Income Tax Appellate Tribunal - Ahmedabad
Ankur Chemfood Ltd.,, Ahmedabad vs Dy.Cit.,Circle-1,, Ahmedabad on 17 November, 2016
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD "C" BENCH
Before: Shri S. S. Godara, Judicial Member
And Shri Amarjit Singh, Accountant Member
ITA No. 1019/Ahd/2013
Assessment Year 2008-09
M/s. Ankur Chemfood The DCIT,
Ltd, 9-B, Sumatinagar Circle-1,
Society, Usmanpura, Vs Ahmedabad
Ahmedabd380013 (Respondent)
PAN:AABCA 8203 F
(Appellant)
Revenue by: Shri Prasoon Kabra, Sr. D.R.
Assessee by: Shri K.C. Thaker, A.R.
Date of hearing : 27-10-2016
Date of pronouncement : 17-11-2016
आदेश /ORDER
PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-
This assessee's appeal for A.Y. 2008-09, arises from order of the CIT(A)-XXI, Ahmedabad dated 05-11-2012 in appeal no. CIT(A)- XXI/190/11-12, in upholding the penalty of Rs. 3,90,750/-, in proceedings under section 271(1)(c) of the Income Tax Act, 1961; in short "the Act".
I.T.A No. 1019/Ahd/2013 A.Y. 2008-09 Page No 2M/s. Ankur Chemfood Ltd. Vs. DCIT
2. In this case, assessee has filed application dated 5/09/2016 for conodanation of delay in filing appeal for a period of about three months. Assessee has filed affidavit of Shri Haresh Maheshwari working as clerk in the office of the assessee. It was explained that the clerk of the assessee has inadvertently misplaced the order passed by ld. Commissioner of Income Tax (A) as a result delay was occurred in filing this appeal before the hon'ble ITAT. We have gone through the affidavit and application of the assessee and we considered the circumstances as stated above by the assessee which resulted in delay in filing this appeal. We find that there is a bonafide mistake on the part of the staff as a result the present appeal has not been filed in time, therefore, we condone the delay in filing this appeal.
3. Brief facts of the case, assessee has filed return of income on 27th September,2008 declaring total income of Rs. 9,55,408/-. Thereafter, assessee filed revised return on 06/02/2009 declaring total income of Rs. 41,21,020/-. During the course of assessment proceedings, the Assessing Officer has noticed that the assessee has debited an amount of Rs. 3,10,000/- on account of fees and stamp duty paid for increase in the authorized share capital of the company. The Assessing Officer made additions of these expenditures to the total income on the ground that the nature of these expenditures are of capital nature which cannot be allowed u/s 37 of the act. Further the Assessing Officer has also noticed that assessee has set off the unabsorbed depreciation to the amount of Rs. 8,39,567/- pertaining I.T.A No. 1019/Ahd/2013 A.Y. 2008-09 Page No 3 M/s. Ankur Chemfood Ltd. Vs. DCIT to A.Y. 1999-2000 and set off the same against the income of the current year. The Assessing Officer has disallowed the set off on the ground that limitation of being eligible for set off against the business income is only upto 8 years as per section 32(2) of the IT act. Thereafter, the Assessing Officer has initiated penalty proceedings u/s 271(1)(c) for furnishing inaccurate particulars of income for both the additions made as stated above. During the course of penalty proceedings, the assessee has stated before the Assessing Officer that they have neither concealed any income nor furnished any particulars of income and provisions of section 271(1)(c) of the act are not attracted. The assessee has stated that they have submitted all the details of unabsorbed depreciation and expenditure incurred towards increased in share capital along with return of income and nothing has been concealed. The Assessing Officer has not accepted the explanation of the assessee and he levied a penalty of Rs. 3,90,750/- on account of filing of inaccurate particulars of income u/s 271(1)(c) of the act. Aggrieved against the order of Assessing Officer, the assessee has filed appeal before the Commissioner of Income Tax (Appeals). The Ld. CIT(A) has sustained the penalty levied by the Assessing Officer stating that he is of the view that the assessee has filed inaccurate particulars of income and the decision of the Commissioner of Income Tax(A) is reproduced as under:-
"4.12 I have perused penalty order u/s. 271(1)(c) of the I.T. Act passed by the AO and the written submissions made by the appellant including the judicial pronouncements relied upon by the appellant. I am of the view that the appellant had filed inaccurate particulars of income by claiming patent inadmissible capital expenditure, in view of the judgement of the Hon'ble Apex Court.
I.T.A No. 1019/Ahd/2013 A.Y. 2008-09 Page No 4M/s. Ankur Chemfood Ltd. Vs. DCIT The AO is correct in holding that the appellant, has filed inaccurate particulars of its income which would have led to payment of lower taxes had the appellant's case was not in scrutiny. Considering the above, I am of the view AO has correctly imposed penalty of Us.3,90,750/- u/s. 271(1)(c) of the I.T. Act and hence the same is hereby confirmed."
4. During the course of appellate proceedings before us, the learned counsel of the assessee stated that Commissioner of Income Tax (Appeals) erred in sustaining the penalty levied by the Assessing Officer as it has not furnished any inaccurate particulars of income. On the other hand, ld. DR relied on the order of the Commissioner of Income Tax (A).
5. We have heard both the sides and perused the material on record. We find that the assessee has incurred legal expenses of Rs. 3,10,000/- on account of increased in authorized capital and claimed unabsorbed depreciation of Rs. 8,39,567/- pertaining to Assessment Year 1999-2000. The Ld. counsel has also placed reliance on the decision of Supreme court in the case of CIT vs. Reliance Petro- Products Pvt. Ltd (2010) 322 ITR 158] (SC). On the other hand, Ld. D.R. relied on the order of the Ld. Commissioner of Income Tax(A).
6. We find that the assessee has submitted all the relevant particulars of year-wise brought forward depreciation and set off in the return of income. Similarly, the assesseee has debited in the profit and loss account the expenditure incurred toward increased in the authorized share capital of the assessee. We have considered I.T.A No. 1019/Ahd/2013 A.Y. 2008-09 Page No 5 M/s. Ankur Chemfood Ltd. Vs. DCIT the above stated facts and circumstances and find that the assessee has not furnished inaccurate particulars of income and the Assessing Officer has only disallowed the claim of the assessee. Therefore, we are not inclined to uphold the order of the Ld. Commissioner of Income Tax(A).
7. In the end, the appeal of the assessee is allowed.
Order pronounced in the open court on 17-11-2016 Sd/- Sd/-
(S.S. GODARA) (AMARJIT SINGH)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Ahmedabad : Dated 17/11/2016
आदेश क त ल प अ े षत / Copy of Order Forwarded to:-
1. Assessee
2. Revenue
3. Concerned CIT
4. CIT (A)
5. DR, ITAT, Ahmedabad
6. Guard file.
By order/आदेश से,
उप/सहायक पंजीकार
आयकर अपील य अ धकरण,
अहमदाबाद