M/s Phool Chand & Others, Kanpur V. Asstt. Commissioner of Income Tax -(3), Kanpur

ITA 807/LKW/2013

• Counselvise Citation: 80723714 RSA 2013
• Duration Of Justice: 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2001-2002
• Appeal Filed On: 27-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.807/LKW/2013 ASSESSMENT YEAR:2001 - 02 M/S PHOOL CHAND & OTHERS, 14/47, SKYLARK COMPLEX, CHUNNIGANJ, KANPUR. PAN:AAFFP6934M VS. A.C.I.T. - 3, KANPUR. (APPELLANT) (RESPONDENT) O R D E R PER SUNIL KUMAR YADAV: THIS APPEAL IS PREFERRED ON BEHALF OF ASSESSEE AGAINST THE ORDER OF CIT(A) CONFIRMING THE PENALTY OF RS.9,82,000/ - LEVIED U/S 271(1)(C) OF THE ACT. 2. DURING THE COURSE OF HEARING OF THE APPEAL, THE LEARNED COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION TO THE FACTS THAT THE MAIN ADDITION WAS MADE ON ACCOUNT OF ESTIMATION OF GROSS PROFIT RATE AT 9% RESULTING INTO ADDITION OF RS.23.12.031/ - . BESIDES OTHER ADDITIONS WERE ALSO MADE ON AD HOC BASIS. IN QUANTUM APPEAL, THE TRIBUNAL HAS REDUCED THE GROSS PROFIT ADDITIONS FROM 9% TO 8.25% VIDE ITS ORDER DATED 31/10/2007. THEREFORE, ONCE THE QUANTUM IS REDUCED, THE PENALTY LEVIED BY THE ASSESSING OFFICER IS ALSO REQUIRED TO BE RECOMPUTED IN THE LIGHT OF THE ADDITIONS SUSTAINED BY THE TRIBUNAL . BUT THE ASSESSING OFFICER HAS NOT PASSED A FRESH ORDER WITH REGARD TO PENALTY LEVIED ON ACCOUNT OF ADDITIONS MADE UNDER THE HEAD GROSS PROFIT ON ESTIMATE BASIS. IT WAS ALSO POINTED OUT BY THE LEARNED COUNSEL FOR THE APPELLANT BY SHRI ALOK MITRA, D.R. RESPONDENT BY SHRI ABHINAV MEHROTRA, ADVOCATE DATE OF HEARING 04/02/2014 DATE OF PRONOUNCEMENT 1 1 / 0 4 / 2 0 1 4 2 ASSESSEE THAT WHILE LEVYING THE PENALTY THE ASSESSING OFFICER HAS NOT ADJUDICATED THE INDEPENDENT ISSUES OF ADDITIONS BEFORE HOLDING THAT THERE WAS ANY CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS. IN THE LIGHT OF THESE FACTS, IT WAS SUBMITTED THAT THE MATTER MAY BE RESTORED TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECTION TO READJUDICATE THE ISSUE OF PENALTY LEVIED UNDER DIFFERENT HEADS AND WHILE DOING SO THE ASSESSING OFFICER SHOULD ALSO EXAMINE THE INDEPENDENT ISSUES OF ADDITIONS BEFORE GIVING A CONCLUSIVE FINDING THAT THE ASSESSEE HAS EITHER CONCEALED THE INCOME OR HAS FURNISHED INACCURATE PARTICULARS. 3. THE LEARNED D.R. SIMPLY RELIED UPON THE ORDER OF CIT(A). 4. H AVING GIVEN A THOUGHTFUL CONSIDERATION TO THE RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSA L OF ORDERS OF THE LOWER AUTHORITIES, WE FIND THAT WHEN THE GROSS PROFIT ITSELF WAS REDUCED FROM 9% TO 8.25% RESULTING INTO SUBSTANTIAL REDUCTION IN GROSS PROFIT ADDITION, THE PENALTY IS ALSO REQUIRED TO BE RECOMPUTED. WE ALSO FIND FORCE IN THE CONTENTION OF THE ASSESSEE THAT THE ASSESSING OFFICER SHOULD HAVE ADJUDICATED THE INDEPENDENT ISSUES OF ADDITIONS ON WHICH THE PENALTY IS LEVIED. THEREFORE, WE SET ASIDE THE ORDER OF CIT(A) AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER WITH THE DIRECT ION TO READJUDICATE AND RECOMPUTE THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT. 5 . IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON 1 1 / 0 4 / 2 0 1 4 ) SD/. SD/. ( A. K. GARODIA ) (SUNIL KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 1 1 / 0 4 / 2 0 1 4 *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR