RAGHUVEER METAL INDUSTRIES LIMITED, DELHI V. ACIT, Alwar

ITA 74/JPR/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5398 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 1 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 22-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA JCIT DHK
• Keywords: Assessment record
• Section: 143(3); 153A; 27

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH EQDQY DS-JKOR] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI MUKUL K. SHRAWAT, JM & SHRI T.R.MEENA, AM VK;DJ VIHY LA-@ ITA NO. 74/JP/2015 FU/KZKJ.K O'K Z @ ASSTT. YEAR : 2004-05. RAGHUVEER METAL INDUSTRIES LTD. C/O H.K.CHOUDHARY 212, M.J. SHOPPING CENTRE, 3, VER SAVARKAR BLOCK, SHAKARPUR, DELHI-110092. CUKE VS. THE ACIT, CENTRAL CIRCLE, ALWAR. (RAJASTHAN) LFKK;H YS[KK LA - @THVKBZVKJ LA - @ PAN/GIR NO. AABCR 7496 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI HIMANSHU GOYAL (C.A) JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJ MEHRA (JCIT) LQUOKBZ DH RKJH[K @ DATE OF HEARING : 08.03.2016. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 11/03/2016. VKNS'K@ ORDER PER MUKUL K. SHRAWAT, JM : THIS IS AN APPEAL FILED BY THE ASSESSEE EMANATING FROM AN ORDER OF LD. CIT (A), ALWAR DATED 25.11.2014. THE ONLY GROUND IS IN RESP ECT OF CONFIRMATION OF PENALTY LEVIED UNDER SECTION 271(1)(C) AMOUNTING TO RS. 1,70,407/- . 2. FACTS IN BRIEF AS EMERGED FROM THE CORRESPONDING ASSESSMENT ORDER PASSED UNDER SECTION 143(3) READ WITH SECTION 153A DATED 1 5.12.2010 AND THE PENALTY ORDER PASSED UNDER SECTION 271(1)(C) READ WITH SECTION 27 4 OF THE IT ACT DATED 31.03.2011 WERE THAT THE ASSESSEE COMPANY HAD INCURRED PRIOR P ERIOD EXPENSES OF RS. 4,75,000/-, WHICH WAS DEBITED IN PROFIT & LOSS ACCOUNT UNDER TH E HEAD ADMINISTRATIVE AND OTHER 2 ITA NO. 74/JP/2015 RAGHUVEER METAL INDUSTRIES LTD. VS. ACIT EXPENSES. IN THE ABSENCE OF FURTHER DETAILS, THE SAID PRIOR PERIOD EXPENSES WERE DISALLOWED. DURING THE PENALTY PROCEEDINGS, THE OB SERVATION OF THE AO WAS THAT THE EXPENDITURES WERE WRONGLY CLAIMED FOR THE YEAR UNDE R CONSIDERATION I.E. A.Y. 2004-05 AND THE ASSESSEE WAS DELIBERATELY CLAIMING THE EXPE NDITURE WHICH PERTAINED TO EARLIER ASSESSMENT YEAR. ON THE IMPUGNED AMOUNT, A PENALTY OF RS. 1,70,407/- WAS IMPOSED. 3. THE APPELLANT HAS CHALLENGED THE LEVY OF PENALTY BEFORE THE FIRST APPELLATE AUTHORITY, HOWEVER, WITHOUT ANY SUCCESS. IN THE LI GHT OF THE ABOVE BRIEF FACTUAL MATRIX, WE HAVE HEARD BOTH THE SIDES. THE APPELLANT HAD FU RNISHED CERTAIN ACCOUNTS BEFORE US TO DEMONSTRATE THAT THIS IS A CASE OF SIMPLY A WRON G ENTRY WHICH WAS REVERSED WHEN THE MISTAKE WAS DETECTED. HOWEVER, THE MAIN PLANK OF A RGUMENT IS THAT THE BASIC FACT ABOUT THE EXPENDITURE IN QUESTION WAS VERY MUCH ON ASSESSMENT RECORD. THERE WAS NO CONCEALMENT IN RESPECT OF PARTICULARS OF THE FACT T HAT THE EXPENDITURE IN QUESTION WAS PRIOR PERIOD EXPENSES. RATHER THE ASSESSEE HAS CLEA RLY MENTIONED IN THE ACCOUNTS ITSELF THAT THE EXPENDITURES WERE NOTHING BUT PRIOR PERIOD EXPENSES. THEREFORE, WE ARE CONVINCED THAT THIS IS NOT A CASE WHERE THE REVENUE HAD DETECTED THE CONCEALMENT OF FACTS OR THE ASSESSEE HAD FURNISHED INACCURATE PART ICULARS ABOUT THE PRIOR PERIOD EXPENSES. ALL THE MATERIAL FACTS WERE VERY MUCH IN THE KNOWLEDGE OF THE REVENUE DEPARTMENT. THOSE FACTS AND THE EXPLANATION OF THE ASSESSEE WERE NOT FOUND TO BE UNTRUE OR FALSE. WE ARE OF THE VIEW THAT EXPLANATIO N-1 TO SECTION 271(1)(C) HAS PRESCRIBED THAT WHERE IN RESPECT OF ANY FACTS MATER IAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT, AND SUCH PERSO N FAILS TO OFFER AN EXPLANATION OR OFFERS AN EXPLANATION WHICH IS FOUND BY THE AO TO B E FALSE OR SUCH PERSON OFFERS AN 3 ITA NO. 74/JP/2015 RAGHUVEER METAL INDUSTRIES LTD. VS. ACIT EXPLANATION WHICH HE IS NOT ABLE TO SUBSTANTIATE AN D FAILS TO PROVE THAT SUCH EXPLANATION IS BONAFIDE AND THAT ALL THE FACTS RELATING TO THE SAME HAVE BEEN DISCLOSED THEN THE AMOUNT ADDED OR DISALLOWED DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. IN THE LIGHT OF T HIS EXPLANATION, WE ARE OF THE VIEW THAT THE ASSESSEE IS OUT OF THE AMBIT OF THE CLUTCH ES OF PENALTY PROVISIONS. INTER ALIA, WE HEREBY DIRECT TO DELETE THE PENALTY. GROUND ALLOWED . 4. IN THE RESULT, APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11/03/201 6. SD/- SD/- VH-VKJ-EHUK EQDQY DS-JKOR ( T.R. MEENA ) (MUKUL K. SHRAWAT) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 11/03/2016. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT-M/S. RAGHUVEER METAL INDUSTRIES LTD., DELHI. 2. IZR;FKHZ@ THE RESPONDENT-THE ACIT, CENTRAL CIRCLE, ALWAR. 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.74/JP/2015) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 4 ITA NO. 74/JP/2015 RAGHUVEER METAL INDUSTRIES LTD. VS. ACIT