PERSPECT ADVERTSING LTD, MUMBAI V. ADDL CIT RG 7(1), MUMBAI

ITA 7557/MUM/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78855 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 05-05-2014
• Assessment Year: 2002-2003
• Appeal Filed On: 21-12-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: PARMINDER
• Assessee Lawyers: N O N E
• Keywords: Revised return; Reason to believe; Bonafide mistake
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH C , MUMBAI BEFORE SHRI N. K. BILLAIYA , ACCOUNTANT MEMBER AND SHRI SANJAY GARG , JUDICIAL MEMBER ITA NO. 7557/M/2012 ASSESSMENT YEAR: 2002 - 03 M/S. PERCEPT ADVERTISING LTD. PERCEPT HOUSE, 22 RAGHUVANSHI ESTATE, 11/12 SENAPATI BAPAT MARG, LOWER PAREL, MUMBAI 400 013 PAN: AAACP 5689F VS. ASST. CIT, RANGE - 7(1), AAYAKAR BHAVAN, M.K. MARG , MUMBAI - 400020 (APPELLANT) (RESPONDENT) ASSESSEE BY : NON E REVENUE BY : SMT. PARMINDER, D.R. DATE OF HEARING : 05.05. 201 4 DATE OF PRONOUNCEMENT : 05.05.2014 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) [(HEREINAFTER REFERRED TO AS CIT(A) ] DATED 31.10.12. THE ASSESSEE HAS AGITATED THE LEVY OF PENALTY @ 200% OF THE TAX AMOUNT SOUGHT TO BE EVADED AMOUNTING TO RS.15,52,536/ - UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT (HEREINAFTER REFERRED TO AS THE ACT). 2. THE ASSESSEE FILED ITS RETURN OF INCOME DECLARING TOTAL INCOME OF RS.1,29,71,224/ - WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE ACT. THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) , HAVING REASON TO BELIEVE THAT THE INCOME OF THE ASSESSEE HAD ESCAPED ASSESSMENT ON ACCOUNT OF EXCESS CLAIM OF DEDUCTION OF RS.21.74 LAKHS BEING LOSS CLAIMED OF JOINT VENTURE ITA NO. 7557/M/2012 M/S . PERCEPT ADVERTISING LTD. 2 PARTNER PERCEPT GULF , REOPENED THE ASSESSMENT UNDER SECTION 147. IN RESPONSE TO THE NOTICE ISSUED UNDER SECTION 14 8 THE ASSESSEE FILED THE RETURN OF INCOME AS WAS ORIGINALLY FILED AND CLAIMED THAT NO INCOME OF THE ASSESSEE HAD ESCAPED ASSESSMENT. HOWEVER, AFTER GOING THROUGH THE REASONS FOR REOPENING OF THE ASSESSMENT THE ASSESSEE ADMITTED THAT IT HAD INADVERTENTLY C LAIMED THE ABOVE DEDUCTI ON WHILE COMPUTING THE INCOME. ASSESSEE THEREFORE ACCORDINGLY FURNISHED ANOTHER RETURN IN WHICH SAID CLAIM OF RS.21.74 LAKHS WAS WITHDRAWN. THE AO OBSERVED THAT THERE WAS NO BONAFIDE OMISSION ON THE PART OF THE ASSESSEE. THE ASSES SEE NOT ONLY WRONGLY CLAIMED THE DEDUCTION BUT ALSO CONTINUED WITH THE SAID CLAIM EVEN IN RESPONSE TO NOTICE UNDER SECTION 148. THE AO THEREFORE HELD THAT THE ASSESSEE HAD FURNISHED INACCURATE PARTICULARS OF INCOME AND THEREBY CONCEALED THE INCOME OF RS.2 1.74 LAKHS. HE THEREFORE LEVIED THE PENALTY @ 200% OF THE TAX SOUGHT TO BE EVADED. 3. THE LD. CIT(A) CONFIRMED THE ABOVE PENALTY LEVIED BY THE AO. THE ASSESSEE IS THUS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE LD. D.R. AND ALSO HAVE GONE THROUGH TH E RECORDS. FROM THE RECORDS IT REVEALS THAT THE ASSESSEE HAS RAISED THE CONTENTION THAT IT HAD NOT CONCEALED ITS INCOME RATHER THE DISPUTED DEDUCTION WAS CLAIMED DUE TO A GENUINE AND BONAFIDE MISTAKE. T HE ASSESSEE HAD ADMITTED TO ITS MISTAKE AND HAD FILE D A REVISED RETURN AND AS SUCH IT WAS NOT A CASE OF CONCEALMENT OF INCOME. HOWEVER, T HE LD. D.R. HAS STRONGLY RELIED UPON THE FINDINGS OF THE LOWER AUTHORITIES. 5. IN OUR CONSIDERED VIEW, IT IS NOT A CASE OF BONAFIDE MISTAKE ON THE PART OF THE ASSESS EE. THE ASSESSEE CONTINUED WITH ITS STAND OF WRONGFUL CLAIM EVEN AFTER RECEIPT OF NOTICE UNDER SECTION 148 FROM THE AO. THE ASSESSEE ADMITTED ITA NO. 7557/M/2012 M/S . PERCEPT ADVERTISING LTD. 3 THE FILING OF WRONGFUL CLAIM ONLY AFTER GOING THROUGH THE REASONS RECORDED BY THE AO FOR REOPENING OF THE CASE A ND THEREAFTER FILED THE REVISED RETURN WHICH WAS NOT FROM THE OWN WILL OR VOLI TION OF THE ASSESSEE RATHER IT WAS FILED ONLY WHEN IT WAS CALLED FOR EXPLANATION BY THE AO IN THIS REGARD. HENCE, WE DO NOT FIND ANY FAULT WITH THE ACTION OF THE AO IN INITIATIN G PENALTY PROCEEDINGS AGAINST THE ASSESSEE. 6. HOWEVER, THE ASSESSEE IN ITS GROUNDS OF APPEAL HAS TAKEN THE ALTERNATE PLEA THAT THE PENALTY LEVIED @ 200% WAS EXCESSIVE AND IT SHOULD BE REDUCED TO 100%. WE FIND THAT THE CASE OF THE ASSESSEE IS NOT AN EX CEPTIONAL CASE OF GR OSS MISCONDUCT OR CONCEALMENT. THE ASSESSEE, THOUGH AT A LATER STAGE , HAD ADMITTED ITS MISTAKE , HENCE EXTREME VIEW WAS NOT REQUIRED TO BE ADOPTED AGAINST THE ASSESSEE. IN VIEW OF THE ABOVE, WE FEEL THAT THE LEVY OF PENALTY IN THIS CASE @ 200% IS ON HIGHER SIDE. SO KEEPING IN VIEW OF THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE, THE PENALTY IS ORDERED TO BE REDUCED AND CONFIRMED @ 100% OF THE TAX SOUGHT TO BE EVADED. WE O RDER ACCORDINGLY. 8. IN THE RESULT, THE APPEAL OF THE ASSES SEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 05.05. 201 4 . SD/ - SD/ - ( N. K. BILLAIYA ) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 1 3 .05. 201 4 . * KISHORE COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT ( A) CONCERNED, MUMBAI ITA NO. 7557/M/2012 M/S . PERCEPT ADVERTISING LTD. 4 THE DR C BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.