ITO, Mohindergarh V. The Mahendergarh Central Co-op Bank Ltd., Mahendergarh

ITA 5580/DEL/2016

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 7691 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2010-2011
• Appeal Filed On: 28-10-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: RAJESH GOEL; PRASHANT GOEL
• Keywords: Set aside
• Section: 271(1)(c); 143(3)

Judgement Text

ITA NO.- 5580/DEL/2016 MAHENDERGARH CENTRAL CO-OP BANK LTD. PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: G: NEW DELHI) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT MEMBER ITA NO:- 5580/DEL/2016 ( ASSESSMENT YEAR: 2010-11) INCOME TAX OFFICER, WARD -1, NARNAUL. VS. THE MAHENDERGARH CENTRAL CO-OP BANK LTD. RAILWAY ROAD, MAHENDERGARH. PAN NO: AAAAT9320K APPELLANT RESPONDENT REVENUE BY : SHRI N.K. BANSAL, SR. DR ASSESSEE BY : SHRI RAJESH GOEL, ADV. AND SHRI PRASHANT GOEL, CA ORDER PER ANADEE NATH MISSHRA, AM THIS APPEAL BY REVENUE IS FILED AGAINST THE ORDER O F LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-ROHTAK, [LD. CIT(A), FOR SHO RT], DATED 24.11.2014 AND 19.08.2016 RESPECTIVELY FOR ASSESSMENT YEAR 2010-11 , ON THE FOLLOWING GROUNDS: 1. THE CIT(A) HAS ERRED IN DELETING THE PENALTY AM OUNTING TO RS. 43,15,142/- FOR FURNISHING INACCURATE PARTICULARS OF INCOME AS THE APPELLANT HAD WRITTEN ITA NO.- 5580/DEL/2016 MAHENDERGARH CENTRAL CO-OP BANK LTD. PAGE 2 OF 5 OFF RS. 1,39,64,587/- AS OTS INTEREST RELIEF WITHOU T MAKING ANY EFFORT TO RECOVER (ALSO CONFIRMED BY THE (CIT(A)). 2. THE CIT(A) HAS ERRED IN DELETING THE PENALTY, WH ILE CIT(A) HERSELF HAS SUSTAINED THE QUANTUM OF ADDITION ON WHICH THIS PEN ALTY WAS IMPOSED. (2) THE ASSESSMENT ORDER DATED 28.03.2013, U/S 143(3) OF THE INCOME TAX ACT, 1961 (I.T. ACT, FOR SHORT) WAS PASSED WHEREIN AN ADDIT ION OF 1,39,64,857/- WAS MADE BY ASSESSING OFFICER (AO, FOR SHORT). THIS ADDITION WAS CONFIRMED BY LD. CIT(A) VIDE ORDER DATED 24.11.2014. THEREAFTER, PENALTY U/S 271(1)(C ) WAS LEVIED BY THE AO VIDE ORDER DATED 30.09.2015, AMOUNTING TO RS. 43,15,142/- WHIC H WAS @ 100% OF TAX SOUGHT TO BE EVADED, IN RESPECT OF THE AFORESAID ADDITION OF RS . 1,39,64,857/-. AGAINST THE PENALTY ORDER DATED 30.09.2015, ASSESSEE APPEALED BEFORE TH E LD. CIT(A), WHO, VIDE HER ORDER DATED 19.08.2016 ALLOWED THE APPEAL OF THE ASSESSEE . THE PRESENT APPEAL BEFORE INCOME TAX APPELLATE TRIBUNAL (ITAT, FOR SHORT) HAS BEEN FILED BY REVENUE AGAINST THE AFORESAID ORDER DATED 19.08.2016 WHEREIN THE LD. CI T(A) DELETED THE PENALTY. AT THE TIME OF HEARING BEFORE US, THE LEARNED COUNSEL FOR ASSESSEE SUBMITTED THAT VIDE ORDER DATED 04.07.2018, ITAT HAS SET ASIDE THE ISSUES REG ARDING THE AFORESAID QUANTUM ADDITION OF RS. 1,39,64,857/- TO THE FILE OF THE AO VIDE ORDER DATED 04.07.2018 IN ITA NO. 883/DEL/2015 FOR ASSESSMENT YEAR 2010-11. HE FILED A COPY OF THE AFORESAID ORDER DATED 04.07.2018 PASSED IN ITA NO. 883/DEL/2015. THE RELE VANT PORTION OF THE ORDER OF ITAT IS REPRODUCED AS UNDER: 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PE RUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE ORDER OF THE ASSESSING OFF ICER SHOWS THAT THE ASSESSING OFFICER HAS DISALLOWED THE ENTIRE AMOUNT CLAIMED AS EXPENDITURE ON THE GROUND THAT THE IMPUGNED AMOUNT WAS HUGE AS COMPARED TO THE INT EREST RECEIPTS CREDITED BY THE ITA NO.- 5580/DEL/2016 MAHENDERGARH CENTRAL CO-OP BANK LTD. PAGE 3 OF 5 ASSESSEE IN ITS PROFIT AND LOSS ACCOUNT. THE ASSESS ING OFFICER HAS DISALLOWED THE ASSESSEES CLAIM AT THE THRESHOLD ITSELF WITHOUT EX AMINING THE DETAILS IN THIS REGARD AND ALSO WITHOUT EXAMINING AS TO WHETHER THE PROVIS IONS OF THE AFIRE MENTIONED CIRCULAR, AS BEING RELIED UPON BY THE ASSESSEE, WER E APPLICABLE IN THE ASSESSEES CASE OR NOT. IT IS ALSO APPARENT THAT THE ASSESSING OFFI CER HAS ALSO NOT EXAMINED WHETHER THE ASSESSEE HAD CLAIMED THE DEDUCTION OF ONE TIME INTEREST WAIVER AS PER THE PROVISIONS OF THE AFORESAID CIRCULAR OR NOT. THE LD . CIT (APPEALS), WHILE DISMISSING THE ASSESSEES APPEAL, HAS DISMISSED THE ASSESSEES APP EAL ON THE GROUND THAT NO FOLLOW UP ACTION HAD BEEN TAKEN UP BY THE ASSESSEE BANK TO RECOVER THE OUTSTANDING AMOUNT. THEREFORE, IT IS VERY MUCH APPARENT THAT NO NE OF THE LOWER AUTHORITIES HAVE EXAMINED THE DEDUCTION CLAIMED BY THE ASSESSEE IN L IGHT OF THE TERMS OF THE AFORESAID CIRCULAR ISSUED BY THE REGISTRAR OF COOPERATIVE SOC IETIES, HARYANA. IN VIEW OF THESE FACTS, IT IS OUR CONSIDERED OPINION THAT IN THE INT EREST OF JUSTICE, THE MATTER SHOULD BE RE-EXAMINED BY THE ASSESSING OFFICER. ACCORDINGLY, WE RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER TO BE EXAMINED AFRESH AFTER T AKING INTO ACCOUNT THE PROVISIONS OF THE CIRCULAR AS WELL AS AFTER DULY EXAMINING WHE THER THE ASSESSEE HAS CLAIMED THE WAIVER OF INTEREST IN TERMS OF THE AFORESAID CIRCUL AR OR NOT. NEEDLESS TO SAY, THE ASSESSEE WILL BE AFFORDED DUE OPPORTUNITY BY THE AS SESSING OFFICER IN THIS REGARD. (2.1) THE LD. COUNSEL FOR ASSESSEE SUBMITTED THAT THE PE NALTY LEVIED BY THE AO IS UNSUSTAINABLE IN VIEW OF THE AFORESAID ORDER OF THE ITAT. THE LD. SR. DEPARTMENTAL REPRESENTATIVE (DR, FOR SHORT) APPEARING FOR REVE NUE RELIED ON THE ORDER OF THE AO. WE HAVE HEARD BOTH SIDES PATIENTLY AND WE HAVE ALSO CA REFULLY PERUSED THE MATERIALS AVAILABLE ON RECORD. WE ARE OF THE VIEW THAT PENALTY U/S 271 (1)(C) OF I.T. ACT OF RS. 43,15,142 /- LEVIED BY AO, HAS NO LEGS TO STAND WHEN THE ISSUES REGARDING CORRESPONDING ADDITIONS MADE BY THE AO HAVE ALREADY BEEN SET ASIDE BY ITAT VIDE ITS AFORESAID ORDER DATED 04.07.2018. WHEN THE QUANTUM ADDITION IS ALREADY S ET ASIDE BY ITAT, THE PENALTY LEVIED U/S 271(1)(C) OF I.T. ACT ON THE CORRESPONDING QUAN TUM ADDITION ALSO CANNOT SURVIVE. WE TAKE SUPPORT FROM JUDICIAL PRECEDENT IN THE CASE OF K.C. BUILDERS VS. ACIT 135 TAXMAN 461 (SC), IN WHICH THE HONBLE APEX COURT HELD THAT WHE RE THE ADDITIONS MADE IN THE ASSESSMENT ORDER, ON THE BASIS OF WHICH PENALTY FOR CONCEALMENT WAS LEVIED, ARE SET ASIDE ITA NO.- 5580/DEL/2016 MAHENDERGARH CENTRAL CO-OP BANK LTD. PAGE 4 OF 5 OR CANCELLED BY ITAT OR OTHERWISE, THE PENALTY CANN OT STAND BY ITSELF AND IS LIABLE TO BE CANCELLED. IN SUCH A SITUATION, THERE REMAINS NO BA SIS AT ALL FOR LEVYING THE PENALTY FOR CONCEALMENT, AND THEREFORE, IN SUCH A CASE, NO SUCH PENALTY CAN SURVIVE AND THE SAME IS LIABLE TO BE CANCELLED. IN VIEW OF THE FOREGOING, APPEAL FILED BY REVENUE IS HEREBY DISMISSED. (3) IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24 TH DAY OF JULY, 2019. SD/- SD/- (H.S. SIDHU) (ANADEE NATH M ISSHRA) JUDICIAL MEMBER ACCOUNTANT MEMBE R DATED: 24.07.2019 POOJA/- COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI ITA NO.- 5580/DEL/2016 MAHENDERGARH CENTRAL CO-OP BANK LTD. PAGE 5 OF 5 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER