Income Tax Appellate Tribunal - Ahmedabad
B. Patel Infrastructure (P) Ltd.,, ... vs Department Of Income Tax on 19 December, 2011
आयकर अपीलीय अिधकरण,
अिधकरण, अहमदाबाद Ûयायपीठ 'बी
बी'
बी अहमदाबाद ।
IN THE INCOME TAX APPELLATE TRIBUNAL
" B " BENCH, AHMEDABAD
सव[ौी मुकुल कुमार ौावत, Ûयाियक सदःय एवं ौी बी.पी.जैन, लेखा सदःय के सम¢ ।
BEFORE SHRI MUKUL Kr.SHRAWAT, JUDICIAL MEMBER AND
SHRI B.P.JAIN, ACCOUNTANT MEMBER
आयकर अपील सं./I.T.A. No.806/Ahd/2010
( िनधा[रण वष[ / Assessment Year : 2005-06)
The DCIT बनाम/
B.Patel Infrastructure
Mehsana Circle Vs. Pvt.Ltd.
Mehsana Sardar Society
Mehsana
ःथायी ले खा सं . /जीआइआर सं . / PAN/GIR No.: AAACB 8590 K
(अपीलाथȸ /Appellant) .. (ू×यथȸ/Respondent)
अपीलाथȸ ओर से/Appellant by : Shri Samir Tekriwal, Sr.D.R.
ू×यथȸ कȧ ओर से/ Respondent by : -None-
सुनवाई कȧ तारȣख/
/ Date of Hearing : 19/12/2011
घोषणा कȧ तारȣख /Date of Pronouncement : 21/12/2011
आदे श/O R D E R
PER SHRI MUKUL Kr. SHRAWAT, JUDICIAL MEMBER :
This is an appeal at the behest of the Revenue which has emanated from the order of Learned CIT(Appeals)-Gandhinagar dated 30/12/2009 passed for A.Y. 2005-06. The Revenue has challenged the deletion of penalty levied u/s.271(1)(c) of the I.T.Act.
2. Facts in brief as emerged from the corresponding penalty order passed u/s.271(1)(c) of the I.T. Act, 1961 dated 27/10/2009 and the assessment order passed u/s.143(3) of the I.T.Act dated 28/12/2007 were ITA No.806/Ahd/2010 DCIT vs. B.Patel Infrastructure Pvt.Ltd.
Asst.Year - 2005-06 -2- that the assessee-company is in the construction business. While levying the penalty, it was noted by the Assessing Officer that the Hon'ble ITAT has confirmed an addition of Rs.6 lacs which was made by invoking the provisions of section 14-A of the I.T.Act. During the assessment proceedings, it was found by the Assessing Officer that the assessee had made an investment of Rs.50 lacs in shares of M/s.Karnavati Infrastructure Pvt.Ltd. The dividend income on such shares was exempt u/s.10(34) of the I.T.Act. Due to the said reason, the corresponding interest expenses on the money borrowed was disallowed and the said disallowance was worked out @ 12% on the investment of Rs.50 lacs which amounted to Rs.6 lacs held as disallowance of interest . With this factual background, it was held by the Assessing Officer that in the light of Dharmendra Textiles UOI vs. Dharmendra Textile 306 ITR 277 (SC), the penalty being a civil liability, hence imposed a sum of Rs.2,20,000/- u/s.271(1)(c) of the I.T.Act. The matter was carried before the first appellate authority.
3. The Learned CIT(Appeals) has referred an earlier decision of the Tribunal and deleted the penalty as under:-
"7. The matter has been given due consideration and I am afraid in the facts and circumstances of the case there is no justifiable reason for levy of penalty u/s.271(1)(c). Vide order No.CIT(A)/GNR/150/2007-08 dated 30/12/2007 in the appellant's case for assessment year 2004-05, the issue that per se the assessee had not concealed any particulars and the fact that there existed difference of opinion among various authorities till the date of receipt of ITAT's order on 31/12/2005, had been highlighted to hold that the assessee cannot be visited penalty u/s.271(1)(c). Disallowance of an expense on different ITA No.806/Ahd/2010 DCIT vs. B.Patel Infrastructure Pvt.Ltd.
Asst.Year - 2005-06 -3- interpretation of a section does not amount to furnishing inaccurate particulars income. The basic spirits of the same logic will have to be applied for this assessment year also. The assessee had made a claim of total amount of interest on borrowing in the return filed on 31/10/2005, i.e. before the date it received the ITAT's order. The act of concealment has to be related to a return of income and not to what an assessee should have done. From the chronology of dates it is clear that on the date of return of income was filed, it did not have the benefit of ITAT's decision to delete part of the interest expenses as relatable to investment in shares. Otherwise, nothing seems to have been concealed from the Assessing Officer. All the facts about investment in shares and borrowings were very much on record and the computation for disallowance has been done on the basis of the assessee's data only. The point made by the Authorised Representative that any case the appellant had not accepted the ITAT's decision and have even gone upto the High Court, whose decision was rendered on 07/02/2007, has also to be kept in mind in coming to the conclusion as to whether the appellant made any inaccurate particulars of claim of expenses."
4. No one has appeared from the side of the respondent-assessee, however we have decided to proceed ex-parte qua the assessee, after hearing ld.Sr.DR Mr.Samir Tekriwal who has placed reliance on the penalty order.
5. At the outset, it is worth to mention that on identical facts for A.Y.2004-05 the Respected Co-ordinate Bench "B" Ahmedabad in ITA No.984/Ahd/2008 titled as "ACIT vs. B.Patel Infrastructure Pvt.Ltd." vide an order dated 31/05/2010 has held as under:-
"4. Having heard both the sides we are of the conscientious view that the issue of disallowance u/s.14A was always been a subject of ITA No.806/Ahd/2010 DCIT vs. B.Patel Infrastructure Pvt.Ltd.
Asst.Year - 2005-06 -4- controversy in the past. Rather this issue has a chequered history. The revenue authorities have not doubted bonafides of the stand taken by the assessee at the time when the claim was made but due to difference of opinion arosen on account of change in law and few decisions of the Hon'ble Courts have taken adverse view against the assessee. In a situation where there is a difference of opinion and issue being contentious the question of levy of concealment penalty should not arise rather a taxpayer in penalty matter may get the benefit of ambiguity of law. In view of these reasons we hereby affirm the findings of Ld. C.I.T.(A)., this ground of the Revenue is dismissed. In the result, appeal is dismissed."
6. Undisputedly, for Assessment Year 2004-05 a disallowance of Rs.6 lacs was made by invoking the provisions of section 14A of the I.T.Act as it was made in the year under consideration for Assessment Year 2005-06. On identical facts a penalty has already been deleted by the Respected Co-ordinate Bench, therefore we find no force in this ground of the Revenue. The deletion is hereby confirmed and ground is dismissed.
7. In the result, Revenue's appeal stands dismissed.
Sd/- Sd/-
(बी.पी.जैन) (मुकुल कुमार ौावत)
लेखा सदःय Ûयाियक सदःय
( B.P. JAIN ) ( MUKUL Kr. SHRAWAT )
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad; Dated 21/ 12 /2011
टȣ.सी.नायर, व.िन.स./T.C. NAIR, Sr. PS
ITA No.806/Ahd/2010
DCIT vs. B.Patel Infrastructure Pvt.Ltd.
Asst.Year - 2005-06
-5-
आदे श कȧ ूितिलǒप अमेǒषत/Copy
षत of the Order forwarded to :
1. अपीलाथȸ / The Appellant
2. ू×यथȸ / The Respondent.
3. संबंिधत आयकर आयुƠ / Concerned CIT
4. आयकर आयुƠ(अपील) / The CIT(A)-Gandhinagar
5. ǒवभागीय ूितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड[ फाईल / Guard file.
आदे शानुसार/ BY ORDER, स×याǒपत ूित //True Copy// उप/सहायक पंजीकार (Dy./Asstt.Registrar) उप/ आयकर अपीलीय अिधकरण, अिधकरण, अहमदाबाद / ITAT, Ahmedabad
1. Date of dictation.......................19.12.2011
2. Date on which the typed draft is placed before the Dictating Member 20.12.2011.................. Other Member.....................
3. Date on which the approved draft comes to the Sr.P.S./P.S.................
4. Date on which the fair order is placed before the Dictating Member for pronouncement......
5. Date on which the fair order comes back to the Sr.P.S./P.S.........21/12/2011
6. Date on which the file goes to the Bench Clerk..................... 21/12/2011
7. Date on which the file goes to the Head Clerk..................................
8. The date on which the file goes to the Assistant Registrar for signature on the order..........................
9. Date of Despatch of the Order..................