The ITO, Ward-6(1), Surat V. Shri Ashok B. Modi, Surat

MA 76/AHD/2014

• Counselvise Citation: [2015] 124 COUNSELVISE.COM (IT) 3356 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 3 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 21-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 17-07-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 09-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHANKARLAL MEENA
• Assessee Lawyers: S N SOPARKAR
• Keywords: Income from undisclosed sources
• Section: 143(3); 133A

Judgement Text

MA NO.76/AHD/2014 (IN ITA NO.219/AHD/2013) A SSESSMENT Y EAR : 2005 - 05 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH , AHMEDABAD [CORAM: PRAMOD KUMAR AM AND RAJPAL YADAV JM ] M.A. NO.76/AHD/2014 (IN ITA NO. 219 / AHD / 2 013 ASSESSMENT YEAR: 200 4 - 05 INCOME TAX OFFICER, ....... .. . ..... APPELLANT WARD 6(1), SURAT. VS. ASHOK B. MODI, .... ........ .... .. .. .. .... .. RESPONDENT 97 - 98, G.I.D.C. , PANDESAR, SURAT. [PAN: A BPPM 9008 A ] APPEARANCES BY: S.N. SOPARKAR , FOR THE A SSESSEE SHANKAR LAL MEENA , FOR THE REVENUE DATE OF CONCLUDING THE HEARING : JUL Y 1 7 TH , 201 5 DATE OF PRONOUNCING THE ORDER : AUGUST 21 ST , 2015 O R D E R PER PRAMOD KUMAR AM : BY WAY OF THIS RECTIFICATION PETITION, THE APPLICANT ASSESSING OFFICER POINTS OUT AS FOLLOWS : - IN THIS CASE, THE ASSESSEE HAD FILED APPEAL BEFORE THE HON BLE INCOME TAX APPELLATE TRIBUNAL, C BENCH, AHMEDABAD AGAINST THE ORDER OF LD. CIT(A) - IV, SURAT. THE HON BLE INCOME TAX APPELLATE TRIBUNAL, C BENCH, AHMEDABAD VIDE ORDER DATED 16.09.2013 IN I T A NO.219/AHD/2013, WHILE DECIDING THE GROUND OF APPEAL AGITATED BY THE ASSESSEE , HAS DELETED THE PENALTY LEVIED BY THE A . O. IN THIS REGARD , IT IS SUBMITTED THAT THERE IS MISTAKE APPARENT ON RECORD IN THE AFORESAID ORDER PASSED BY THE HON BLE ITAT IN RESPECT OF FOLLOWING OBSERVATIONS : MA NO.76/AHD/2014 (IN ITA NO.219/AHD/2013) A SSESSMENT Y EAR : 2005 - 05 PAGE 2 OF 4 SINCE THE PART ADDITION UPHELD B Y THE TRIBUNAL IS ON THE BASIS OF ESTIMATED GP PERCENTAGE, NO PENALTY IS JUSTIFIED ON SUCH ESTIMATED ADDITION. WITH A VIEW TO SUMMARISE THE FACT, IT IS SUBMITTED THAT IN THIS CASE A S URVEY U/S. 133A OF THE ACT WAS CARRIED OUT ON 21.01.2004 DURING THE COUR SE OF WHICH THE ASSESSEE GROUP HAD ADMITTED UNACCOUNTED INCOME OF RS.1.05 CRORE. ASSESSMENT U/S. 143(3) OF THE ACT WAS FINALISED ON 01.12.2006 . DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED THAT THE EFFECT OF SURVEY WAS NULLIFIED BY THE ASS ESSEE BY WAY OF SUPPRESSION OF GROSS PROFIT OF NORMAL BUSINESS. THE AO HAS ALSO NOTICED VARIOUS DISCREPANCIES IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. THEREFORE, AFTER REJECTING THE BOOK RESULTS OF THE ASSESSEE, NET ADDITION OF RS.17,82,564/ - WAS MADE B Y THE AO AFTER ESTIMATING THE NET PROFIT OF RS.3,42,560/ - AND FURTHER ADDING THE INCOME DISCLOSED DURING THE COURSE OF SURVEY ON ACCOUNT OF UNACCOUNTED CASH OF RS.35,26,795/ - AND UNEXPLAINED DEBTS OF RS.4,58,205/ - . BEING AGGRIEVED, THE ASSESSEE WENT UP IN APPEAL BEFORE THE CIT(A). VIDE ORDER DATED 31.12.2007, THE LD . CIT ( A ) H A S CONFIRMED T HE ACTION OF TH E A .O. THE ASSESSEE CARRIED T HE MATTER IN FUR T HER APPEAL BEFORE THE ITAT. THE HON BLE ITAT, AHMEDABAD BENCH C VIDE ITS ORDER DATED 24.09.2010 IN ITA NO .1060/AHD/2008 HAD DI S MIS S ED THE APPEAL OF TH E ASSESSEE. SUBSEQUENTLY, THE AO H A D PAS S ED T HE PENALTY ORDER ON 29.04.2011. THEREAFTE R ANOTHER ORDER DATED 20.04.2012 IN SAME ITA NO.1060/AHD/2008 HAS BEEN RECEIVED FROM THE HON BLE ITAT WHEREIN THE APPEAL OF THE ASSESSEE WAS PAR T LY ALLOWED. THE REASON FOR PA SS ING TH E SECOND ORDER DATED 20.04.2012 IS NOWHERE MENTIONED IN THE SAID ORDER OF THE HON BLE I TAT . WHILE DECIDING THE PRESENT APPEAL OF THE ASSESSEE AGAINST THE PENALTY ORDER PASSED BY THE AO, THE HON BLE ITAT HAS OBSERVED THAT : WE FIND THAT PENALTY W A S IMPOSED BY THE AO ON THE A DDITION OF RS.17,82,565/ - M A DE BY THE AO. OUT OF THIS ADDITION, IN QUANTUM PROCEEDINGS, THE TRIBUNAL HAS UPHELD THE ADDITION OF ONLY RS.4,43,283/ - AND THE SAME IS ALSO CONFIR MED BY ESTIMATING THE GP A RTE OF 13.38% AS PER PARAGRAPH NO.8 OF THE TRIBUNAL ORDER IN QUANTUM PROCEEDINGS. SINCE THE PART ADDITION UPHELD BY THE TRIBUNAL IS ALSO ON THE BASIS OF ESTIMATED GP PERCENTAGE, NO PENALTY IS JUSTIFIED ON SUCH ESTIMATED ADDITION AS PER THE TRIBUNAL DECISION CITED BY THE LD. AR OF THE ASSESSEE THAT HAS BEEN RENDERED IN THE CASE OF AJAYBHAI MAHESHBHAI M AVANI VS. ITO (SUPRA). RESPECTFULLY FOLLOWING THIS TRIBUNAL DECISION, WE DELETE THE PENALTY IN THE PRESENT CASE . IN THIS REGARD, I T IS SUBMITTED THAT THE HON BLE BENCH HAS FAILED TO APPRECIATE THE FACT THAT THE QUANTUM OF NET ADDITION OF RS.17,82,564/ - WAS NOT A LUMP SUM FIGURE OR A FIGURE ABRUPTLY TAKEN OUT OF THE BOOKS OF ACCOUNT OF THE ASSESSEE. THE ADDITION WAS MADE AFTER REWORK ING OF THE TRADING AND P&L ACCOUNT GIVEN BY THE ASSESSEE . THE AO HA S ESTIMATED THE GP AT RS.3,42,560/ - IN PLACE OF LOSS OF RS.12,05,563/ - CLAIMED BY THE ASSESSEE. THIS FIGURE OF MA NO.76/AHD/2014 (IN ITA NO.219/AHD/2013) A SSESSMENT Y EAR : 2005 - 05 PAGE 3 OF 4 RS.17,82,564/ - WAS ARRIVED AFTER TAKING INTO CONSIDERATION THE UNACCOUNTED C ASH TRANSACTIONS AN D UNEXPLAINED DEBTS AMOUNTING TO RS.35,26,795/ - AND RS.4,58,205/ - RESPECTIVELY. THUS , THE PENALTY LEVIED OVER THE AMOUNT OF RS.17,82,564/ - INCLUDED THE COMPONENT OF UNACCOUNTED C A SH TRANSACTIONS AND UNEXPLAINED DEBTS. THEREFORE, A MIST AKE APPARENT FROM RECORD HAS CREPT IN THE AFORESAID ORDER OF HON BLE ITAT. THE HON BLE ITAT HAS ALSO FAILED TO APPRECIATE THE FACT THAT AT THE TIME OF PASSING PENALTY ORDER ON 20.04.2011, THERE WAS AN ORDER OF HON BLE ITT DATED 24.09.2010 DISMISSING THE Q UANTUM APPEAL OF THE ASSESSEE, BEFORE THE AO. IT IS WORTHWHILE TO MENTION HERE THAT THE ASSESSEE HIMSELF, THROUGH HIS AR S LETTER DATED 06.03.2013, HAS STATED THAT THE DIFFERENCE BETWEEN THE ASSESSED INCOME AND THE RETURNED INCOME COMES TO RS.6,03,909/ - IN VIEW OF THE RELIEF GIVEN BY THE ITAT AND, THEREFOR E , PENALTY IS REQUIRED TO BE LEVIED ON THE ABOVE DIFFERENCE AMOUNT. THE ASSESSEE ACCORDINGLY REQUESTED THIS OFFICE TO REDUCE THE PENALTY OF RS.5,67,290/ - TO THAT EXTENT. IN VIEW OF THE ABOVE, THE CIT - II, SURAT HAS APPROVED FILING OF MISCELLANEOUS APPLICATION BEFORE THE HON BLE IT A T, AHMEDABAD, VIDE LETTER N O . SRT/CIT - II/TECH/260A/BM/2014 - 15 DATED 01.05. 2014. THEREFORE, A MISCELLANEOUS APPLICATION ON THE ABOVE ISSUE IN THIS CASE IS BEING FILED. 7. I N VIEW O F THE FACTS DISCUSSED ABOVE, IT IS REQUESTED THAT HON BLE ITAT MAY KINDLY RECTIFY THE AFORESAID MISTAKES APPARENT FROM RECORD AND CONFIRM THE PENALTY LEVIED CORRESPONDING TO THE ADDITIONS CONFIRMED IN QUANTUM APPEAL S 2. LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER HAND, SUBMITS THAT THE ORDER OF THE TRIBUNAL DATED 24 TH SEPTEMBER, 2010 WAS SUBSEQUENTLY RECALLED FOR THE PURPOSE OF DECIDING ASSESSEE S GRIEVANCE AGAINST GROSS PROFIT ADDITION, WHICH WAS, PURSUANT TO ORDER HAVING BEEN SO RECALLED, DECIDED PA RTLY IN FAVOUR OF THE ASSESSEE VIDE ORDER DATED 20.04.2012. I T WAS IN THIS LIGHT T HAT, VIDE IMPUGNED ORDER, THE PENALTY W A S DELETED. 3. LEARNED COUNSEL FOR THE ASSESSEE ALSO INVITES OUR ATTENTION TO THE ORDER DATED 12 TH SEPTEMBER, 2014 PASSED BY THE TRIB UNAL DISMISSING SIMILAR RECTIFICATION PETITION BY OBSERVING, IN TER ALIA, AS FOLLOWS : - 3. WE HAVE HEARD THE SR. DR AND GONE THROUGH THE WRITTEN SUBMISSIONS FILED BY THE ASSESSEE. THE UNDISPUTED FACTS REMAINS THAT IN ITA NO.1060 / AHD/2008, THE ORDER MA NO.76/AHD/2014 (IN ITA NO.219/AHD/2013) A SSESSMENT Y EAR : 2005 - 05 PAGE 4 OF 4 DATED 24.09.2010 WAS PASSED THEREBY THE APPEAL OF THE ASSESSEE WAS DISMISSED. SUBSEQUENTLY, THE MISCELLANEOUS APPLICATION NO.236/AHD/2010 WAS FILED BY THE ASSESSEE ON THE GROUND THAT ONE OF THE GROUNDS RAISED BY THE ASSESSEE WAS NOT DECIDED. THE MISCELLANEOUS AP PLICATION NO.236/AHD/2010 FILED BY THE ASSESSEE WAS ALLOWED AND THE ORIGINAL ORDER OF THE TRIBUNAL WAS RECALLED FOR THE LIMITED PURPOSE FOR ADJUDICATION ON GROUND OF ADDITION FOR GROSS PROFIT. CONSEQUENTLY, ANOTHER ORDER DATED 20.04.2012 IN ITA NO.1060/AH D/2008 CAME TO BE PASSED WHEREBY THE APPEAL OF THE ASSESSEE WAS PARTLY ALLOWED. IT TRANSPIRED FROM RECORDS THAT THE DEPARTMENTAL REPRESENTATIVE WAS PRESENT ON THE DATE OF HEARING WHEN THE MISCELLANEOUS APPLICATION NO.236/AHD/2010 WAS FIXED FOR HEARING ON 2 3.09.2011. SUBSEQUENTLY, THE ORDER DATED 31.10.2011 WAS PASSED. UNDER THESE FACTS, WE DO NOT FIND ANY MISTAKE CREPT INTO THE ORDER PASSED IN ITA NO.1060/AHD/2008 DATED 20.04.2012. THEREFORE, THE APPLICATION FOR RECALLING THE ORDER DATED 20.04.2012 IS REJEC TED. THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. 4. WE FIND THAT AS THE QUANTUM APPEAL WAS SUBSEQUENTLY DECIDED PARTLY IN FAVOUR OF THE ASSESSEE, BY RECALLING THE ORDER DATED 24.09.2010 , THE VERY FOUNDATION OF PRESENT RECTIFICATION PETITION IS FACTUALLY INCORRECT AND UNSUSTAINABLE IN LAW. IN THIS VIEW OF THE MA T TER, AND RESPECTFULLY FOLLOWING CO - ORDINATE BENCH DECISION DATED 12 TH SEPTEMBER, 2014, WE DISMISS THIS PETITION AND DECLINE TO INTERFERE IN THE MATTER. 5. IN THE RESULT, MISC ELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST AUGUST, 2015 ) SD/ - SD/ - RAJPAL YADAV PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD , THE 21 ST DAY OF AUGUST, 201 5 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOM E TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD