NOVA DIGITAL SERVICES, THANE V. ITO WD 3(1), THANE

ITA 7061/MUM/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 7716 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 06-12-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 03-12-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Business income; Tangible material

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUM BAI , , , , ! BEFORE SHRI RAJENDRA, AM AND SHRI AMARJIT SINGH, JM / I.T.A. NO.7061/MUM/2013 ( '# $# / ASSESSMENT YEAR: 2004-05) M/S. NOVA DIGITAL SERVICES SHOP NO.13, KAUSTHUBHA SOCIETY, BAJI PRABHU DESHPANDE ROAD, VISHNU NAGAR THANE (W) - 600602 / VS. INCOME TAX OFFICER WARD 3(1) THANE ./ ./PAN/GIR NO. : AAEFN8755B ( /APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING: 24.03.2017 /DATE OF PRONOUNCEMENT: 29.03.2017 / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST T HE ORDER DATED 27.08.2013 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS)-I, MUMBAI [HEREINAFTER REFERRED TO AS THE CIT(A)] R ELEVANT TO THE A.Y.2004-05 IN WHICH PENALTY LEVIED BY THE ASSESSIN G OFFICER TO THE TUNE OF RS.73,130/- HAS BEEN UPHELD. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- ASSESSEE BY: NONE REVENUE BY: SHRI RAJGURU M. V. ITA NO.7061/M/2013 A.Y.2004-05 2 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) 1 ERRED IN CONFIRMING THE PENALTY LEVIED U /S.271(1)(C) OF THE ACT, 1961 OF RS.73,130/- 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) 1 ERRED IN NOT APPRECIATING THE DETAILS SU BMITTED TOWARDS EXPLANATION OF DIFFERENCE IN THE SALE FIGUR E. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A)-1 ERRED IN CONFIRMING THE PENALTY ON THE GRO UND THAT THE DETAILS FURNISHED WERE INCORRECT. 4. THE APPELLANT CRAVES LEAVE TO ADD TO ALTER AND / OR AMEND ANY OF THE GROUNDS OF APPEAL MENTIONED HEREINABOVE. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E FILED ITS RETURN OF INCOME FOR THE A.Y.2004-05 DECLARING TOTAL INCOME A S RS. NIL ON 12.10.2004. THE RETURN WAS PROCESSED U/S.143(1) O F THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). THE CASE WAS SELECTED F OR SCRUTINY, THEREFORE NOTICE U/S.143(2) OF THE ACT WAS ISSUED ON 26.08.20 05 WHICH WAS DULY SERVED UPON THE ASSESSEE. FURTHER NOTICE U/S.143( 2) OF THE ACT WAS ISSUED ON 13.09.2006 WHICH WAS DULY SERVED UPON THE ASSESS EE ON 19.09.2006. SINCE ASSESSEE WAS NOT RESPONSIVE, THEREFORE FINAL NOTICE U/S.143(2) OF THE ACT WAS ISSUED ON 27.11.2006 ALONG WITH CERTAIN REQ UIREMENTS AND SHOW CAUSE NOTICE U/S.271(1)(B) OF THE ACT FOR NON COMPL IANCE TO THE NOTICE U/S.143(2) OF THE ACT WAS ALSO ISSUED. THE SAID NO TICE WAS SERVED UPON THE ASSESSEE ON 28.11.2006. THE ASSESSEE WAS IN THE B USINESS OF SALES AND SERVICE OF THE COMPUTER SYSTEMS AND PERIPHERALS, SA LE OF MULTI FUNCTION DEVICES, PRINTERS AND SCANNERS ETC. ON VERIFICATIO N OF THE MANUFACTURING ACCOUNT SUBMITTED BY THE ASSESSEE, IT WAS FOUND THA T THE ASSESSEE SHOWN SALES AMOUNTING TO RS.34,76,379/- FOR THE A.Y.2003- 04. HOWEVER, AS PER ITA NO.7061/M/2013 A.Y.2004-05 3 THE DETAILS OF THE PARTYWISE SALES ABOVE RS.10,000/ - SUBMITTED BY THE ASSESSEE THE TOTAL SALES COMES TO RS.36,68,404/-. HOWEVER, THE ASSESSEE EXPLAINED ABOUT THE INCLUSION OF THE SERVICE CHARGE S BUT FAILED TO EXPLAIN THE DIFFERENCE OF SALE TO THE TUNE OF RS.1,92,025/-. T HE ASSESSEE ALSO FILED AN APPLICATION U/S.154 OF THE ACT ON 18.01.2007 AND TH E REVISED DIFFERENCE WAS FILED TO THE TUNE OF RS.1,53,270/- WHICH WAS NOT EX PLAINED, THEREFORE NOTICE U/S.271(1)(C) OF THE ACT WAS ISSUED AND AFTER GETTI NG REPLY THE PENALTY TO THE TUNE OF RS.73,130/- WAS LEVIED. FEELING AGGRIEVED THE APPEAL WAS FILED BEFORE THE CIT(A) WHO CONFIRMED THE ORDER OF THE AS SESSING OFFICER, THEREFORE THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. ISSUE NO. 1 TO 3:- 4. UNDER THE ABOVE SAID ISSUES THE ASSESSEE HAS CHA LLENGED THE CONFIRMATION OF THE PENALTY TO THE TUNE OF RS.73,13 0/- BY THE CIT(A) U/S.271(1)(C) OF THE ACT. THE CONTENTION OF THE LE ARNED REPRESENTATIVE OF THE ASSESSEE IS THAT THERE WAS A TOTALING MISTAK E IN THE ACCOUNTS WHICH WAS UNINTENTIONAL, THEREFORE, IN THE SAID CIR CUMSTANCES THE PENALTY IS NOT LEVIABLE IN VIEW OF THE LAW SETTLED IN CIT VS. PITAMBARDAS DULICHAND [2004] 194 CTR (MP) 43. IT W AS ALSO CONTENDED THAT THERE IS NOTHING ON RECORD TO WHICH IT CAN BE ASSUMED THAT THE ASSESSEE HAS CONCEALED THE INCOME OR FURNI SHED THE INACCURATE PARTICULARS OF INCOME, THEREFORE, IN THE SAID CIRCU MSTANCES NO PENALTY IS LEVIABLE IN VIEW OF THE LAW SETTLED IN ANITA BUI LDERS, JODHPUR VS. ACIT [2001] 20 DTC 156. HOWEVER, THE LEARNED REPRE SENTATIVE OF THE DEPARTMENT HAS PLACED RELIANCE UPON THE ORDER PASSE D BY THE CIT(A) ITA NO.7061/M/2013 A.Y.2004-05 4 IN QUESTION. ON APPRAISAL OF THE ORDER PASSED BY T HE CIT(A) IT IS OBSERVED THAT THERE WAS INITIALLY DIFFERENCE OF RS. 1,92,025/- IN THE FIGURE OF SALE AS SHOWN BY THE APPELLANT IN THE ACC OUNT AND AS WORKED OUT ON THE BASIS OF PARTYWISE DETAILS. NO DOUBT, S UBSEQUENTLY, THE ASSESSEE FILED AN APPLICATION U/S.154 OF THE ACT IN WHICH THE EXPLANATION WITH REGARD TO THE AMOUNT OF RS.38,755/ - WAS FOUND CORRECT AS SERVICE CHARGES WAS INCLUDED IN THE FIGU RE OF THE SALE OF MATERIAL. BUT SO FAR AS THE SALE TO THE TUNE OF RS .1,53,270/- IS CONCERNED THE SAME HAS NOT BEEN EXPLAINED BY THE AS SESSEE BEFORE THE ASSESSING OFFICER AS WELL AS CIT(A) AND BEFORE US A LSO. THERE IS NO TANGIBLE MATERIAL ON THE FILE TO WHICH IT CAN BE AS SUMED THAT THE ADDITION TO THE TUNE OF RS.1,53,270/- IS IN CONNECT ION WITH THE TOTALING MISTAKE IN THE ACCOUNTS. THE FIGURE IS NO DOUBT EF FECTING THE TAXATION. IT IS THE DUTY OF THE ASSESSEE TO BRING OUT THE BON A-FIDE EXPLANATION WITH REGARD TO THE INCORRECT PARTICULARS MENTIONED IN THE RETURN. THE MISTAKE CAN BE CLARIFIED BY ADDUCING THE SUFFICIENT MATERIAL BEFORE THE AUTHORITY BELOW AS WELL AS BEFORE US ALSO. SINCE T HERE IS NOTHING ON RECORD TO WHICH IT CAN BE ASSUMED THAT THE SALE TO THE TUNE OF RS.1,53,270/- IS THE MISTAKE IN THE ACCOUNTS, THERE FORE WE ARE OF THE VIEW THAT THE CIT(A) HAS RIGHTLY CONFIRMED THE ORDE R PASSED BY THE ASSESSING OFFICER WHICH NOWHERE REQUIRE ANY INTERFE RENCE OF THE TRIBUNAL. HENCE THE APPEAL FILED BY THE ASSESSEE I S HEREBY DISMISSED. ITA NO.7061/M/2013 A.Y.2004-05 5 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS HEREBY ORDERED TO BE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH MARCH, 2017 . SD/- SD/- (RAJENDRA) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 29 TH '# , 2017 MP & '$ / 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