Income Tax Appellate Tribunal - Delhi
Vivek Aggarwal, New Delhi vs Acit, New Delhi on 3 January, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH: 'D' NEW DELHI
BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER
AND
SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER
I.T.A. Nos. 2540 TO 2542/Del/2014
Assessment Years: 2003-04 TO 2005-06
Sh. Vivek Aggarwal, Vs. ACIT, CC-13,
E-384, Greater Kailash, Part-II, New Delhi
New Delhi - 110 048
(PAN: AAEPA0902H)
(APPELLANT) (RESPONDENT)
Assessee by: Dr. Ram Samujh, A.R.
Revenue by: Shri Umesh Chand Dubey, Sr. DR
ORDER
PER H.S. SIDHU, JM
These three appeals are filed by the Assessee against the separate Orders all dated 08.1.2014 passed by the Ld. CIT(A)-XXV, New Delhi relating to Assessment Year 2003-04 to 2005-06. Since the issues involved in these appeals are common and identical, hence, were heard together and are being disposed of by this common order for the sake convenience, by dealing with ITA No. 2540/Del/2014 (AY 2003-04).
2. The grounds raised in 2540/Del/2014 (AY 2003-04) read as under:-
(i) On the facts and circumstances of the case and in law, the CIT(A) has erred upholding the levy of penalty on income of Rs. 2,46,644/- by AO on the losses incurred by the appellant from garment business without substantiating the manipulation and tampering.
ii) The appellant craves leave for reserving the right to amend modify, alter, add or forego any grounds of appeal at any time before or during the appeal.
3. The grounds raised in 2541/Del/2014 (AY 2004-05) read as under:-
(i) On the facts and circumstances of the case and in law, the CIT(A) has erred upholding the levy of penalty on income of Rs. 2,06,991/- by AO on the losses incurred by the appellant from garment business without substantiating the manipulation and tampering.
ii) The appellant craves leave for reserving the right to amend modify, alter, add or forego any grounds of appeal at any time before or during the appeal.
4. The grounds raised in 2542/Del/2014 (AY 2005-06) read as under:-
(i) On the facts and circumstances of the case and in law, the CIT(A) has erred upholding the levy of penalty on income of Rs. 96,065/- by AO on the losses incurred by the 2 appellant from garment business without substantiating the manipulation and tampering.
ii) The appellant craves leave for reserving the right to amend modify, alter, add or forego any grounds of appeal at any time before or during the appeal.
5. The brief facts of the case are that a search and seizure action u/s. 132 of the I.T. Act, 1961 was carried out in the Suresh Nanda Group of cases on 28.2.2007 of which the assessee was a member. In this case notice u/s. 153A was issued on 18.11.2008 and served on the assessee. Pursuant thereto the applicant filed its return declaring income of Rs. 15,14,302/- u/s. 153A(1)(a) of the I.T. Act, on 6.2.2009. Thereupon the AO issued notice u/s. 143(2) of the I.T. Act, on 9.2.2009 and the assessment were accordingly completed at Rs. 28,12,213/- u/s. 143(3) r.w.s. 153A of the I.T. Act, 1961 dated 29.12.2009 after making various additions and disallowances and penalty proceedings were also initiated against the assessee. In this case, against the AO's order, in the quantum proceedings, by reason of which the assessee's income was determined at Rs. 28,13,213/- the assessee approached the Ld. CIT(A), New Delhi and the ITAT, New Delhi, who upheld the disallowance of business loss amounting to RS. 2,46,644/- only while deleting most of the other additions/ disallowances. As a result to the order of the Ld. CIT(A), the AO passed the order imposing penalty u/s. 271(1)(c) of the I.T. Act, 1961 3 on the assessee on 10.12.2012 was imposed of Rs. 77,693/- i.e. @100% of tax sought to be evaded i.e. Rs. 2,46,644/-.
6. Against the above Penalty Order dated 10.12.2012 passed by the Assessing Officer, assessee appealed before the Ld. First Appellate Authority, who vide impugned order dated 08.1.2014 dismissed the appeal of the assessee.
