SHRIRAM CHITS (MAHARASHTRA) LTD, MUMBAI v. DCIT CIR 3(3), MUMBAI

ITA 1853/MUM/2012 | 2008-2009
Pronouncement Date: 29-04-2015 | Result: Allowed

Appeal Details

RSA Number 185319914 RSA 2012
Assessee PAN AAECS7592Q
Bench Mumbai
Appeal Number ITA 1853/MUM/2012
Duration Of Justice 3 year(s) 1 month(s) 13 day(s)
Appellant SHRIRAM CHITS (MAHARASHTRA) LTD, MUMBAI
Respondent DCIT CIR 3(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 29-04-2015
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted E
Tribunal Order Date 29-04-2015
Date Of Final Hearing 14-10-2014
Next Hearing Date 14-10-2014
Assessment Year 2008-2009
Appeal Filed On 16-03-2012
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND AMIT SHUKLA (JM) . . ./ I.T.A. NO. 1853 / MUM/20 12 ( / ASSESSMENT YEAR : 2008 - 09 ) M/S SHRIRAM CHITS (MAHARASHTRA) LTD C/O SHANKARLAL JAIN AND ASSOCIATES 12 ENGINEER BUILDING 265 PRINCESS STREET MUMBAI - 400002 / VS. DY. COMMISSIONER OF INCOME TAX CIRCL E 3(3) MUMBAI. ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN/GIR NO. : AAECS7592Q / A PPELLANT BY SHRI S L JAIN / RE SPONDENT BY S MT. N V NADKARNI / DATE OF HEARING : 21. 4. 201 5 / DATE OF PRONOUNCEMENT : 29. 4 . 201 5 / O R D E R PER B.R. BASKARAN (AM) THE ASSESSEE HAS FILED THIS APPEAL CHALLENGING THE ORDER DATED 01 - 11 - 2011 PASSED BY LD. CIT(A) - 7 MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 2008 - 09. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD.CIT(A) IN CONFIRMING THE PENALTY OF RS. 6 04 548 / - LEVIED U/S 271(1)(C) OF THE INCOME TA X ACT 1961 (THE ACT) ON THE DISALLOWANCE OF RS . 8 89 306/ - MADE BY THE AO IN THE QUANTUM ASSESSMENT PROCEEDINGS. 2. WE HEARD THE PARTIES AND PERUSED THE RECORD. THE ASSESSEE COMPANY IS ENGAGED IN CHIT FUND BUSINESS. THE AO NOTICED THAT THE ITA NO. 185 3 / MUM/201 2 2 ASSESSEE HAS WRITTEN OFF CERTAIN DEBIT BALANCES AND CLAIMED THE SAME AS DEDUCTION. ON VERIFICATION OF THE DETAILS OF THE SAME THE AO NOTICED THAT THE ASSESSEE HAS WRITTEN OFF TDS OF EARLIER YEARS TO THE TUNE OF RS.8.98 306/ - . SINCE THE TAXES PAID WILL NOT BE ALLOWED AS DEDUCTION THE ASSESSING OFFICER DISALLOWED THE SAID CL AIM AND THE SAME WAS ALSO ACCEPTED BY THE ASSESSEE. THE AO LEVIED PENALTY OF RS.6 04 548/ - ON THE ABOVE SAID AMOUNT @ 200% OF THE TAX SOUGHT TO BE EVADED. THE LD CIT(A) ALSO CONFIRMED THE SAID PENALTY BY PLACING RELIANCE ON THE DECISION OF HONBLE DELHI HIGH COURT IN THE CASE OF ZOOM COMMUNICATIONS PVT LTD (40 DTR (DEL) 249). 3. HOWEVER ACCORDING TO THE LD. A.R THE ASSESSEE HAS WRITTEN OFF THE TDS AMOUNT TO BE RECEIVED FROM THE INCOME TAX DEPARTMENT AS REFUND AND SINCE IT WAS NOT RECEIVED FOR A LON G TIME THE ASSESSEE DECIDED TO W RITE IT OFF. T HE LD A.R FURTHER SUBMITT ED THAT THE SAME WAS ALLOWABLE AS BUSINESS EXPENDITURE SINCE THE TDS WAS DEDUCTED FROM ITS INCOME IN THE NORMAL COURSE. ACCORDINGLY THE LD A.R CONTENDED THAT THE DISALLOWANCE OF THE ABOVE SAID CLAIM IS A DEBATABLE ONE AND HENCE THE SAME WILL NOT LEAD TO PENALTY U/S 271(1)(C) OF THE ACT. HE FURTHER SUBMITTED THAT THE ASSESSEE HAS AGREED FOR THE ADDITION TO PURCHASE PEACE AND ON THAT COUNT ALSO THE SAME COULD NOT LEAD TO PENALTY. THE LD A.R ALSO SUBMITTED THAT THE ASSESSEE HAS NEITHER CONCEALED PARTICULARS OF INCOME NOR FURNISHED INACCURATE PARTICULARS OF INCOME. ACCORDINGLY HE PRAYED FOR DELETION OF THE PENALTY. 4. ON THE CONTRARY THE LD D.R PLACED STRONG RELIANCE ON THE ORDER PASSED BY LD CIT(A). ITA NO. 185 3 / MUM/201 2 3 5. HAVING HEARD RIVAL CONTENTIONS WE ARE OF THE VIEW THAT THERE IS MERIT IN THE CONTENTIONS OF THE ASSESSEE. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE ASSESSEE HAS WRITTEN OFF THE TDS RECEIVABLE ACCOUNT WHICH ACCORD ING TO THE ASSESSEE IS THE TAX AMOUNT RECEIVABLE FROM THE INCOME TAX DEPARTMENT AND THE SAME REPRESENTS THE AMOUNT PAID BY OR ON BEHALF OF T HE ASSESSEE OVER AND ABOVE THE AMOUNT OF TAX DUE FROM IT. SO IN OUR VIEW THE SAID EXCESS AMOUNT PARTAKES THE CHAR ACTER OF ADVANCE PAYMENT AND WOULD NOT ASSUME THE CHARACTER OF TAX. HENCE WE AGREE WITH THE CONTENTIONS OF THE ASSESSEE THAT THE QUESTION WHETHER THE DEDUCTION CLAIMED BY THE ASSESSEE BY WRITING OFF THE AMOUNT OF TAX DUE FROM INCOME TAX DEPARTMENT IS A LLOWABLE AS DEDUCTION OR NOT IS A DEBATABLE QUESTION WHERE TWO VIEWS ARE POSSIBLE. HENCE IN OUR VIEW THERE IS MERIT IN THE CONTENTIONS OF THE ASSESSEE THAT THE SAID CLAIM WILL NOT LEAD TO LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. IN VIEW OF THE ABOVE WE ARE OF THE VIEW THAT THE LD CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIED BY THE AO. ACCORDINGLY WE SET ASIDE HIS ORDER AND DIRECT THE ASSESSING OFFICER TO CANCEL THE IMPUGNED PENALTY. 6 . IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THE AB OVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 29TH APR 2015 . 29TH APR 2015 SD SD ( / AMIT SHUKLA ) ( . . / B.R. BASKARAN) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI: 29TH APR 2015 . . . ./ SRL SR. PS ITA NO. 185 3 / MUM/201 2 4 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. / DR ITAT MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER TRUE COPY (ASSTT. REGISTRAR) /ITAT MUMBAI