ACIT, New Delhi V. M/s. I. Ahmad, Lucknow

ITA 5392/DEL/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 7492 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 15-12-2014
• Assessment Year: 1995-1996
• Appeal Filed On: 03-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M H KHAN
• Keywords: Difference of opinion

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: C : NEW DELHI BEFORE SH. G. D. AGRAWAL, VICE PRESIDENT AND SH. H.S. SIDHU , JM ITA NO. 5391/DEL/2013 : ASSTT. YEAR : 1994 - 95 ITA NO. 5392/DEL/2013 : ASSTT. YEAR : 1995 - 96 ITA NO. 5393/DEL/2013 : ASSTT. YEAR : 1996 - 97 ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 6, NEW DELHI VS SH. I. AHMAD, 1, KAPOORTHALA COMPLEX, ALIGANJ, LUCKNOW (UP) (APPELLANT) (RESPONDENT) CO NO. 112/DEL/2014 : ASSTT. YEAR : 1994 - 95 CO NO. 113/DEL/2014 : ASSTT. YEAR : 1995 - 96 CO NO. 114/DEL/2014 : ASSTT. YEAR : 1996 - 97 SH. I. AHMAD, 1, KAPOORTHALA COMPLEX, ALIGANJ, LUCKNOW (UP) VS ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 6, NEW DELHI (APPELLANT) (RESPONDENT) PAN NO. ACPPA7639A ASSESSEE BY : SH. M. H. KHAN, ADV. REVENUE BY : SH. VIKRAM SAHAY, SR. DR DT. OF HEARING : 15 . 12.2014 DT. OF PRONOUNCEMENT: 19 . 12.2014 ORDER PER BENCH : THESE APPEALS BY THE REVENUE AND CROSS OBJECTIONS BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF LEARNED CIT(A) - 1, NEW DELHI DATED 23.07.2013 FOR THE ASSESSMENT YEARS 1994 - 95 TO 1996 - 97. ITA NO.5391 TO 5393/DEL/2013 & CO 112 TO 114 / DEL/2014 2 2. THE ONLY GROUND RAISED IN ALL THESE APPEALS BY THE REVENUE IS AGAINST THE CANCELLATION OF PENALTY LEVIED U/S 271(1)(C) AS UNDER: ASSESSMENT YEAR PENALTY LEVIED 1. 1994 - 95 RS. 5,66,500/ - 2. 1995 - 96 RS. 4,28,700/ - 3. 1996 - 97 RS. 8,85,300/ - 3 . WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL BEFORE US . THE FACTS OF THE CASE ARE THAT THE ASSESSEE CLAIMED DEDUCTION FOR INTEREST AGAINST THE INVESTMENT MADE BY THE ASSESSEE IN THE SHARE S OF LIMITD COMPANIES, WHICH WAS DISALLOWED BY THE ASSESSING OFFICER BUT ALLOWED BY THE CIT(A) AND THE ITAT. HOWEVER, THE HON BLE JURISDICTIONAL HIGH COURT REVERSED THE FINDINGS OF THE ITAT AND UPHELD THE DISALLOWANCE OF INTEREST. AFTER THE DECISION OF HO N BLE JURISDICTIONAL HI GH COURT, T HE ASSESSING OFFICER LEVIED PENALTY U/S 271(1)(C) IN ALL THE THREE YEARS. THE CIT(A) CANCEL LED THE PENALTY WITH THE FOLLOWING FINDINGS: 5.2 I HAVE CONSIDERED THE RELEVANT ORDERS, SUBMISSIONS OF THE APPELLANT AND THE RELEVANT LAW ON THE SUBJECT . ON FACTS, THE ALLOWABILITY OF INTEREST ON BORROWED CAPITAL USED FOR INVESTMENTS IN SHARE CAPITAL AS EXPENDITURE FOR THE PURPOSES OF COMPUTING INCOME UNDER THE HEAD OTHER SOURCES WAS SETTLED LAW AS PER RULING OF HON BLE SUPREME COURT IN THE CASE OF RAJE NDRA PRASAD MODI 115 ITR 519 (SC). IN THE PRESENT CASE, WHILE THE AO AND THE HON BLE HIGH COURT HAVE OPINED AGAINST THE APPELLANT, THE CIT(A) AND HON BLE ITAT HAVE RULED IN FAVOUR OF THE APPELLANT. THUS, IT IS A CLEAR CASE OF DIFFERENCE OF OPINION AND THE RULING OF THE HON BLE APEX COURT IN CIT VS RELIANCE PETROPRODUCTS PVT. LTD. 322 ITR 158 (SC) WOULD BE ITA NO.5391 TO 5393/DEL/2013 & CO 112 TO 114 / DEL/2014 3 APPLICABLE. ACCORDINGLY, PENALTY IMPOSED CANNOT BE SUSTAINED FOR THE PRESENT AND IS CANCELLED. 4. AFTER CONSIDERING THE ARGUMENT S OF BOTH THE SIDES AN D THE FACTS OF THE CASE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A). ON THESE FACTS , THE DECISION OF HON BLE APEX COURT IN THE CASE OF RELIANCE PETROPRODUCTS PVT. LTD. 322 ITR 158 RELIED UPON BY THE LD. CIT(A) WOULD BE SQUARELY APPLI CABLE. IN THE ABOVE CASE THEIR L ORDSHIPS HELD AS UNDER: WHERE THERE IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE THERE IS NO QUESTION OF INVITING THE PENALTY UNDER SECTION 271(1)(C). A MERE M AKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. SUCH A CLAIM MADE IN THE RETURN CANNOT AMOUNT TO FURNISHING INACCURATE PARTICULARS. 5. IN THE CASE UNDER APPEAL BEFORE US, THE ASSESSEE CLAIMED THE DEDUCTION OF INTEREST IN RESPECT OF MONEY INVESTED BY HIM IN SHARE S OF VARIOUS COMPANIES . HIS CLAIM WAS NOT ACCEPTED BY THE ASSESSING OFFICER BUT WAS ACCEPTED BY CIT(A) AND ITAT. HON BLE JURISDICTIONAL HIGH COURT REVERSED THE FINDINGS OF THE ITAT AND UPHELD THE DISALLOWANCE . HOWEVER, THERE IS NO FINDING THAT THE DETAILS SUPPLIED BY THE ASSE SSEE IN ITS RETURN OF INCOME WERE IN CORRECT OR ERRONEOUS OR FALSE. MERELY BECAUSE THE CLAIM OF INTEREST MADE BY THE ASSES SEE WAS NOT ACCEPTED , SUCH A CLAIM IN ITSELF DOES NOT AMOUNT TO FURNISHING OF INACCURATE PARTICULARS. ITA NO.5391 TO 5393/DEL/2013 & CO 112 TO 114 / DEL/2014 4 6. IN VIEW OF THE ABOVE , IN OUR OPINION , THE CIT(A) RIGHTLY DELETED THE PENALTY FOLLOWING THE DECISION OF HON BLE APEX COURT IN THE CASE OF RELIANCE PET ROPRODUCTS PVT. LTD. (SUPRA). ACCORDINGLY, H IS ORDER IS UPHELD AND THE REVENUE S APPEALS ARE DISMISSED. 7. AS REGARDS THE CROSS OBJECTION S, IT IS SUBMITTED BY THE LD. COUNSEL THAT IF THE REVENUE S APPEALS ARE DISMISSED THEN THE ASSESSEE WOULD NOT LIKE TO PRESS THE CROSS OBJECTION S, S INCE WE HAVE DISMISSED THE REVENUE S APPEALS , T HE CROSS OBJECTION S FURNISHED BY THE ASSESSEE ARE TREATED AS NOT PRESSED AND REJECTED AS SUCH. 8. IN THE RESULT, THE REVENUE S APPEALS AND THE ASSESSEE S CROSS OBJECTIONS ARE DISMISSED. ORDER PRONO UNCED IN THE OPEN COURT ON 1 9 /12/2014. S D / - S D / - ( H. S. SIDHU ) ( G. D. AGRAWAL ) JU DICIAL MEMBER VICE PRESIDENT DATED: 1 9 /12/2014 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITA NO.5391 TO 5393/DEL/2013 & CO 112 TO 114 / DEL/2014 5 DATE INITIAL 1. DRAFT DICTATED ON 15 . 12.2014 PS 2. DRAFT PLACED BEFORE AUTHOR 15 .1 2.2014 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER.