M/S LAVINO KAPUR COTTONS PVT LTD., MUMBAI V. DCIT 3 (2)(1), MUMBAI

ITA 6548/MUM/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3580 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 16-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 271(1)(c); 142(1); 115JB; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE SHRI M. BALAGANESH , AM AND SHRI AMARJIT SINGH, JM (HEARING THROUGH VIDEO CONFERENCING MODE) / I .T.A. NO. 6548 /MUM/20 19 ( / ASSESSMENT YEAR: 2013 - 14 ) M/S. LAVINO KAPUR COTTONS PVT. LTD. 121/122, MITTAL CHAMBERS, NARIMAN POINT, MUMBAI - 400021 . / VS. DCIT - 3(2)(1) AAYAKAR BHAVAN, M. K. ROAD, CHURCHGATE, MUMBAI - 400020. ./ ./ PAN/GIR NO. : AAACL08 24C ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING : 16 /08/2021 / DATE OF P RONOUNCEMENT : 08 /10 /2021 / O R D E R PER AMARJIT SINGH, J M: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 11 . 07 .201 9 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 08 , MUMBAI [HEREINAFTE R REFERRED TO AS THE C IT(A)] RELEVANT TO THE A.Y. 2013 - 14 IN WHICH THE PENALTY LEVIED BY AO HAS BEEN ORDERED TO BE CONFIRMED . 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: - 1.A) THAT THE C.I.T.(APPEALS) HAS ERRED IN CONFIRMING THE PENALTY OF RS.3,89,137/ - IMPOSED U/S 271 (L)(C) BY THE ASSESSING OFFICER. ASSESSEE BY : SHRI SURINDER MEHRA REVENUE BY: SHRI BRAJENDRA KUMAR (DR) ITA. NO .6548 /M UM /20 19 A.Y. 2013 - 14 2 B) THAT THE SAID PENALTY OF RS. 3,89,137/ - PERTAINS TO ADDITION OF RS. 12,97,123/ - MADE ON ACCOUNT OF DISALLOWANCE OF INTEREST PAID ON LATE PAYMENT OF SERVICE TAX OF RS.10,59,401/ - AND INTEREST ON LATE PAYMENT OF SERVICE AN D PROFESSION TAX AGGREGATING TO RS. 2,37,732/ - . C) THAT IN LETTER DATED 24.12.2015 THE APPELLANT COMPANY HAD SUO MOTO STATED THAT THE SAID INTEREST PAID AGGREGATING TO RS. 12,97.123/ - WAS NOT DISALLOWED THROUGH AN OVERSIGHT AT THE TIME OF FILING THE RETURN OF INCOME AND THE SAME MAY HE ADDED TO THE INCOME RETURNED. D) THAT THE SAID DISCLOSURE WAS TOTALLY SUO MOTO AND NOT ON ACCOUNT OF ANY DISCOVERY BY THE INCOME - TAX DEPARTMENT. E) THAT IN VIEW OF THE SAID BONA FIDE VOLUNTARY DISCLOSURE MADE BY THE APPELLANT NO PENALTY SHOULD HAVE BEEN LEVIED. F) THAT THE C.I.T.(A) HAS ERRED IN PLACING RELIANCE ON DECISION OF THE SUPREME COURT IN THE CASE OF MAK DATA (P.) LTD. REPORTED IN 358 ITR 593 WHICH WAS A CASE OF DISCLOSURE MADE AFTER DETECTION BY THE DEPARTMENT. G) TH AT IN THE PRESENT EASE THERE WAS NO DETECTION BY THE DEPARTMENT AND THE DISCLOSURE MADE WAS VOLUNTARY AND AS SUCH THE FACTS AND CASE LAW OF THE SAID EASE ARE NOT APPLICABLE TO THE PRESENT EASE AND THE PENALTY IMPOSED MAY BE CANCELLED. ' 4 . THE BRIEF FACTS O F THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 23 .09.20 14 DECLARING TOTAL I NCO ME TO THE TUNE OF RS.18,76,28,150/ - FOR THE A.Y.2014 - 15 . THE REAFTER, THE CASE WAS SELECTED FOR SCRUTINY UNDER CASS. NOTICES U/S 143(2) & 142(1) OF THE ACT WERE ITA. NO .6548 /M UM /20 19 A.Y. 2013 - 14 3 IS SUED AND SERVED UPON THE ASSESSEE. THE ASSESSEE COMPANY WAS ENGAGED IN THE BUSINESS OF ABSORBENT COTTON AND FINISHED PRODUCTS THEREFROM AND EXPORT OF THE SAME. THE ASSESSEE WAS HAVING 100% EXPORT ORIENTED UNIT SITUATED AT TARAPUR AND ALL THE PRODUCTS MANUF ACTURED WERE EXPORTED OUT OF INDIA. AFTER CERTAIN DISALLOWANCE, THE ASSESSMENT WAS COMPLETED BY ASSESSING THE INCOME IN SUM OF RS.18,79,79,349/ - AND BOOK PROFIT U/S 115JB OF THE ACT TO THE TUNE OF RS.16,09,10,379/ - . FEELING AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO PARTLY ALLOWED THE CLAIM OF THE ASSESSEE BUT THE CIT(A) SUSTAINED THE ADDITION ON ACCOUNT OF INTEREST PAID ON LATE PAYMENT OF SERVICE TAX, PROFES SION TAX ETC. OF RS.12,97,123/ - . THE PENALTY PROCEEDING WAS INITIATED. NOTICE WAS GIVEN AND AFTER THE REPLY OF THE ASSESSEE, THE PENALTY TO THE TUNE OF RS.3,89,137/ - WAS LEVIED . THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO UPHELD THE PENALTY, THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. 5. THE LEARNED REPRESENT ATIVE OF THE ASSESSEE HAS ARGUED THAT THE PRESENT APPEAL HAS BEEN FILED DELAYED FOR THE PERIOD OF 7 DAYS. THE ASSESSEE FILED AN APPLICATION ALONG WITH AN AFFIDAVIT STATING THAT THE APPEAL FILED WAS DELAYED AS SHRI SURINDER MEHRA, CA, WHO IS PREPARING THE A BOVE APPEAL WAS ON LEAVE FROM 28.09.2019 T O 08.10.2019. THE ASSESSEE MENTIONED THE REASON FOR THE DELAY IN THE APPLICATION AS WELL AS AFFIDAVIT. SINCE THE DELAY IS FOR THE PERIOD OF ONLY 7 DAYS WHICH IS NOT SO LONG THEREFORE WE ARE OF THE VIEW THAT THE TH AT THE DELAY IS LIABLE TO BE CONDONED. MOREOVER, ON APPRAISAL OF THE APPEAL, WE ARE OF THE VIEW THAT THE CASE IS REQUIRED TO BE DECIDED ON MERITS, THEREFORE THE DELAY FOR THE 7 DAYS IN FILING OF PRESENT APPEAL IS HEREBY CONDONED. ITA. NO .6548 /M UM /20 19 A.Y. 2013 - 14 4 5 . WE HAVE HEARD THE AR GUMENT ADVANCED BY THE LD. REPRESENTATIVE OF THE PARTIES AND PERUSED THE RECO R D. THE CERTAIN CLAIM OF THE ASSESSEE WAS DISALLOWED AND THEREAFTER, THE ASSESSMENT WAS COMPLETED BY ASSESSING THE TOTAL INCOME TO THE TUNE OF RS. 18,79,79,349/ - . THE ASSESSEE FILE D AN APPEAL BEFORE THE CIT(A) WHO PARTLY ALLOWED THE CLAIM OF THE ASSESSEE BUT SUSTAINED THE DISALLOWANCE ON INTEREST PAID ON LATE PAYMENT OF SERVICE TAX, PROFESSION TAX ETC. OF RS.12,97,123/ - . THE S ECTION 271(1(C) REVEALS THAT (1) IF THE ASSESSING OFFICER OR THE COMMISSIONER (APPEALS) (OR THE (PRINCIPAL COMMISSIONER OR) COMMISSIONER) IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT, IS SATISFIED THAT ANY PERSON - (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCO ME OR). 6. ON APPRAISAL OF THE ABOVE SAID FINDING OF LD. CIT(A) , WE NOWHERE FOUND THE CASE OF THE ASSES SEE COMES WITHIN THE AMBIT OF CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME I.E. WITHIN THE AMBIT OF 271(1)(C) OF THE ACT . DISALLOWANCE OF ANY CLAIM NOWHERE ATTRACT THE PENALTY IN ACCORDANCE WITH LAW. IN THIS REGARD, WE ALSO FOUND SUPPORT OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF RELIANCE PETROPRODUCT VS. CIT (P) LTD. 322 ITR 158 SC. TAKING INTO ACCOU NT OF ALL THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT THE FINDING OF THE CIT(A) IS NOT JUSTIFIABLE, HENCE, THE SAME IS HEREBY ORDERED TO BE SET ASIDE. ACCORDINGLY, WE DELETE THE PENALTY. ITA. NO .6548 /M UM /20 19 A.Y. 2013 - 14 5 7 . IN THE RESULT, THE APPEAL FILED BY THE ASSE SSEE IS HEREBY ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 08 / 10 / 20 2 1 SD/ - SD/ - ( M. BALAGANESH ) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 08 /10 /2021 V IJAY PAL SINGH (SR. PS) / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, //TRUE COPY// / / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI