Jawarilal Lunia Prop. Maharani Art Exporters, JODHPUR V. DCIT, JODHPUR

ITA 565/JODH/2010

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1600 (ITAT-JODHPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 01-02-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 29-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G R KOKANI
• Assessee Lawyers: R R SI NGHVI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER, AND SHRI N.K.SAINI, ACCOUNTANT MEMBER ITA NO.565/JU/2010 ASSESSMENT YEAR: 2005-06 SHRI JAWARILAL LUNIA VS. THE D.C.I.T PROP. M/S MAHARANI ART EXPORTERS CIRCLE - 3 JODHPUR JODHPUR PAN NO. AADPL 8577 E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI R.R. SINGHVI DEPARTMENT BY : SHRI G.R. KOKANI DATE OF HEARING : 01.02.2013 DATE OF PRONOUNCEMENT : 05.02.2013 ORDER PER N.K.SAINI, A.M. THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE CIT(A), JODHPUR DATED 27.07.2009. 2 2. THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEA L RELATES TO THE CONFIRMATION OF PENALTY OF RS. 1,20, 000/- LEVIED BY THE A.O. U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT', FOR SHO RT]. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE FILED RETURN OF INCOME DECLARING INCOME AT RS. 1,07,49,71 1/- ON 31.10.2005. HOWEVER, ASSESSMENT WAS FRAMED BY THE A.O. AT AN INCOME OF RS. 1,10,95,846/-. THE A.O. MADE ADDITIONS OF RS. 62,300/-, RS. 2,55,725/-, RS. 14,3 95/- AND RS. 13,715/- ON ACCOUNT OF UNDER VALUATION OF GOLD JEWELLERY, UNDER VALUATION OF SILVER JEWELLERY, UND ER VALUATION OF STOCK ON ACCOUNT OF FREIGHT AND DISALL OWANCE OUT OF TELEPHONE EXPENSES RESPECTIVELY. THE A.O. AL SO LEVIED PENALTY OF RS. 1,20,000/- U/S 271(1)(C) OF T HE ACT CONSIDERING THE ADDITION AS CONCEALED INCOME OF THE ASSESSEE. PENALTY LEVIED BY THE A.O. WAS SUSTAINED BY THE LD. CIT(A). NOW THE ASSESSEE IS IN APPEAL. 3 4. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ITAT, JODHPUR, IN QUANTUM APPEAL DATED 9.7.2009, IN ITA NO. 199/JODHPUR/2008 HAS DELETED THE ADDITION IN RE SPECT OF UNDER VALUATION OF CLOSING STOCK OF SILVER AT RS . 2,55,725/- AND IN RESPECT OF FREIGHT EXPENSES AT RS . 14,395/- AND THE MATTER HAS BEEN RESTORED FOR ADDIT ION OF RS. 62,300 REPRESENTING THE ENHANCED CLOSING STOCK OF GOLD JEWELLERY. IT WAS FURTHER STATED THAT THE ADDITION OF RS. 8,000/- WHICH WAS SUSTAINED BY THE LD. CIT(A) OUT O F ADDITION OF RS. 13,715/- ON ACCOUNT OF PERSONAL USE OF TELEPHONE WAS ONLY CONFIRMED BY THE ITAT VIDE ORDER DATED 9.7.2009 AND THAT ADDITION WAS ONLY ON ESTIMATE BAS IS. THEREFORE, PENALTY U/S 271(1)(C) WAS NOT LEVIABLE I N THE PRESENT CASE. 5. IN HIS RIVAL SUBMISSIONS, THE LD. D.R. SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 4 6. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PA RTIES AND THE MATERIAL ON RECORD, IN THE PRESENT CASE IT IS NOTICED THAT ALL THE ADDITIONS EXCEPT RS. 8000/- ON THE BASIS OF WHICH PENALTY WAS LEVIED BY THE A.O. HAS B EEN DELETED BY THE ITAT VIDE ORDER DATED 9.7.2009, COPY OF WHICH IS PLACED AT PAGES 10-13 OF THE ASSESSEES COMPILATION. THE ADDITION OF RS. 8,000/- WAS SUSTA INED BY THE LD. CIT(A) OUT OF ADDITION OF RS. 13,715/- MAD E BY THE A.O. BY MAKING DISALLOWANCE OUT OF TELEPHONE EXPENS ES ON ESTIMATE BASIS. THE SAID ADDITION WAS UPHELD BY TH E ITAT VIDE ORDER DATED 09.07.2009. HOWEVER, IT IS AN ADM ITTED FACT THAT THE DISALLOWANCE OF RS. 8,000/- ON ACCOUN T OF PERSONAL USE OF TELEPHONE WAS ONLY ON ESTIMATE BASI S AND THERE WAS NO CONCRETE FINDING THAT THE ASSESSEE CON CEALED INCOME TO THAT EXTENT. WE ARE, THEREFORE, OF THE CONSIDERED OPINION THAT NO PENALTY WAS LEVIABLE IN THIS CASE BECAUSE THE MAJOR ADDITIONS MADE BY THE A.O. W ERE DELETED BY THE ITAT AND THE MATER RELATING TO ADDIT ION OF RS. 62,300/- WAS RESTORED TO THE A.O. FOR FRESH ADJUDICATION. 5 REMAINING ADDITION OF RS. 8,000/- WAS MERELY ON EST IMATE BASIS. IN VIEW OF THE ABOVE, WE DELETE THE PENALTY LEVIED BY THE A.O. AND SUSTAINED BY THE LD. CIT(A). 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. (ORDER PRONOUNCED IN THE COURT ON 5 TH FEBRUARY, 2013). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMER DATED :5 TH FEBRUARY, 2013. VL/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR