SMT. KRISHNA SONI, JAIPUR V. INCOME TAX OFFICER, ALWAR

ITA 587/JPR/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1900 (ITAT-JAIPUR)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 10-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P P MEENA
• Keywords: Depreciation; Wrong claim; Difference of opinion

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 587/JP/2017 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2008-09 SMT. KRISHANA SONI C/O TRIPUTI AUTOMOBILES, NH-8,KOTPUTLI, DISTT. JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD BEHROR, BEHROR 301 701 DISTT. ALWAR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AIDPS1888D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : NONE JKTLO DH VKSJ LS @ REVENUE BY : SHRI P.P. MEENA (J.CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 03/11/2017 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 10/11/2017 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 08.06.2017 OF CIT (A), ALWAR ARISING FROM THE PENAL TY ORDER PASSED U/S 271(1)(C) OF THE ACT FOR A.Y. 2008-09. THE ASSESSE E HAS RAISED THE FOLLOWING GROUNDS AS UNDER:- 1. THE LEARNED AO HAS ERRED IN IMPOSING THE PENALT Y OF RS. 20000/- UNDER SECTION 271(1)(C) ON AD HOC OR LUMP S UM ADDITION MADE ON ESTIMATE BASIS AND CIT (APPEAL) HAS ERRED I N CONFIRMING THE SAME. 2. ANY OTHER GROUND OF APPEAL AT THE TIME HEARING. ITA NO. 587/JP/2017 SMT. KRISHNA SONI V ITO 2 2. AT THE TIME OF HEARING NONE HAS APPEARED ON BEHA LF OF THE ASSESSEE HOWEVER, MR. ANIL GOYAL (C.A.) THE LD. AUT HORIZED REPRESENTATIVE OF THE ASSESSEE FILED A LETTER DATED 27.10.2017 AND PLEADED THAT THIS APPEAL OF THE ASSESSEE MAY BE DEC IDED BY CONSIDERING WRITTEN SUBMISSIONS FILED ON BEHALF OF THE ASSESSEE ON 28.08.2017. THUS THIS APPEAL OF THE ASSESSEE IS TAKEN UP FOR HEARING AND ADJUDICATION. 3. WE HAVE CAREFULLY PERUSED AND GIVEN OUR THOUGHT TO THE WRITTEN SUBMISSIONS OF THE ASSESSEE AS WELL AS THE CONTENTI ONS OF THE LD. DR. THE ASSESSEE IS ENGAGED IN THE BUSINESS OF PLYING O F TRUCKS. THE ASSESSEE DECLARED HER INCOME FROM THE BUSINESS OF P LYING TRUCKS UNDER THE PROVISIONS OF SECTION 44AE. WHILE FRAMING THE A SSESSMENT THE ASSESSING OFFICER MADE DISALLOWANCE OF RS. 64,675/- ON ACCOUNT OF DEPRECIATION OF CAR CLAIMED BY THE ASSESSEE. THE AD DITION WAS CONFIRMED BY THE CIT(A) AND THEREAFTER THE AO INITI ATED THE PENALTY PROCEEDINGS U/S 271(1)(C) AGAINST THE ADDITION ON A CCOUNT OF DISALLOWANCE OF DEPRECIATION ON CAR. THUS THE ISSUE OF DISALLOWANCE OF DEPRECIATION, IN THE FACTS OF THE CASE WHEN THE ASS ESSEE HAS DECLARED THE INCOME UNDER DEEMING OF PROVISIONS OF SECTION 4 4AE, HAS ATTAINED THE FINALITY. THE ASSESSING OFFICER IMPOSED LEVY O F PENALTY OF RS. 20,000/- U/S 271(1)(C) VIDE ORDER DATED 25.03.2015 WHICH WAS ITA NO. 587/JP/2017 SMT. KRISHNA SONI V ITO 3 CHALLENGED BY THE ASSESSEE BEFORE THE LD. CIT(A) HO WEVER, THE LD. CIT(A) WAS NOT IMPRESSED WITH THE CONTENTION AND EX PLANATION OF THE ASSESSEE AND CONFIRMED THE LEVY OF PENALTY. 4. BEFORE THE TRIBUNAL THE ASSESSEE HAS SUBMITTED T HAT THERE IS NO RESTRICTION TO CLAIM THE DEPRECIATION OF ANY ASSET WHICH IS BEING USED IN THE BUSINESS OF PLYING TRUCKS U/S 44AE. THEREFORE, IN THE ABSENCE OF ANY SPECIFIC RESTRICTION OF ALLOWING THE DEPRECIATION O N THE ASSET OTHER THAN THE PLYING TRUCKS THE CLAIM OF THE ASSESSEE THOUGH, DISALLOWANCE MADE BY THE ASSESSEE AND CONFIRMED BY THE CIT(A) CANNOT BE TREATED AS BOGUS LEADING TO THE DEFAULT OF EITHER CONCEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. FURTHE R, IT IS CONTENDED THAT IT MAY BE A DIFFERENCE OF OPINION ON A DEBATABLE IS SUE AND MERELY BECAUSE THE ASSESSING OFFICER MADE AN ADDITION ON T HE BASIS OF MATERIAL AVAILABLE ON RECORD IT WILL NOT AMOUNT TO FURNISHIN G INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME. WHE N THE ASSESSEE EXPLAINED AND FURNISHED ALL THE RELEVANT DETAILS AND DOCUMENTS BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS THEN THE A DDITION MADE BY THE AO WOULD NOT WARRANT LEVY OF PENALTY U/S 271(1) (C). THE ASESSEE HAS PLACED RELIANCE ON VARIOUS DECISIONS INCLUDING THE DECISION OF ITA NO. 587/JP/2017 SMT. KRISHNA SONI V ITO 4 HONBLE SUPREME COURT IN CASE OF CIT VS. RELIANCE P ETRO PRODUCTS PVT. LTD. 322 ITR 158. 5. ON THE OTHER HANDS, THE LD. DR HAS SUBMITTED THA T THE ASSESSEE CLAIMED DEPRECIATION ON CAR WHICH IS NOT PERMISSIBL E AS PER THE PROVISIONS OF THE ACT WHEN THE ASSESSEE DECLARED TH E INCOME FROM BUSINESS U/S 44AE FROM THE BUSINESS OF PLYING TRUCK S. HE HAS FURTHER CONTENDED THAT DURING THE ASSESSMENT PROCEEDINGS TH E AO NOTED THAT THE ASSESSEE HAS CLAIMED DEPRECIATION ON CAR WHICH WAS WRONGLY CREDITED IN THE CAPITAL ACCOUNT OF THE ASSESSEE IN M/S TRIPUTI COTTAGE WHEREAS THE SAID AMOUNT WAS SUB SUMED IN CALCULATIN G THE INCOME U/S 44AE. HE HAS RELIED UPON THE ORDERS OF THE AUTHORIT IES BELOW. 6. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD, WE NOTE THAT AS FAR AS THE INCO ME DECLARED U/S 44AE IS CONCERNED THE ASSESSING OFFICER HAS ACCEPTED THE SAME. HOWEVER, THE AO DISALLOWED THE CLAIM OF THE ASSESSEE ON ACCO UNT OF DEPRECIATION ON CARS. THOUGH DISALLOWANCE MADE BY THE AO WAS CON FIRMED BY THE LD. CIT(A) AND ATTAINED FINALITY, HOWEVER, WHEN THE AS SESSEE HAS PRODUCED THE ALL RELEVANT RECORD, DETAILS AS WELL AS FACTS BEFORE THE ASSESSING OFFICER AND ONLY FROM THE RECORD PRODUCED BY THE AS SESSEE THE AO NOTED THAT THE ASSESSEE HAS CLAIMED THE DEPRECIATIO N OF RS. 64,675/- ITA NO. 587/JP/2017 SMT. KRISHNA SONI V ITO 5 WHICH WAS ALSO CREDITED TO THE CAPITAL ACCOUNT OF T HE ASSESSEE. THUS, THE DISALLOWANCE MADE BY THE AO IS BASED ON THE GRO UND THAT THE SAID CLAIM IS NOT PERMISSIBLE WHEN THE ASSESSEE HAS DECL ARED INCOME U/S 44AE. THERE IS NO QUARREL ON THE POINT THAT AS PE R SUB-SECTION 3 OF SECTION 44AE NO DEDUCTION IS ALLOWABLE U/S 30 TO 38 AS THE SAME IS DEEMED TO HAVE BEEN ALREADY GIVEN FULL EFFECT WHILE COMPUTING THE INCOME AS PER PROVISIONS OF SECTION 44AE(1). HOWEVE R THE DISALLOWANCE OF THE CLAIM AS PER THE STATUTORY PROVISION WOULD N OT AMOUNT THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF IN COME OR CONCEALMENT OF INCOME WHEN ALL THE DETAILS AND RELEVANT MATERIA L AVAILABLE BEFORE THE AO AS PRODUCED BY THE ASSESSEE. THEREFORE, IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN CASE OF CIT VS. RELIANCE P ETRO PRODUCTS PVT. LTD. (SUPRA) WHICH IS BINDING PRECEDENT WE ARE OF T HE VIEW THAT THE PENALTY CANNOT BE LEVIED SIMPLY BECAUSE OF THE ADDI TION MADE BY THE AO AS IT WAS NOT ALLOWABLE UNDER THE PROVISIONS OF SECTION 44AE. IT IS NOT THE CASE OF THE AO THAT THE DEPRECIATION CLAIME D BY THE ASSESSEE IS A BOGUS CLAIM ON NON EXISTING BUSINESS ASSET OR OTH ERWISE ABSOLUTELY WRONG. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE WE DELETE THE PENALTY OF RS. 20,000/- LEVIED U/S 271(1)(C) OF THE ACT. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED. ITA NO. 587/JP/2017 SMT. KRISHNA SONI V ITO 6 ORDER PRONOUNCED IN THE OPEN COURT ON 10/11/2017 SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 10/11/2017. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. KRISHANA SONI C/O TRIPUTI AUTOMOBILES, NH-8,KOTPUTLI, DISTT. JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- INCOME TAX OFFICER, WARD BEHROR, BE HROR 301 701 DISTT. ALWAR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 587/JP/2017} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR