M/s. Parshwa Construction, Nadiad V. The Income Tax Officer, Ward-1, Nadiad

ITSSA 107/AHD/2015

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 3572 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 8 month(s) 15 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 02-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 17-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR SHRI JAYANT JHAVERI
• Assessee Lawyers: P M MEHTA WITH; GULABJI M THAKOR
• Section: 132

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH A BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ IT(SS) NO.103 TO 107/AHD/2015 / ASSTT. YEARS: 2003-04 TO 2007-08 M/S.PARSHWA CONSTRUCTION G-21, GHANTAKARNA COMPLEX GUNJ BAZAR NADIAD 387 001. PAN : AAEFP 6639 G VS. ITO, WARD-1 NADIAD. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI P.M. MEHTA WITH & GULABJI M. THAKOR, A.R REVENUE BY : (DR.)SHRI JAYANT JHAVERI, SR.DR ! / DATE OF HEARING : 02/01/2018 '#$ ! / DATE OF PRONOUNCEMENT: 02 /01/2018 %& / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE PRESENT FIVE APPEALS ARE DIRECTED AT THE INSTA NCE OF THE ASSESSEE AGAINST THE COMMON ORDERS OF LEARNED COMMISSIONER O F INCOME TAX (APPEALS) DATED 28.01.2015 PASSED FOR ASSESSMENT YE AR 2003-04 TO 2007- 08. 2. THE GRIEVANCE OF THE ASSESSEE IS THAT THE LEARNE D COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN CONFIRMING THE PE NALTY OF RS. 3,35,755/- RS.2,36,646/-, RS.1,34,364/-, RS.1,27,332/- AND RS. 67,026/- IMPOSED BY IT(SS) NO. 103 TO 107/AHD/2015 2 THE ASSESSING OFFICER U/S. 271(1)(C) OF THE INCOME TAX ACT IN ASSESSMENT YEARS 2003-04 TO 2007-08. 3. AT THE VERY OUTSET, LEARNED COUNSEL FOR THE ASSE SSEE SUBMITTED THAT THE ADDITIONS RELATING TO VISITING THE ASSESSEE WIT H THE PENALTY HAS BEEN DELETED BY THE TRIBUNAL IN QUANTUM APPEAL I.E. ITA NO. 42 TO 47/AHD/2012. HE PLACED ON RECORD COPY OF THE TRIBUNALS ORDERS. THE LEARNED DEPARTMENTAL REPRESENTATIVE WAS UNABLE TO CONTROVER T THIS CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE. 4. WITH THE ASSISTANCE OF LEARNED REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORD CAREFULLY. WE FIND THAT FACTS ON ALL VIT AL POINT ARE COMMON IN THESE FOUR ASSESSMENT YEARS. THEREFORE FOR THE FACI LITY OF REFERENCES, WE ARE TAKING OF THE FACTS FROM ASSESSMENT YEAR 2003-04. T HE ASSESSEE HAS FILED ITS RETURN OF INCOME ON 26.9.2003 DECLARING TOTAL I NCOME AT RS.1,09,060/-. A SEARCH U/S. 132 OF THE INCOME TAX ACT WAS CONDUCT ED IN THE CASE OF SHRI RAMESHBHAI BABUBHAI SHAH ON 03.04.2008. DURING THE COURSE OF SEARCH A LAPTOP WAS FOUND WHICH CONTAINS BOOKS OF ACCOUNT OF 65 ENTITIES. THEREFORE A PROCEEDING U/S. 153C WAS INITIATED AGAINST THE AS SESSEE. THE LEARNED ASSESSING OFFICER HAS MADE ADDITIONS. WHEN THE DISP UTE TRAVELLED BEFORE THE TRIBUNAL THEN, IT WAS CONTENDED THAT ACTION U/S . 153C COULD BE TAKEN IF DURING THE ASSESSMENT PROCEEDINGS OF THE SEARCHED P ERSON IT CAME TO THE NOTICE OF ASSESSING OFFICER THAT MATERIAL RELATING TO SOME OTHER ASSESSEE, EXHIBITING ESCAPEMENT OF INCOME WAS FOUND DURING CO URSE OF SEARCH. THE ASSESSING OFFICER OF THE SEARCHED PERSON WAS REQUIR ED TO RECORD HIS SATISFACTION THAT ACTION AGAINST SUCH OTHER PERSONS WHOM MATERIAL WAS FOUND AT THE TIME OF SEARCH, SHOWING ESCAPEMENT OF INCOME. IF THIS SATISFACTION WAS NOT RECORDED BY THE A.O. OF SEARCH ED PERSON THEN NO PROCEEDING U/S. 153C CAN BE TAKEN UP AGAINST SUCH O THER PERSONS. THE TRIBUNAL HAS RECORDED A FINDING THAT NO SATISFACTIO N WAS RECORDED BY THE ASSESSING OFFICER OF THE SEARCHED PERSON AND THEREF ORE PROCEEDING AGAINST IT(SS) NO. 103 TO 107/AHD/2015 3 THE ASSESSEE U/S. 153C IS NOT SUSTAINABLE. ON THE B ASIS OF THIS REASONING TRIBUNAL HAS QUASHED THE ASSESSMENT ORDERS. 5. SUB-CLAUSE (III) OF SECTION 271(1)(C) PROVIDES M ECHANISM FOR QUANTIFICATION OF PENALTY. IT CONTEMPLATES THAT THE ASSESSEE WOULD BE DIRECTED TO PAY A SUM IN ADDITION TO TAXES, IF ANY, PAYABLE BY HIM, WHICH SHALL NOT BE LESS THAN, BUT WHICH SHALL NOT EXCEED THREE TIMES THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF CONCEALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME. IN OTHER WORDS, THE QUANTIFICATION OF THE PENALTY IS DEPENDED UPON THE ADDITIONS MADE TO THE INCOME OF THE ASSESSEE. SINCE ASSESSMENT ORDERS HAV E BEEN QUASHED IN THESE ASSESSMENT YEARS THEREFORE THE VERY BASIS TO CONSTRUE THE CONCEALMENT OF INCOME OR EVASION OF TAXES WOULD EXT INGUISHED. THEREFORE THERE CANNOT BE ANY PENALTY UPON THE ASSESSEE. WE A LLOW ALL THESE APPEALS AND DELETE THE PENALTY. ORDER PRONOUNCED IN THE COURT ON 2 ND JANUARY, 2018. SD/- SD/- (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER