M/s Heera Moti Spices Pvt. Ltd., Chandigarh V. DCIT, Chandigarh

ITA 586/CHANDI/2016

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 3825 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-12-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Next Hearing Date: 13-10-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 16-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Section: 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCHES, CHANDIGARH BEFORE SH. N. K. SAINI, AM AND SH. RAVISH SOOD, JM ITA NO. 586 /CHD./2016 : ASSTT. YEAR : 2006-07 ITA NO. 587 /CHD./2016 : ASSTT. YEAR : 2007-08 M/S HEERA MOTI SPICES PVT. LTD., 1054, INDUSTRIAL AREA, PHASE-II, CHANDIGARH VS DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-I, CHANDIGARH (APPELLANT) (RESPONDENT) PAN NO. AABCH4813J ASSESSEE BY : SH. SUDHIR SEHGAL, ADV. REVENUE BY : SH. S. K . MITTAL, DR DATE OF HEARING : 22.12.2016 DATE OF PRONOUNCEMENT : 22.12.2016 ORDER PER N. K. SAINI, AM: THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAI NST THE SEPARATE ORDERS EACH DATED 18.02.2016 OF THE LD . CIT(A)- 3, GURGAON. 2. SINCE THE APPEALS WERE HEARD TOGETHER AND COMMON ISSUE RELATING TO CONFIRMATION OF PENALTY U/S 271(1 )(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS TH E ACT) IS INVOLVED. THEREFORE, THESE APPEALS ARE DISPOSED OFF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVIT Y. 3. AS REGARDS TO THE APPEAL IN ITA NO. 586/CHD./201 6 FOR THE ASSESSMENT YEAR 2006-07, THE LD. LD. COUNSEL FO R THE ASSESSEE SUBMITTED THAT THE ADDITION ON THE BASIS O F WHICH THE IMPUGNED PENALTY WAS LEVIED BY THE AO HAS NOW B EEN DELETED BY THE ITAT VIDE ORDER DATED 23.08.2016 IN ITA NO. 567/CHD./2013 FOR THE ASSESSMENT YEAR 2006-07 (COPY OF THE SAID ORDER WAS FURNISHED WHICH IS PLACED ON RECORD) . ITA NOS. 586 & 587/CHD./2016 HEERA MOTI SPICES P VT. LTD. 2 4. AS REGARDS TO THE APPEAL IN ITA NO. 587/CHD./201 6 FOR THE ASSESSMENT YEAR 2007-08, THE LD. LD. COUNSEL FO R THE ASSESSEE SUBMITTED THAT THE ADDITION ON THE BASIS O F WHICH THE IMPUGNED PENALTY WAS LEVIED HAS BEEN SET ASIDE BY THE ITAT IN ITA NO. 568/CHD./2013 VIDE ORDER DATED 20.0 9.2016 (COPY OF THE SAID ORDER WAS FURNISHED WHICH IS PLAC ED ON RECORD). 5. IN HIS RIVAL SUBMISSIONS THE LD. CIT DR ALTHOUGH SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW BUT C OULD NOT CONTROVERT THE AFORESAID CONTENTION OF THE LD. LD. COUNSEL FOR THE ASSESSEE. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE O N THE RECORD. IN THE PRESENT CASE, IT IS NOTICED THAT FOR THE ASSESSMENT YEAR 2006-07, THE ITAT VIDE ORDER DATED 23.08.2016 IN ITA NO. 567/CHD./2013 FOR THE ASSESSM ENT YEAR 2006-07 HELD IN PARA 37 AS UNDER: 37. IN VIEW OF THE ABOVE WE HOLD THAT IN THE ABSENCE OF ANY INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SEARCH AND THE ASSESSMENT PROCEEDINGS HAVING NOT ABATED AT THE TIME OF SEARCH, THE ASSESSING OFFICER HAS NO JURISDICTION T O MAKE THE ADDITION U/S 153A OF THE ACT. 7. AS REGARDS TO THE ASSESSMENT YEAR 2007-08, THE I TAT VIDE ORDER DATED 20.09.2016 IN ITA NO. 568/CHD./201 3 HELD IN PARA 21 AS UNDER: 21. ON GROUND NOS. 3 TO 6, ASSESSEE CHALLENGED THE ADDITION OF RS.7,93,331/- ON ACCOUNT OF UNEXPLAINED SUNDRY CREDITORS. THIS ISSUE IS SAME AS HAVE BEEN CONSIDERED IN ITA 739/2013 IN THE CASE OF M/S HEERA MOTI AGRO INDUSTRIES. FOLLOWING THE ITA NOS. 586 & 587/CHD./2016 HEERA MOTI SPICES P VT. LTD. 3 REASONS FOR DECISION IN THIS CASE, WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND RESTORE THE SAME TO THE FILE OF ASSESSING OFFICER WITH DIRECTION TO RE- DECIDE THIS ISSUE AS IS DIRECTED IN ITA 739/2013. THESE GROUNDS ARE ALLOWED FOR STATISTICAL PURPOSES. 8. FROM THE ABOVE SAID FACTS, IT IS CRYSTAL CLEAR T HAT THE ADDITIONS ON THE BASIS OF WHICH THE IMPUGNED PENALT IES WERE LEVIED BY THE AO AND SUSTAINED BY THE LD. CIT(A) AR E NOT IN EXISTENCE NOW. THEREFORE, NO PENALTY U/S 271(1)(C) OF THE ACT WAS LEVIABLE. 9. ON A SIMILAR ISSUE THE HONBLE SUPREME COURT IN THE CASE OF K.C BUILDERS VS ACIT 265 ITR 562 (DEL.) HELD AS UNDER: WHERE THE ADDITIONS MADE IN THE ASSESSMENT ORDER O N THE BASIS OF WHICH PENALTY FOR CONCEALMENT IS LEVIED, A RE DELETED, THERE REMAINS NO BASIS AT ALL FOR LEVYING PENALTY F OR CONCEALMENT AND, THEREFORE, IN SUCH A CASE NO PENAL TY CAN SURVIVE AND THE PENALTY IS LIABLE TO BE CANCELLED. 10. IN VIEW OF THE ABOVE, THE PENALTIES LEVIED BY T HE AO U/S 271(1)(C) OF THE ACT FOR THE ASSESSMENT YEARS 2006- 07 & 2007-08 AND SUSTAINED BY THE LD. CIT(A) ARE DELETED . 11. IN THE RESULT, APPEALS OF THE ASSESSEE ARE ALLO WED. (ORDER PRONOUNCED IN THE COURT ON 22/12/2016) SD/- SD/- (RAVISH SOOD) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT M EMBER DATED: 22/12/2016 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR