GIRISH C. SANGANI, MUMBAI V. ACIT CEN CIR 23, MUMBAI

ITA 827/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1877 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2016
• Appeal Filed By: Assessee
• Bench Allotted: G
• Next Hearing Date: 03-11-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 06-02-2015
• Court: TRIBUNAL
• Section: 132

Judgement Text

, , G, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES G, MUMBAI , , , BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER, AND SHRI ASHWANI TANEJA, ACCOUNTANT MEMBER ITA NO.827/MUM/2015 ASSESSMENT YEAR: 2009-10 GIRISH C. SANGANI 2/26, KAMALA BHUVAN, SAHAR ROAD, ANDHERI (E) MUMBAI-400069 / VS. ACIT CENTRAL CIRCLE 23, AAYKAR BHAVAN, 4 TH FLOOR, M.K. ROAD, NEW MARIN LINE, MUMBAI-40020 (APPELLANT ) (RESPONDENT ) P.A. NO. AAEPS4932R ITA NO.829-831/MUM/2015 ASSESSMENT YEARS: 2009-10, 2010-11 & 2011-12 GIRISH C. SA NGANI HUF 2/26, KAMALA BHUVAN, SAHAR ROAD, ANDHERI (E) MUMBAI-400069 / VS. ACIT CENTRAL CIRCLE 23, AAYKAR BHAVAN, 4 TH FLOOR, M.K. ROAD, NEW MARIN LINE, MUMBAI-40020 ( APPELLANT ) (RESPONDENT ) P.A. NO. AACHG4558D APPELLANT BY SHRI ANUJ KISNADWALA ( A R) REVENUE BY SHRI PRAKASH MANE (DR) / DATE OF HEARING: 03/11/2016 / DATE OF ORDER: 18/11/2016 GIRISH C. SANGANI 2 / O R D E R PER ASHWANI TANEJA (ACCOUNTANT MEMBER): THESE APPEALS INVOLVE COMMON ISSUES, THEREFORE THES E WERE HEARD TOGETHER AND BEING DISPOSED OF BY THIS C OMMON ORDER. 2. DURING THE COURSE OF HEARING, ARGUMENTS WERE MADE B Y SHRI ANUJ KISNADWALA, AUTHORISED REPRESENTATIVES (A R) ON BEHALF OF THE ASSESSEE AND BY SHRI PRAKASH MANE, DEPARTMENTAL REPRESENTATIVE (DR) ON BEHALF OF THE R EVENUE. FIRST WE SHALL TAKE UP ITA NO.829/MUM/2015 IN THE C ASE OF GIRISH C. SANGANI HUF FOR A.Y. 2009-10 THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST PENALTY LEVIED BY THE AO FOR RS.45148/- WHICH WAS C ONFIRMED BY THE LD. CIT(A). 3. THE BRIEF FACTS AS BROUGHT OUT BEFORE US ARE THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE WAS PROPRIETO R OF M/S. ISHA TRADE LINKS ENGAGED IN THE BUSINESS OF TRADING IN IRON AND STEEL. SEARCH ACTION WAS DONE U/S 132 ON 29.03. 2011 IN THE CASE OF KANAKIA GROUP. DURING THE COURSE OF SEA RCH, THE PREMISES OF THE ASSESSEE WERE ALSO COVERED. DURING THE COURSE OF SEARCH ON THE SAID GROUP IT WAS NOTED BY THE REV ENUE OFFICIALS THAT CERTAIN BOGUS ACCOMMODATION BILLS OF PURCHASE WERE OBTAINED THROUGH ASSESSEE. UNDER THESE CIRCUMS TANCES, THE ASSESSEE WAS ASKED TO JUSTIFY ENTIRE PURCHASES AND SALES. BUT, THE ASSESSEE MADE AN OFFER TO PAY ADDITIONAL T AX @ 1% GIRISH C. SANGANI 3 OVER & ABOVE THE AMOUNT OF GROSS PROFIT SHOWN IN T HE BOOKS OF ACCOUNTS, TO BUY PEACE & AVOID PROTRACTED LITIGA TION, AS THE ASSESSEE WAS NOT ABLE TO PRODUCE THE PARTIES TO CON FIRM THE ALL THE TRANSACTIONS OF PURCHASES AND SALES. UNDER THES E CIRCUMSTANCES, THE AO ACCEPTED OFFER OF THE ASSESSE E AND ASSESSED THE GP @ 1% OVER AND ABOVE THE GP RATE REC ORDED IN THE REGULAR BOOKS BY THE ASSESSEE. THE AFORESAID AD DITION WAS ACCEPTED BY THE ASSESSEE AND NO APPEAL WAS FILED. SUBSEQUENTLY, AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C). DURING THE COURSE OF PENALTY PROCEEDINGS, THE ASSES SEE REPLIED THAT THOUGH AN OFFER WAS MADE TO PAY ADDITIONAL TAX , BUT ACTUALLY THERE WAS NO CONCEALED INCOME AND THE OFFE R WAS MADE TO BUY PEACE AND AVOID LITIGATION ONLY. THE AO DID NOT AGREE WITH THE SUBMISSION OF THE ASSESSEE, AND THUS HE LEVIED PENALTY OF RS.45,148/-. THE PENALTY WAS CONFIRMED B Y THE LD. CIT(A). THUS, BEING AGGRIEVED, THE ASSESSEE FILED A PPEAL BEFORE THE TRIBUNAL. 4. DURING THE COURSE OF HEARING, LD. COUNSEL OF THE A SSESSEE SUBMITTED THAT IT WAS A CASE OF ESTIMATED ADDITION ONLY AND THERE WAS NO CONCEALED INCOME ACTUALLY AND THE OFFE R WAS MADE TO BUY PEACE AND AVOID LITIGATION. IT WAS ALSO SUBMITTED THAT IN THE INDIVIDUAL CASE OF KARTA NAMELY SHRI GI RISH C. GANGANI FOR A.Y. 2011-12 WHEREIN PENALTY WAS LEVIED U/S 271AAA IN IDENTICAL CIRCUMSTANCES, THE MATTER HAD R EACHED BEFORE THE TRIBUNAL, AND TRIBUNAL DELETED THE PENAL TY VIDE ITS ORDER DATED 25.10.2016 IN ITA NO.828/MUM/2015, INTER-ALIA ON THE GROUND THAT ALL THE FACTS HAVE BEEN FAIRLY D ISCLOSED BY THE ASSESSEE AND NOTHING HAS BEEN CONCEALED AND THE REFORE GIRISH C. SANGANI 4 PENALTY WAS DELETED AFTER MAKING DETAILED DISCUSSIO N IN THE ORDER. UNDER THESE CIRCUMSTANCES, REQUEST WAS MADE TO DELETE THE PENALTY IN THIS CASE ALSO. IT WAS SUBMITTED THA T IN A.Y. 2010-11, ALSO NO PENALTY ON THIS ISSUE WAS LEVIED B Y THE AO IN ASSESSEES OWN CASE. UNDER THESE CIRCUMSTANCES, LEV Y OF THE PENALTY IN THE IMPUGNED YEAR WAS NOT JUSTIFIED. THU S, PENALTY LEVIED SHOULD BE DELETED. PER CONTRA, LD. DR RELIED UPON THE ORDERS OF THE LOWER AUTHORITIES. 5. WE HAVE GONE THROUGH THE ORDERS OF THE LOWER AUTHO RITIES. IT IS AN ADMITTED CASE THAT NO EVIDENCES HAVE BEEN FOU ND BY ANY AUTHORITY WITH REGARD TO ANY CONCEALMENT OF INCOME BY THE ASSESSEE. THE INCOME WAS ASSESSED PURELY ON THE BAS IS OF OFFER MADE BY THE ASSESSEE ON ESTIMATE BASIS. THE INCOME WAS COMPUTED BY MAKING AN ESTIMATE OF 1% OVER AND ABOVE THE GROSS PROFIT DECLARED BY THE ASSESSEE. DURING THE C OURSE OF PENALTY PROCEEDINGS, ASSESSEE HAD CLARIFIED THAT IN FACT NO INCOME WAS CONCEALED, AND THE OFFER WAS MADE ONLY T O BUY PEACE AND AVOID PROTRACTED LITIGATION. IT IS NOTED THAT NO PENALTY WAS LEVIED IN THE SIMILAR CIRCUMSTANCES BY THE AO IN A.Y. 2010-11 IN ASSESSEES OWN CASE. IT IS ALSO NOT ED THAT IN THE INDIVIDUAL CASE OF KARTA, THE TRIBUNAL HAD DELE TED THE PENALTY WHICH WAS LEVIED U/S 271AAA AFTER TAKING IN TO ACCOUNT ALL THE FACTS AND CIRCUMSTANCES OF THE CASE IN ITS ORDER DATED 25.10.2016 IN ITA NO.828/MUM/2015. DURING THE COURSE OF HEARING, LD. DR WAS NOT ABLE TO JUSTIFY T HE LEVY OF PENALTY IN ANY MANNER. UNDER THESE CIRCUMSTANCES, W E FIND THAT LEVY OF PENALTY WAS NOT JUSTIFIED AND WAS NOT IN GIRISH C. SANGANI 5 ACCORDANCE WITH LAW. THUS, PENALTY LEVIED BY THE AO OF RS.45148/- IS HEREBY DIRECTED TO BE DELETED. 6 . IN OTHER APPEALS ALSO IT IS NOTED BY US THAT PENA LTY HAS BEEN LEVIED IN THE SIMILAR CIRCUMSTANCES. THERE WAS NO C ONCEALED INCOME DETECTED BY THE AO. ADDITION WAS MADE PURELY ON THE BASIS OF ESTIMATE. LD. DR ALSO AGREED THAT FACTS AR E IDENTICAL IN ALL THE CASES. THUS, RESPECTFULLY FOLLOWING OUR EAR LIER ORDER, WE HERBY DELETE THE PENALTY IN ALL THE CASES. 7. IN THE RESULT, THESE APPEALS FILED BY THE ASSESSEE ARE ALLOWED. ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE CONCL USION OF HEARING. SD/- (AMIT SHUKLA ) SD/- (ASHWANI TANEJA) ! / JUDICIAL MEMBER ' ! / ACCOUNTANT MEMBER MUMBAI; # DATED : 18 /11/2016 CTX? P.S/. .. #$%&'(')% / COPY OF THE ORDER FORWARDED TO : 1. % &' / THE APPELLANT 2. ()&' / THE RESPONDENT. 3. * * ( % ) / THE CIT, MUMBAI. 4. * * / CIT(A)- , MUMBAI 5. -. / (01 , * % 012 , / DR, ITAT, MUMBAI 6. / 34 5 / GUARD FILE. / BY ORDER, ) -% ( //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI