Income Tax Appellate Tribunal - Kolkata
Central Roller Flour Mills Pvt. Ltd., ... vs Department Of Income Tax on 20 May, 2013
आयकर अपीलीय अधीकरण, Ûयायपीठ - "बी ", कोलकाता,
IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH "B", KOLKATA
[(सम¢) ौी के.के.गुƯा,
ा, लेखा सदःय, एवं ौी जाज[ माथन Ûयायीक सदःय]]
[Before Hon'ble Sri K.K.Gupta, AM & Hon'ble Sri George Mathan, JM]
आयकर अपील संÉया /ITA Nos.534/& 535/Kol/2011
िनधॉरण वषॅ/Assessment Years : 1987-88 & 1990-91
(अपीलाथȸ/APPELLANT ) -वनाम- (ू×यथȸ/RESPONDENT)
D.C.I.T., Central Circle-XXI, M/s.Central Roller Flour Mills
Kolkata -versus- Pvt.Ltd., Kolkata.
(PAN:AABCC 8240 N)
अपीलाथȸ कȧ ओर से/ For the Appellant: Shri Rajesh Kumar, JCIT,
Sr.DR
ू×यथȸ कȧ ओर से/For the Respondent: Miss.Leena Rachh, FCA
सुनवाई कȧ तारȣख/Date of Hearing : 20.05.2013
घोषणा कȧ तारȣख/Date of Pronouncement : 20.05.2013
आदे श/ORDER
Per Shri George Mathan, JM
These appeals are filed by the Revenue against the order of ld. C.I.T.(A)- Central-II, Kolkata in Appeal Nos.82&83/XXI/CIT(A)-C-II/08-09 dated 31.01.2011 for the Assessment years 1987-88 and 1990-91 respectively..
2. Shri Rajesh Kumar, JCIT,Sr.DR represented on behalf of the Revenue and Miss.Leena Rachh, FCA represented on behalf of the assessee.
3. In the Revenue's appeal the Revenue has raised the following grounds :-
"1. That in the facts and circumstances of the case and in law, the ld. CIT(A) has erred in canceling the penalty of rs.10,41,982/- u/s 271(1)(c) of the Act, when the quantum addition was confirmed by the Hon'ble ITAT to the extent of G.P. of 7.5% as against G.P. of 2.67% disclosed by the assessee.
2. That the department craves leave to add, modify or alter any of the ground(s) of appeal and/or adduce additional evidence at the time of hearing of the case."
4. It was submitted by the ld.DR that the assessee was involved in fodder scam. It was the submission that consequently the income of the assessee had been estimated ITA Nos.534 & 535/Kol/2011 2 DCIT vs M/s.Central Roller Flour Mills Pvt. Ltd.
A.Yrs.1987-88 &1990-91 by the AO at 15%. It was the submission that on appeal in the quantum proceedings, the ld. CIT(A) had reduced the income of the assessee by estimating the same at 10% and on further appeal the Tribunal had reduced the estimation to 7.5%. The ld. DR drew our attention to the order of the Co-ordinate Bench of this Tribunal in assessee's case in quantum proceedings wherein it was the submission that in para 2.8 of the order the Tribunal had recognized that Shri Dipesh Chandak who was a director of the assessee company was involved in the fodder scam and the assessee had been used as a conduit for the transactions involved in the fodder scam. It was the submission that as the assessee had not cooperated in the assessment proceedings and as the Tribunal had for the earlier assessment years estimated the income at 7.5%, had continued to estimate the income of the assesee for the year under appeal at 7.5%. It was the submission that the fact that the assessee's accounts were not reliable itself led the foundation for levy of penalty us 271(1)(c) of the Act. It was the further submission that as the assessee could not substantiate its return the AO had levied penalty u/s 271(1)(c) of the Act. It was the submission that on appeal the ld. CIT(A) had deleted the penalty levied by holding that the additions to the income was estimated on the basis of assumption and extrapolation without any definite finding of there being any amount on account of bogus purchases. Consequently the ld. CIT(A) had deleted the penalty levied for both the assessment years. It was the submission that the order of the ld. CIT(A) was liable to be reversed. He fully relied on the order of the AO.
5. In reply the ld. AR submitted that the income of the assesee had been estimated and there was no clear cut finding or evidence to show that the assessee had concealed its income or furnished inaccurate particulars of its income. It was the submission that in the course of re-assessment the accounts of the assessee had been rejected by invoking the provision of section 145 of the Act. It was the submission that the fact that the income of the assesee has been estimated itself clearly shows that there is no concealment on the part of the assessee.
6. We have considered the rival submissions. A perusal of the facts of the present case shows that in the course of assessment the AO had estimated the income of the ITA Nos.534 & 535/Kol/2011 3 DCIT vs M/s.Central Roller Flour Mills Pvt. Ltd.
A.Yrs.1987-88 &1990-91 assessee at 15%. This income was reduced by the ld. CIT(A) to an estimated 10% and further reduction of the same by the Tribunal to 7.5%. Further a perusal of the order of the ld. AO shows that this issue of adjudicating the gross profit rate is also pending under appeal before the Hon'ble High Court at Patna. Thus it is clearly seen that the income of the assessee has been estimated right from the level of the AO and continues to be estimated. A perusal of the order of the ld. CIT(A) shows that he cancelled the penalty levied on the ground that the income has been estimated on the basis of assumption and extrapolation without any definite finding of their being any amount on account of bogus purchases. Further, a perusal of the penalty for both the assessment years under appeal also clearly shows that the income allegedly to have been concealed for both the assessment years are identical amounts which also gives support to the finding that the income has been estimated for both the assessment years on the basis of assumption and extrapolation. Admittedly on estimated addition to the income no penalty is leviable as no specific concealment of income or furnishing of inaccurate particulars could be pointed out on part of the assessee. In this circumstances, we are of the view that the findings of the ld. CIT(A) in canceling the penalty is on a right footing and the same is upheld.
7. In the result the appeals filed by the Revenue stand dismissed.
Order dictated and pronounced in the open court on 20.05.2013.
Sd/- Sd/-
[ौी केके.गुƯा,, लेखा सदःय ] [ौी.जाज[ माथन, Ûयायीक सदःय ]
[K.K.Gupta] [ George Mathan ]
Accountant Member Judicial Member
(तारȣख)
तारȣख)Date: 20.05.2013.
R.G.(.P.S.)
ITA Nos.534 & 535/Kol/2011 4
DCIT vs M/s.Central Roller Flour Mills Pvt. Ltd.
A.Yrs.1987-88 &1990-91
आदे श कȧ ूितिलǒप अमेǒषतः-
Copy of the order forwarded to:
1. M/s.Central Roller Flour Mills Pvt. Ltd., 14A, 5th floor, FMC Fortuna, 234/3A, A.J.C.Bose Road, Kolkata-700020.
2 The D.C.I.T., Central Circle-XXI, Kolkata.
3. CIT Kolkata 4. CIT(A)- Central-II, Kolkata
5. DR, Kolkata Benches, Kolkata स×याǒपत ूित/True Copy, आदे शानुसार/ By order, Deputy /Asst. Registrar, ITAT, Kolkata Benches