Commercial Automobiles Pvt. Ltd., Kanpur V. DY. Commissioner of Income Tax-VI, Kanpur

ITA 73/LKW/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1155 (ITAT-LUCKNOW)
• Duration Of Justice: 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 25-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B , LUCKNOW BEFORE SHRI. T.S. KAPOOR, ACCOUNTANT MEMBER AND SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER ITA NO. 73/LKW/2017 ASSESSMENT YEAR: 2011 - 12 COMMERCIAL AUTOMOBILES PVT. LTD. 84/105, G.T. ROAD KANPUR V. DY. CIT - VI KANPUR T AN /PAN : AACCC4267E (APP ELL ANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SHRI HIMANSHU PANDEY, D.R. DATE OF HEARING: 16 01 201 8 DATE OF PRONOUNCEMENT: 17 01 201 8 O R D E R PER P ARTHA SARATHI CHAUDHURY, J.M : THIS APPEAL PREFERRED BY THE ASSESSEE EMANATES FROM THE ORDER OF THE LD. CIT(A) - III, KANPUR DATED 24/11/2016 ON THE FOLLOWING GROUNDS OF APPEAL: - 1. BECAUSE THE CIT (APPEALS) - LL, KANPUR HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE PENALTY U/S. 271(1) (C) OF THE ACT OF RS.40,614/ - LEVIED VIDE ORDER DATED 26.03.2014 BY THE ASSESSING OFFICER WITHOUT APPRECIATING THE EXPLANATION OF THE APPELLANT, FACTS AND LAWS ON THE SUBJECT MATTER. 2. BECAUSE THE PENALTY IMPOSED IS BAD IN LAW AND ON FACTS WITHOUT APPRE CIATING THAT THE MISTAKE IN THE COMPUTATION OF INCOME WAS BONAFIDE AND BROUGHT TO THE NOTICE OF THE ASSESSING OFFICER SUO MOTTO BY THE APPELLANT. 3. THE APPELLANT CRAVES LEAVE TO MODIFY ANY OF THE GROUNDS OF THE APPEAL GIVEN ABOVE AND OR ADD ANY FRESH GROU NDS AS AND WHEN IT IS FOUND NECESSARY. ITA NO.73/LKW/2017 PAGE 2 OF 4 2 . THE ASSESSEE HAS RAISED AN ADDITIONAL GROUND THAT BECAUSE CHARGE BEING NOT SPECIFIC BY INITIATION OF PENALTY IN THE NOTICE ISSUED UNDER SECTION 274 READ WITH SECTION 271(1)(C) OF THE INCOME - TAX ACT, 1961, THE PENALTY IMPOSED IS BAD IN LAW AND BE QUASHED. IT WAS SUBMITTED THAT SINCE THE ADDITIONAL GROUND RAISED BY THE ASSESSEE IS PURELY LEGAL GROUND AND GOES TO THE ROOT OF THE MATTER, THE SAME MAY BE ADMITTED AND I N THIS REGARD, RELIANCE WAS PLACED ON THE DECISIONS O F THE HON'BLE SUPREME COURT IN THE CASE OF NTPC LTD. VS. CIT, 229 ITR 383, HON'BLE GAUHATI HIGH COURT IN THE CASE OF ASSAM CO. INDIA LTD., 256 ITR 423 AND THE DECISION OF THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF AL CARGO GLOBAL LOGISTICS LTD. VS. DC IT, 30 SOT 374. 3 . WE ARE CONVINCED WITH THIS ADDITIONAL GROUND WHICH GOES TO THE ROOT OF THE MATTER AND WE FIND THAT NO FRE SH INVESTIGATION IS REQUIRED TO ADJUDICATE THE SAME. WE, THEREFORE , ADMIT THE ADDITIONAL GROUND RAISED BY THE ASSESSEE AND PROCEED TO LOOK INTO THIS ADDITIONAL GROUND FIRST. 4 . THE FACTS IN BRIEF ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSING OFFICER HAD SPECIFICALLY ASKED THE ASSESSEE TO EXPLAIN WHY THERE WAS A DIFFERENCE OF RS.3,86,800/ - IN THE AMOUNT OF ADDITIONS IN COMP UTER (PLANT AND MACHINERY OF 60%). ON THIS QUERY, ASSESSEE REPLIED THAT DUE TO CLERICAL MISTAKE, AN ADDITION OF RS.3,86,800/ - WAS WRONGLY INCLUDED UNDER THE HEAD PLANT AND MACHINERY OF 60% WHEREAS IT WAS LIABLE FOR DEPRECIATION @ 15%. APART FROM DISALL OW ING THE EXCESS DEPRECIATION CLAIMED, ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT . 5 . AT THE TIME OF HEARING BEFORE US, NONE APPEARED ON BEHALF OF THE ASSESSEE AND A WRITTEN SUBMISSION IS FILED BEFORE US , IN WHICH IT IS PRAYED THAT THE CASE MAY BE DECIDED AFTER CONSIDERING THE WRITTEN SUBMISSION FILED BY THE ASSESSEE. WE , THEREFORE, PROCEED TO DECIDE THE ITA NO.73/LKW/2017 PAGE 3 OF 4 CASE ON THE BASIS OF THE WRITTEN SUBMISSION FILED BY THE ASSESSEE AND AFTER HEARING THE LD. D.R. 6 . WE HAVE PERUSED THE CASE RECORD A ND AT THE OUTSET WE FIND THAT THE PENALTY NOTICE ISSUED UNDER SECTION 274 READ WITH 271(1)(C) OF THE ACT IS NOT SPECIFIC AS TO WHICH LIMB PENALTY IS BEING LEVIED. A COPY OF NOTICE HAS BEEN FILED BEFORE US ALONG WITH THE WRITTEN SUBMISSION AND ON A PERUSAL OF THE SAME , IT IS ABSOLUTELY CLEAR THAT IT IS NOT SPECIFIC UNDER WHICH LIMB PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS BEING LEVIED. WE OBSERVE THAT LEVY OF PENALTY , AS HELD BY VARIOUS JUDICIAL FORUMS, HAS T O BE DONE IN AN EQUIVOCAL AND UNAMBIG UOUS M ANNER AND IT IS NOT A PRIZ E GIVEN TO THE ASSESSEE RATHER IT IS A PUNISHMENT AND THE AUTHORITY IMPOSING PENALTY , THEREFORE , SHOULD BE CLEAR IN HIS M IND FOR WHICH FAULT PENALTY IS LEVIED. FOR THE ABOVE PROPOSITION, RELIANCE WAS PLACED I N THE CASE S OF CIT VS . SMT. BAISETTY REVATHI, 398 ITR 88 ( T&AP); CIT & ANOTHER VS. M/S SSAS EMERALD MEADOWS IN CC NO.11485/2016 (SC) AND CIT VS. MANJUNATHAN COTTON & GINNING FACTORY, 359 ITR 365 . I N THE ABSENCE OF SPECIFIC MENTION AS TO WHICH LIMB PENALTY UNDER SECTION 271(1 )(C) OF THE ACT IS IMPOSED UPON THE ASSESSEE, PENALTY NOTICE UNDER SECTION 274 OF THE ACT DATED 27/9/2013 IS BAD IN LAW. WE ARE OF THE CONSIDERED VIEW THAT FOR THE FACTS AS STATED HEREINABOVE, PENALTY LEVIED BY THE ASSESSING OFFICER AND CONFIRMED BY THE L D. CIT(A) IS LIABLE TO BE DELETED. WE, ACCORDINGLY, SET ASIDE THE ORDER OF THE LD. CIT(A) AND DELETE THE PENALTY. 7 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 / 01 / 201 8 . SD/ - SD/ - [ T.S. KAPOOR ] [PARTHA SARA THI CHAUDHURY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 17 TH JANUARY , 201 8 JJ: 1601 ITA NO.73/LKW/2017 PAGE 4 OF 4 COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR