Shri Lukman Ilyas Khatri, Surat V. The Income Tax Officer,Ward-5(2), Surat

ITA 591/AHD/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 94555 (ITAT-AHMEDABAD)
• Duration Of Justice: 7 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 19-10-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 16-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L CHANDEL
• Assessee Lawyers: MONIL SHAH

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ ITA NO. 591/AHD/2015 / ASSESSMENT YEAR: 2009-10 LUKMAN ILYAS KHATRI, L-101, RADHE MARKET, RING ROAD, SURAT PAN : ALQPK 5956 N VS. THE INCOME TAX OFFICER, WARD-5(2), SURAT ./ ITA NO. 592/AHD/2015 / ASSESSMENT YEAR: 2009-10 SIDDIQ ISHAQ KHATRI, L-163A, RADHEY MARKET, SALASAR HANUMAN MARG, RING ROAD, SURAT PAN : AOOPK 6577 N VS. THE INCOME TAX OFFICER, WARD-5(4), SURAT / (APPELLANT) / (RESPONDENT) ASSESSEE(S) BY : SHRI MONIL SHAH, AR REVENUE BY : SHRI S.L. CHANDEL, SR. DR. / DATE OF HEARING : 19/10/2015 / DATE OF PRONOUNCEMENT: 21/10/2015 / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THESE TWO APPEALS BY THE DIFFERENT ASSESSEES ARE DI RECTED AGAINST TWO SEPARATE ORDERS OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-1, SURAT, BOTH DATED 02.01.2015 FOR ASSES SMENT YEAR 2009-10. 2. THE ONLY GROUND RAISED IN THESE TWO APPEALS IS A GAINST THE LEVY OF PENALTY U/S 271(1)(C) OF THE INCOME-TAX ACT, AS UNDER:- ITA NOS. 591 & 592/AHD/2015 LUKMAN ILYAS KHATRI & SIDDIQ ISHAQ KHATRI VS. ITO : AY 2009-10 2 IN THE CASE OF SHRI LUKMAN ILYAS KHATRI : RS. 17,1 57/- IN THE CASE OF SHRI SIDDIQ ISHAQ KHATRI : RS. 8, 910/- 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. BOTH THE ASSESSEES ARE INDIVIDUAL WHO D ERIVES INCOME FROM PURCHASE AND SALES OF SAREES AT SURAT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER FOUND FROM THE V ERIFICATION OF BANK STATEMENT THAT CERTAIN TRANSACTIONS WERE NOT RECORD ED IN THE BOOKS OF ACCOUNTS. WHEN THE ASSESSEE WAS CONFRONTED WITH TH ESE DISCREPANCIES, HE ADMITTED THAT THE TRANSACTIONS IN THE BANK ACCOU NT WERE RELATING TO BUSINESS AND ACCORDINGLY, THE ASSESSEE FURNISHED TH E REVISED COMPUTATION BY OFFERING THE ADDITIONAL INCOME OF TH E PROFIT ON THE SALE WHICH WAS OMITTED TO BE RECORDED. THE ASSESSING OF FICER COMPLETED THE ASSESSMENT AFTER ACCEPTING THE ASSESSEES EXPLA NATION BY SLIGHTLY MODIFYING THE GP. THE ASSESSED INCOME HAS BEEN ACC EPTED BY THE ASSESSEE; HOWEVER, THE ASSESSING OFFICER LEVIED THE PENALTY U/S 271(1)(C) WHICH IS SUSTAINED BY THE CIT(A). 4. AT THE TIME OF HEARING BEFORE US, IT WAS SUBMITT ED BY THE ASSESSEES COUNSEL THAT BOTH THE ASSESSEES ARE SMAL L BUSINESSMEN AND WHOSE TURNOVER IS RS.23 LACS IN THE CASE OF SHRI LU KMAN ILYAS KHATRI AND RS.17 LACS IN THE CASE OF SHRI SIDDIQ ISHAQ KHA TRI. THAT, DUE TO SUCH SMALL TURNOVER, THE ASSESSEE HAD ONLY A PART-T IME ACCOUNTANT WHO COMMITTED SOME MISTAKES WHILE RECORDING THE SALE. WHEN THE ASSESSING OFFICER POINTED OUT THE DISCREPANCIES, TH E ASSESSEE IMMEDIATELY AGREED TO ENHANCE THE GP AND RESULTANT INCOME. HE, THEREFORE, SUBMITTED THAT THE MISTAKE IS UNINTENTIO NAL; BONA FIDE MISTAKE ITA NOS. 591 & 592/AHD/2015 LUKMAN ILYAS KHATRI & SIDDIQ ISHAQ KHATRI VS. ITO : AY 2009-10 3 COMMITTED BY THE PART-TIME ACCOUNTANT OF THE ASSESS EE ON WHICH PENALTY U/S 271(1)(C) SHOULD NOT BE LEVIED. 5. THE LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 6. CONSIDERING THE FACTS OF THE CASE AND ARGUMENTS OF BOTH THE SIDES, ESPECIALLY THE SMALLNESS OF THE ASSESSEES B USINESS AND THE MEAGER AMOUNT OF THE PENALTY, WE ARE OF THE OPINION THAT IT IS NOT A FIT CASE FOR LEVY OF PENALTY U/S 271(1)(C). CONSIDERIN G THE FACTS OF THE CASE, WE ACCEPT THE ASSESSEES CONTENTION THAT IT WAS A BONA FIDE MISTAKE COMMITTED BY THE ACCOUNTANT OF THE ASSESSEE WHO WAS ONLY LOOKING AFTER THE ASSESSEES ACCOUNT PART-TIME. IN VIEW OF ABOVE, WE CANCEL THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. 7. IN THE RESULT, THE APPEALS FILED BY BOTH ASSESSE ES ARE ALLOWED. ORDER PRONOUNCED IN THE COURT ON 21 ST OCTOBER, 2015 AT AHMEDABAD. SD/- SD/- (KUL BHARAT) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 21/10/2015 BIJU T., PS !'#$#%! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. ! / THE RESPONDENT. 3. '# $ / CONCERNED CIT 4. $ ( ) / THE CIT(A) 5. '() # , # , ' / D R, ITAT, AHMEDABAD 6. ). / / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD