SCHRADER DUNCAN LTD, MUMBAI V. ADDL CIT RG 10(3), MUMBAI

ITA 8223/MUM/2010

• Counselvise Citation: 822319914 RSA 2010
• Duration Of Justice: 4 year(s) 1 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 17-12-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 26-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: HARESH G BUCH
• Keywords: Capital asset; Question of law
• Section: 6; 10

Judgement Text

, , ,, , , ,, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E MUMBAI , . . , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C.SHARMA, ACCOUNTANT MEMBER . / ITA NO.8223/MUM/2010 ! ! ! ! ' ' ' ' / ASSESSMENT YEAR: 2004-05 M/S SCHRADER DUNCAN LIMITED, LBS MARG, MULUND (W), MUMBAI-400080 VS. ADDITIONAL COMMISSIONER OF INCOME-TAX (10)-3, MUMBAI ( !#$ / ASSESSEE) ( % / REVENUE) P.A. NUMBER : AAACS0769H !#$ & ' / ASSESSEE BY: SHRI HARESH G. BUCH % & ' / REVENUE BY SHRI NEIL PHILIP ! & $( / DATE OF HEARING : 17/12/2014 )*' & $( / DATE OF PRONOUNCEMENT : 01/01/2015 O R D E R PER JOGINDER SINGH, JM: THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 15/09/2010 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: GROUND I: I. THE COMMISSIONER OF INCOME TAX (APPEALS)-22 ('THE C IT(A)') ERRED IN UPHOLDING THE ACTION OF THE ASST. COMMISSIO NER OF INCOME TAX-10(3) ('THE AO') IN LEVYING PENALTY ON T HE 2 M/S SCHRADER DUNCAN LIMITED . DISALLOWANCE OF LONG TERM CAPITAL LOSS ON REPURCHAS E OF US 64 UNITS OF UNIT TRUST OF INDIA, WITHOUT GIVING ADE QUATE OPPORTUNITY TO THE APPELLANT, ON THE ALLEGED GROUND THAT NO SATISFACTORY EVIDENCE WAS FURNISHED FOR THE SAME. II. THE APPELLANT PRAYS THAT IT BE HELD THAT NO ADEQUATE OPPORTUNITY HAD BEEN GIVEN TO IT AND HENCE THE ORDER PASSED U/S. 271 (1) (C) OF THE ACT BE HELD AS AB-INITIO AND/ OR OTHERWISE VOID AND BAD-IN-LAW. WITHOUT PREJUDICE TO THE ABOVE GROUND II: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) ERRED IN UPHOLDING THE ACTION OF THE AO IN LE VYING PENALTY OF RS. 66,36,077/- U/S SECTION 271(1)(C) OF THE ACT ON THE ALLEGED GROUND THAT THERE WAS CONCEALMENT OF INCOME AND THAT THE APPELLANT HAD FURNISHED INACCURATE DETAILS OF INCOME WITH RESPECT TO THE LONG TERM CAPITAL LOSS CLAIMED BY THE APPELL ANT. 2.THE APPELLANT PRAYS THAT A MERE DIFFERENCE IN OPI NION WOULD NOT AMOUNT TO RAISING A QUESTION ON THE BONAFIDE CLAIM M ADE BY THE APPELLANT WITH RESPECT TO THE LONG TERM CAPITAL LOS S. 3.THE APPELLANT PRAYS THAT THE SAID PENALTY LEVIED B Y THE AO AND CONFIRMED BY THE CIT(A) BE DELETED. 2. AT THE TIME OF HEARING, LD. COUNSEL FOR THE ASSE SSEE, SHRI HARESH G. BUCH, CONTENDED THAT SUBSTANTIAL QUESTION OF LAW HAS BEEN ADMITTED BY THE HONBLE HIGH COURT, THEREFORE, NO PENALTY IS IMPOSABLE U/S 271(1)(C) OF THE ACT. RELIANCE WAS P LACED UPON THE DECISION FROM HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS M/S NAYAN BUILDERS & DEVELOPERS (ITA NO.415/2012 ) ORDER DATED 8 TH JULY, 2014. OUR ATTENTION WAS INVITED TO THE CASE OF THE ASSESSEE ITSELF (ITA NO.602/2012) ORDER DATED 19 TH SEPTEMBER, 3 M/S SCHRADER DUNCAN LIMITED . 2014 ADMITTING THE SUBSTANTIAL QUESTION OF LAW. TH E LD. DR, SHRI NEIL PHILIP HAS NEITHER CONTROVERTED THE ASSERTIONS OF THE ASSESSEE NOR BROUGHT ON RECORD ANY CONTRARY MATERIAL ON RECO RD. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. BEFORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION FRO M THE CONCLUSION ARRIVED AT BY THE LD. COMMISSIONER OF IN COME TAX (APPEALS) FOR READY REFERENCE: 2.3 I HAVE CONSIDERED THE FACTS OF THE CASE, PERUSE D THE PENALTY ORDER AND SUBMISSIONS MADE BY THE APPELLANT AND ALSO DISCUSSED THE CASE WITH THE AIR OF THE APPELLAN T. A.O. IN THE PENALTY ORDER HAS MENTIONED THAT IN RESPONSE T O NOTICE DATED 08.03.2010 FIXING THE CASE FOR HEARING ON 17.03.2010 NEITHER ANYBODY ATTENDED NOR ANY SUBMISSIO N HAVE BEEN FILED. THE APPELLANT SUBMITS THAT THE SAI D NOTICE WAS RECEIVED BY IT ON 23.03.2010. HOWEVER, BEFORE ME THE APPELLANT FAILED TO FURNISH ANY EVIDENCE IN SUPPORT T HEREOF. THE ORDER HAS BEEN PASSED ON 29.03.2010 AND BEFORE T HAT THERE WAS NO COMMUNICATION FROM THE APPELLANT AND H ENCE IN MY OPINION THERE IS NO DISCREPANCY IN THE FINDIN GS GIVEN BY A.O. THE APPELLANT HAS RELIED ON THE DECISION OF HON'BLE [TAT IN THE CASE OF MAHESH LUNCH HOME (SUPRA). HOWEV ER, ON PERUSAL OF THIS JUDGMENT IT IS NOTED THAT THE ISSU E THERE RELATES TO NON RECORDING OF SATISFACTION FOR INITIA TING PENALTY PROCEEDINGS WHICH IS NOT THE ISSUE IN THE PRESENT C ASE. ACCORDINGLY, THE RATIO OF THE JUDGMENT DOESN'T APPLY IN THIS CASE. THUS, THIS GROUND OF APPEAL IS DISMISSED. 3.1 GROUND OF APPEAL NO.2 IS AGAINST THE LEVYING PEN ALTY OF RS.66,36,077/- U/S 271(1)(C) OF THE I.T.ACT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS A.O. MADE THE ADDI TION OF RS.6,34,72,767/- ON ACCOUNT OF DISALLOWANCE OF LONG TERM CAPITAL LOSS, DURING THE COURSE OF ASSESSMENT PROCE EDINGS 4 M/S SCHRADER DUNCAN LIMITED . A.O. NOTED THAT ASSESSEE HAS CLAIMED LONG TERM CAPITA L LOSS OF RS.6.34,72,767/- ON ACCOUNT OF REPURCHASE OF UNI TS OF MUTUAL FUNDS OF UNIT TRUST OF INDIA. A.O. OBSERVED TH E DETAILS AND NOTED THAT THE UNITS VALUED AT RS.7,14,42,3 94/- WERE PURCHASED DURING A.YRS. 1992-1993 TO 2001-2002 A ND HAVE BEEN SOLD BY WAY OF REPURCHASE BY UTI AND AFTER REPURCHASE THE SAME WERE INVESTED IN TAX FREE BONDS. A.O. REFERRED TO SUB SECTION 6 OF SECTION 45 AND NOTED THAT NON OBSTANTE CLAUSE WHICH MENTIONS THAT THE DIFFERENCE BETWEEN THE REPURCHASE PRICE OF THE UNITS AND CAPITAL VALUE OF UNITS SHALL BE DEEMED TO BE CAPITAL GAINS ARISING TO THE A SSESSEE IN THE PREVIOUS YEAR IN WHICH SUCH A REPURCHASE TAK ES PLACE AND WILL BE TAXED ACCORDINGLY. IN VIEW OF THESE FAC TS A.O. DISALLOWED THE CLAIM OF LONG TERM CAPITAL LOSS OF RS.6,34,72,767/- AND ALLOWED SHORT TERM CAPITAL LOS S AT RS.97,17,302/-. ON APPEAL, THE LD.CIT(A) MADE ENHANCEMENT OF RS.97, 17,302/- WHICH HAD BEEN ALLOW ED BY THE A.O. AS SHORT TERM CAPITAL LOSS AND WAS ALLOW ED TO BE CARRIED FORWARD. ACCORDINGLY. THE A.O. LEVIED MINIMU M PENALTY OF RS.66,36.077/- TREATING THAT THE ASSESSE E HAS DELIBERATELY FURNISHED INACCURATE PARTICULARS OF ITS INCOME AND SOUGHT TO EVADE INCOME TO THE EXTENT OF RS.6,34,72.767/-. 3.2 DURING THE COURSE OF APPELLATE PROCEEDINGS THE APPELLANT HAS FURNISHED WRITTEN SUBMISSIONS WHEREIN IT HAS BEE N SUBMITTED THAT CAPITAL GAINS ON THE CONVERSION OF SU BJECT US 64 UNITS INTO US 64 TAX FREE BONDS SHOULD BE COMPUTED UNDER NORMAL PROVISIONS U/S45( I) AND NOT U/S.4S(6) O F THE I.T.ACT. APPELLANT FURTHER SUBMITTED THAT US 64 UNITS ARE CAPITAL ASSET TO THE APPELLANT WITHIN THE MEANING O F SECTION 2( 14) OF THE ACT WHICH EXC1UDES FROM THE AMBIT THER EOF SIX TYPES OF ASSETS. APPELLANT ALSO RELIED ON THE FOLLO WING DECISIONS: (I) ADDL.CIT VS. TRUSTEES OF H.E.H. THE NIZAMS SECOND SUPPLEMENTARY FAMILY TRUST, 102 ITR 248. 5 M/S SCHRADER DUNCAN LIMITED . (II) KIRLOSKAR ASIALTD. VS. CIT, 117 ITR 82 (KAR.) (III) ANARKALI SARABHAI, 224ITR 422. APPELLANT FURTHER SUBMITS THAT STATEMENT SHOWING TH E CALCULATION OF THE LONG TERM CAPITAL LOSS ARISING F ROM THE CONVERSION OF UNITS INTO BONDS WAS ATTACHED WITH TH E RETURN OF INCOME AND SAME WAS ALSO PROVIDED 'DURING ASSESSMEN T PROCEEDINGS, THEREFORE, THERE WAS NO CONCEALMENT OF ANY PARTICULARS OR FURNISHING OF ANY INACCURATE PARTICU LARS, JUSTIFYING INVOKING OF THE PENAL PROVISIONS. APPELL ANT ALSO SUBMITTED THAT ACTUAL STATE OF AFFAIRS PRESENTED TO T HE DEPARTMENT DOES NOT CONTAIN ANY ERROR AND NO DISCREPAN CY IS FOUND IN ANY OF THE MATERIAL FACTS, HENCE IT IS E STABLISHED BEYOND THAT PROCEEDINGS U/S. 271 (1 )(C) FOR ALLEGED DEFAULT OF CONCEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS THEREOF IS UNWARRANTED AND UNJUSTIFIED AN D DOES NOT STAND A MOMENT'S SCRUTINY. APPELLANT FURTHER SU BMITTED THAT IT IS A SETTLED LAW THAT BEFORE PENALTY COULD BE LEVIED, THE ENTIRELY OF CIRCUMSTANCES MUST REASONABLY POINT THE A.O. TO CONCLUSION THAT THE DISPUTED AMOUNT REPRESENTED IN COME AND THAT IT HAD CONSCIOUSLY CONCEALED THE PARTICULAR S OF HIS INCOME OR HAD DELIBERATELY FURNISHED INACCURATE PARTI CULARS. APPELLANT ALSO SUBMITTED THAT VIEW TAKEN BY THE A.O. WHICH FORMED THE BASIS OF LEVYING THE PENALTY WAS IN ANY C ASE NOT ACCEPTED BY THE CIT(A)-X IN QUANTUM APPEAL, HENCE EV EN IN SUCH CASE THERE WAS NO QUESTION OF LEVYING ANY PENA LTY. IN THIS RESPECT APPELLANT RELIED ON THE FOLLOWING DECISI ONS: I. CIT VS. MITHALAL RAMACHANDRA, 82 ITR 470 II. CIT VS. INDO AMERICAN ELECTRICALS LTD. 45 CTR 146 III. HINDUSTAN STEEL LTD. VS. STATE OF ORISSA, 83 ITR 26 IV. YASMIN PROPERTIES (P) LTD. 46 ITD 331 V. D.M. DAHANUKAR VS. CIT, 65 ITR 280 VI. ITO VS. H.A. SODHAN (GREATER HUF) 17 ITD 479 (AHD.) VII. CIT VS. INDIAN METALS & FERRO ALLOYS LTD. 211 ITR 3 5 (ORI.) VIII. NUCHEM LTD. VS. DCIT. 47 ITD 487 (DEL.) 6 M/S SCHRADER DUNCAN LIMITED . IX. ASSOCIATED CEMENT COMPANIES LTD. VS. DCIT, 40 ITD 70 (80M.) IN VIEW OF THESE SUBMISSIONS, APPELLANT PRAYED THAT PENALTY LEVIED U/S.271 (I )(C) AMOUNTING TO RS.66,36,077/- M AY BE DROPPED. 3.3 I HAVE CONSIDERED THE FACTS OF THE CASE, PERUSED THE PENALTY ORDER AND SUBMISSIONS MADE BY THE APPELLANT AND ALSO DISCUSSED THE CASE WITH THE A/R OF THE APPELLAN T. THE A.O. MADE DISALLOWANCE OF LONG TERM CAPITAL LOSS ON SALE OF UNITS OF UTI BUT ALLOWED THE SHORT TERM CAPITAL LOSS (DIFFERENCE BETWEEN PURCHASE PRICE & SALE PRICE OF UNITS) TO BE CARRIED FORWARD. WHILE CONSIDERING THE ISSUE DURING FIRST APPELLATE PROCEEDINGS, THE LD.CIT(A) IN PARA 1.13 O F HIS ORDER NO.CIT(A)-XIIT/275/2006-07 DATED 28.11.2008 OBSERVED AS UNDER: '1.13 HOWEVER, IN THE COURSE OF APPELLATE PROCEEDIN GS, IT WAS NOTICED THAT THE CAPITAL GAINS ACCRUING ON US 64 WERE SPECI FICALLY EXEMPTED FROM TAXATION U/S. L0(33). THEREFORE, VIDE ORDER SH EET ENTRY DATED 18.LL.2008, THE ASSESSEE WAS SPECIFICALLY ASKED TO SHOW CAUSE AS TO WHY THE CAPITAL LOSS SHOULD NOT ALSO BE DISALLOWED ON T RANSFER OF US 64. IN OTHER WORDS, IT WOULD LEAD TO AN ENHANCEMENT AS ENV ISAGED U/S 251(2). IN THIS REGARD THE ASSESSEE HAS SUBMITTED AS FOLLOW S: (A) AS PER SECTION 10 ONLY POSITIVE INCOME IS EXEMP T AND NOT LOSS. (B) CAPITAL LOSS IS NOT INCLUDED IN TOTAL INCOME AN D IS CARRIED FORWARD. (C) SECTION 10(35) DEALS WITH POSITIVE INCOME AND T HEREFORE, SECTION 10(33) IS ALSO CONFINED TO POSITIVE INCOME. (D) THAT THE INTENTION OF SECTION 10(33) WAS TO GIV E RELIEF TO INVESTORS. ITS INTENTION WAS NOT TO DEPRIVE. 1.14 I HAVE EXAMINED THE PROVISIONS OF LOW IN THIS CASE SECTION 10 BEGINS WITH THE CLAUSE THAT IN COMPUTING THE TOTAL INCOME OF A PREVIOUS YEAR OF ANY PERSON, ANY INCOME FALLING WITHIN ANY O F THE FOLLOWING CLAUSES SHALL NOT BE INCLUDED. NOW, CLAUSE (33) SPE CIFICALLY REFERS TO INCOME ARISING FROM TRANSFER OF CAPITAL ASSETS, BEI NG UNITS OF US 64. 7 M/S SCHRADER DUNCAN LIMITED . THUS, SECTION 10 IS AN EXEMPTION CLAUSE AND NOT A D EDUCTION. ANY INCOME OF THE TYPE DEFINED IN CLAUSE (1) TO (36) OF THAT SECTION WILL NOT BE INCLUDED IN THE TOTAL INCOME. NOW IT IS A WELL ACCE PTED PROPOSITION THAT UNDER THE INCOME TAX ACT, THE WORD 'INCOME' INCLUDE S 'LOSS'. IN OTHER WORDS, ANY INCOME/LOSS ON TRANSFER OF US 64 ASSETS WOULD BE EXEMPTED FROM BEING INCLUDED IN THE COMPUTATION OF TOTAL INC OME. IN THE CIRCUMSTANCES, I FAIL TO UNDERSTAND HOW THE ASSESSE E CAN ARGUE THAT SECTION 10(33) IS CONFINED TO ONLY POSITIVE INCOME AND NOT LOSSES. IN THE CIRCUMSTANCES, THE ASSESSEE WILL NOT BE ENTITLED TO CLAIM OF CAPITAL LOSS ON TRANSFER OF US 64. THE A.O. IS DIRECTED TO EXCLU DE THE ENTIRE LOSS FROM THE COMPUTATION OF TOTAL INCOME. THIS WOULD RESULT IN AN ENHANCEMENT RS.97,17,302/-. FOR STATISTICAL PURPOSES THIS GROUN D OF APPEAL IS TREATED AS DISMISSED. FROM THE ABOVE IT MAY BE NOTED THAT AN AMOUNT OF RS.97,17,302/- HAVE BEEN DISALLOWED BY THE CIT(A) AN D ACCORDINGLY THE PENALTY HAS BEEN COMPUTED BY THE A.O . INCLUDING THE AMOUNT DISALLOWED BY THE A.O. BEFORE M E IT WAS STATED THAT NO PARTICULARS WERE CONCEALED AND CIT( A) HAS CONFIRMED THE DISALLOWANCE FOLLOWING THE ENHANCE MENT PROCEDURE. HOWEVER, I DO NOT AGREE WITH THE CONTENTI ON OF THE APPELLANT SINCE CIT(A) HAS BEEN GIVEN SPECIFIC POWER TO MAKE ENHANCEMENT WHICH IS COTERMINUS TO THE JURISDI CTION APPELLANT FURTHER SUBMITS THAT THE DETAILS WERE ATTA CHED WITH THE RETURN OF INCOME. HOWEVER, THIS IS NOT COR RECT SINCE THE APPELLANT DID NOT SUO MOTO OFFER THE DISALLOWANC E OF U/S.10(33) IN ITS RETURN OF INCOME AND HENCE THE CLA IM OR LOSS WAS NOT BONAFIDE. THE APPELLANT HAS FURTHER STA TED THAT THE A.O. HAS NO WHERE CONCLUDED THE DISPUTED AMOUNT WE RE CONSCIOUSLY CONCEALED OR HAD DELIBERATELY FURNISHED INACCURATE PARTICULARS. THIS ARGUMENT OF THE APPELL ANT IS UNFOUNDED IN VIEW OF THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF UNION OF INDIA VS DHARMENDRA T EXTILE PROCESSORS (2008) 306 ITR 277, WHERE IN ORDER DATED 29.9.2008 IT WAS HELD THAT THE OBJECT BEHIND ENACTING SECTION 271(1)(C) READ WITH EXPLANATION INDICATES TH AT THE SAID SECTION HAS BEEN ENACTED TO PROVIDE A REMEDY FOR LOSS OF REVENUE. PENALTY U/S. 271(1)(C) IS A 'CIVIL LIAB ILITY'. WILLFUL 8 M/S SCHRADER DUNCAN LIMITED . CONCEALMENT IS NOT ESSENTIAL INGREDIENT FOR ATTRACT ING A CIVIL LIABILITY AS IN THE MATTER OF PROSECUTION U/S. 276C . THUS, IT MAY BE NOTED THAT THE APPELLANT HAS FAILED TO OFFER AN EXPLANATION BEFORE THE A.O. BY WAY OF NOT RESPONDIN G TO PENALTY NOTICE U/S.271(1)(C). EVEN DURING THE COURSE OF APPELLATE PROCEEDINGS IT FAILED TO PROVE THAT ITS AC TION TO CLAIM LOSS WAS BONAFIDE. IN VIEW OF THESE FACTS AND L EGAL POSITION. I AM OF THE CONSIDERED OPINION THAT THE PE NALTY U/S.271(1)(C) HAS RIGHTLY BEEN IMPOSED BY THE A.O. W HICH IS UPHELD. 4 GROUND OF APPEAL NO. III IS GENERAL IN NATURE, HEN CE NOT ADJUDICATED UPON. 5. IN THE RESULT, APPEAL IS DISMISSED. 2.2. WITHOUT GOING INTO MUCH DELIBERATION AND MERITS OF THE CASE, NOW QUESTION ARISES SINCE THE SUBSTANTIAL QU ESTION OF LAW WHETHER ON THE FACTS IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE TRIBUNAL WAS JUSTIFIED IN HOLDING THAT THE APPE LLANT WAS NOT ENTITLED TO CLAIM THE LOSS OF RS.6.34 CRORE ARISIN G ON CONVERSION OF UTI US 64 UNITS IN TO 6.75% TAX FREE BONDS OF UTI? HAS BEEN ADMITTED BY THE HONBLE JURISDICTIONAL HIGH COURT, VIDE ORDER DATED 19 TH SEPTEMBER, 2014, NOW QUESTION ARISES WHETHER PENA LTY U/S 271(1)(C) OF THE ACT SURVIVES WHEN THE ADDITION HAS BECOME DEBATABLE? WE NOTE THAT THE HONBLE JURISDICTIONAL HIGH COURT VIDE ORDER DATED 08/07/2014 IN THE CASE OF CIT VS M/S NA YAN BUILDERS & DEVELOPERS (ITA NO.415/2012) HELD THAT NO PENALTY IS IMPOSABLE U/S 271(1)(C) OF THE ACT. LIKEWISE, THE TRIBUNAL, IN THE CASE OF M/S NAYAN BUILDERS & DEVELOPERS PVT. LTD. (ITA NO.2379/ MUM/2009) ORDER DATED 18 TH MARCH 2011, DELETED THE PENALTY. IN ANOTHER CASE ADVAITA ESTATE DEVELOPMENT (P.) LTD. VS ITO (2 013) 40 9 M/S SCHRADER DUNCAN LIMITED . TAXMAN.COM 142 (MUMBAI-TRIB.) VIDE ORDER DATED 27/0 8/2013 DELETED THE PENALTY. IN VIEW OF THESE FACTS, WHEN THE HONBLE JURISDICTIONAL HIGH COURT HAS ADMITTED SUBSTANTIAL QUESTION OF LAW ON THE ADDITION, IT BECOMES APPARENT THAT THE ADDIT ION SO MADE HAS BECOME DEBATABLE. THE PENALTY WAS IMPOSED ON T HE BASIS OF ADDITION SO MADE, THEREFORE, WHEN THE ADDITION ON T HE BASIS OF WHICH THE PENALTY WAS IMPOSED HAS BECOME DOUBTFUL/D EBATABLE, THEREFORE, PENALTY IMPOSED U/S 271(1)(C) OF THE ACT CANNOT SURVIVE. RESPECTFULLY FOLLOWING THE HONBLE JURISDICTIONAL H IGH COURT, THE APPEAL OF THE ASSESSEE IS ALLOWED. HOWEVER, IT IS MADE CLEAR THAT IF AT ANY STAGE, THE ORDER OF THE TRIBUNAL ON QUANTUM ADDITION IS UPHELD BY THE HONBLE HIGH COURT, THE DEPARTMENT IS FREE TO PROCEED IN ACCORDANCE WITH LAW ON PENALTY PROCEEDIN GS. FINALLY, APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 17/12/2014. SD/- SD/- (R.C.SHARMA) (JO GINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED - 01/01/2015 F{X~{T? P.S/. ! . . & && & +$, +$, +$, +$, -,'$ -,'$ -,'$ -,'$ / COPY OF THE ORDER FORWARDED TO : 1. ./ / THE APPELLANT 2. +0./ / THE RESPONDENT. 3. 1 ( ) / THE CIT(A)- 4. 1 / CIT 10 M/S SCHRADER DUNCAN LIMITED . 5. ,23 +$! , , / DR, ITAT, MUMBAI 6. 34 5 / GUARD FILE. ! ! ! ! / BY ORDER, 0,$ +$ //TRUE COPY// 6 66 6 / 7 7 7 7 % % % % (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI