DCIT 9(2), MUMBAI V. MEERA COTTON SYNTHETICS MILLS P.LTD, MUMBAI

ITA 7007/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 2778 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 02-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revised return
• Section: 143(3); 142(1)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B, MUMBAI , , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.7007/MUM/2013 ASSESSMENT YEAR- 2006-07 DCIT-9(2), R. NO.218, 2 ND FLOOR, AAYAKAR BHAVAN, M.K.ROAD, MUMBAI-400020 / VS. M/S MEERA COTTON & SYNTHETICS MILLS PVT. LTD., 401, 402, EXPRESS ZONE, W.E. HIGHWAY, A.W. OPPORTUNITY, RELIANCE OFFICE, NEAR PATEL UANIKA, MALAD (EAST), MUMBAI-400097 ( / REVENUE) ( !'# $ /ASSESSEE) PAN. NO. AABCM8385J / REVENUE BY SHRI VIJAY KUMAR SONI-DR !'# $ / ASSESSEE BY NONE % & $ ' / DATE OF HEARING : 29/10/2015 & $ ' / DATE OF ORDER: 06/11/2015 / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) THE REVENUE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 18/09/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, M/S MEETA COTTON & SYNTHETICS MILLS PVT. LTD. ITA NO.7007/MUM/2013 2 DELETING THE PENALTY IMPOSED U/S 271(1)(C) OF THE I NCOME TAX ACT, 1961 (HEREINAFTER THE ACT) ON ACCOUNT OF DISALLOWANCE OF LOSS ON SALE OF ASSETS. 2. THE CRUX OF ARGUMENT ADVANCED BY SHRI VIJAY KUMAR SONI, LD. DR, IS IDENTICAL TO THE GROUND RAIS ED BY SUBMITTING THAT THE DISALLOWANCE WAS CONFIRMED BY T HE LD. COMMISSIONER OF INCOME TAX (APPEALS) AND THE ASSESS EE REVISED HIS RETURN ONLY AFTER ISSUANCE OF NOTICES U /S 142(1) AND 143(2) OF THE ACT. ON THE OTHER HAND, NONE WAS PRESENT FOR THE ASSESSEE IN SPITE OF ISSUANCE OF RE GISTERED NOTICE, THEREFORE, WE HAVE NO OPTION BUT TO PROCEED EX- PARTE, QUA THE ASSESSEE AND TEND TO DISPOSE OFF THE APPEAL ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. 2.1. WE HAVE DULY CONSIDERED THE SUBMISSIONS OF THE LD. DR AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS A PRI VATE LIMITED COMPANY ENGAGED IN PRODUCTION OF TEXTURISED YARN KNITTED FABRICS AND WOVEN FABRICS DECLARED INCOME O F RS,17,52,807/-, FILED ON 25/11/2006. DURING THE COU RSE OF ASSESSMENT PROCEEDINGS U/S 143(3) OF THE ACT, TH E ASSESSEE RELIES THAT A LOSS OF RS.9,46,662/- WAS IN CURRED ON SALE OF MACHINERY WHICH WAS DEBITED PROFIT & LOS S ACCOUNT VIDE SCHEDULE NO.E, HOWEVER, WHILE PREPARIN G NORMAL COMPUTATION OF TOTAL INCOME, THE SAID AMOUNT REMAINED TO BE ADDED TO THE PROFIT OF THE COMPANY B Y OVERSIGHT. THIS MISTAKE WAS BROUGHT TO THE NOTICE O F THE M/S MEETA COTTON & SYNTHETICS MILLS PVT. LTD. ITA NO.7007/MUM/2013 3 ASSESSING OFFICER BY THE ASSESSEE AND REQUESTED TO PERMIT THE ASSESSEE TO FILE REVISED RETURN. THE ASSESSEE S UO-MOTO FILED THE REVISED COMPUTATION AND OFFERED THE SAME FOR TAXATION. THE ASSESSING OFFICER DULY CONSIDERED THE EXPLANATION OF THE ASSESSEE AND ADDED THE SAME TO T HE TOTAL INCOME OF THE ASSESSEE. AT THE SAME TIME, THE LD. ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. NOW, QUESTION ARISES, WHETHER THE PENALTY WAS RIGHTLY LEVIED. THE OBVIOUS REPLY IS N O BECAUSE QUANTUM AND PENALTY PROCEEDINGS ARE ALL TOG ETHER DIFFERENT AND BOTH SHOULD BE CONSIDERED INDEPENDENT LY UNINFLUENCED BY THE FINDING IN THE QUANTUM ADDITION . EVEN OTHERWISE, THE ASSESSEE IS FORTIFIED BY THE DE CISION FROM HONBLE APEX COURT IN CIT VS RELIANCE PETRO PR ODUCTS PVT. LTD. (2010) 320 ITR 158 (SC). IT IS NOTED THA T DURING ASSESSMENT PROCEEDINGS ITSELF, THE ASSESSEE FILED C ORRECTED COMPUTATION OF INCOME BY FILING REVISED RETURN, THU S, NEITHER THERE IS CONCEALMENT OF INCOME OR FURNISHIN G OF INACCURATE PARTICULARS OF SUCH INCOME. IT IS SIMPLE CASE OF DISALLOWANCE, THEREFORE, THE ASSESSEE FURTHER FIND SUPPORT FROM THE RATIO LAID DOWN IN PRICE WATER HOUSE COOPE R PVT. LTD. VS CIT (2012) 348 ITR 306 (SC) AND CIT VS ICON CONTROLS PVT. LTD. (2007) 207 CTR (DEL.) 592. IN VI EW OF THIS FACT AND THE DECISION MENTIONED HEREINABOVE, WE FIN D NO INFIRMITY IN THE CONCLUSION DRAWN BY THE LD. COMMIS SIONER OF INCOME TAX (APPEALS). FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. M/S MEETA COTTON & SYNTHETICS MILLS PVT. LTD. ITA NO.7007/MUM/2013 4 THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. DR AT THE CONCLUSION OF THE HEARING ON 29/10/2015. SD/- SD/- ( RAJESH KUMAR ) (JOGINDER SINGH) '# / ACCOUNTANT MEMBER $# / JUDICIAL MEMBER % MUMBAI; ( DATED : 06/11/2015 F{X~{T? P.S/. . . %$&'()(*& / COPY OF THE ORDER FORWARDED TO : 1. *+,- / THE APPELLANT 2. ./,- / THE RESPONDENT. 3. 0 0 1$ ( *+ ) / THE CIT, MUMBAI. 4. 0 0 1$ / CIT(A)- , MUMBAI 5. 34 .$ ! , 0 *+' *! 5 , % / DR, ITAT, MUMBAI 6. 6' 7% / GUARD FILE. / BY ORDER, /3+$ .$ //TRUE COPY// / (DY./ASSTT. REGISTRAR) , % / ITAT, MUMBAI.