Sh. Praveen Kumar Maheshwari, New Delhi V. ITO, New Delhi

ITA 6480/DEL/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6611 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 22-11-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 05-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: UMESH CHAND DUBEY
• Section: 144

Judgement Text

1 ITA NO. 6480/DEL/2013 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: D NEW DELHI BEFORE SHRI N. K. SAINI, ACCOUNTAN T MEMBER AND MS SUCHITRA KAMBLE, JUDICIAL MEMBER I.T.A .NO. 6480/DEL/2013 (ASSESSM ENT YEAR-2008-09) PRAVEEN KUMAR MAHESHWARI 8875/2, MULTANI DHANDA, PAHAR GANJ, NEW DELHI AAKPM1582B (APPELLANT) VS ITO WARD-39(4) NEW DELHI (RESPONDENT) APPELLANT BY SH. SATYAJIT GOEL, CA RESPONDENT BY SH. UMESH CHAND DUBEY, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 20/09/2013 PASSED BY CIT(A)-XXVIII, NEW DELHI. 2. THE GROUNDS OF APPEAL ARE AS FOLLOWS: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE CIT(A) WAS NOT JUSTIFIED IN CONFIRMING PENALTY IN RESPECT OF ESTIM ATED ADDITIONS MADE BY THE ASSESSING OFFICER AS PER DETAILS GIVEN IN PARA 5.1 TO 5.3 OF THE APPELLATE ORDER. DATE OF HEARING 22.11.2016 DATE OF PRONOUNCEMENT 30.11.2016 2 ITA NO. 6480/DEL/2013 2. THAT THERE IS NO CASE OF ANY CONCEALMENT OR FURN ISHING OF INACCURATE PARTICULARS AND MERELY ON ACCOUNT OF ADDITIONS MADE BY THE ASSESSING OFFICER, THERE CANNOT BE A CASE OF PENALTY U/S. 271 (1)(C). 3. THAT ORDERS OF THE LOWER AUTHORITIES ARE NOT JUS TIFIED ON FACTS AND SAME ARE BAD IN LAW. 3. THE ASSESSMENT IN THE PRESENT CASE WAS COMPLETED U/S 144 OF THE INCOME-TAX ACT 1961 AT AN INCOME OF RS.3,64,860/- O N 16/12/2010 AS AGAINST RETURN INCOME OF RS.1,04,863/- AFTER MAKING TOTAL A DDITION OF RS.2,60,000/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE PR OFIT WAS ESTIMATED BY APPLYING NET PROFIT RATE OF 12.52% ON THE CASH DEPO SITED IN THE BANK WHICH COMES TO RS.2,60,000/- BY THE ASSESSING OFFICER. TH E SAME WAS ADDED TO THE DECLARED TAXABLE INCOME OF THE ASSESSEE. THE ASSES SEE FILED APPEAL BEFORE THE CIT(A) WHO ALSO CONFIRMED THE ORDER OF THE ASSESSIN G OFFICER. THE ASSESSEE ACCEPTED THE ADDITIONS AND PROMPTLY DEPOSITED ON 12 /1/2011 THE DUE TAX OF RS.80,767/- AGAINST DEMAND RAISED VIDE ORDER DATED 16/12/2010. THE ASSESSING OFFICER LEVIED PENALTY OF RS.60,722/- BEI NG 100% OF TAX U/S 271(1)(C). 4. THE PENALTY ORDER OF THE ASSESSING OFFICER WAS C ONFIRMED BY THE LD. CIT(A). NOW THE ASSESSEE IS IN APPEAL. 