A. G. VISION PVT. LTD. (A. G. VISION LLP), MUMBAI V. A.C.I.T. CIRCLE - 11(1), MUMBAI

ITA 6637/MUM/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 6063 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 17-11-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M R
• Assessee Lawyers: NARAYAN ATAL
• Keywords: Rectification of order; Wrong claim; Onus to prove
• Section: 271(1)(c); 143(3); 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A MUMBAI BEFORE SHRI JOGINDER SINGH ( VICE PRESIDENT ) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 6637 /MUM/2017 ASSESSMENT YEAR: 2010 - 11 M/S A.G. VISION PVT. LTD. (A.G. VISION LLP) 1 ST F LOOR, EMPIRE, HOUSE, 10, SHAH INDUSTRIAL ESTATE, VEERA DESAI ROAD, ANDHERI WEST, MUMBAI - 400053. VS. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE - 11(1), 4 TH FLOOR, AAYAKAR BHAVAN, MUMBAI - 400020. PAN NO. AAACA5232H APPELLANT RESPONDENT ASSESSEE BY : MR. NARAYAN ATAL, AR REVENUE BY : MR. PANKAJ KUMAR , DR DATE OF HEARING : 03/ 0 1 /201 9 DATE OF PRONOUNCEMENT : 22/01/2019 ORDER PER N.K. PRADHAN, AM THIS IS AN APPEAL FILED BY THE ASSESSEE . THE RELEVANT ASSESSMENT YEAR IS 2010 - 11 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISS IONER OF INCOME TAX (APPEALS) - 6 , MUMBAI [IN SHORT CIT(A)] AND ARISES OUT OF THE PENALTY LEVIED U/S 271(1)(C) OF THE INCOME TAX ACT 1961, (THE ACT) . 2. IN THE GROUND OF APPEAL, THE ASSESSEE HAS RAISED OBJECTION TO THE ORDER OF THE LD. CIT(A) CONFIRMING THE PENALTY OF RS.1,68,936/ - LEVIED BY THE AO U/S 271(1)(C) OF THE ACT. M/S A.G. VISION ITA NO. 6637/MUM/2017 2 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETU RN OF INCOME FOR THE ASSESSMENT YEAR (AY) 2010 - 11 ON 17.09.2010 DECLARING A TOTAL INCOME OF RS.47,48,560/ - . THE ASSESSING OFFICER (AO) COMPLETED THE ASSESSMENT U/S 143(3) ON 29.01.2013 DETERMINING THE TOTAL INCOME AT RS.56, 06, 350/ - . THEREAFTER, THE AO INIT IATED PENALTY PROCEEDINGS IN RESPECT OF DISALLOWANCE OF LONG TERM CAPITAL LOSS CLAIMED INTRA - HEAD AGAINST SHORT TERM CAPITAL GAINS. THE RELEVANT PORTION OF THE ASSESSMENT ORDER, RELIED ON BY THE AO IS AS UNDER: DURING THE YEAR UNDER CONSIDERATION, THE AS SESSEE HAS CLAIMED SET OFF OF LONG TERM CAPITAL LOSS OF RS.5,46,720/ - FOR THE YEAR 2009 - 10 FROM THE SHORT TERM CAPITAL GAIN, WHICH IS NOT IN ACCORDANCE WITH THE PROVISIONS OF THE INCOME TAX ACT, 1961. THEREFORE, AMOUNT OF THE LONG TERM CAPITAL LOSS CLAIMED AS SET OFF IS DISALLOWED AND ADDED BACK TO THE INCOME OF THE ASSESSEE AND CHARGED TO TAX ACCORDINGLY. THE AMOUNT OF DISALLOWANCE IS RS.5,46,720/ - , WHICH IS ADDED BACK TO THE TOTAL INCOME. PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT ARE BEING INITIATED SE PARATELY FOR CONCEALMENT OF INCOME AND FILING INACCURATE PARTICULARS OF INCOME. THE AO HELD THAT THE ASSESSEE SOUGHT TO BE EVADE TAX ON THE ABOVE AMOUNT OF RS.5,46,720/ - . ACCORDINGLY, HE LEVIED A MINIMUM PENALTY OF RS.1,68,936/ - U/S 271(1)(C) OF THE ACT. 4. A GGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) DISMISSED THE APPEAL FILED BY THE ASSESSEE WITH THE FOLLOWING OBSERVATIONS: THE APPELLANT, IN ITS SUBMISSION, HAS ALSO RELIED UPON THE DECISIONS IN THE CASES OF GEM GRANITES V. DCIT (SUPRA), WHICH IS IN RESPECT OF ONUS TO PROVE THERE WAS CONCEALMENT OF INCOME WITH A VIEW TO EVADE TAXES. IN THIS CASE M/S A.G. VISION ITA NO. 6637/MUM/2017 3 CLAIM OF SET OFF LONG TERM CAPITAL LOSS AGAINST SHORT TERM GAIN COULD BE NOTHING BUT TO REDUCE INCIDENC E OF TAX AND THEREBY EVADE TAX TO THAT EXTENT. THE APPELLANT HAS ALSO RELIED UPON THE DECISION IN THE CASE OF CIT V. M.B. ENGG. WORKS PVT. LTD. WHICH IS IN RESPECT OF BRIN G ING SUFFICIENT MATERIAL ON RECORD FOR IMPOSITION OF PENALTY. IN THIS THE APPELLANT H AS MADE A PATENTLY WRONG CLAIM, THERE IS NO FURTHER MATERIAL REQUIRED TO BE BROUGHT ON RECORD. THE APPELLANT HAS ALSO RELIED UPON THE DECISION IN THE CASE OF BURMAH - SHELL OIL STORAGE AND DISTRIBUTION COMPANY OF INDIA LTD. V. ITO (SUPRA), WHICH IS IN RESPEC T OF MERE REJECTION OF ASSESSEES CLAIM BEING NOT SUFFICIENT FOR IMPOSITION OF PENALTY. THIS ISSUE HAS BEEN DEALT IN HERE IN ABOVE AND RELIANCE IS PLACED ON THE DECISION OF CIT V. HCIL KALINDEE ARSSPL (SUPRA). IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND DISCUSSION HEREINABOVE, THE CONTENTIONS AND SUBMISSIONS OF THE APPELLANT ARE NOT FOUND TO BE ACCEPTABLE AND ARE ACCORDINGLY REJECTED AND THE PENALTY SO IMPOSED BY THE AO IS THEREFORE CONFIRMED. 5. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE SUBMITS THAT THE AO HAS PASSED A RECTIFICATION ORDER U/S 154 ON 06.11.2017 AND THEREFORE, THE PENALTY DOES NOT SURVIVE. ON THE OTHER HAND, THE LD. DR. RELIES ON THE ORDER PASSED BY THE LD. CIT(A). 6. WE HAVE HE ARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. WE FIND THAT THE AO VIDE ORDER DATED 06.11.2017 HAS ALLOWED THE SET OFF OF BROUGHT FORWARD LONG TERM CAPITAL LOSS AND SHORT TERM CAPITAL LOSS PERTAINING TO THE AY 2009 - 10 TO THE EXTENT INCOME AVAILABLE I.E. RS.5,46,720/ - . M/S A.G. VISION ITA NO. 6637/MUM/2017 4 THE AO PASSED THE PENALTY ORDER ON 30.07.2013. T HE LD. CIT(A) PASSED THE APPELLATE ORDER ON 18.09.2017. THEREAFTER, THE AO PASSED A RECTIFICATION ORDER U/S 154 ON 06.11.2017 ALLOWING THE ABOVE SET OFF OF RS.5,46,720/ - . THEREFORE, THE PENALTY OR RS.1,68,936/ - CONFIRMED BY THE LD. CIT(A) DOES NOT SURVIVE. 7. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 22/01/2019. SD/ - SD/ - ( JOGINDER SINGH ) (N.K. PRADHAN) VICE PRESIDENT ACCOUNTANT MEMBER MUMBAI ; DATED: 22/01/2019 RAHUL SHARMA, SR. P.S. 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// (SR. PRIVATE SECRETARY) ITAT, MUMBAI