PVR Infratech India Private Limited, Hyderabad, Hyderabad V. ACIT, Circle-16(2), Hyderabad, Hyderabad

ITA 913/HYD/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2519 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 25-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: B SHANTHI KUMAR
• Keywords: Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A : HYDERABAD BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI S. RIFAUR RAH MAN, ACCOUNTANT MEMBER ITA NO. 913/HYD/2017 (A.Y.: 2012 - 2013) PVR INFRATECH INDIA PRIVATE LIMITED, HYDERABAD. PAN: AAECP 8420 C VS. ACIT, CIRCLE - 16(2), HYDERABAD. (APPELLANT) (RESPONDENT) FOR ASSESSEE: SHRI B. SHANTHI KUMAR FOR REVENUE : SHRI SUNKU SRINIVAS, DR DATE OF HEARING : 24.10 .2017 DATE OF PRONOUNCEMENT : 24.10 .2017 ORDER PER D. MANMOHAN, VP: THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST ORDER PASSED BY LD. CIT(A) - 4, HYDERABAD AND IT PERTAINS TO A.Y. 2012 - 2013. 2. PENALTY OF RS. 2,89,172/ - LEVIED BY A.O. U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 HAVING BEEN CONFIRMED BY LD. CIT(A) ASSESSEE PREFERRED AN APPEAL BEFORE THE TRIBUNAL CONTENDING INTER ALIA THAT THE ADDITION IS MERELY BASED ON ESTIMATE I.E., DISALLOWANCE O F 2% OF EXPENDITURE CLAIMED UNDER DAILY WAGES ON THE GROUND THAT SOME OF THE EXPENSES WERE NOT SUPPORTED BY PROPER BILLS / VOUCHERS. IN FACT ASSESSMENT ORDER DOES NOT INDICATE THAT THE ADDITION IS ON ACCOUNT OF CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND A.O. HAVING NOT RECORDED ANY FINDING IN THAT REGARD , PENALTY PROCEEDINGS OUGHT NOT TO HAVE BEEN INITIATED. IT WAS FURTHER SUBMITTED THAT NOTICE ISSUED BY A.O. U/S 274 OF THE ACT DOES NOT INDICATE AS TO WHETHER THE PROC EEDINGS WERE INITIATED FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND IN THIS REGARD H E ADVERTED OUR ATTENTION TO PAGE 8 OF THE PAPER BOOK TO CONTEND THAT IN ORDER TO INITIATE VALID PROCEEDINGS, A.O. SHOULD SPECIFY AS TO WHETHER PENALTY PROCEEDINGS WERE INITIATED FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME WHEREAS 2 IN THE INSTANT CASE THE WORD OR HAS NOT BEEN DELETED. RELIANCE WAS PLACED UPON DECISION OF ITAT, HYDERABAD BENCH IN THE CASE OF ITO VS. M/S. O.M.R.S. WINES (ITA NOS. 410 TO 414/HYD/13) WHEREIN THE TRIBUNAL OBSERVED THAT MERELY BECAUSE THE PROFIT HAS BEEN ESTIMATED AND CERTAIN ADDITIONS ARE MADE IN THE ASSESSMENT IT WOULD NOT AUTOMATICALLY LEAD TO IMPOSITION OF PENALTY UNLESS SOME MORE MATERIAL IS BROUGHT ON RECORD BEFORE COMING TO A CONCLUSION THAT THERE A CONSCIOUS ATTEMPT ON THE PART OF ASSESSEE TO CONCEAL ITS INCOME. 