MEGHNA ARUN SINGIT, MUMBAI V. ITO 17(2)(3), MUMBAI

ITA 7488/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3600 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Assessment Year: 2008-2009
• Appeal Filed On: 16-12-2014
• Court: TRIBUNAL
• Department Lawyers: SOMANATH UKKALI
• Keywords: Rule of consistency
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER I.T.A. NO.7488/M/2014 (ASSESSMENT YEAR: 2008 - 2009 ) MRS. MEGHNA ARUN SINGIT, 59, REKHA KUNJ, R.A. KIDWAI ROAD, KING CIRCLE, MUMBAI 400 019. / VS. ITO 17(2)(3), ITAT, 4 TH FLOOR, PRATISHTA BHAVAN, M.K. ROAD, MUMBAI 400 020. ./ PAN : AAJPS7201A ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : NONE / RESPONDENT BY : SHRI SOMANATH UKKALI, JCIT / DATE OF HEARING : 21.06.2016 / DATE OF PRONOUNCEMENT : 22 .08.2016 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 16.12.2014 IS AGAINST THE ORDER OF THE CIT (A) - 29, MUMBAI DATED 9.10.2014 FOR THE ASSESSMENT YEAR 2008 - 2009. IN THIS APPEAL, ASSESSEE RAISED THE FOLLOWING GROUNDS WHICH READ AS UNDER: - 1. THE LD CIT (A) ERRED IN UPHOLDING THE ACTION OF AO IN TREATING THE APPELLANT TO BE IN DEFAULT U/S 271(1)(C) OF THE ACT AND CONSEQUENTLY ERRED IN CONFIRMING THE PENALTY OF RS. 10,02,705/ - . 1.1. THE LD CIT (A) IN CONFIRMING THE PENALTY DID NOT APPRECIATE THAT THE INCOME OF RS.28,04,943/ - (SIC) ON WHICH THE TAX WAS DEDUCTED AT S OURCE IN RESPECT OF ADVANCE RECEIVED AGAINST JOB CHARGES DURING THE YEAR UNDER APPEAL WAS OFFERED TO TAX IN THE IMMEDIATE SUCCEEDING YEAR BASED ON COMPLETION OF JOB. 1.2. THE LD CIT (A) ERRED IN HOLDING THERE IS COMPLETE SUPPRESSION OF INCOME ON THE PART OF TH E APPELLANT. 2. BRIEFLY STATED RELEVANT FACTS OF THE CASE ARE THAT THE ASSESSEE, WHO IS AN INDIVIDUAL, FILED THE RETURN OF INCOME DECLARING THE TOTAL INCOME OF RS. 7,34,856/ - . ASSESSMENT WAS COMPLETED THE U/S 147 R.W.S 143(3) OF THE ACT AND THE ASSESSED INCOME WAS DETERMINED AT RS. 36,83,260/ - WHICH INCLUDES CERTAIN DISALLOWANCES. DURING THE ASSESSMENT, AO OBSERVED THAT THE ASSESSEE RECEIVED JOB WORK RECEIPTS AMOUNTING TO RS. 28,94,843/ - AND THE SAME WAS OFFERED TO TAX IN THE AY 2009 - 2010. HOWEVER, AO I S OF THE OPINION, THE SAME SHOULD SUFFER TAX IN THE YEAR UNDER 2 CONSIDERATION IE 2008 - 2009. IN THE QUANTUM PROCEEDINGS, THE CLAIM OF THE ASSESSEE WAS APPROVED AND THE RECEIPTS WERE SUBJECT TO TAX IN THE YEAR UNDER CONSIDERATION. FURTHER, AO LEVIED PENALTY OF RS. 10,02,705/ - U/S 271(1)(C) OF THE ACT. ON APPEAL, CIT (A) CONFIRMING THE SAME. AGGRIEVED, ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3. DURING THE PROCEEDINGS BEFORE THE TRIBUNAL , NONE APPEARED TO REPRESENT THE ASSESSEES CASE. HOWEVER, LD DR FOR THE REVENUE FAIRLY SUBMITTED THAT THE ISSUE UNDER CONSIDERATION IS CHARGEABILITY OF THE PENALTY WHEN THE YEAR OF TAXATION IS THE SUBJECT MATTER. IN RESPONSE TO THE BENCHS QUERY ABOUT THE DEBATABILTY OF SUCH ISSUES, LD DR FOR THE REVENUE FAIRLY RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 4. AFTER HEARING THE LD DR AND O N CONS IDERING THE SUBMISSIONS OF THE ASSESSEE AS WELL AS THE CONTENTS OF THE ORDERS OF THE REVENUE AUTHORITIES, I AM OF THE OPINION THAT THERE IS NO CONCEALMENT OF INCOME BY THE ASSESSE E AS THE SAID RECEIPTS ARE ADMITTEDLY OFFERED TO TAX IN THE NEXT AY 2009 - 2010. THE TAXABILITY OF THE SAME IN THE YEAR UNDER CONSIDERATION, IN MY OPINION, INVOLVES DEBATE ALTHOUGH THE SAID ISSUE IS DECIDED IN FAVOUR OF THE REVENUE IN QUANTUM PROCEEDINGS. THEREFORE, I AM OF THE CONSIDERED VIEW THAT NO PENALTY SHOULD BE LEVIED ON SUCH INCOME WHICH INVOLVES DEBATE QUA THE YEAR OF TAXATION. FOR THIS PROPOSITION, THE DECISION OF THE ITAT, MUMBAI IN THE CASE OF DCIT VS. OTIS ELEVATOR CO (I) LTD (27 ITR 3030) IS RELIED WHEREIN IT WAS OBSERVED THAT IT IS THE CASE WHERE THE YEAR OF TAXABILITY OF INCOME WAS IN DISPUTE........IN SUCH MATTERS, PENALTY UNDER SECTION 271(1)(C) CANNOT BE LEVIED. CONSIDERING THE SETTLED NATURE OF THE ISSUE AS WELL AS RESPECTFULLY FOLLOWI NG THE SAID DECISION OF THE TRIBUNAL AND ALSO FOLLOWING THE PRINCIPLE OF CONSISTENCY, ASSESSEE GETS RELIEF AND THE PENALTY IS DELETED. ACCORDINGLY, GROUNDS RAISED BY THE ASSESSEE ARE ALLOWED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRO NOUNCED IN THE OPEN COURT ON 2 2 N D AUGUST, 2016. S D / - (D. KARUNAKARA RAO) ACCOUNTANT MEMBER MUMBAI ; 22 .8.2016 . . ./ OKK , SR. PS 3 / 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 . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI