Income Tax Appellate Tribunal - Jaipur
Smt. Krishna Soni, Jaipur vs Income Tax Officer, Alwar on 10 November, 2017
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IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR
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BEFORE: SHRI VIJY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM
vk;dj vihy la-@ITA No. 587/JP/2017
fu/kZkj.k o"kZ@Assessment Year : 2008-09
Smt. Krishana Soni cuke Income Tax officer,
C/o Triputi Automobiles, Vs. Ward Behror,
NH-8,Kotputli, Distt. Jaipur. Behror 301 701
Distt. Alwar.
LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AIDPS1888D
vihykFkhZ@Appellant izR;FkhZ@Respondent
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s Assessee by : None
jktLo dh vksj ls@ Revenue by : Shri P.P. Meena (J.CIT)
lquokbZ dh rkjh[k@ Date of Hearing : 03/11/2017
mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 10/11/2017
vkns'k@ ORDER
PER: VIJAY PAL RAO, J.M. This appeal by the assessee is directed against the order dated 08.06.2017 of CIT (A), Alwar arising from the penalty order passed u/s 271(1)(c) of the Act for A.Y. 2008-09. The assessee has raised the following grounds as under:-
"1. The learned AO has erred in imposing the penalty of Rs. 20000/- under section 271(1)(c) on ad hoc or lump sum addition made on estimate basis and CIT (Appeal) has erred in confirming the same.
2. Any other ground of appeal at the time hearing."ITA No. 587/JP/2017
Smt. Krishna Soni V ITO
2. At the time of hearing none has appeared on behalf of the assessee however, Mr. Anil Goyal (C.A.) the ld. Authorized Representative of the assessee filed a letter dated 27.10.2017 and pleaded that this appeal of the assessee may be decided by considering written submissions filed on behalf of the assessee on 28.08.2017. Thus this appeal of the assessee is taken up for hearing and adjudication.
3. We have carefully perused and given our thought to the written submissions of the assessee as well as the contentions of the ld. DR. The assessee is engaged in the business of plying of trucks. The assessee declared her income from the business of plying trucks under the provisions of section 44AE. While framing the assessment the Assessing Officer made disallowance of Rs. 64,675/- on account of depreciation of car claimed by the assessee. The addition was confirmed by the CIT(A) and thereafter the AO initiated the penalty proceedings u/s 271(1)(c) against the addition on account of disallowance of depreciation on car. Thus the issue of disallowance of depreciation, in the facts of the case when the assessee has declared the income under deeming of provisions of section 44AE, has attained the finality. The Assessing Officer imposed levy of penalty of Rs. 20,000/- u/s 271(1)(c) vide order dated 25.03.2015 which was 2 ITA No. 587/JP/2017 Smt. Krishna Soni V ITO challenged by the assessee before the ld. CIT(A) however, the ld. CIT(A) was not impressed with the contention and explanation of the assessee and confirmed the levy of penalty.
4. Before the Tribunal the assessee has submitted that there is no restriction to claim the depreciation of any asset which is being used in the business of plying trucks u/s 44AE. Therefore, in the absence of any specific restriction of allowing the depreciation on the asset other than the plying trucks the claim of the assessee though, disallowance made by the assessee and confirmed by the CIT(A) cannot be treated as bogus leading to the default of either concealment of income or furnishing inaccurate particulars of income. Further, it is contended that it may be a difference of opinion on a debatable issue and merely because the Assessing Officer made an addition on the basis of material available on record it will not amount to furnishing inaccurate particulars of income or concealment of income. When the assessee explained and furnished all the relevant details and documents before the AO during the assessment proceedings then the addition made by the AO would not warrant levy of penalty u/s 271(1)(c). The asessee has placed reliance on various decisions including the decision of 3 ITA No. 587/JP/2017 Smt. Krishna Soni V ITO Hon'ble Supreme Court in case of CIT Vs. Reliance Petro Products Pvt. Ltd. 322 ITR 158.
5. On the other hands, the ld. DR has submitted that the assessee claimed depreciation on car which is not permissible as per the provisions of the Act when the assessee declared the income from business u/s 44AE from the business of plying trucks. He has further contended that during the assessment proceedings the AO noted that the assessee has claimed depreciation on car which was wrongly credited in the capital account of the assessee in M/s Triputi Cottage whereas the said amount was sub sumed in calculating the income u/s 44AE. He has relied upon the orders of the authorities below.
6. Having considered the rival submissions as well as relevant material on record, we note that as far as the income declared u/s 44AE is concerned the Assessing Officer has accepted the same. However, the AO disallowed the claim of the assessee on account of depreciation on cars. Though disallowance made by the AO was confirmed by the ld. CIT(A) and attained finality, however, when the assessee has produced the all relevant record, details as well as facts before the Assessing Officer and only from the record produced by the assessee the AO noted that the assessee has claimed the depreciation of Rs. 64,675/- 4 ITA No. 587/JP/2017
Smt. Krishna Soni V ITO which was also credited to the capital account of the assessee. Thus, the disallowance made by the AO is based on the ground that the said claim is not permissible when the assessee has declared income u/s 44AE. There is no quarrel on the point that as per sub-section 3 of section 44AE no deduction is allowable u/s 30 to 38 as the same is deemed to have been already given full effect while computing the income as per provisions of section 44AE(1). However the disallowance of the claim as per the statutory provision would not amount that the assessee has furnished inaccurate particulars of income or concealment of income when all the details and relevant material available before the AO as produced by the assessee. Therefore, in view of the decision of Hon'ble Supreme Court in case of CIT vs. Reliance Petro Products Pvt. Ltd. (Supra) which is binding precedent we are of the view that the penalty cannot be levied simply because of the addition made by the AO as it was not allowable under the provisions of section 44AE. It is not the case of the AO that the depreciation claimed by the assessee is a bogus claim on non existing business asset or otherwise absolutely wrong. Therefore, in the facts and circumstances of the case we delete the penalty of Rs. 20,000/- levied u/s 271(1)(c) of the Act.
In the result, the appeal of the assessee is allowed. 5 ITA No. 587/JP/2017
Smt. Krishna Soni V ITO Order pronounced in the open court on 10/11/2017 Sd/- Sd/-
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(Vikram Singh Yadav) (Vijay Pal Rao)
ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member
Tk;iqj@Jaipur
fnukad@Dated:- 10/11/2017.
*Santosh.
vkns'k dh izfrfyfi vxzfs 'kr@Copy of the order forwarded to:
1. vihykFkhZ@The Appellant- Smt. Krishana Soni C/o Triputi Automobiles, NH-8,Kotputli, Distt. Jaipur.
2. izR;FkhZ@ The Respondent- Income Tax officer, Ward Behror, Behror 301 701 Distt. Alwar.
3. vk;dj vk;qDr@ CIT
4. vk;dj vk;qDr@ CIT(A)
5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur.
6. xkMZ QkbZy@ Guard File {ITA No. 587/JP/2017} vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar 6