Income Tax Appellate Tribunal - Ahmedabad
Prarthana Const P Ltd, Ahmedabad vs Department Of Income Tax on 27 May, 2011
IN THE INCOME TAX APPELLATE TRIBUNAL
AHMEDABAD BENCH " B "
Before Shri T. K. SHARMA, JUDICIAL MEMBER
and Shri D. C. AGRAWAL, ACCOUNTANT MEMBER
M.A. No. 194/Ahd/2010
in I.T.A. No. 2235 / Ahd/2002
(Assessment year 1997-98)
Jt. CIT (SR)1, Vs. Prarthana Construction P. Ltd.,
Ahmedabad 10, Pritam Nagar,
Ellisbridge, Ahmedabad
PAN/GIR No. :AADCP3934A
(APPLICANT) .. (RESPONDENT)
Applicant by: Shri S P Talati, DR
Respondent by: Shri M K Patel, AR
ORDER
PER SHRI D. C. AGARWAL, AM:-
This M.A. is filed by the revenue in respect of order of the tribunal in I.T.A. No. 2235/Ahd/2002. The issue was about levy of penalty u/s 140A(3) read with section 221 of the I.T. Act. There was default in the payment of self assessment tax. The revised return was filed on 23.04.1998 on income of Rs.26,37,117/- against earlier declared income of Rs.26,91,739/-. The return was accepted u/s 143(1)(a). Assessee had not paid any self assessment tax. It had paid taxes in the subsequent year as under:
Month & year Amount Rs.
June 1998 1,00,000
July 1998 4,00,000
Sept. 1998 5,51,083
Oct. 1998 3,25,000
Dec. 1998 1,00,000
2. The tribunal confirmed the existence of default in making the payment of tax u/s 140A(3). However it was noted by he tribunal that that assessee had paid taxes for the assessment year 1997-98 but they were adjusted by the department against the demand of assessment year 1996-97 thus creating a default for the assessment year 1997-98. The tribunal gave following directions:
"We have considered the rival submissions and perused the material on record. For the reasons discussed by us in assessment year 1996-97 we confirm the existence of default in making payment of taxes u/s 140A(3) as facts and circumstances of the case remained the same except the fact that assessee has made the payment of taxes of Rs.14,76,083/- from July, 1998 to December, 1998, whose details are given above. Therefore, there is no material to hold a different view than taken in Asst. Year 1996-97. Accordingly, -we- accept the contention of assessee that credit for taxes paid should be given while calculating quantum of penalty when in fact -assessee has paid taxes for Asst. Year 1997-98 even though department might have adjusted the same against demand for Asst. Year 1996-97.
Keeping in view this position, we direct that quantum of penalty leviable for default u/s 140A(3) should be calculated form the date of filing of return till the payment of taxes or till the date of regular assessment which is earlier. The penalty should be calculated @ 15% p.a. for each complete month of default or part of the month treating it as full month of default. The credit of taxes paid should be given before calculating penalty. We accordingly restore this issue to the file of AO for carrying out calculation as per our direction above."
3. In the M.A., the A.O. mentioned that it was not the payment for assessment year 1997-98 but it was a payment for the assessment year 1996-
97. It was also not contended by the assessee before the A.O. that regular payment for tax for the assessment year 1996-97 should be treated as advance tax for the assessment year 1997-98.
4. We have heard both the parties. From the order of the tribunal referred to above, there is no direction that regular tax paid for the assessment year 1996-97 by the assessee should be treated as self assessment tax for the assessment year 1997-98. The directions are very clear that penalty u/s 140A(3) should be calculated form the date of filing of return till the payment of taxes or till the date of regular assessment, whichever is earlier. In other words, only that payment of taxes will be given credit which is paid for the assessment year 1997-98 as per challans and no credit will be given for taxes paid for the assessment year 1996-97 for which credit will be given only in that year and not in the assessment year 1997-98. What is observed by the tribunal is only about calculation of penalty and it is not a direction that taxes paid fort the assessment year 1996-97 should be treated as self assessment tax paid for the assessment year 1997-98. It is a matter of verification, according to which, the A.O. can take appropriate action for calculating penalty u/s 140A(3). In any case, there is no case for interference in the order passed by the tribunal.
5. In the result, M.A. of the department stands rejected.
6. Order pronounced in the open court on 27th May 2011.
Sd./- Sd./- (T. K. SHARMA) (D. C. AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad; Dated : 27th May, 2011 Sp Copy of the Order forwarded to: 1. The applicant 2. The Respondent 3. The CIT Concerned 4. The Ld. CIT (Appeals) 5. The DR, Ahmedabad 6. The Guard File 1. Date of dictation...24/5/11.
2. Date on which the typed draft is placed before the Dictating Member 25/5/11 Other Member ........................
3. Date on which the approved draft comes to the Sr. P.S./P.S. 26/5/11
4. Date on which the fair order is placed before the Dictating Member for pronouncement 27/5/11
5. Date on which the fair order comes back to the Sr. P.S./P.S.27/5/11
6. Date on which the file goes to the Bench Clerk ...27/5/11
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. .......................