Kachhawaha Rameshwar Singh, JODHPUR V. ITO, JODHPUR

ITA 575/JODH/2013

• Counselvise Citation: 57523314 RSA 2013
• Duration Of Justice: 3 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-04-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 01-04-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 20-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Keywords: Wrong claim
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 575/JODH/2013 (A.Y. 2009-10) KACHHAWAHA RAMESHWAR SINGH, VS. ITO, WARD-3(1), HUF THROUGH KARTA RAMESHWAR SINGH JODHPUR. KACHHAWAHA, RAM MOHALLA, O/S NAGORI GATE, JODHPUR. PAN NO. AABHK 9437 L (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI MAHESH GEHLOT DEPARTMENT BY : SHRI N.A. JOSHI - D.R. DATE OF HEARING : 01/04/2014. DATE OF PRONOUNCEMENT : 03/04/2014. O R D E R PER N.K. SAINI, A.M THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDE R DATED 14/10/2013 OF LD. CIT(A), JODHPUR. THE FOLLOWING G ROUNDS HAVE BEEN RAISED IN THIS APPEAL:- 1. THE LD. ASSESSING OFFICER HAD ARBITRARILY IMPOS ED PENALTY OF RS. 1,01,890/- U/S 271(1)(C) OF THE ACT. 2. THE LD. ASSESSING OFFICER HAD IMPOSED PENALTY ON GROUND OF CONCEALMENT ON INCOME WHICH IS TOTALLY WRONG AS NO INCOME HAVE 2 BEEN CONCEALED BY THE ASSESSEE. ON THE BASIS OF DE DUCTION WHICH ARE WRONGLY CLAIMED FROM OTHER INCOME ARE GENUINE RESIG N TO IMPOSED PENALTY. 3. CIT APPEAL HAS CONFIRMED THE PENALTY PARTLY. 4. THEREFORE, THE PENALTY IMPOSED IS ARBITRARY, ILL EGAL AND WRONG. 5. THE ORDER PASSED BY A.O. IS BAD IN LAW AND ON FA CTS OF THE CASE AND THEREFORE, THE PENALTY NEEDS TO BE CANCELLED. IN T HE VIEW OF ABOVE, THE PENALTY IMPOSED MAY BE DELETED. 6. THE APPELLANT CRAVE LIBERTY TO ADD, AMEND, ALTER , MODIFY ANY OF THE GROUND OF APPEAL DURING OR BEFORE ITS HEARING BEFOR E YOU. 2 THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEAL RELATES TO THE CONFIRMATION OF PENALTY OF RS. 1,01,890/- LEVIED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE I.T. ACT, 1961 (HERE INAFTER REFERRED TO AS THE ACT IN SHORT). 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSE E FILED RETURN OF INCOME ON 28/07/2009 DECLARING AN INCOME OF RS. 3,6 0,790/-. HOWEVER, THE ASSESSMENT WAS FRAMED UNDER SECTION 143(3) OF T HE ACT ON 20/07/2011 AT A TOTAL INCOME OF RS. 7,36,910/- THER EBY MAKING AN ADDITION OF RS. 3,76,123/- (RS. 3,27,580/- + RS. 48 ,543/-). IN THE PENALTY ORDER, THE ASSESSING OFFICER OBSERVED THAT THE ASSE SSEE CLAIMED DEDUCTION OF RS. 3,27,580/- UNDER THE HEAD INCOME FROM OTHER SOURCES FOR BROKERAGE AND COMMISSION, LEGAL EXPENSES ETC. THE ASSESSING OFFICER MENTIONED THAT THE DEDUCTION WAS NOT AT ALL AVAILAB LE TO THE ASSESSEE. THE ASSESSING OFFICER ALSO OBSERVED THAT THE ASSESS EE HUF CLAIMED 3 DEDUCTION UNDER SECTION 24(B) OF THE ACT FOR INTER EST PAYMENT MADE TO ONE OF THE CO-PARCENER WHEREAS IT DID NOT CHARGE AN Y INTEREST ON ADVANCES MADE TO ONE OF THE CO-PARCENER AND AS SUCH THE ASSESSEE UNDER ESTIMATED HIS INCOME BY CLAIMING WRONG DEDUCTION OF RS. 48,543/-. ACCORDINGLY, HE LEVIED PENALTY OF RS. 1,01,890/- UN DER SECTION 271(1)(C) OF THE ACT. 4. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED THAT THE ASSESSEE HAD SURRENDERED A S UM OF RS. 3,76,123/- AND THE ASSESSMENT WAS COMPLETED ON AGREED BASIS AND THAT SURRENDER WAS DUE TO WRONG CLAIM OF EXPENDITUR E UNDER WRONG HEAD. RELIANCE WAS PLACED ON THE FOLLOWING CASE LAWS:- 1) CIT VS. IN DEH BISLERS (2001) TAXMAN 766. 2) CIT VS. PUNJAB TYRES 162 ITR 517 (MP); AND 3) ACIT VS. BHARTIYA BHANDAR 122 ITR 622. 5. THE LD. CIT(A) DID NOT FIND MERIT IN THE SUBMISSIO NS OF THE ASSESSEE AND SUSTAINED THE PENALTY IN RESPECT OF ADDITION OF RS. 3,27,580/- MADE BY THE ASSESSING OFFICER AND DELETED THE PENALTY IN RESPECT OF ADDITION OF RS. 48,543/- BY OBSERVING THAT THE SAID ADDITION WA S ON ACCOUNT OF EXPENDITURE WHICH WAS EITHER DEBATABLE OR CONTROVER SIAL, SO IT COULD NOT 4 BE SAID THAT THE ASSESSEE CONCEALED ANY INCOME OR F URNISHED INACCURATE PARTICULARS OF ITS INCOME. NOW THE ASSESSEE IS IN APPEAL. 6 . LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE S UBMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FURNISHED THE INAC CURATE PARTICULARS OF INCOME. IT WAS ALSO SUBMITTED THAT THE ASSESSMENT W AS COMPLETED ON AGREED BASIS. IT WAS FURTHER STATED THAT THE CLAIM OF THE ASSESSEE WAS NOT ACCEPTED BY THE ASSESSING OFFICER, BUT ON THAT BASI S PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS NOT LEVIABLE. RELIANCE WA S PLACED ON THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. [2012] 322 ITR 158. 7. LEARNED D.R. IN HIS RIVAL SUBMISSIONS STRONGLY SUPP ORTED THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) AND SUBMITT ED THAT THE ASSESSEE FURNISHED INACCURATE PARTICULARS OF INCOME, HENCE, PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS RIGHTLY LEVIED. 8. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PAR TIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON RE CORD. IT IS AN ADMITTED FACT THAT THE ADDITION OF RS. 3,27,580/- WAS MADE B Y THE ASSESSING OFFICER 5 BY DISALLOWING THE DEDUCTION CLAIMED OUT OF THE IN COME FROM OTHER SOURCES. THE ASSESSING OFFICER HIMSELF MENTIONED IN THE PENALTY ORDER DATED 12/01/2012 THAT THE ADDITION OF RS. 3,27,580/ - WAS MADE ON ACCOUNT OF DISALLOWANCE OF DEDUCTION CLAIMED OUT OF THE INCOME FROM OTHER SOURCES. THEREFORE, IT IS CLEAR THAT THE ADD ITION ON THE BASIS OF WHICH THE IMPUGNED PENALTY HAS BEEN LEVIED WAS ON A CCOUNT OF DISALLOWANCE OUT OF THE CLAIM MADE BY THE ASSESSEE. 9. ON A SIMILAR ISSUE, THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. (SUPRA) HAS HELD AS UNDER:- WHERE THERE IS NO FINDING THAT ANY DETAILS SUPPLIE D BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS O R FALSE THERE IS NO QUESTION OF INVITING THE PENALTY UNDER SECTION 271( 1)(C). A MERE MAKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDI NG THE INCOME OF THE ASSESSEE. SUCH A CLAIM MADE IN THE RETURN CANN OT AMOUNT TO FURNISHING INACCURATE PARTICULARS. 10 . IN THE PRESENT CASE ALSO, THE CLAIM OF THE ASSESS EE WAS NOT ACCEPTED BY THE ASSESSING OFFICER, HOWEVER, IT CANNOT BE SAI D THAT THE ASSESSEE CONCEALED THE INCOME OR FURNISHED INACCURATE PARTIC ULARS OF INCOME. THEREFORE, IN VIEW OF THE RATIO LAID DOWN BY THE HO N'BLE SUPREME COURT IN THE AFORESAID CASE, THE PENALTY UNDER SECTION 271(1 )(C) OF THE ACT WAS NOT 6 LEVIABLE. ACCORDINGLY, THE PENALTY LEVIED BY THE A SSESSING OFFICER AND CONFIRMED BY THE LD. CIT(A) IS DELETED. 11 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. (ORDER PRONOUNCED IN THE COURT ON 03 RD APRIL, 2014). SD/- SD/- (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 3 RD APRIL, 2014. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR, ITAT, JODHPUR.