ASST CIT 17(2), V. EDEN GARDEN EXPORTS,

MA 731/MUM/2012

• Counselvise Citation: [2013] 124 COUNSELVISE.COM (IT) 0623 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 05-07-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2006-2007
• Appeal Filed On: 05-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bonafide belief; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI VIVEK VERMA, JUDICIAL MEMBER MA NO. 731/MUM/2012 ARISING OUT OF ITA NO.7097/MUM/2010 ASSESSMENT YEAR : 2006-07 ACIT - 17(2) 217, 2 ND FLOOR, PIRAMAL CHAMBERS LALBAUG MUMBAI-400 012. VS. M/S. EDEN GARDEN EXPORTS A-37, SRI RAM INDUSTRIAL ESTATE G.D. INDUSTRIAL ESTATE G.D. AMBEDKAR ROAD WADALA MUMBAI-400 013. PAN NO.AAAFE 0570 D (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI MANOJ KUMAR DATE OF HEARING : 28.06.2013 DATE OF PRONOUNCEMENT : 05 .07.2013 O R D E R PER B. RAMAKOTAIAH, AM: THIS MISCELLANEOUS APPLICATION IS PREFERRED BY THE REVENUE AGAINST THE ORDER OF ITAT IN ITA NO.7097/MUM/10 DATED 18.07 .2012. THE ISSUE IN THE APPEAL PREFERRED BY THE ASSESSEE WAS WITH RE SPECT TO CONDONATION OF DELAY WHICH WAS NOT ALLOWED BY CIT(A) AND SUSTE NANCE OF PENALTY IMPOSED BY THE AO UNDER SECTION 271(1)(C). 2. BRIEF FACTS LEADING TO THE LEVY OF PENALTY WERE STATED IN PARA-3 OF THE ORDER AND THE ORDER OF CIT WAS DISCUSSED IN PAR A-4. IN PARA-7 THE ITAT HAS RECORDED THE FOLLOWING. MA NO.731/M/12 A.Y.06-07 M/S. ED EN GARDEN EXPORTS 2 7. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE LD.DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE FACTS ARE NOT IN DISPUTE INASMUCH AS IT IS ALSO NOT IN DISPUTE THAT THE ASSESSEE HAS FILED COMPLETE DETAIL S OF FOREIGN TRAVELLING EXPENSES AND THE PURPOSE OF THE VISIT TO FOREIGN COUNTRIES. HOWEVER, IN THE ABSENCE OF ANY DOCUMENTA RY EVIDENCE TO SHOW THE BUSINESS RELATIONSHIP OF THE FOREIGN TRIPS, THE A.O. DISALLOWED THE FOREIGN TRAVELLING E XPENSES RS.1,86,368/- OUT OF TOTAL EXPENSES CLAIMED BY THE ASSESSEE AT RS.3,41,672/- ON WHICH AO HAS ALSO IMPOSED PENAL TY U/S. 271(1)(C) OF THE ACT. ON APPEAL THE LD. CIT(A) WHIL E REJECTING THE CONDONATION OF DELAY OF 92 DAYS HELD ON MERITS THAT SINCE THE ASSESSEE HAS FAILED TO FILE DOCUMENTARY EVIDENCE, T HE AO WAS JUSTIFIED IN IMPOSING THE PENALTY. 2.1 IN PARA-8, 9, AND 10 VARIOUS CASE LAW WERE DIS CUSSED AND VIDE PARA-11 THE CONDONATION WAS GRANTED. THEREAFTER, VI DE PARA 13 AND 14 THE ISSUE WAS CONSIDERED ON MERITS. FOLLOWING THE P RINCIPLES LAID DOWN BY THE HONBLE APEX COURT IN CIT VS. RELIANCE PETROPRO DUCTS LTD. (322 ITR 158) THE BENCH VIDE PARA-14 DELETED THE PENALTY STA TING AS UNDER :- 14. RESPECTFULLY FOLLOWING THE ABOVE DECISION AND KEEPING IN VIEW THAT IT IS NOT THE CASE OF THE REVENUE THAT THE CLAIM MADE BY THE ASSESSEE WAS FOUND TO BE FALSE OR UNTRU E BASED ON NO MATERIAL OR BONAFIDE BELIEF, WE ARE OF THE VI EW THAT THERE IS NO CONCEALMENT ON THE PART OF THE ASSESSEE WHICH MAY CALL FOR LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT AND A CCORDINGLY THE PENALTY IMPOSED BY THE AO AND SUSTAINED BY THE LD. CIT(A) IS DELETED. THE GROUNDS TAKEN BY THE ASSESSEE ARE THER EFORE ALLOWED. 3. THE REVENUE PREFERRED THE PRESENT MISCELLANEOUS APPLICATION ON THE REASON THAT WHILE ADJUDICATING THE ISSUE IN PAR A-12, THE BENCH OPINED THAT DISALLOWANCE WAS MADE ON ESTIMATE BASIS WHICH IS NOT CORRECT, AND SINCE ADJUDICATING THE PENALTY ORDER W AS ON WRONG PRESUMPTION THE ORDER OF THE ITAT SHOULD BE RECALLE D. MA NO.731/M/12 A.Y.06-07 M/S. ED EN GARDEN EXPORTS 3 3.1 THE ASSESSEE WAS NOT PRESENT WHEN THE MISCELLAN EOUS APPLICATION WAS CALLED AND AFTER HEARING THE LD. DR WHO REITERA TED THE SUBMISSION MADE IN THE MISCELLANEOUS APPLICATION, THE MISCELLA NEOUS APPLICATION WAS DECIDED EXPARTE RESPONDENT. 4. WE DO NOT SEE ANY MERIT IN THE MISCELLANEOUS APP LICATION PREFERRED BY THE REVENUE AS ENTIRE SET OF FACTS LEADING TO TH E DISALLOWANCE OF AN AMOUNT OF RS.1,86,368/-OUT OF THE TOTAL TRAVELLING EXPENSES OF RS.3,41,672/-WERE DISCUSSED AND CONTENTIONS WERE AL SO EXAMINED IN PARA-7. IN VIEW OF THIS, EVEN THOUGH THE WORD USED IN PARA-12 WAS ON ESTIMATE BASIS THAT ITSELF DOES NOT MAKE THE ORDE R ON WRONG PRESUMPTIONS OR MIS-CONCEPTION, AS ALL THE FACTS LE ADING TO THE DISALLOWANCE WERE DISCUSSED IN PARA-7 OF THE ORDER. MOREOVER VIDE PARA- 14 WHICH IS EXTRACTED ABOVE, IT WAS SUBSEQUENTLY ME NTIONED THAT THE REVENUE DID NOT ALLEGE THAT THE EXPENDITURE WAS FAL SE OR UNTRUE BASED ON NO MATERIAL OR BONAFIDE BELIEF. THEREFORE, THERE IS NO MERIT IN THE CONTENTIONS RAISED BY THE AO IN THE MISCELLANEOUS A PPLICATION. ACCORDINGLY, THE SAME IS REJECTED. 5. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE REVENUE STANDS REJECTED. ORDER PRONOUNCED IN THE OPEN COURT ON 05.07. 2013. SD/- SD/- (VIVEK VERMA) JUDICIAL MEMBER (B. RAMAKOTAIAH ) ACCOUNTANT MEMBER MUMBAI, DATED: 05/07/13. JV. MA NO.731/M/12 A.Y.06-07 M/S. ED EN GARDEN EXPORTS 4 COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR BENCH TRUE COPY BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.