ACIT 12(3)(2), MUMBAI V. LASHKARIA CONSTRUCTION PVT LTD., MUMBAI

ITA 553/MUM/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 4975 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 23-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BRAJENDRA KUMAR LD
• Keywords: Bogus purchase; Tax effect
• Section: 271(1)(c); 143(3)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI , , BEFORE HONBLE SHRI VIKAS AWASTHY, JM AND HONBLE SHRI MANOJ KUMAR AGGARWAL, AM (HEARING THROUGH VIDEO CONFERENCING MODE) ./ I.T.A. NO. 553 /MUM/20 20 ( / ASSESSMENT YEAR : 2011 - 12 ) ACIT 12(3)(2 ) R. NO. 128H , 1 ST FLOOR AAYKAR BHAVAN, M. K. ROAD, MUMBAI - 400 020 / VS. M/S LASHKARIA CONSTRU CTION PVT. LTD. 1 02, DIAMOND APARTMENT, LINK ROAD, JOGESHWARI (WEST), MUMBAI - 400 102 ./ ./ PAN/GIR NO . A AACL - 6508 - R ( / APPELLANT ) : ( / RESPONDENT ) REVENUE BY : SHRI BRAJENDRA KUMAR LD. DR ASSESSEE BY : NONE / DATE OF HEARING : 28 /09 /2021 / DATE OF PRONOUNCEMENT : 28/09/2021 / O R D E R MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. AFORESAID APPEAL BY REVENUE FOR ASSESSMENT YEAR [AY] 20 11 - 12 ARISES OUT OF THE ORDER OF LD. C OMMISSIONER OF INCOME - TAX ( APPEALS ) - 20, MUMBAI [ CIT(A)] D ATED 15/10/2019 WHICH HAS DELETED THE PENALTY OF RS.18,05,912/ - U/S 271(1)(C) AS LEVIED BY LD. AO VIDE PENALTY ORDER DATED 30/03/2017. THOUGH NONE APPEARED FOR ASSESSEE, HOWEVER, THE MATERIAL ON REC ORD WAS SUFFICIENT ENOUGH FOR DISPOSAL OF THE APPEAL. THE LD. DR PLEADED FOR RESTORATION OF THE PENALTY. 2 2. FACTS LEADING TO IMPOSITION OF PENALTY ARE THAT IN AN ASSESSMENT FRAMED U/S 143(3) ON 11/03/2014, THE ASSESSEE WAS SADDLE D WITH ADDITION OF ALLEGED BOGUS PURCHASES FOR RS.584.43 LACS. UPON FURTHER APPEAL, THE QUANTUM WAS ESTIMATED @10% AND THE ADDITIONS WERE RESTRICTED TO RS.58.44 LACS. CONSEQUENTLY, PENALTY OF RS.18.05 LACS WAS IMPOSED FOR QUANTUM ADDITION OF RS.58.44 LACS. UPON FURTHER APPEAL CHALLE NGING LEVY OF PENALTY, LD. CIT(A) DELETED THE SAME, INTER - ALIA, BY OBSERVING THAT THE ADDITIONS WERE ESTIMATED ADDITIONS. AGGRIEVED, THE REVENUE IS IN FURTHER APPEAL BEFORE US. 3. IN OUR CONSIDERED OPINION, THE IMPUGNED ORDER WOULD NOT REQUIRE ANY INTERFER ENCE ON OUR PART FOR TWO REASONS. FIRSTLY, THE ADDITIONS WERE MERELY ESTIMATED ADDITIONS FOR UNPROVED PURCHASES AND THEREFORE, NO CASE OF CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME COULD BE MADE OUT AGAINST THE ASSESSEE. SECOND LY, THE REVENUES APPEAL IS NOT MAINTAINABLE IN TERMS OF LATEST LOW TAX EFFECT CBDT CIRCULAR NO. 17/2019 DATED 08/08/2019 [F.NO.279/MISC. 142/2007 - TTJ(PT.) WHICH PRESCRIBES MINIMUM THRESHOLD LIMIT OF RS.50 LACS FOR REVENUE TO AGITATE THE MATTER FURTHER BEF ORE TRIBUNAL. IT IS SETTLED LEGAL POSITION THAT QUANTUM PROCEEDINGS AND PENALTY PROCEEDINGS ARE INDEPENDENT AND DISTINCT PROCEEDINGS AND CONFIRMATION OF ADDITIONS MAY NOT BE THE SOLE GROUND FOR CONFIRMING THE PENALTY . EXTENDING THE SAME LOGIC, UNLESS SPECI FIC EXCEPTION IS PROVIDED IN THE CIRCULAR WITH RESPECT TO PENALTY ALSO, IT COULD NOT BE CONSTRUED THAT THE PENALTY WAS TO BE TREATED AT PAR WITH QUANTUM ADDITIONS. THE CLAUSE 10(E) SPECIFICALLY APPLIES ONLY TO ADDITIONS WHICH ARE BASED ON INFORMATION RECEI VED FROM EXTERNAL SOURCES. THE LEVY OF PENALTY, BY NO STRETCH OF IMAGINATION, COULD BE CONSTRUED AS ADDITION AS ENVISAGED BY CLAUSE 10(E). THEREFORE, THE 3 SUBMISSIONS MADE BY LD. DR COULD NOT BE HONORED AND WE DECLINE TO ACCEPT THE SAME. 4. RESULTANTLY, THE APPEAL STAND DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 28 TH SEPTEMBER, 2021. SD/ - SD/ - ( VIKAS AWASTHY ) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 28 /09 /2021 SR.PS, DHANANJAY / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE / BY ORDER, / (DY./ASSTT.REGISTRAR) , / ITAT, MUMB AI.