3 . IT MAY BE NOTICED THAT THERE IS A DELAY OF 108 DAYS IN FILING APPEAL BEFORE THE TRIBUNAL. ASSESSEE FILED PETITION FOR CONDONATION OF DELAY ALONG WITH AN AFFIDAVIT OF SHRI P. VENKATESWARA RAO, DIRECTOR OF PVR INFRATECH INDIA PVT LTD., HYDERABAD WHEREIN IT WAS STATED THAT THOUGH LD. CIT(A) WAS INFORMED OF THE CHANGE OF ADDRESS OF THE ASSESSEE, THE ORDER O F LD. CIT(A) WAS SERVED AT THE OLD ADDRESS. THE PRESENT OCCUPANT OF THE OLD PREMISES RECEIVED ORDER OF THE COMMISSIONER ON 07.12.2016 BUT IT WAS HANDED OVER TO THE ASSESSEE - COMPANY ON 03.04.2017. LD COUNSEL FOR THE ASSESSEE ALSO PLACED BEFORE US AN ACKNO WLEDGEMENT COPY OF THE LETTER ADDRESSED TO THE CIT (A) - 4, HYDERABAD IN SUPPORT OF THE CONTENTION THAT CHANGE OF ADDRESS WAS COMMUNICATED ON 08.09.2016 WHEREAS THE ORDER OF LD. CIT(A) WAS PASSED ON 20.10.2016 WITHOUT TAKING ON RECORD THE CHANGE OF ADDRESS W HICH RESULTED IN NON - COMMUNICATION OF THE ORDER OF THE COMMISSI ONER IN TIME AND AS A CONSEQUEN C E THERE WAS A DELAY IN FILING THE APPEAL. 4 . LD DR ACCEPTED THE PLEA OF ASSESSEE THAT CHANGE OF ADDRESS WAS NOT TAKEN ON RECORD. HAVING REGARD TO THE CIRCUMSTANC ES OF THE CASE, WE CONDONE THE DELAY AND ADMIT THE APPEAL. 5 . EVEN ON MERITS THE PLEA OF ASSESSEE W A S THAT THE ADDITION WAS BASED ON ESTIMATE AND NO MATERIAL WAS BROUGHT ON RECORD ON THE BASIS OF WHICH A CONCLU SION CAN BE FORMED THAT THERE WAS A CONSCIOUS ATTEMP T ON THE PART OF THE ASSESSEE TO CONCEAL ITS INCOME. IDENTICAL ISSUE WAS CONSIDERED BY THE ITAT, HYDERABAD BENCH (SUPRA). LD DR COULD NOT PLACE ANY MATERIAL TO SUPPORT THE STAND OF REVENUE THAT A.O. HAS ARRIVED AT A FINDING WITH REGARD TO EITHER CONCEAL MENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME . IT IS ALSO ON RECORD THAT ASSESSMENT ORDER DOES NOT INDICATE THAT THE ADDITION MADE BY A.O. WAS ON ACCOUNT OF CONCEALMENT 3 OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND OBVIOUSLY THE NOTICE ISSUED U/S 274 OF THE IT ACT REINFORCES THE FACT THAT A.O. HAD NOT FORMED ANY OPINION BEFORE INITIATING PENALTY PROCEEDINGS. UNDER THESE CIRCUMSTANCES, BY RESPECTFULLY FOLLOWING THE ORDER PASSED BY THE ITAT (SUPRA) WE HOLD THAT PE NALTY LEVIED BY ASSESSING OFFICER IS NOT IN ACCORDANCE WITH LAW. 6 . IN THE RESULT, WE SET ASIDE THE ORDER OF LD. CIT(A) AS WELL AS THE ORDER OF A.O. AND CANCEL THE PENALTY LEVIED BY A.O. PRONOUNCED ACCORDINGLY IN THE OPEN COURT ON 24 TH OCTOBER, 2017. S D / - S D / - (S. RIFAUR RAHMAN ) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT HYDERABAD, DATED: 24 TH OCTOBER , 2017 OKK, SR.PS COPY TO 1. B. SHANTI KUMAR, ADVOCATE, 111, TARAMANDAL COMPLEX, 5 - 9 - 13, SAIFABAD, HYDERABAD - 500 004 . 2. ACIT, CIRCLE - 16(2), INCOME TAX TOWERS, A.C. GUARDS, HYDERABAD. 3. CIT(A) - 4, HYDERABAD. 4. PR. CIT - 4, HYDERABAD . 5. D.R. ITAT A BENCH, HYDERABAD. 6. GUARD FILE