DCIT 2 (2)92), MUMBAI V. M/S NISIGANDHA POLYMERS PVT LTD., MUMBAI

ITA 7959/MUM/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 1222 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-07-2021
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 26-12-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: THARIAN OOMMEN
• Assessee Lawyers: MAYANK CHAUHAN
• Keywords: Bogus purchase
• Section: 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , B BENCH MUMBAI BEFORE : SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI M.BALAGANESH, A CCOUNTANT M EMBER ITA NO. 7959 /MUM/ 20 19 ( ASSESSMENT YEAR : 201 0 - 1 1 ) DCIT - 2(2)(2), MUMBAI ROOM NO.545, 5 TH FLOOR AA YAKAR BHAVAN MUMBAI 400 020 VS. M/S. NISHIGANDHA POLYMERS PVT. LTD., 3 RD FLOOR, RUSTOM BUILDING 29, VEER NARIMAN ROAD FOUNTAIN, MUMBAI 400 023 PAN/GIR NO. AAACB6044J (APPELLANT ) .. (RESPONDENT ) REVENUE BY SHRI THARIAN OOMMEN ASSESSEE BY SHRI MAYANK CHAUHAN DATE OF HEARING 05 / 07 /202 1 DATE OF PRONOUNCEMENT 09 / 07 /202 1 / O R D E R PER M. BALAGANESH (A.M) : THIS APPEAL IN ITA NO. 7959/MUM/2019 FOR A.Y. 2010 - 11 ARISES OUT OF THE ORDER BY THE LD. COMMISSIONER OF INCOME TA X (APPEALS) - CIT(A) - 5, MUMBAI IN APPEAL NO.CIT(A) - 5/ACIT - 2(2)(2)/IT - 24/17 - 18 DATED 01/10/2019 (LD. CIT(A) IN SHORT) IN THE MATTER OF IMPOSITION OF PENALTY U/S.271(1)(C) OF THE INCOME TAX ACT, 1961 ( HEREINAFTER REFERRED TO AS ACT). ITA NO . 7959/MUM/2019 M/S. NISHIGANDHA POLYMERS PVT. LTD., 2 2. WE HAVE HEARD RIVAL SU BMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE LD. AO HAD LEVIED PENALTY ON THE ESTIMATED ADDITION MADE ON ACCOUNT OF BOGUS PURCHASES. THIS PENALTY LEVIED U/S.271(1)(C) OF THE ACT ON AN ADDITION MADE ON ACCOUNT OF BOGUS PURCHASES WAS DELETED BY THE LD. CIT(A) ON THE PRIMARY GROUND THAT NO PENALTY WOULD SURVIVE ON AN ESTIMATED ADDITION. AGGRIEVED, THE REVENUE IS IN APPEAL BEFORE US. 3. WE FIND AT THE OUTSET, THE LD AR ARGUED THAT PENALTY THAT IS IN DISPUTE BEFORE US, FALLS BELOW TH E MONETARY LIMIT PRESCRIBED BY THE CBDT IN ITS CIRCULAR NO. 17/2019 DATED 08/08/2019 FOR PREFERRING APPEAL BY THE REVENUE BEFORE THIS TRIBUNAL. WE FIND THAT THE LD. DR VEHEMENTLY ARGUED THAT THE SAID CASE FALLS WITHIN THE EXCEPTION PROVIDED IN PARA 10(E) O F THE SAID CIRCULAR AND ACCORDINGLY HE ARGUED THAT THE APPEAL IS MAINTAINABLE. WE FIND THAT THE EXCEPTION PROVIDED IN PARA 10(E) OF THE CIRCULAR 17/2019 DATED 08/08/2019 IS APPLICABLE ONLY FOR THE QUANTUM PROCEEDINGS AND THE SAME CANNOT BE MADE APPLICABLE FOR PENALTY PROCEEDINGS. IT IS WELL SETTLED THAT PENALTY AND QUANTUM ASSESSMENT PROCEEDINGS ARE DISTINCT AND SEPARATE. EVEN OTHERWISE ON MERITS, WE FIND THAT THE CONCEALMENT PENALTY U/S.271(1)(C) OF THE ACT HAD BEEN LEVIED IN THE INSTANT CASE ON AN ESTIM ATED ADDITION MADE ON ACCOUNT OF BOGUS PURCHASES. THE LAW IS VERY WELL SETTLED THAT NO CONCEALMENT PENALTY WOULD LIE ON AN ESTIMATED ADDITION. ACCORDINGLY, WE DISMISS THIS APPEAL OF THE REVENUE BY FOLLOWING THE AFORESAID CIRCULAR NO.17/2019 DATED 08/08/201 9 AND HOLD THAT THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE. ITA NO . 7959/MUM/2019 M/S. NISHIGANDHA POLYMERS PVT. LTD., 3 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 09 / 07 /202 1 BY WAY OF PROPER MENTIONING IN THE NOTICE BOARD. SD/ - ( VIKAS AWASTHY ) SD/ - (M.BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED 09 / 07 / 2021 KARUNA , SR.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, ( ASSTT. REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. D R, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//