5. THE LD. AR SUBMITTED THAT THE ASSESSEE HAS NOT M ADE ANY INACCURATE PARTICULARS OR CONCEALED ANY INCOME. THE ASSESSING OFFICER HAS DONE ESTIMATION ON THE ESTIMATE BASIS ON BANK DEPOSITS F OR GP RATE. THE LD. AR RELIED UPON THE ORDER DATED 4/11/2015 IN CASE OF MA NMOHAN VS. ITO PASSED BY ITAT DELHI BENCH IN I.T. A. NO. 315/DEL/2014 FOR THE A.Y. 2009-10 WHEREIN IT IS STATED THAT MERE FACT WITH AN ADDITION HAS BE EN ACCEPTED OR IS CONFIRMED BEING QUANTUM PROCEEDINGS CANNOT BE CONCLUSION OF T HE IMPOSITION OF PENALTY AND THAT NO PENALTY U/S. 271(1)(C) OF THE ACT CAN B E IMPOSED WHEN INCOME IS DETERMINED ON ESTIMATE BASIS. IN THE SAID DECISION THE RELIANCE WAS PLACED ON THE JUDGMENT OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF DURGA KANAL RICE MILLS VS. CIT 2004 265 ITR 25 (CAL) WHEREIN IT HAS BEEN HELD THAT 3 ITA NO. 6480/DEL/2013 QUANTUM PROCEEDINGS ARE DIFFERENT FROM PENALTY PROC EEDINGS AS WELL AS ONE MORE CASE OF HONBLE KERALA HIGH COURT IN CIT VS. P . K. NARAYAN 1999 238 ITR 905 (KERALA) WHEREIN IT WAS HELD THAT DESPITE THE A DDITION BEING CONFIRMED BY THE TRIBUNAL IN QUANTUM PROCEEDINGS, THE PENALTY CA N STILL BE DELETED BY THE TRIBUNAL, IF THE FACTS ARE JUSTIFIED 5. THE LD. DR RELIED UPON THE PENALTY ORDER AND CIT (A)S ORDER. 6. WE HAVE PERUSED ALL THE RECORDS AND HEARD BOTH T HE PARTIES. THE PENALTY PROCEEDINGS HAVE BEEN INITIATED ON THE GROSS PROFIT DECLARED BY THE ASSESSEE BEING TOO LOW, TAKING COGNIZANCE OF THE QUANTUM ASS ESSMENT MERELY ON THE GROUND THAT THE ASSESSEE FILED INCORRECT STATEMENTS AND FURNISHING INACCURATE PARTICULARS FOR CONCEALMENT OF INCOME. BUT THERE IS NOTHING TO SHOW ON RECORD THAT THE ASSESSEE FILED ANY INCORRECT DETAILS OR FU RNISHED ANY INACCURATE PARTICULARS OF THE RECORDS. THE DOCUMENTS AND THE D ETAILS WERE AVAILABLE BEFORE THE ASSESSING OFFICER AS RELATES TO GROSS PROFIT TA KEN BY THE ASSESSEE AS WELL AS BY THE ASSESSING OFFICER ON CASH DEPOSITED IN THE B ANK. MERELY PAYING THE TAX AFTER ASSESSMENT IS COMPLETE, DOES NOT CONCLUDE THA T THERE IS CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF I NCOME. THE GP RATE GIVEN BY THE ASSESSING OFFICER IS ALSO ON THE ESTIMATED BASI S WHICH DOES NOT MENTION THAT IT IS CONCEALMENT. THE PENALTY CANNOT BE LEVIE D IN RESPECT OF ADDITION MADE ON ESTIMATE BASIS. THEREFORE, CIT (A) AS WELL AS T HE ASSESSING OFFICER HAS WRONGLY IMPOSED PENALTY ON THE ASSESSEE, THE SAME I S DELETED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH NOVEMBER, 2016 . SD/- SD/- (N. K. SAINI) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL ME MBER 4 ITA NO. 6480/DEL/2013 DATED: 30/11/2016 R. NAHEED * COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 22/11/2016 PS 2. DRAFT PLACED BEFORE AUTHOR 22/11/2016 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER .2016 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 30.11.2016 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 30.11.2016 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 5 ITA NO. 6480/DEL/2013