STRIDES ARCOLAB LTD., NAVI MUMBAI V. THE INCOME TAX OFFICER 10(3)(4), MUMBAI

ITA 5878/MUM/2008

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3196 (ITAT-MUMBAI)
• Duration Of Justice: 7 year(s) 6 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: K
• Next Hearing Date: 12-05-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 24-09-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N K CHAND

Judgement Text

ITA NOS 5878/MUM/08 ASSESSMENT YEAR: 2002 - 03 PAGE 1 OF 2 IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI L BENCH, MUMBAI [CORAM : PRAMOD KUMAR AM AND PAWAN SINGH JM] ITA NOS 5878/MUM/08 AS SESSMENT Y EAR : 2002 - 03 STRIDES ACROLAB LTD .. ....... .APPELLANT 201, DEVAVRATA, SECTOR 17, VASHI NEW MUMBAI 400 703 [PAN: AADC8104P ] VS. INCOME TAX OFFICER WARD 10 (3) (4) , MUMBAI ... RESPONDENT APPEARANCES BY: NITESH JOSHI , FOR THE ASSESSEE N K CHAND F OR THE ASSESSEE DATE OF CONCLUDING THE HEARING : JANUARY 7 , 201 6 DATE OF PRONOUNCING THE ORDER : MAR CH 31 ST , 201 6 O R D E R PER PRAMOD KUMAR AM : 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT HAS CALLED INTO QUESTION CORRECTNESS OF LEARNED CIT(A) S ORDER DATED 1 ST JULY 2008 PARTLY UPHOLDING THE PENALTY OF RS 1,15,65,736 IMPOSED ON THE A SSESSEE UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2002 - 03, TO THE EXTENT IT RELATES TO (A) DEDUCTION UNDER SECTION 35(2AB) OF RS 1,86,63,256 AND (B) ALLEGED SUPPRESSION OF COMMISSION INCOME OF RS 2,88,500. 2. SO FAR AS T HE FIRST ITEM, I.E., QUANTUM DISALLOWANCE OF RS 1,86,63,256 IS CONCERNED, WE FIND THAT A COORDINATE BENCH OF THIS TRIBUNAL, VIDE ORDER DATED 15 TH DECEMBER 2015, HAS DELETED THE SAME. ONCE THE QUANTUM ADDITION ITSELF IS DELETED, THE VERY FOUNDATION OF RELAT ED PENALTY CEASES TO HOLD GOOD IN LAW. WE, THEREFORE, DELETE THE SAME. 3. AS REGARDS THE SECOND ITEM, I.E., ADDITION OF RS 2,88,500 IN RESPECT OF COMMISSION INCOME IS CONCERNED, IT IS SUFFICIENT TO TAKE NOTE OF THE FACT THAT THIS INCOME, ACCORDING, TO TH E ASSESSEE, PERTAINED TO THE ASSESSMENT YEAR 2003 - 04 AND HAS ALSO BEEN ASSESSED AS INCOME OF THE ASSESSMENT YEAR 2003 - 04. HOWEVER, DUE TO SOME MIX UP, THE TDS CREDIT WAS ERRONEOUSLY CLAIMED IN THE ASSESSMENT YEAR 2002 - 03. HOWEVER, AS THE ASSESSING OFFICER BROUGHT THE SAID INCOME TO TAX IN THIS ASSESSMENT YEAR, THE DISPUTED AMOUNT IS HELD TO BE CONCEALED INCOME. AT BEST, IT IS ITA NOS 5878/MUM/08 ASSESSMENT YEAR: 2002 - 03 PAGE 2 OF 2 SAID TO BE CASE OF THE WRONG ASSESSMENT YEAR, BUT THEN THE ASSESSING OFFICER HAS IMPOSED THE PENALTY AND THE CIT(A) HAS CONFIRMED THE ASSESSEE. NOT HAPPY WITH THE ORDER OF THE AUTHORITIES BELOW, THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. HAVING HEARD THE RIVAL CONTENTIONS, AND HAVING PERUSED THE MATERIAL ON RECORD, WE ARE INCLINED TO UPHOLD THE PLEA OF THE LEARNED COUNSEL THAT IT WAS NOT A FIT CASE FOR CONCEALMENT OF PENALTY UNDER SECTION 271(1)(C). THE ASSESSEE HAS GIVEN A REASONABLE EXPLANATION FOR NOT INCLUDING THE SAID COMMISSION AS INCOME OF THIS ASSESSMENT YEAR AND THE AMOUNT OF THE SAID INCOME IS ALSO VERY SMALL. ON THESE F ACTS, BY NO STRETCH OF LOGIC, THE AMOUNT OF RS 2,88,500 CAN BE SAID TO BE CONCEALED INCOME. WE, THEREFORE, DELETE THE CONCEALMENT PENALTY UNDER SECTION 271(1)(C) IN RESPECT OF THIS QUANTUM ADDITION AS WELL. ACCORDINGLY, THE GRIEVANCE OF THE ASSESSEE, IN RE SPECT OF PENALTY FOR BOTH THE ITEMS ABOVE, I.E. (A) DEDUCTION UNDER SECTION 35(2AB) OF RS 1,86,63,256 AND (B) ALLEGED SUPPRESSION OF COMMISSION INCOME OF RS 2,88,500, STANDS DELETED. 5. IN THE RESULT, THE APPEAL IS ALLOWED. PRONOUNCED IN THE OPEN COURT TODAY ON THE 31 ST DAY OF MARCH, 2016 S D/ - SD/ - PAWAN SINGH PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) DATED: THE 31 ST DAY OF MARCH , 2016 . COPIES TO : (1) THE APPE LLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL MUMBAI B ENCHES, MUMBAI