SHIVALIK VENTURES P.LTD, THANE V. ACIT CC 4(2), MUMBAI

ITA 5430/MUM/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 0819 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 24-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JUSTIN
• Keywords: Search and seizure
• Section: 143(3); 153A; 115JB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER AND SHRI N.K. PRADHAN, ACCOUNTANT MEMBER ITA NO.5430/M/2015 ASSESSMENT YEAR: 2009-10 M/S. SHIVALIK VENTURES PVT. LTD., PLOT NO.746, STANEY FERNANDES WADI, D.S. BABREKAR MARG, DADAR (WEST), MUMBAI 400 028 PAN: AALCS7683R VS. ACIT-CC-4(2), AAYAKAR BHAVAN, M.K. ROAD, MUMBAI - 400020 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI VIJAY MEHTA, A.R. REVENUE BY : SHRI V. JUSTIN, D.R. DATE OF HEARING : 14.11.2018 DATE OF PRONOUNCEMENT : 24.01.2018 O R D E R PER D.T. GARASIA , JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 29.09.2015 OF THE COMMISSIONER OF I NCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] R ELEVANT TO ASSESSMENT YEAR 2009-10. 2. THE ONLY GROUND IN THIS APPEAL IS AGAINST THE CO NFIRMATION OF PENALTY OF RS.14,97,826/- ON THE INCOME APPEARING I N 26AS. 3. THE BRIEF FACTS OF THE CASE ARE AS UNDER:- ITA NO.5430/M/2015 M/S. SHIVALIK VENTURES PVT. LTD. 2 THE ASSESSEE HAS FILED THE ORIGINAL RETURN OF INCO ME UNDER SECTION 139(1) OF THE ACT ON 31.12.09 DECLARING INC OME OF RS.2,44,52,972/-. A SEARCH AND SEIZURE ACTION UNDE R SECTION 132(1) WAS CONDUCTED IN ASSESSEES COMPANY BY INVESTIGATIO N WING. DURING THE ASSESSMENT PROCEEDING ASSESSEE WAS ASKED AS TO WHY THE INCOME OF RS.44,06,667/- ON WHICH THE TDS WAS DEDUCTED OF RS.1,99,88,551/- AS PER 26AS HAS NOT BEEN OFFERED I N RETURN OF INCOME FILED UNDER SECTION 139(1). IN REPLY, ASSES SEE SUBMITTED THAT INADVERTENTLY FORGOTTEN TO CONSIDER THE SAME WHILE FILING THE RETURN UNDER SECTION 139(1) BUT AO DID NOT CONSIDER AND IM POSED PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 4. BEFORE US, THE LD. A.R. SUBMITTED THAT AS PER TH E DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. NAL WA SONS INVESTMENTS LTD. (327 ITR 543, 553) WHEREIN THE HIG H COURT HAS CONSIDERED THAT IMPOSING THE PENALTY UNDER SECTION 271(1)(C) HAS BEEN AMENDED W.E.F. 2015 TO COVER THE SITUATION FOR LEVYING THE PENALTY WHENEVER THE INCOME UNDER NORMAL PROVISION IS LESS AND THEN THE INCOME DECLARED FOR THE PURPOSE OF SECTION 115J B OF THE ACT. THIS AMENDMENT IS PROSPECTIVE AND APPLICABLE W.E.F. 01.04.2016. IN THIS CASE, AS PER THE CHART THE INCOME COMPUTED UND ER THE MAT PROVISIONS. AS PER SECTION 271(1)(C) OF THE ACT TH E PENALTY HAS TO BE IMPOSED WHEN THERE IS A DIFFERENCE BETWEEN TAX ON A SSESSED INCOME AND TAX ON RETURN INCOME. IN THIS CASE SINCE NO AD DITION WAS MADE UNDER SECTION 115JB OF THE ACT THE RETURN INCOME AN D ASSESSED ITA NO.5430/M/2015 M/S. SHIVALIK VENTURES PVT. LTD. 3 INCOME UNDER SECTION 115JB REMAINS THE SAME. THERE FORE, NO PENALTY CAN BE LEVIED. 