Income Tax Appellate Tribunal - Ahmedabad
Ashish P.Patel,, Ahmedabad vs Acit, Central Circle-1(3),, Ahmedabad on 24 March, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "C" BENCH AHMEDABAD
BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER
AND SHRI MANISH BORAD, ACCOUNTANT MEMBER
ITA No.2284/Ahd/2013
(Assessment Year: 1998-99)
Shri Ashish P. Patel
1st Floor, Chinubhai Chambers,
B/h. City Gold Cinema, Off. Ashram
Road, Ahmedabad - 380009 Appellant
Vs.
ACIT,
Central Circle-1(3), Ahmedabad Respondent
PAN: ACTPP0045O
आवेदक क ओर से/By Assessee : Shri P. M. Mehta, A.R.
राज व क ओर से/By Revenue : Shri Sanjeev Kumar Dev,
Sr. D.R.
सन
ु वाई क तार ख/Date of Hearing : 23.03.2017
घोषणा क तार ख/Date of
Pronouncement : 24.03.2017
ORDER
PER S. S. GODARA, JUDICIAL MEMBER
This assessee's appeal for assessment year 1998-99 is preferred against the CIT(A)-I, Ahmedabad's order dated 30.08.2013, passed in appeal no. CIT(A)-I/CC.1(3)/058/2013-14, upholding Assessing Officer's action in imposing penalty of Rs.1,68,947/-, in proceedings u/s.271(1)(c) of the Income Tax Act, 1961; in short "the Act".
ITA No. 2284/Ahd/2013 (Shri Ashish P. Patel vs. ACIT)A.Y. 1998-99 -2-
2. We straightway come to basic facts of the case. The Assessing Officer had framed a re-assessment in assessee's case on 26.03.2002 disallowing quantum interest expenses of Rs.6,06,492/-. He made the said disallowance after observing that the assessee on the one hand had paid interest to various parties whereas it had not charged all of its creditors likewise interest amount. The assessee preferred appeal. The CIT(A) deleted the above quantum disallowance in order dated 05.03.2003. The Revenue filed ITA No.2089/ahd/2003 before this tribunal. A co-ordinate bench in its order dated 09.01.2009 restored the issue back to the file of Assessing Officer to be decided in tune with a similar order passed in assessment year 1995-96. The Assessing Officer took up consequential assessment. He reiterated the very interest disallowance therein. The assessee does not appear to have filed any appeal.
3. We now advert to the impugned penalty proceedings. The Assessing Officer quoted quantum developments narrated in preceding paragraph to observe that the assessee's act and conduct resulting in said interest disallowance amounting to an instance of furnishing of inaccurate particulars of income. He thus imposed the impugned penalty of Rs.1,68,947/- in order dated 26.03.2013 as confirmed in lower appellate proceedings.
4. We have heard rival submissions. Relevant findings perused. The sole issue in the instant case is about correctness of the impugned penalty arising from interest disallowance made in quantum proceedings. We have already narrated the fact that the said disallowance did not arise on account of any genuineness issue in raising of deduction claim but because of the fact that the Assessing Officer found the assessee to have paid interest to its creditors and not charged from the persons he had lent his money. It has further come on record that the assessee had otherwise filed all necessary particulars ITA No. 2284/Ahd/2013 (Shri Ashish P. Patel vs. ACIT) A.Y. 1998-99 -3- leading to the said disallowance on the basis of correctness thereof. The Assessing Officer's re-assessment framed on 26.03.2002 contains a specific mention to this effect. We observe in this backdrop that the assessee cannot be held to have furnished inaccurate particulars of income. It is further evident that this tribunal's quantum order (supra) restored the issue in light of its observations in assessment year 1995-96 only. We thus quote hon'ble apex court's decision in CIT vs. Reliance Petroproducts 322 ITR 158(SC) that each and every quantum disallowance does not necessarily attract the impugned penal provision and direct the Assessing Officer to delete the impugned penalty.
5. This assessee's appeal is allowed.
[Pronounced in the open Court on this the 24th day of March, 2017.] Sd/- Sd/-
(MANISH BORAD) (S. S. GODARA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad: Dated 24/03/2017
True Copy
S.K.SINHA
आदे श क त ल
प अ े
षत / Copy of Order Forwarded to:-
1. राज व / Revenue
2. आवेदक / Assessee
3. संबं धत आयकर आयु!त / Concerned CIT
4. आयकर आयु!त- अपील / CIT (A)
5. )वभागीय ,-त-न ध, आयकर अपील य अ धकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड3 फाइल / Guard file.
By order/आदे श से, उप/सहायक पंजीकार आयकर अपील य अ धकरण, अहमदाबाद ।