GODFREY PHILIPS INDIA LTD., MUMBAI v. DCIT 8(1), MUMBAI

ITA 1476/MUM/2009 | 2003-2004
Pronouncement Date: 28-09-2011 | Result: Allowed

Appeal Details

RSA Number 147619914 RSA 2009
Assessee PAN AABCG4768K
Bench Mumbai
Appeal Number ITA 1476/MUM/2009
Duration Of Justice 2 year(s) 6 month(s) 26 day(s)
Appellant GODFREY PHILIPS INDIA LTD., MUMBAI
Respondent DCIT 8(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 28-09-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 28-09-2011
Date Of Final Hearing 14-09-2011
Next Hearing Date 14-09-2011
Assessment Year 2003-2004
Appeal Filed On 04-03-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL G BENCH: MUMBAI BEFORE SHRI P.M. JAGTAP ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR JUDICIAL MEMBER ITA NO.1476/MUM/2009 (ASSESSMENT YEAR: 2003-04) GODFREY PHILLIPS INDIA LTD. SAHARA ROAD CHAKALA ANDHERI (EAST) MUMBAI -400 099 ....... APPELLANT VS DCIT -8(1) AAYAKAR BHAVAN MUMBAI ..... RESPONDENT PAN: AABCG 4768 K APPELLANT BY: SHRI YOGESH THAR RESPONDENT BY: SHRI A.K. NAYAK DATE OF HEARING: DATE OF PRONOUNCEMENT: 14.09.2011 28.09.2011 O R D E R PER R.S. PADVEKAR JM: IN THIS APPEAL THE ASSESSEE HAS CHALLENGED THE IMPU GNED ORDER OF THE LD. CIT (A)-8 MUMBAI DATED 10.12.2008 FOR TH E A.Y. 2003-04 PARTLY CONFIRMING THE PENALTY LEVIED BY THE A.O. T HE ASSESSEE HAS TAKEN THE FOLLOWING EFFECTIVE GROUND:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN AW THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS ) VIII MUMBAI (THE CIT (A)) ERRED IN UPHOLDING THE ACTION OF THE DEPUTY COMMISSIONER OF INCOME TAX RANGE 8(1) MUMBAI (A.O.) IN LEVYING PENALTY U/S.271(1)(C) ON DISALLOWANCE OF INTEREST COST ON THE LOANS GIVEN TO ITS SUBSIDIARIES ITA 1476 /MUM/2009 GODFREY PHILLIPS INDIA LTD. 2 2. THE APPELLANT PRAYS THAT PENALTY LEVIED U/S.271( 1)(C) OF THE ACT BE DELETED.. 2. IN THIS CASE THE ORIGINAL ASSESSMENT OF THE ASSE SSEE WAS COMPLETED U/S.143(3) ON 20.1.2006 DETERMINING THE T OTAL INCOME AT ` 81 80 99 980/- AS AGAINST ` 77 87 52 790/- DECLARED BY THE ASSESSEE IN ITS RETURN. IN RESPECT OF FOLLOWING ADDITIONS THE A.O. INITIATED THE PENALTY PROCEEDINGS U/S.271(1)(C) OF THE ACT:- DETAILS AMT. IN ` (I) PRODUCT DEVELOPMENT EXPENSES 8 43 527 (II) DEPRECIATION ON UPS 2 45 908 (III) EDP CHARGES 6 49 600 (IV) INTEREST 38 98 000 (V) LEAVE ENCASHMENT 20 00 000 3. THE A.O. LEVIED THE PENALTY OF ` 28 02 347/- WHICH WAS EQUIVALENT TO 100% OF TAX ALLEGED TO BE EVADED. TH E ASSESSEE CHALLENGED THE PENALTY ORDER BEFORE THE LD. CIT (A) . 4. THE LD. CIT (A) SUSTAINED THE PENALTY ONLY TO TH E EXTENT OF ADDITION MADE BY THE DISALLOWANCE OF THE INTEREST O F ` 38 98.000/- AND DELETED PENALTY ON THE OTHER ADDITIONS. 5. THE LD. COUNSEL SUBMITS THAT SO FAR AS ADDITION OF INTEREST DISALLOWANCE IS CONCERNED IN THE QUANTUM APPEAL TH E SAID ISSUE HAS BEEN RESTORED TO THE FILE OF THE A.O. FOR PASSING A FRESH ORDER AFTER NECESSARY EXAMINATION IN THE LIGHT OF THE OBSERVATI ONS OF THE TRIBUNAL. HE THEREFORE PLEADED FOR CANCELING THE PENALTY. ITA 1476 /MUM/2009 GODFREY PHILLIPS INDIA LTD. 3 6. WE HAVE ALSO HEARD THE LD. D.R. THE ONLY GROUN DS TAKEN BY THE ASSESSEE ARE IN RESPECT OF PENALTY ON THE INTER EST DISALLOWANCE. AS PER COPY OF THE TRIBUNAL ORDER IN THE ASSESSEES OW N CASE FOR THE A.Y. 2003-04 (ITA NO.1071/M/2007) AND OTHER APPEALS DATE D 20.04.2011 THE TRIBUNAL HAS RESTORED THE ISSUE OF DISALLOWANCE OF THE INTEREST TO THE FILE OF THE A.O. FOR FRESH DETERMINATION OF SAI D ISSUE. AS QUANTUM ADDITION ITSELF IS RESTORED TO THE FILE OF THE A.O. THE PENALTY DOES NOT SURVIVE. WE THEREFORE CANCEL THE PENALTY LEVIED BY THE A.O. ON THE ADDITION BY DISALLOWANCE OF THE INTEREST WITH A LIB ERTY TO THE A.O. TO INITIATE SAME IF NECESSARY AS PER PROVISIONS OF LAW . 7. IN THE RESULT ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS DAY OF 2 8TH SEPTEMBER 2011. SD/- SD/- ( P.M. JAGTAP ) ACCOUNTANT MEMBER ( R.S. PADVEKAR ) JUDICIAL MEMBER MUMBAI DATED : 28TH SEPTEMBER 2011 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A) -VIII MUMBAI. 4) THE CIT- VIII MUMBAI. 5) THE D.R. G BENCH MUMBAI. BY ORDER / / TRUE COPY / / ASSTT. REGISTRAR I.T.A.T. MUMBAI *CHAVAN ITA 1476 /MUM/2009 GODFREY PHILLIPS INDIA LTD. 4 SR.N. EPISODE OF AN ORDER DATE INITIALS CONCERNED 1 DRAFT DICTATED ON 16.09.2011 SR.PS 2 DRAFT PLACED BEFORE AUTHOR 20.09.2011 SR.PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER