TAMANJIT H, MEHTA, MUMBAI V. ASST CIT RG 20(3), MUMBAI

ITA 832/MUM/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0032 (ITAT-MUMBAI)
• Duration Of Justice: 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2009-2010
• Appeal Filed On: 06-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JUSTIN
• Keywords: Depreciation
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI BEFORE SHRI G S PANNU, ACCOUNTANT MEMBER & SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO. 832/MUM/2017 ASSESSMENT YEAR : 2009 2010 SHRI TAMANJIT H MEHTA 002, GROUND FLOOR, ACORPOLLIS MILITARY ROAD, MAROL MAROSHI, ANDHERI (E) MUMBAI 400 059 PAN ALVPM7512R VS ASSISTANT CIT RANGE 20(3) MUMBAI (APPELLANT) (RESPONDENT) APPELLANT BY : MS VINITA SHAH RESPONDENT BY : SHRI V JUSTIN DATE OF HEARING : 23 . 08 .2017 DATE OF PRONOUNCEMENT : 30 .0 8 .2017 O R D E R PER PAWAN SINGH, JUDICIAL MEMBER: THIS APPEAL BY THE ASSESSEE U/S. 253 OF THE I T A CT, IS DIRECTED AGAINST THE ORDER OF THE CIT(A)-37, MUMBAI, DATED 29.11.201 6 FOR A Y 2009-10. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL : 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS W ELL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTI ON OF LEARNED ASSESSING OFFICER IN LEVYING A PENALTY OF RS.74,472 /- U/S.271(1)(C) OF THE INCOME TAX ACT 1961, BEING 300% OF THE TAX S OUGHT TO BE EVADED, WITHOUT CONSIDERING THE FACTS AND CIRCUMSTA NCES OF THE CASE. 2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AS WE LL AS IN LAW, THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE ACTION O F LEARNED ITA NO.832/MUM/2017 TAMANJIT H MEHTA 2 ASSESSING OFFICER IN IMPOSING A PENALTY ON THE ISSU E OF ADDITION MADE OF RS.73,0347- ON ACCOUNT OF ALLEGED UNDISCLOS ED PROFESSIONAL FEES ON THE BASIS OF AIR INFORMATION WITHOUT APPREC IATING THE FACT THAT THE SAID INCOME DOES NOT BELONGS TO THE APPELL ANT. 3) THE APPELLANT CRAVES LEAVE TO ADD, AMEND, ALTER OR DELETE THE SAID GROUND OF APPEAL. 2. THE BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS AN INDIVIDUAL AND RUNNING A BUSINESS CENTRE IN PROPRIETARY CAPACITY I N THE NAME OF M/S. TDC BUSINESS CENTRE. FOR THE IMPUGNED ASSESSMENT YEAR, THE ASSESSEE FILED HIS RETURN OF INCOME ON 30.09.2009 DECLARING TOTAL INCO ME AT ` 21,28,380/- THE ASSESSMENT WAS COMPLETED U/S. 143(3) ON 30.11.2011. WHILE PASSING THE ASSESSMENT ORDER, THE ASSESSING OFFICER MADE DISALL OWANCE OF 10% OF EXPENSES CONSISTING OF MOTOR CAR DEPRECIATION, BUSI NESS PROMOTION EXPENSES, CONVEYANCE EXPENSES, INTEREST ON MOTOR CAR LOAN, MO TOR CAR EXPENSES AND TELEPHONE EXPENSES AND FURTHER MADE DISALLOWANCE OF PROFESSION/TECHNICAL FEES AMOUNTING TO ` 73,034/-. THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS IN RESPECT OF DISALLOWANCE OF PROFESSIO NAL/TECHNICAL FEES. HE LEVIED PENALTY @300% ON THE TAX SOUGHT TO BE EVADED . ON APPEAL, THE CIT(A) CONFIRMED THE ORDER OF THE ASSESSING OFFICER . AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. 3. WE HAVE HEARD BOTH THE PARTIES AND HAVE PERUSED THE MATERIAL ON RECORD ALONG WITH THE ORDERS OF THE AUTHORITIES BEL OW. THE LEARNED AR OF THE ASSESSEE ARGUED THAT THE ASSESSING OFFICER LEVIED P ENALTY@300% ON THE TAX ITA NO.832/MUM/2017 TAMANJIT H MEHTA 3 SOUGHT TO BE EVADED WITHOUT MENTIONING ANY SPECIFIC REASON. IT WAS FURTHER ARGUED THAT THE ASSESSEE FILED HIS REPLY DATED 13.0 5.2014 IN RESPONSE TO NOTICE U/S. 274 R.W.S 271 AND EXPLAINED THE FACT TH AT THE INCOME IS DULY REFLECTING IN THE REGULAR BOOKS OF ACCOUNTS OF THE THIRD PARTY AND THE SAME HAS BEEN DULY OFFERED FOR TAXATION BY THE SAID PART Y AND THAT THE SAID ADDITION HAS BEEN MADE SOLELY ON TECHNICAL GROUNDS AND TYPOG RAPHICAL ERROR QUOTING THE WRONG PAN WHILE FILING TDS RETURNS. THE ASSESS EE IN HIS REPLY HAS FURNISHED SATISFACTORY EXPLANATION FOR SUBSTANTIATI NG HIS DEFENCE. THE ASSESSEE HAS NOT FURNISHED ANY INACCURATE PARTICULA RS OR CONCEALED ANY MATERIALS. ON THE OTHER HAND, THE LEARNED DR FOR T HE REVENUE HAS RELIED ON THE ORDER OF THE ASSESSING OFFICER. 4. THE ASSESSING OFFICER MADE ADDITION ON THE BASIS OF AIR INFORMATION. ON THE BASIS OF THIS INFORMATION RECEIVED, THE ASSE SSEE WAS ASKED TO FURNISH THE DETAILS OF RECEIPTS IN THE NAME OF FEES FOR PRO FESSIONAL/TECHNICAL SERVICES. THE ASSESSEE SUBMITTED ONE TDS CERTIFICATE WHICH IS PERTAINING TO OTHER CONCERN, THE SAME WAS ACCEPTED. BUT IN RESPECT OF T HE OTHER ONE AMOUNTING TO ` 73,034/- IN THE CASE OF ATLAS DOCUMENTARY FACILITA TORS CO. PVT. LTD., THE ASSESSEE COULD NOT FURNISH REQUIRED DOCUMENTS. THE ASSESSING OFFICER INSTEAD OF MAKING ANY FURTHER INQUIRIES MADE ADDITI ON OF EQUAL AMOUNT TO THE TOTAL INCOME OF THE ASSESSEE. THE ASSESSING OFFICE R INITIATED PENALTY FOR SIMILAR ADDITION. THE ASSESSEE, FURTHER IN REPLY T O THE NOTICE U/S. 274 R.W.S. ITA NO.832/MUM/2017 TAMANJIT H MEHTA 4 271, CONTENDED THAT THE ADDITION WAS MADE ONLY FOR THE REASON THAT IN THE AIR INFORMATION, DUE TO TYPOGRAPHICAL ERROR IN QUOT ING WRONG PAN WAS REFLECTED IN THE INFORMATION OF THE ASSESSEE. THE ASSESSEE FURTHER CONTENDED THAT THE INCOME IS DULY REFLECTING IN THE REGULAR B OOKS OF ACCOUNTS OF THE THIRD PARTY AND THE SAME HAS BEEN DULY OFFERED FOR TAXATI ON BY THE SAID PARTY. WE HAVE FURTHER NOTICED THAT THE ASSESSING OFFICER HAS NEITHER MADE ANY FURTHER INQUIRY NOR BROUGHT ANY INCRIMINATING MATERIAL ON R ECORD TO PROVE THAT THE INFORMATION REFLECTING IN THE AIR INFORMATION RELAT ED TO THE ASSESSEE AND NOT TO ANY OTHER PERSON OR THIRD PARTY. THE ASSESSING OFFICER LEVIED PENALTY @300% ON THE TAX SOUGHT TO BE EVADED WITHOUT MAKING ANY FURTHER INQUIRY. IN OUR CONSIDERED VIEW, THE ASSESSEE HAS SUBSTANTIA TED AND EXPLAINED THE FACT. THE EXPLANATION OF THE ASSESSEE WAS BONA FID E, WHICH HAS NOT BEEN CONSIDERED BY THE ASSESSING OFFICER WHILE PASSING T HE PENALTY ORDER. IN OUR VIEW, THE PENALTY ORDER IS NOT SUSTAINABLE AND THE SAME IS SET ASIDE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DAY OF AUGUST, 2017. SD/- SD/- (G S PANNU) (PAWAN S INGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED: 30 TH AUGUST, 2017 SA ITA NO.832/MUM/2017 TAMANJIT H MEHTA 5 COPY OF THE ORDER FORWARDED TO : 1. THE APP ELL ANT. 2. THE RESPONDENT. 3. T HE CIT(A), MUMBAI 4. THE CIT 5. DR, E BENCH, ITAT, MUMBAI BY ORDER, #TRUE COPY # ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI