LAFFANS PETROCHEMICALS LTD, MUMBAI V. DCIT 8(2), MUMBAI

ITA 666/MUM/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2422 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 19-07-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 30-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B S BIST
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D, MUMBAI BEFORE SHRI B.R.BASKARAN (AM) AND SHRI RAM LAL NEGI (JM) ITA NO 666/MUM/2015 ASSESSMENT YEAR: 2008-09 LAFFANS PETROCHEMICALS LTD., 10, LUTHRA INDL, COMPLEX, ANDHERI KURLA ROAD, SAFED PHOOL, MUMBAI- 400 072. PAN:- AAACL0645D VS. THE DY. CIT - 8( 2 ), AAYAKAR BHAVAN, ROOM NO. 216(A), M.K.ROAD, MUMBAI- 400 020. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. SHEKHAR GUPTA. RESPONDENT BY : SHRI. B.S.BIST. DATE OF HEARING: 1 9 /07/ 2016 DATE OF PRONOUNCEMENT: 22/07/20 16 O R D E R PER RAM LAL NEGI, JM THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AG AINST ORDER DATED 18/12/2014 PASSED BY THE LD. CIT(APPEALS)-17 MUMBAI FOR THE ASST. YEAR 2008-09, WHEREBY THE LD. CIT(A) CONFIRMED THE PENAL TY LEVIED ON THE ASSESSEE U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WITH REGARD TO DEPRECIATION CLAIMED BY THE ASSESSEE ON BUILDING AN D ELECTRICAL FITTINGS. 2. THE APPELLANT/ASSESSEE HAS CHALLENGED THE IMPUG NED ORDER ON THE FOLLOWING EFFECTIVE GROUNDS:- 2 ITA NO 666/MUM/2015 ASSESSMENT YEAR: 2008-09 1. THE LEARNED CIT(APPEALS) HAS ERRED IN LAW AND ON THE FACTS OF THE CASE IN SUSTAINING THE PENALTY U/S 271(1)(C) ALTHOU GH THE QUANTUM APPEAL WAS PENDING BEFORE THE TRIBUNAL. 2. THE LEARNED CIT(APPEALS) HAS ERRED IN LAW AND ON THE FACTS OF THE CASE IN SUSTAINING THE PENALTY U/S 271(1)(C) WITH R EGARD TO DEPRECIATION CLAIMED BY THE ASSESSEE ON BUILDING AN D ELECTRICAL FITTINGS. 3. AT THE VERY OUTSET THE LD. AUTHORISED REPRESENT ATIVE (AR) OF THE ASSESSEE SUBMITTED THAT THE QUANTUM APPEAL IN THIS CASE HAS BEEN ALLOWED BY THE A BENCH OF THE MUMBAI ITAT AND SINCE THE SAME HAS BEE N DECIDED IN FAVOUR OF THE ASSESSEE, THE PENALTY APPEAL DOES NOT SURVIVE. THEREFORE THE PRESENT APPEAL DESERVES DISMISSAL ON THIS SCORE ONLY. THE ASSESSEE ALSO FILED THE COPY OF ORDER DATED 20/02/2015 PASSED BY THE CO-ORDINATE BENCH IN QUANTUM APPEAL, LAFFANS PETROCHEMICALS LTD. VS. DY. CIT CIR. 8(2) ITA NO. 1221/MUM/2012 FOR A.Y. 2008-09 PLACED ON RECORD. 4. WE HAVE GONE THROUGH THE RECORD, WE NOTICE THAT THE CO-ORDINATE BENCH HAS ALLOWED THE QUANTUM APPEAL OF THE ASSESSEE HOLDING AS UNDER:- 6. WE FOUND THAT THE PAYMENT OF RS. 1,00,940/- TO S CIENTIFIC SALES CORPORATION WAS MADE ON ACCOUNT OF COOLING BATH WHI CH INVOLVES REPLACEMENT OF COMPRESSOR, THERMOSTAT AND REFILLING OF GAS. WE HAVE VERIFIED INVOICE NO. JKM/24243/07 DATED 06/08/2007 ISSUED BY M/S. SCEINTIFIC SALES CORPORATION PLACED ON RECORD AND FOUND THAT PAYMENT WAS MADE ON ACCOUNT OF PURCHASE OF THESE IT EMS ON WHICH CST AT 3% WAS PAID, ACCORDINGLY IT DID NOT REQUIRE ANY DEDUCTION OF 3 ITA NO 666/MUM/2015 ASSESSMENT YEAR: 2008-09 TAX AT SOURCE. WE THEREFORE DIRECT TO A.O. TO DELET E THE DISALLOWANCE OF RS. 1,00,940/- WHICH WAS ON ACCOUNT OF PURCHASE OF COOLING BATH. 7. IN RESPECT OF PAYMENT MADE TO EXODUS CHEMTANK P VT. LTD., WE FOUND THAT THE PAYMENT WAS MADE TO A FOREIGN SHIPPI NG COMPANY THROUGH AN AGENT, HENCE PROVISIONS OF SECTION 194-C OF THE ACT IS NOT APPLICABLE. FOR THIS PURPOSE, A CERTIFICATE FORM AS STT. DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION) WAS ALSO PRODUC ED AS REQUIRED U/S 172 OF THE ACT. ACCORDINGLY WE DO NOT FIND ANY MERIT FOR THE DISALLOWANCE OF PAYMENT MADE ON ACCOUNT OF FREIGHT, FORWARDING AND CLEARING CHARGES PAID TO THE FOREIGN SHIPPING C OMPANY THROUGH ITS AGENT. THE A.O.IS DIRECTED TO DELETE THE DISALL OWANCE SO MADE U/S 40(A)(IA) OF THE ACT. 5. IN VIEW OF THE FACT THAT THE TRIBUNAL HAS ALLOW ED THE APPEAL FILED BY THE APPELLANT/ASSESSEE AGAINST THE ORDER OF THE CIT(A) AND DIRECTED THE A.O. TO DELETE THE DISALLOWANCES MADE U/S 40(A)(IA) OF THE ACT, THE IMPUGNED PENALTY ORDER DOES NOT SURVIVE. ACCORDINGLY WE SET ASIDE TH E IMPUGNED ORDER PASSED BY THE LD. CIT(A) AND ALLOW THE APPEAL FILED BY THE AS SESSEE. 6. IN THE RESULT APPEAL FILED BY THE ASSESSEE FOR A.Y. 2008-09 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JULY, 2016 SD/- SD/- ( B.R.BASKARAN ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED: 22/07/2016 4 ITA NO 666/MUM/2015 ASSESSMENT YEAR: 2008-09 / 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 PRAMILA