7. Against the above order of the Ld. CIT(A) dated 08.1.2014, assessee is in appeal before the Tribunal.
8. Ld. Counsel of the assessee stated that assessee neither concealed any income nor he was liable for furnishing any inaccurate particulars of income. The disallowance of business loss in aforesaid 3 years were neither based on any seized material nor with other documentary evidence. He further stated that AO did not consider the assessee's explanation in proper perspective but he levied the penalty u/s. 271(1)(c) merely on the basis of disallowance made in the assessment order and upheld in the appellate orders in quantum appeals. Also as per the assessee's counsel contention, there was no satisfaction for concealment was recorded by the AO; the onus proving the concealment lies on the revenue. It was his further contention that penalty cannot be levied on the basis of assessment order and appellate order as the penalty are all together different than the assessment proceedings. In view of above, the penalty is not leviable. 4 In support of his contention, he relied upon the decision of the Hon'ble Apex Court in the case of CIT vs. Reliance Petro Products (2010) Taxman 322.
9. On the other hand, Ld. DR relied upon the order of the authorities below and requested that the Appeal of the Assessee may be dismissed.
10. We have heard both the parties and perused the records, especially the orders of the authorities below, we find that in this case no satisfaction for concealment was recorded for penalty of in dispute. We further note the AO observed that assessee furnished inaccurate particulars of its income and is liable for penalty u/s 271(1)(c), which did not establish from the facts and circumstances of the case that how the assessee has furnished inaccurate particulars of its income. Section 271(1)(c) postulates imposition of penalty for furnishing of inaccurate particulars and concealment of income. In this regard, we draw my support from the decision of the Hon'ble Apex Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd. (2010) 322 ITR-158 (SC) wherein the Hon'ble Supreme Court has held that 'where there is no findings that any details supplied by the assessee in its return are found to be incorrect or erroneous or false, there is no question of inviting the penalty u/sec. 271(1)(c) of the Act. A mere making a claim, which is not sustainable in law, by itself, will not amount of furnishing inaccurate particulars regarding the income of the assessee. Such claim 5 made in the return cannot amount to furnishing a inaccurate particulars of income. As the assessee has furnished all the details of its expenditure as well as income in its return, which details, in themselves, were not found to be inaccurate nor could be viewed as the concealment of income on its part. It was up to the authorities to accept its claim in the return or not. Merely, because the assessee had claimed the expenditure, which claim was not accepted or was not acceptable to the Revenue, that by itself would not, in our opinion, attract the penalty u/sec. 271(1)(c). If we accept the contention of the Revenue then in case of every return where the claim made is not accepted by the Assessing Officer for any reason, the assessee will invite penalty u/sec. 271(1)(c). That is clearly not the intendment of the Legislature".
11. In the background of the aforesaid discussions and respectfully follow the precedent, as aforesaid, we are of the considered view that the assessee has not furnished inaccurate particulars of income and there are no findings of the Assessing Officer and the CIT (Appeals) that the details furnished by the assessee in his return are found to be inaccurate or erroneous or false. Under these circumstances, in our view the penalty in dispute is totally unwarranted and deserve to be deleted. Accordingly, we delete the penalty in dispute and cancel the orders of the authorities below on the issue in dispute.
12. Following the consistent view as taken in assessment year 2003-04, as aforesaid, the penalty in dispute in appeals relating to 6 assessment years 2004-05 & 2005-06 also stand deleted and accordingly, the appeals relating for AYrs. 2004-05 & 2005-06 also stand allowed.
13. In the result, all the 03 Appeals filed by the Assessee stand allowed.
Order pronounced in the open court on 03/1/2017.
Sd/- SD/-
[PRASHANT MAHARISHI] [H.S. SIDHU]
ACCOUNTANT MEMBER JUDICIAL MEMBER
Date 03/1/2017
"SRBHATNAGAR"
Copy forwarded to: -
1. Appellant -
2. Respondent -
3. CIT
4. CIT (A)
5. DR, ITAT
TRUE COPY
By Order,
Assistant Registrar, ITAT, Delhi Benches
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