HAS ISSUED SHOW CAUSE NOTICE DATED 23 RD MARCH, 2016 SEEKING EXPLANATION OF ASSESSEE, COPY OF WHICH IS FILED IN THE APPEAL PAPERS IN WHIC H THE A.O. HAS MENTIONED HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR FURNISHING INACCURATE PARTICULARS OF SUCH INCOME. THE A.O. WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE AND LEVIED THE PENALTY, WHICH IS CONFIRMED BY THE LD. CIT(A). 3. AFTER CONSIDERING THE RIVAL CONTENTIONS, I AM O F THE VIEW THAT PENALTY IS NOT LEVIABLE IN THE MATTER. TH E A.O. ISSUED PENALTY NOTICE DATED 23 RD MARCH, 2016, UNDER SECTION 274 R.W.S. 271(1)(C) OF THE I.T. ACT, REFERRED TO ABOVE, WHICH IS BAD IN LAW 3 ITA.NO.5373/DEL./2017 M/S. SCOUT EXIM PVT. LTD., NEW DELHI. AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)( C) OF THE ACT, PENALTY PROCEEDINGS HAD BEEN INITIATED I.E., WHETHE R FOR CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISH ING OF INACCURATE PARTICULARS OF INCOME. I AM FORTIFIED IN MY VIEW BY DECISION OF HONBLE KARNATAKA HIGH COURT IN THE CAS E OF CIT VS. M/S. SSAS EMERALD MEADOWS 73 TAXMANN.COM 241 (KAR. ) (HC) IN WHICH ON THE SAME MATTER, THE DEPARTMENTAL APPEA L HAS BEEN DISMISSED. THE VIEW OF THE HONBLE KARNATAKA H IGH COURT IN THE CASE OF CIT VS. M/S. SSAS EMERALD MEADOWS ( SUPRA), HAS BEEN CONFIRMED BY THE HONBLE SUPREME COURT BY DISM ISSING THE SLP REPORTED IN 73 TAXMANN.COM 284 (SC). IN VIE W OF THE ABOVE DISCUSSION, I SET ASIDE THE ORDERS OF THE AUT HORITIES BELOW AND CANCEL THE PENALTY. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 08 TH MARCH, 2018 VBP/- 4 ITA.NO.5373/DEL./2017 M/S. SCOUT EXIM PVT. LTD., NEW DELHI. COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH, DELHI 6. GUARD FILE. // BY ORDER // ASSISTANT REGISTRAR : ITAT DELHI BENCHES : DELHI.