5. THE LD. D.R. HAS RELIED UPON THE ORDERS OF THE R EVENUE AUTHORITIES. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE P ARTIES. WE FIND THAT PURSUANT TO SEARCH, ASSESSMENT ORDER WAS PASSED U/S 143(3) R.W.S. 153A OF THE ACT. DURING THE COURSE OF ASSESS MENT PROCEEDINGS, ON PERUSAL OF FORM 26AS, IT WAS OBSERVED BY THE AO THAT THE ASSESSEE HAD NOT OFFERED AN INCOME OF RS.44,06,667/ - ON WHICH TDS OF RS.9,98,551/- WAS DEDUCTED. IN VIEW OF THE SAME, THE AO MADE AN ADDITION OF RS.44,06,667/- TO THE TOTAL INCOME OF T HE ASSESSEE UNDER THE NORMAL PROVISIONS OF THE ACT WHEREAS NO ADDITIO N OF THE SAID INCOME WAS MADE WHILE COMPUTING INCOME U/S 115JB OF THE ACT. SINCE THE TAX ON INCOME COMPUTED U/S 115JB WAS HIGH ER THAN TAX ON INCOME COMPUTED UNDER NORMAL PROVISIONS, ASSESSMENT WAS COMPLETED BY ASSESSING THE INCOME U/S 115JB OF THE ACT. PENALTY PROCEEDINGS WERE INITIATED U/S 271(1)(C) OF THE ACT ON THE ABOVE ADDITION. WE FIND THAT DURING THE COURSE OF HEARIN G, THE LD. A.R. HAS GIVEN THE CHART WHICH IS REPRODUCED AS UNDER: SR. NO. PARTICULARS INCOME (UNDER NORMAL PROVISIONS) INCOME (UNDER MAT PROVISIONS) 1. AS PER COMPUTATION OF INCOME AND ORDER PASSED U/S 143(3) OF THE ACT 2,80,93,425/- 301,08,27,550/- 2. ADD: INCOME AS PER 26AS 44,06,667 NIL 3. ASSESSED INCOME IN ORDER PASSED U/S 143(3) R.W.S 153A OF THE ACT 3,25,00,092 301,08,27,550 ITA NO.5430/M/2015 M/S. SHIVALIK VENTURES PVT. LTD. 4 AS PER THE ABOVE CHART, THE TAX ON INCOME COMPUTED UNDER SECTION 115JB IS HIGHER THAN TAX ON INCOME COMPUTED UNDER NORMAL PROVISIONS OF THE ACT AND HENCE THE ASSESSMENT WAS COMPLETED BY AO BY ASSESSING THE INCOME U/S 115JB OF THE ACT. I T IS EVIDENT FROM THE ABOVE CHART THAT TAX ON INCOME COMPUTED UNDER S ECTION 115JB ACT WAS HIGHER THAN THE TAX COMPUTED UNDER NORMAL P ROVISIONS OF THE ACT. HENCE, THE ASSESSMENT WAS COMPLETED BY AO ASS ESSING THE INCOME UNDER SECTION 115JB OF THE ACT. WE FIND THAT AS PER EXPLANATION 4 TO SECTION 271(1)(C), THE QUANTUM OF PENALTY IS DETERMINED BY CALCULATING THE AMOUNT OF TAX SOUGHT TO BE EVADED BY THE ASSESSEE. WE FIND THAT NO ADDITION WAS MADE UN DER SECTION 115JB OF THE ACT ON THE RETURN OF INCOME AND ASSESS ED THE INCOME UNDER SECTION 115JB OF THE ACT. HENCE, NO PENALTY CAN BE LEVIED UNDER SECTION 271(1)(C) OF THE ACT. WE FIND THE JUD GMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. NALWA SONS INVESTMENTS LTD. (SUPRA) IS IN FAVOUR OF THE ASSESSEE. 7. RESPECTFULLY FOLLOWING THE SAME, WE FIND THAT NO PENALTY CAN BE LEVIED. HENCE, WE DELETE THE PENALTY. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 24.01.2018. SD/- SD/- (N.K. PRADHAN) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 24.01.2018. * KISHORE, SR. P.S. ITA NO.5430/M/2015 M/S. SHIVALIK VENTURES PVT. LTD. 5 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.