JOY HOMECREATION LTD, MUMBAI V. ITO 8(2)(1), MUMBAI

ITA 5893/MUM/2010

• Counselvise Citation: 589319914 RSA 2010
• Duration Of Justice: 1 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: I
• Assessment Year: 2008-2009
• Appeal Filed On: 26-07-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: MANISH J SHETH
• Keywords: Reasonable cause

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, I, MUMBAI BEFORE S/SHRI D.K.AGARWAL (JM) AND B. RAMAKOTAIAH ( A.M ) ITA NO.5893/MUM/2010 (ASSESSMENT YEAR : 2008-09) JOY HOMECREATION LTD., 306/310, MADHAVA, C-4, BANDRA KURLA COMPLEX, BANDRA (EAST), MUMBAI-400051 PAN: AABCJ2480R INCOME TAX OFFICER, 8(2)(1), MUMBAI. APPELLANT V/S RESPONDENT DATE OF HEARING : 29.9.2011 DATE OF PRONOUNCEMENT :12.10.2011 APPELLANT BY : SHRI MANISH J.SHETH RESPONDENT BY : SHRI SUNIL KUMAR SINGH O R D E R PER D.K.AGARWAL (JM) THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 15.4.2010 PASSED BY THE LD . CIT(A) FOR THE ASSESSMENT YEAR 2008-09. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE IS ENGAGED IN THE BUSINESS AS A BUILDER AND DEVELOPER. IT FILED RETURN DECLARING TOTAL INCOME OF RS.1,18,25,570/- AFTER PAYING THE TAX OF RS.2,15,100/- ONLY. THE AO, HO WEVER, OBSERVED THAT THE TAX PAYABLE AS PER RETURN OF INCO ME IS SHOWN AT RS.1,16,65,910/-. SINCE THE SELF ASSESSMEN T TAX HAS NOT BEEN PAID BY THE ASSESSEE ALONG WITH THE RE TURN OF ITA NO.5893/MUM/2010 (ASSESSMENT YEAR : 2008-09) 2 INCOME, HE TREATED THE ASSESSEE IN DEFAULT AS PER T HE PROVISIONS OF SECTION 140A(3) OF THE INCOME TAX AC T, 1961 (IN SHORT THE ACT) AND ISSUED SHOW CAUSE NOTICE U /S 221 R.W.S.140A(3) CALLING FOR THE ASSESSEE TO PAY THE D EMAND AND ALSO SHOW CAUSE AS TO WHY THE PENALTY U/S 221(1) SHOULD NOT BE IMPOSED FOR NON PAYMENT OF SELF ASSESSMENT TAX. IN RESPONSE, THE ASSESSEE SUBMITTED THAT NON PAYMENT OF SELF ASSESSMENT TAX OF RS.1,16,65,910/- OCCURRED DUE TO CALCULATION MISTAKE COMMITTED BY THE ACCOUNTS DEP ARTMENT OF THE ASSESSEE COMPANY AND WHEN THE ASSESSEE CAME TO KNOW ABOUT THIS, THE TAX OF RS. 1,16,65,910/- WA S DEPOSITED BY 30.12.2008 AS UNDER: DATE AMOUNT I) 12.11.2008 RS.25,00,000/- II) 25.11,2008 RS.30, 00,000/- III) ADJUSTMENT OF REFUND FOR AY.2006-07 RS. 2,33,563/- IV) 11.12.2008 RS.30,00,000/- V) 30.12.2008 RS.29,33,347/- TOTAL RS.L,I6,65,910/- HOWEVER, THE AO WAS OF THE VIEW THAT SINCE THE SELF ASSESSMENT TAX WAS PAYABLE ON OR BEFORE 30.10.2007 AND THE SAME REMAINED UNPAID TILL THE FILING OF THE INCOME TAX RETURN AND IN THE ABSENCE OF ANY REASONABLE CAUSE SHOWN BY THE ASSESSEE, HE IMPOSED PENALTY OF RS.5,83,296/- BEI NG 5% OF ITA NO.5893/MUM/2010 (ASSESSMENT YEAR : 2008-09) 3 THE GROSS DEMAND OF TAX OF RS.L,I6,65,910/- VIDE ORDER DATED 21.1.2009 PASSED U/S 221(1) OF THE ACT. ON APPEAL , THE LD. CIT(A) WHILE OBSERVING THAT ONLY REASON GIVEN FOR REASONABLE CAUSE, BEING ERROR ON THE PART OF THE ACCOUNTING DEPARTMENT IS NOT ACCEPTABLE, CONFIRMED THE PENALTY IMPOSED BY THE AO. 3. BEING AGGRIEVED BY THE ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE US TAKING THE FOLLOWI NG EFFECTIVE GROUND: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN CONFIRMING THE PENALTY OF RS.5,83,296/- LEVIED BY AO U/S 221(1) OF THE INCOME TAX ACT, 1961. 4. AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE WHILE REITERATING THE SAME SUBMISSIONS AS SUBMITTED BEFORE THE AO AND THE LD. CIT(A) FURTHER SUBMITS THAT HE HAS NO OBJECTION IF THE PENALTY IS REDUCED TO RS.1,00,000/- 5. ON THE OTHER HAND, THE LD. DR SUPPORTS THE ORDE R OF THE AO AND THE LD. CIT(A). 6. HAVING CAREFULLY HEARD THE SUBMISSIONS OF THE RI VAL PARTIES AND PERUSING THE MATERIAL AVAILABLE ON REC ORD WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAS DEPOSITED THE BALANCE AMOUNT OF SELF ASSESSMENT TAX OF RS.L,I6,65,910/- IMMEDIAT ELY AFTER ITA NO.5893/MUM/2010 (ASSESSMENT YEAR : 2008-09) 4 THE RECEIPT OF SHOW CAUSE NOTICE DATED 1.12.2008. IT WAS EXPLAINED BY THE ASSESSEE THAT SHORT PAYMENT OF S ELF ASSESSMENT TAX WAS DUE TO THE REASON THAT THE ACCO UNTS DEPARTMENT OF THE ASSESSEE-COMPANY HAS WRONGLY CALC ULATED THE AMOUNT OF TAX. CONSIDERING THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE CO-OPERATION MADE BY THE ASSESSEE IN DEPOSITING THE TAX IMMEDIATELY AFTER T HE ISSUANCE OF SHOW CAUSE NOTICE, WE ARE OF THE VIEW T HAT IN THE INTEREST OF JUSTICE, IT WOULD BE FAIR AND REASONABL E, IF THE PENALTY OF RS.5,83,296/- IS REDUCED TO RS.1,00,000 /- AND ACCORDINGLY WE REDUCE THE SAME TO RS.1,00,000/- ON LY FOR SUCH DEFAULT. WE HOLD AND ORDER ACCORDINGLY. THE GR OUND TAKEN BY THE ASSESSEE, IS THEREFORE, PARTLY ALLOWED . 7. IN THE RESULT, THE ASSESSEES APPEAL STANDS PAR TLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12 TH OC T., 2011. SD SD (B. RAMAKOTAIAH) (D .K.AGARWAL) ACCOUNTANT MEMBER JUDICIAL MEM BER MUMBAI, DATED 12 TH OCT., 2011 SRL: ITA NO.5893/MUM/2010 (ASSESSMENT YEAR : 2008-09) 5 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. DR CONCERNED BENCH 6. GUARD FILE. BY ORDER TRUE COPY ASSTT. REGISTRAR, ITAT, MUMBAI