ITO 2(1)(1), MUMBAI V. BHAKTAWAR CONSTRUCTION CO. P.LTD, MUMBAI

ITA 74/MUM/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9758 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 6 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-07-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 31-03-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 03-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T A KHAN LD
• Assessee Lawyers: AMOGH M GHU I SAS LD
• Keywords: Earning of tax free income; Question of law
• Section: 143(3); 115JB; 15

Judgement Text

ITA NO.74/M/2013 BHAKTAWAR CONSTRUCTION CO.PVT.LTD ASSESSMENT YEAR-2006-07 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI , , BEFORE SHRI JOGINDER SINGH, JM AND SHRI MANOJ KUMAR AGGARWAL, AM ./I.T.A. NO.74/MUM/2013 ( / ASSESSMENT YEAR: 2006-07) INCOME TAX OFFICER WARD 2(1) AAYKAR BHAWAN 5 TH FLOOR, ROOM NO. 561 M.K.ROAD MUMBAI - 400 020 / VS. BHAKTAWAR CONSTRUCTION CO. PVT.LTD MEHER HOUSE, 1 ST FLOOR 15 CAWASJI PATEL STREET FORT MUMBAI 400 001 ! ./ ./PAN/GIR NO. AAACB-4942-P ( !# /APPELLANT ) : ( $%!# / RESPONDENT ) A SSESSEE BY : AMOGH M.GHU I SAS, LD. AR RE VENUE BY : T.A.KHAN, LD. DR / DATE OF HEARING : 24/07/2017 / DATE OF PRONOUNCEMENT : 28 /07/2017 ITA NO.74/M/2013 BHAKTAWAR CONSTRUCTION CO.PVT.LTD ASSESSMENT YEAR-2006-07 2 / O R D E R PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. THE CAPTIONED APPEAL BY REVENUE FOR ASSESSMENT YEAR [AY] 2006- 07 ASSAILS THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-4 [CIT(A)], MUMBAI DATED 11/10/2012. THE REVENUE HAS FILED REVISED GROUNDS OF APPEAL ON 13/10/2015 WHERE THE REVENUE I S PRIMARILY AGGRIEVED BY DELETION OF PENALTY U/S 271(1)(C) OF T HE INCOME TAX ACT BY LD. CIT(A). 2. BRIEFLY STATED, THE ASSESSEE BEING RESIDENT CORPORATE ASSESSEE ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION, WAS ASSESSED U/S 143(3) FOR THE IMPUGNED AY ON 30/12/2008. DURING ASSESSMEN T IT WAS NOTICED THAT THE ASSESSE COMPUTED BOOK PROFIT U/S 115JB AFT ER DEDUCTING CAPITAL GAINS OF RS.3.18 CRORES EARNED BY THE ASSESSEE ON T HE PREMISES THAT DEDUCTION U/S 54EC WAS AVAILABLE AGAINST THE SAME A ND THEREFORE, THE SAME WAS EXEMPT INCOME AND DEDUCTIBLE FOR THE PURPO SE OF SECTION 115JB. HOWEVER, THE LD. AO REJECTED THE ASSESSEES CONTENTION AND OPINED THAT THE SAME COULD NOT BE DEDUCTED FOR THE PURPOSE OF COMPUTATION OF BOOK PROFIT U/S 115JB IN VIEW OF THE EXPRESS STATUTORY PROVISIONS. THE STAND OF LD. AO WAS CONFIRMED BY LD . CIT(A) WHICH WAS CHALLENGED IN SECOND APPEAL WITHOUT ANY SUCCESS BEF ORE THIS TRIBUNAL VIDE ITA NO.1814/MUM/2010 ORDER DATED 25/10/2011. 2.1 IN THE MEANTIME, PENALTY PROCEEDINGS U/S 271(1) (C) WERE INITIATED FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND CONSEQUENTLY THE ITA NO.74/M/2013 BHAKTAWAR CONSTRUCTION CO.PVT.LTD ASSESSMENT YEAR-2006-07 3 ASSESSEE HAS BEEN SADDLED WITH A PENALTY OF RS.23,4 4,410/- VIDE PENALTY ORDER DATED 28/04/2010. 2.2 AGGRIEVED, THE ASSESSEE SUCCESSFULLY ASSAILED T HE PENALTY BEFORE LD. CIT(A) VIDE IMPUGNED ORDER DATED 11/10/2012 WHE RE THE PENALTY WAS DELETED BY LD. CIT(A) BY NOTING THAT THE ASSESS EE PROVIDED COMPLETE DETAILS OF THE CLAIM DURING ASSESSMENT PRO CEEDINGS AND THEREFORE, THERE WAS NO FURNISHING OF INACCURATE PA RTICULARS OF INCOME OR CONCEALMENT SO AS TO ATTRACT THE IMPUGNED PENALTY. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US. 3. THE LD. DEPARTMENTAL REPRESENTATIVE [DR] JUSTIFI ED THE IMPOSITION OF PENALTY ON THE GROUND THAT THE ASSESSEE MADE A C LAIM WHICH WAS NOT TENABLE IN LAW WHICH COULD BE GAUGED FROM THE FACT THAT THE ASSESSEES APPEAL AGAINST THE SAME WAS REJECTED BY THE TRIBUNA L. 3.1 PER CONTRA, LD. REPRESENTATIVE FOR ASSESSEE [AR] DREW OUR ATTENTION TO THE FACT THAT THE ASSESSEE HAS CONTEST ED THE ORDER OF TRIBUNAL BEFORE HONBLE BOMBAY HIGH COURT VIDE ITA NO. 357 OF 2012 DATED 24/03/2014 WHERE THE QUESTION OF LAW HAS BEEN FRAMED AND ADMITTED AND THEREFORE, THE ISSUE WAS DEBATABLE ONE AND THE PENALTY COULD NOT SUSTAINED. RELIANCE WAS ALSO PLACED ON TH E RATIO OF JUDGMENT OF APEX COURT RENDERED IN CIT VS RELIANCE PETROPRODUCTS PVT. LTD. [322 ITR 158] FOR THE CONTENTION THAT MERE NON-ACCEPTANCE OF ASSE SSEES CLAIM DO NOT RESULT INTO AUTOMATIC IMPOSITION OF PE NALTY. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED RELEVANT MATERIAL ON RECORD. AFTER GOING THROUGH THE SAME, WE FIND ST RENGTH IN BOTH THE ARGUMENTS OF LD. AR SINCE THE SUBSTANTIAL QUESTION OF LAW AGAINST ITA NO.74/M/2013 BHAKTAWAR CONSTRUCTION CO.PVT.LTD ASSESSMENT YEAR-2006-07 4 QUANTUM ADDITION AS SUSTAINED BY THIS TRIBUNAL HAS BEEN ADMITTED BY HONBLE BOMBAY HIGH COURT WHICH IS EVIDENT FROM ORD ER DATED 24/03/2014 PLACED ON RECORD. THEREFORE, THE ISSUE B EING CLEARLY DEBATABLE ONE, PENALTY AGAINST THE SAME, AT THIS MOMENT , DO NOT SURVIVE. EVEN OTHERWISE ALSO, LD. CIT(A) CLINCHED THE ISSUE IN THE RIGHT PERSPECTIVE SINCE THE ASSESSEE MADE A CLAIM WITH AD EQUATE / COMPLETE DISCLOSURES WHICH HAS NOT BEEN ACCEPTED BY THE REVE NUE. NEVERTHELESS, THERE IS NO FURNISHING OF INACCURATE PARTICULARS OF INCOME OR C ONCEALMENT SO AS TO ATTRACT THE PENALTY AS PER THE RATIO OF CI TED DECISION OF HONBLE SUPREME COURT. THEREFORE, FINDING NO SUBSTANCE IN R EVENUES APPEAL, WE DISMISS THE SAME. NEEDLESS TO SAY, THE REVENUE IS F REE TO REINITIATE THE SAME ON THE BASIS OF OUTCOME OF THE DECISION OF HON BLE BOMBAY HIGH COURT AGAINST QUANTUM ADDITIONS. 5. RESULTANTLY, THE REVENUES APPEAL STANDS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH JULY, 2017. SD/- SD/- (JOGINDER SINGH) (MANOJ KUMAR AGGARWAL) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 28.07.2017 SR.PS:- THIRUMALESH ITA NO.74/M/2013 BHAKTAWAR CONSTRUCTION CO.PVT.LTD ASSESSMENT YEAR-2006-07 5 / 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