The Assistant Commr. of Income Tax, Junagadh Circle, JUNAGADH V. Smt. Gracy Kuthumkal Thomas, Veraval

ITA 541/RJT/2015

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5274 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 05-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARVIND N SONTAKKE
• Assessee Lawyers: MJ RANPURA
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH , RAJKOT BEFORE: SHRI RAJPAL YADAV, JUDICIAL MEMBER AND S H RI AMARJIT SINGH , ACCOUNTANT MEMBER [CONDUCTED THROUGH E - COURT AT AHMEDABAD] ACIT, JUNAGADH CIRCLE, JUNAGADH (APPELLANT) VS SMT. GRACY KUTHUMKAL THOMAS, PROP. OF M/S. JINNY MARINE TRADERS, PLOT NO. 1306/1311, GIDC ESTATE, VERAVAL PAN: ABSPT1009K (RESPONDENT) REVENUE BY : S H RI ARVIND N. SONTAKKE , D . R. ASSESSEE BY: S H RI M.J. RANPURA , A.R. DATE OF HEARING : 19 - 06 - 2 018 DATE OF PRONOUNCEMENT : 10 - 07 - 2 018 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THI S REVENUE S APPEAL FOR A.Y. 2009 - 10 , AR ISES FROM ORDER OF THE CIT(A), JAMNAGAR DATED 2 6 - 08 - 2015 , IN PROCEEDINGS UNDER SECTION 271(1 ) (C) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE RE VENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE EASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN CANCELLING THE PENALTY LEVIED U/S 271(1)(C) OF THE I.T. ACT, 1961 OF RS. 34,80,700/ - . 2. ANY OTHER GROUND TH AT THE REVENUE MAY RAISE BEFORE OR DURING THE PROCEEDING BEFORE THE HON'BLE L.T.A.T. 3. ON THE FACTS OF THE CASE AND IN LAW, THE LD. C,I,T.(A) OUGHT TO HAVE UPHELD THE PENALTY ORDER OF THE A.O. 4. IT IS, THEREFORE, PRAYED THAT THE ORDER OF TH E C.L.T.(A) MAY BE SET ASIDE AND THAT OF THE A.O. BE RESTORED TO THE ABOVE EXTENT. I T A NO . 541 / RJT /20 15 A SSESSMENT YEAR 200 9 - 10 I.T.A NO. 541 /RJT /20 15 A.Y. 2009 - 10 PAGE NO ACI T VS. SMT. GRACY KUTHUMKAL THOMAS 2 3. THE BRIEF FACT OF THE CASE IS THAT RETURN OF INCOME DECLARING INCOME OF RS. 1 , 04 , 47 , 640/ - WAS FILED ON 25 TH SEP, 2009. SUBSEQUENTLY, THE ASSESSMENT U/S. 143(3) OF THE ACT WAS MADE ON 29 TH DECEMBER, 2011 AT RS. 7 , 30 , 96 , 940/ - . THE FOLLOWING TWO ADDITIONS MADE BY THE ASSESSING OFFICER WERE SUSTAINED BY THE LD. CIT(A) IN THE APPELLATE PROCEEDINGS: - (I) ADDITION ON ACCOUNT OF UNDER VALUATION OF CLOSING STOCK OF RS. 98,1 0,499/ - (II) ADDITION ON ACCOUNT OF DISALLOWANCE OF FOREIGN TRAVELLING EXPENSES FOUND TO BE PERSONAL IN NATURE OF RS. 6,29,855/ - . THE ASSESSING HAS INITIATED PENALTY PROCEEDINGS U/S271(1)(C) OF THE ACT. IN RESPONSE TO SHOW CAUSE NOTICE THE ASSESSEE HAS ST ATED SHE HAS NOT CONCEAL ED OR FURNISHED ANY INACCURATE PARTICULARS OF INCOME AS THE ADDITION OF ARBITRARY NATURE ON VALUATION OF CLOSING STOCK WAS MADE BY THE LD. CIT(A) ON WHICH NO PENALTY SHOULD BE LEVIED. HOWEVER, THE ASSESSING OFFICER HAS NOT ACCEP TED THE EXPLANATION OF THE ASSESSEE AND LEVIED PENALTY OF RS. 34,80,697/ - U/S. 271(1) (C) . 4 . THE ASSESSEE HAS PREFERRED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS DELETED THE PENALTY ON THE GROUND THAT COMPLETE DETAILS WERE ON RECORD AT THE TIME OF ASSESSMENT PROCEEDINGS AFTER PLACING RELIANCE ON THE DECISION OF H ON BLE SUPREME COURT IN THE CASE OF RELIANCE PETRO - PRODUCTS PVT. LTD. 5 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD CAREFULLY. WE HAVE PERUSED THE FINDINGS OF THE LD. CIT(A) ST A TI N G THAT WHILE VALUATION OF CLOSING STOCK OF FISHES THE ASSESSEE HAS ADOPTED NET REALIZABLE VALUE S WHICH WAS LOWER THAN THE AVERAGE SALE PRICE OF THESE PRODU CT S . T HEREFORE THE LD. CIT(A) HAS ADO P TED THE VALUE OF CLOSING ST OCK AS PER THE AVERAGE COST PRICE O F F ISHE S AND MADE ADDITION OF RS. 98,10,499/ - ON THE BASIS OF COST OR MARKET P RICE WHICHEVER IS LOWER . THE CLAIM OF FOREIGN TRAVEL EXPENSES W AS DISALLOWED ON THE GROUND OF BEING PERSONAL NATURE PERTAINING TO THE FAMILY ME MBERS OF THE ASSESSEE . AFTER CONSIDERING THAT ALL THE PARTICULARS AND THE DETAILS WERE FURNISHED AND IT WAS NOT PROVED THAT ASSESSEE HA D FURNISHED I.T.A NO. 541 /RJT /20 15 A.Y. 2009 - 10 PAGE NO ACI T VS. SMT. GRACY KUTHUMKAL THOMAS 3 INCORRECT PARTICULARS OF INCOME OR CONCEALED PARTICULARS OF INCOME WE DO NOT FIND ANY INFIRMITY IN T H E DEC ISION OF THE LD. CIT(A). THEREFORE THE APPEAL OF THE REVENUE IS DISMISSED. 6 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PR ONOUNCED IN THE OPEN C OUR T ON 10 - 07 - 201 8 SD/ - SD/ - (RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 10 /07 /201 8 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, RAJKOT