VIJAY KUMAR H. GUPTA, MUMBAI V. ASST CIT CIR 15(1), MUMBAI

ITA 6713/MUM/2016

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 9904 (ITAT-MUMBAI)
• Duration Of Justice: 9 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 16-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR LD
• Assessee Lawyers: PRAKASH JHUNJHUNWAL LD
• Section: 143(3)

Judgement Text

ITA NO 6713/MUM/2016 VIJAY KUMAR H.GUPTA ASSESSMENT YEAR 2007-08 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI . . , , BEFORE SHRI D.T. GARASIA, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./I.T.A. NO. 6713/MUM/2016 ( / ASSESSMENT YEAR: 2007-08) VIJAY KUMAR H.GUPTA 401,ROYAL CHAMBERS OPP. CLUB MILLENIUM GULMOHUR ROAD,JVPD VILE PARLE,MUMBAI 400 049 / VS. ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 15(1) BANDRA KURLA COMPLEX MUMBAI ! ./ ./PAN/GIR NO. AABPG-8011-G ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) ASSESSEE BY : PRAKASH JHUNJHUNWAL LD. AR REVENUE BY : SUMAN KUMAR, LD. DR / DATE OF HEARING : 17/08/2017 / DATE OF PRONOUNCEMENT : 06 /09/2017 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. THE CAPTIONED APPEAL BY ASSESSEE FOR ASSESSMENT YEAR [AY] 2007-08 ASSAILS THE ORDER OF LD. COMMISSIONER OF IN COME TAX (APPEALS)-37 [CIT(A)], MUMBAI DATED 16/08/2016 QUA CONFIRMATION OF PENALTY U/S 271(1)(C). THE REGISTRY HAS NOTED THAT THE APPEAL HAS BEEN ITA NO 6713/MUM/2016 VIJAY KUMAR H.GUPTA ASSESSMENT YEAR 2007-08 2 FILED WITH A DELAY OF 2 DAYS AND THE ASSESSEE HAS P RAYED FOR CONDONATION OF THE SAME WHICH IS DULY SUPPORTED BY THE AFFIDAVIT DATED 16/08/2017. KEEPING IN VIEW THE DELAY BEING ONLY OF TWO DAYS, THE SAME IS CONDONED. 2. FACTS LEADING TO THE SAME ARE THAT THE ASSESSEE BEING RESIDENT INDIVIDUAL DEALING IN IRON & STEEL UNDER PROPRIETORSHIP CONCERN NAMELY BOMBAY STEEL WAS ASSESSED U/S 143(3) FOR IMPUGNED AY ON 27/11/20 09 AT RS.30,41,303/- AFTER CERTAIN ADDITIONS / DISALLO WANCES AS AGAINST RETURNED INCOME OF RS.16,71,100/- FILED BY THE ASSE SSEE ON 26/10/2007. THE ASSESSEE SUFFERED VARIOUS ADDITIONS AGGREGATING TO RS.13,70,204/- ON ACCOUNT OF UN-RECONCILED DIFFERENCES, COMMISSION PAID TO HUF, PERSONAL EXPENSES AND CERTAIN ADHOC EXPENSE ADDITIO NS. THE QUANTUM ADDITION, UPON APPEAL TO FIRST APPELLATE AUTHORITY, WAS REDUCED TO RS.12,92,017/-. CONSEQUENTLY, PENALTY U/S 271(1)(C) WAS INITIATED IN THE QUANTUM PROCEEDINGS AND THE ASSESSEE WAS SADDLED WI TH PENALTY OF RS.3,67,372/- VIDE ORDER DATED 26/03/2014 AGAINST F OLLOWING ADDITIONS:- 3. AGGRIEVED, THE ASSESSEE CONTESTED THE PENALTY WI TH PARTIAL SUCCESS BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 16/08/2 016 WHERE LD. CIT(A) NOTED THAT THE QUANTUM ADDITION AGAINST COMM ISSION, UPON FURTHER APPEAL BY ASSESSEE, WAS DELETED BY THIS TRI BUNAL AND THEREFORE, THE PENALTY TO THAT EXTENT DO NOT SURVIVE. HOWEVER, THE PENALTY WAS NO. NATURE AMOUNT (RS.) 1. ON ACCOUNT OF DIFFERENCES NOT RECONCILED 4,76,80 1/- 2. ON ACCOUNT OF DISALLOWANCE OF COMMISSION TO HUF 6,04,024/- TOTAL 10,80,825/- ITA NO 6713/MUM/2016 VIJAY KUMAR H.GUPTA ASSESSMENT YEAR 2007-08 3 UPHELD ON THE BALANCE ADDITION, AGAINST WHICH THE A SSESSEE IS IN FURTHER APPEAL BEFORE US. 4. THE LD. COUNSEL FOR ASSESSEE [AR] WHILE DRAWING OUR ATTENTION TO THE DOCUMENTS PLACED IN THE PAPER BOOK SUBMITTED THAT THE ASSESSEE HAS BEEN SADDLED WITH IMPUGNED PENALTY DUE TO DIFFE RENCE IN LEDGER BALANCES OF THREE SUNDRY CREDITORS. THE MAJOR ADDIT ION PERTAINED TO OPENING BALANCE OF RS.4,36,935/- REFLECTED BY THE A SSESSEE IN HIS BOOKS AGAINST ONE PARTY NAMELY BHUSHAN POWERS & STEEL LIMITED AS AGAINST NIL SHOWN BY THE SAID SUPPLIER. THE LD. AR EXPLAINED TH AT THE DIFFERENCE AROSE ONLY DUE TO ISSUANCE OF DISCOUNTS / REBATES E TC. AND THERE WAS NO REMISSION / CESSATION OF LIABILITY WITHIN THE MEANI NG OF SECTION 41(1). HOWEVER, THE ADDITION WAS NOT OF SUCH A NATURE SO A S TO ATTRACT PENALTY U/S 271(1)(C) SINCE THERE WAS NO FURNISHING OF INAC CURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME. PER CONTRA, LD. DR SUPPORTED THE CONFIRMATION OF PENALTY BY LD. CIT(A). 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIO N AND PERUSED RELEVANT MATERIAL ON RECORD. UPON PERUSAL OF RESPEC TIVE LEDGER EXTRACTS, WE FIND THAT THE ASSESSEE HAS REGULAR BUSINESS DEAL ING WITH THE SAID CREDITORS AND MAKING PURCHASES FROM THEM FROM TIME TO TIME AND RECEIVING DISCOUNTS ETC. FROM THESE CREDITORS. FURT HER, THE MAJOR DIFFERENCE OF RS.4,36,935/- REPRESENT DIFFERENCE OF OPENING BALANCE AGAINST ONE CREDITOR AND THE LD. AR HAS ATTRIBUTED THE SAME TO DISCOUNT RECEIVED BY THE ASSESSEE. HENCE, THE DIFFERENCE WAS ONLY A MATTER OF RECONCILIATION. THEREFORE, WE ARE OF THE CONSIDERED OPINION THAT THE NATURE OF ADDITION DO NOT CALL FOR IMPOSITION OF AN Y PENALTY SINCE THERE ITA NO 6713/MUM/2016 VIJAY KUMAR H.GUPTA ASSESSMENT YEAR 2007-08 4 WERE NO FURNISHING OF INACCURATE PARTICULARS OF INC OME BY THE ASSESSEE OR CONCEALMENT OF INCOME WITHIN THE MEANING OF SECT ION 271(1)(C). THEREFORE, BY DELETING THE SAME, WE ALLOW ASSESSEE S APPEAL. 6. RESULTANTLY, THE APPEAL FILED BY THE ASSESSEE S TANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 06 TH SEPTEMBER, 2017. SD/- SD/- (D.T. GARASIA) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 06. 09.2017 SR.PS:- THIRUMALESH ! / COPY OF THE ORDER FORWARDED TO : 1. !# / THE APPELLANT 2. $%!# / THE RESPONDENT 3. , ( ) / THE CIT(A) 4. , / CIT CONCERNED 5. $'. , . , / DR, ITAT, MUMBAI 6. / / GUARD FILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI