The ITO, Ward-5(2), Ahmedabad V. M/S Prarthana Const P Ltd, Ahmedabad

MA 194/AHD/2010

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 6298 (ITAT-AHMEDABAD)
• Duration Of Justice: 8 month(s) 13 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 1997-1998
• Appeal Filed On: 13-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P TALATI
• Assessee Lawyers: M K PATEL
• Keywords: Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B BEFORE SHRI T. K. SHARMA, JUDICIAL MEMBER AND SHRI D. C. AGRAWAL, ACCOUNTANT MEMBER M.A. NO. 194/AHD/2010 IN I.T.A. NO. 2235 / AHD/2002 (ASSESSMENT YEAR 1997-98) JT. CIT (SR)1, AHMEDABAD VS. PRARTHANA CONSTRUCTION P. LTD., 10, PRITAM NAGAR, ELLISBRIDGE, AHMEDABAD PAN/GIR NO. :AADCP3934A (APPLICANT) .. (RESPONDENT) APPLICANT BY: SHRI S P TALATI, DR RESPONDENT BY: SHRI M K PATEL, AR O R D E R PER SHRI D. C. AGARWAL, AM:- THIS M.A. IS FILED BY THE REVENUE IN RESPECT OF OR DER OF THE TRIBUNAL IN I.T.A. NO. 2235/AHD/2002. THE ISSUE WAS ABOUT LEVY OF PENALTY U/S 140A(3) READ WITH SECTION 221 OF THE I.T. ACT. THERE WAS D EFAULT IN THE PAYMENT OF SELF ASSESSMENT TAX. THE REVISED RETURN WAS FILED ON 23.04.1998 ON INCOME OF RS.26,37,117/- AGAINST EARLIER DECLARED INCOME O F RS.26,91,739/-. THE RETURN WAS ACCEPTED U/S 143(1)(A). ASSESSEE HAD NO T PAID ANY SELF ASSESSMENT TAX. IT HAD PAID TAXES IN THE SUBSEQUEN T YEAR AS UNDER: MONTH & YEAR AMOUNT RS. JUNE 1998 1,00,000 JULY 1998 4,00,000 SEPT. 1998 5,51,083 OCT. 1998 3,25,000 DEC. 1998 1,00,000 2. THE TRIBUNAL CONFIRMED THE EXISTENCE OF DEFAULT IN MAKING THE PAYMENT OF TAX U/S 140A(3). HOWEVER IT WAS NOTED BY HE TRI BUNAL THAT THAT ASSESSEE HAD PAID TAXES FOR THE ASSESSMENT YEAR 1997-98 BUT THEY WERE ADJUSTED BY THE DEPARTMENT AGAINST THE DEMAND OF ASSESSMENT YEAR 19 96-97 THUS CREATING A DEFAULT FOR THE ASSESSMENT YEAR 1997-98. THE TRIBU NAL GAVE FOLLOWING DIRECTIONS: WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUS ED THE MATERIAL ON RECORD. FOR THE REASONS DISCUSSED BY U S IN ASSESSMENT YEAR 1996-97 WE CONFIRM THE EXISTENCE OF DEFAULT IN MAKING PAYMENT OF TAXES U/S 140A(3) AS FACTS AND CI RCUMSTANCES OF THE CASE REMAINED THE SAME EXCEPT THE FACT THAT ASSESSEE HAS MADE THE PAYMENT OF TAXES OF RS.14,76,083/- FROM JU LY, 1998 TO DECEMBER, 1998, WHOSE DETAILS ARE GIVEN ABOVE. THER EFORE, THERE IS NO MATERIAL TO HOLD A DIFFERENT VIEW THAN TAKEN IN ASST. YEAR 1996-97. ACCORDINGLY, -WE- ACCEPT THE CONTENTION OF ASSESSEE THAT CREDIT FOR TAXES PAID SHOULD BE GIVEN WHILE CA LCULATING QUANTUM OF PENALTY WHEN IN FACT -ASSESSEE HAS PAID TAXES FOR ASST. YEAR 1997-98 EVEN THOUGH DEPARTMENT MIGHT HAVE ADJU STED THE SAME AGAINST DEMAND FOR ASST. YEAR 1996-97. KEEPING IN VIEW THIS POSITION, WE DIRECT THAT QUANT UM OF PENALTY LEVIABLE FOR DEFAULT U/S 140A(3) SHOULD BE CALCULA TED FORM THE DATE OF FILING OF RETURN TILL THE PAYMENT OF TAXES OR TILL THE DAT E OF REGULAR ASSESSMENT WHICH IS EARLIER. THE PENALTY SHOULD BE CALCULATED @ 15% P.A. FOR EACH COMPLETE MONTH OF DEFAULT OR PART OF THE MONTH TREA TING IT AS FULL MONTH OF DEFAULT. THE CREDIT OF TAXES PAID SHOULD B E GIVEN BEFORE CALCULATING PENALTY. WE ACCORDINGLY RESTORE THIS ISSUE TO THE FILE OF AO FOR CARRYING OUT CALCULATION AS PER OUR DIRECTION ABOVE. 3. IN THE M.A., THE A.O. MENTIONED THAT IT WAS NOT THE PAYMENT FOR ASSESSMENT YEAR 1997-98 BUT IT WAS A PAYMENT FOR TH E ASSESSMENT YEAR 1996- 97. IT WAS ALSO NOT CONTENDED BY THE ASSESSEE BEFO RE THE A.O. THAT REGULAR PAYMENT FOR TAX FOR THE ASSESSMENT YEAR 1996-97 SHO ULD BE TREATED AS ADVANCE TAX FOR THE ASSESSMENT YEAR 1997-98. 4. WE HAVE HEARD BOTH THE PARTIES. FROM THE ORDER OF THE TRIBUNAL REFERRED TO ABOVE, THERE IS NO DIRECTION THAT REGUL AR TAX PAID FOR THE ASSESSMENT YEAR 1996-97 BY THE ASSESSEE SHOULD BE T REATED AS SELF ASSESSMENT TAX FOR THE ASSESSMENT YEAR 1997-98. THE DIRECTION S ARE VERY CLEAR THAT PENALTY U/S 140A(3) SHOULD BE CALCULATED FORM THE D ATE OF FILING OF RETURN TILL THE PAYMENT OF TAXES OR TILL THE DATE OF REGULAR AS SESSMENT, WHICHEVER IS EARLIER. IN OTHER WORDS, ONLY THAT PAYMENT OF TAX ES WILL BE GIVEN CREDIT WHICH IS PAID FOR THE ASSESSMENT YEAR 1997-98 AS PE R CHALLANS AND NO CREDIT WILL BE GIVEN FOR TAXES PAID FOR THE ASSESSMENT YEA R 1996-97 FOR WHICH CREDIT WILL BE GIVEN ONLY IN THAT YEAR AND NOT IN THE ASSE SSMENT YEAR 1997-98. WHAT IS OBSERVED BY THE TRIBUNAL IS ONLY ABOUT CALC ULATION OF PENALTY AND IT IS NOT A DIRECTION THAT TAXES PAID FORT THE ASSESSMENT YEAR 1996-97 SHOULD BE TREATED AS SELF ASSESSMENT TAX PAID FOR THE ASSESSM ENT YEAR 1997-98. IT IS A MATTER OF VERIFICATION, ACCORDING TO WHICH, THE A.O . CAN TAKE APPROPRIATE ACTION FOR CALCULATING PENALTY U/S 140A(3). IN ANY CASE, THERE IS NO CASE FOR INTERFERENCE IN THE ORDER PASSED BY THE TRIBUNAL. 5. IN THE RESULT, M.A. OF THE DEPARTMENT STANDS REJ ECTED. 6. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH MAY 2011. SD./- SD./- (T. K. SHARMA) (D. C. AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED : 27 TH MAY, 2011 SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD 6. THE GUARD FILE 1. DATE OF DICTATION 24/5/11. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 25/5/11 OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 26/5/11 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 27/5/11 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.27/5/11 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 27/5/11 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. ..