M/s. Surja Ram & sons, Malout V. The Deputy Commissioner of Income tax, Bathinda

ITA 598/ASR/2013

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5715 (ITAT-AMRITSAR)
• Duration Of Justice: 4 year(s) 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 30-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P N ARORA LD
• Section: 131; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRI BUNAL AMRITSAR BENCH, AMRITSAR BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER ITA NO.598(ASR)/2013 ASSESSMENT YEAR:200 6-07 M/S SURJA RAM & SONS KAIRAON ROAD, MALOUT PAN:AACFS7229M VS. DY. CIT,CIRCLE-II, BATHINDA (APPELLANT) (RESPONDENT) APPELLANT BY: SH. P.N.ARORA (LD.ADV. ) RESPONDENT BY: SH. CHARAN DASS (LD. DR) DATE OF HEARING: 08.03.2018 DATE OF PRONOUNCEMENT: 16.03.2018 ORDER PER N.K.CHOUDHRY, JM: THE INSTANT APPEAL HAS BEEN PREFERRED BY THE ASSESSEE/APPELLANT, ON FEELING AGGRIEVED AGAINST THE ORD ER DATED 24.07.2013 PASSED BY THE LD. CIT(A), BATHINDA, U/S 25 0(6) OF THE I.T. ACT, 1961 (HEREINAFTER CALLED AS THE ACT). 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL. 1. THE LD. CIT(A) ERRED ON FACT AND LAW IN UPHOLDIN G THE PENALTY AMOUNTING TO RS.3,14,270/- IMPOSED U/S 271( 1)(C) OF THE INCOME TAX ACT,1961. ITA NO.598/ASR/2013 (A.Y.2006-07) M/S SURJA RAM SONS, MAL OUT VS. DCIT 2 2. THE LD. CIT(A) ERRED ON FACTS ON LAW IN UPHOLDIN G THE PENALTY AMOUNTING TO RS.3,14,270/- IMPOSED U/S 271( 1)(C) OF THE INCOME TAX ACT, 1961. IN SPITE OF THE FACT THAT IT WAS EXPLAINED BEFORE THE LD. AO AND THE LD. CIT(A) DURI NG THE COURSE OF ASSESSMENT AS WELL AS PENALTY PROCEEDINGS THAT THE CREDIT OF RS.9,30,833/- BELONGED TO SH. PARHLAD KUM AR, PARTNER AND IT IS SETTLED LAW THAT NO ADDITION U/S 68 CAN BE MADE IN THE HANDS OF PARTNERSHIP FIRM WHERE THE CRE DIT BELONGS TO THE PARTNER. THUS THE PENALTY ORDER U/S 271(1) (C) DESERVES TO THE QUASHED. 3. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE COURSE O F ASSESSMENT PROCEEDING, IT WAS NOTICED THAT THE ASSESSEE HAD ACCEPTED CREDITS IN THE ACCOUNTS OF THE PARTNERS VIZ. SH. PARHLAD KUMAR TO THE TUNE OF RS.9,30,833/- AND SH. AMAR KUMA R TO THE TUNE OF RS.33,98,377/- ON WHICH THE ASSESSEE WAS ASKED TO PRODUCE THE EVIDENCE OF CREDITS WITH SOURCE THEREOF SO AS T O ESTABLISH THE GENUINENESS OF THE LOANS. HOWEVER, THE ASSE SSEE COULD FURNISH EVIDENCE IN RESPECT OF CREDIT OF SH. AMAR KUMAR ONLY BUT NO EVIDENCE IN THE FORM OF CONFIRMATION OR THE SOURCE OF CREDITS IN RESPECT OF SH. PARHLAD KUMAR WAS PRODUCED, DESP ITE AVAILING VARIOUS OPPORTUNITIES, LATER ON ONE OF THE PARTNERS OF THE ASSESSEE STATED THAT SH. PARHLAD KUMAR IS NOT IN GOOD TERMS OF OTHER PARTNERS I.E., SH. AMAR KUMAR, THEREFORE, I T IS NOT POSSIBLE TO PROVIDE HIS RECORDS AT THAT STAGE. ALTHOUGH, THE NOTICE U/S 131 OF THE I.T. ACT WAS ISSUED ON 20.11.2007 TO SH. PARHLAD KUMAR BUT NOT YIELDED ANY RESULT, THEREAFTER , THE ADDITION TO THE TUNE OF RS.9,30,833/- AS WELL AS RS.2,8 14/- AND DISALLOWANCE TO THE TUNE OF RS.97,792/- HAVE BEEN ADDE D IN THE INCOME OF THE ASSESSEE AND PENALTY PROCEEDING HAVE ALSO BE EN ITA NO.598/ASR/2013 (A.Y.2006-07) M/S SURJA RAM SONS, MAL OUT VS. DCIT 3 INITIATED WHICH RESULTED INTO LEVY OF PENALTY TO THE TUNE OF RS.3,14,270/-. 4. ON FELLING AGGRIEVED AGAINST THE ORDER PASSED BY TH E ASSESSING OFFICER, THE ASSESSEE PREFERRED THE FIRST APPEAL BE FORE THE LD. CIT(A), WHO UPHELD THE PENALTY IMPOSED BY TH E ASSESSING OFFICER ON THE GROUND OF FURNISHING INACCURATE PARTICULARS OF INCOME WITH THE REASON THAT NO EVIDENCE R EGARDING THE GENUINENESS OF THE CREDITS OF RS.9,30,833/- IN THE CA PITAL ACCOUNT OF SH. PARHLAD KUMAR PARTNER HAS BEEN FURNISHE D EVEN BEFORE HIM AND SIMILARLY THE DIFFERENCE IN THE RECEIP TS TO THE TUNE OF RS.2,814/- ALSO COULD NOT BE RECONCILED. THE ASSESSEE FI RM PREFERRED THE INSTANT APPEAL. 5. AT THE OUTSET, OUR ATTENTION WAS DRAWN BY THE LD. AR THAT ADDITION OF RS.9,30,833/- MADE BY INVOKING PROVISIONS OF SEC.69 HAS ALREADY BEEN DELETED BY THE LD. CIT(A) VIDE ITS ORDER DATED 27 TH APRIL, 2017 WHICH HAS ATTENDED FINALITY AS THE DEPAR TMENT HAS NOT PREFERRED ANY APPEAL AGAINST THE SAID ORDER, THEREFORE, THE PENALTY COULD NOT SURVIVE. FURTHER, AS PER THE ADD ITION OF RS.2,814/- IS CONCERNED, THIS DIFFERENCE IS ON ACCOUNT OF RE CEIPTS SHOWN BY THE ASSESSEE VIZ-A-VIZ AS PER TDS CERTIFICATE, THEREFORE, THERE WAS ONLY CLERICAL, GENUINE AND HONEST MISTAKE ON WHICH NO PENALTY SHOULD HAVE BEEN LEVIED AS THE DIF FERENCE WAS VERY SMALL. ITA NO.598/ASR/2013 (A.Y.2006-07) M/S SURJA RAM SONS, MAL OUT VS. DCIT 4 6. ON THE OTHER HAND, THE LD. DR HAS NOT SUBMITTED CONTR ARY TO THE CLAIM OF THE ASSESSEE. 7. WE HAVE GONE THROUGH WITH THE FACTS AND CIRCUMSTAN CES OF THE CASE AND ALSO ORDER DATED 27.04.2017 PASSED BY THE L D. CIT(A), BATHINDA BY WHICH THE ADDITION TO THE TUNE OF RS.9,30,833/- IS DIRECTED TO BE DELETED, AND WHICH HAS SINCE ATTAINED FINALITY. HENCE, CONSIDERING THE SAID ORDER AS WELL AS SUBMISSIONS OF THE LD. AR FOR ADDITION OF RS.2,814/- THE DIFFERENCE ON ACCOUNT OF RECEIPTS SHOWN BY THE ASSESSEE AS PAR TDS CERTIFICATE OCCURRED DUE TO CLERICAL AND INADVERTENT MISTAKE AND EVEN OTHERWISE THE DIFFERENCE IS VERY SMALL, HENCE, THE PENALTY LEVIED BY THE ASSESSING OFFICER TO THE TUNE OF RS.3,14,270/- AND CONFIRMED BY THE LD. CIT(A) STAND DELETED. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 .03.2018. SD/- SD/- (SANJAY ARORA) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDIC IAL MEMBER DATED:16.03.2018 /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) M/S SURJA RAM & SONS, KAIRAON ROAD, MALOUT (2) THE DCIT, CIRCLE-II, BATHINDA (3) THE CIT(A), BATHINDA (4) THE CIT CONCERNED (5) THE SR DR, I.T.A.T., AMRITSAR TRUE COPY BY ORDER