The DCIT, Circle-10,, Ahmedabad v. Shri Manoj B. Vadodaria, Ahmedabad

ITA 3155/AHD/2007 | 2001-2002
Pronouncement Date: 14-05-2010 | Result: Dismissed

Appeal Details

RSA Number 315520514 RSA 2007
Assessee PAN AALPV5038N
Bench Ahmedabad
Appeal Number ITA 3155/AHD/2007
Duration Of Justice 2 year(s) 9 month(s) 24 day(s)
Appellant The DCIT, Circle-10,, Ahmedabad
Respondent Shri Manoj B. Vadodaria, Ahmedabad
Appeal Type Income Tax Appeal
Pronouncement Date 14-05-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 14-05-2010
Date Of Final Hearing 06-05-2010
Next Hearing Date 06-05-2010
Assessment Year 2001-2002
Appeal Filed On 20-07-2007
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D BEFORE SHRI BHAVNESH SAINI JUDICIAL MEMBER AND SHRI N.S.SAINI ACCOUNTANT MEMBER DATE OF HEARING: 6.05.2010 DRAFTED ON: 6.05.20 10 ITA NO.3155/AHD/2007 ASSESSMENT YEAR : 2001-2002 DCIT CIRCLE 10 NARAYAN CHAMBERS ASHRAM ROAD AHMEDABAD. VS. MANOJ B. VADODARIA 61 ADARSH COMPLEX NR. SWASTIK CHAR RASTA NAVRANGPURA AHMEDABAD. PAN/GIR NO. : AALPV 5038N (APPELLANT) .. (RESPONDENT) APPELLANT BY : SHRI C.K.MISHRA SR. D.R. RESPONDENT BY: SHRI S.N.SOPARKAR SR. ADV. O R D E R PER N.S.SAINI ACCOUNTANT MEMBER :- THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS)-IV AHM EDABAD DATED 20.03.2007. 2. THE ONLY GRIEVANCE OF THE REVENUE IN THIS APPEAL IS THAT THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) HAS ERRED IN LA W AND ON FACTS IN DELETING THE PENALTY OF RS.17 50 000/- LEVIED UNDER SECTION 271(1)(C) OF THE ACT BY THE LEARNED ASSESSING OFFICER. 3. THE FACTS IN BRIEF ARE THAT THE IN THE ASSESSMEN T MADE UNDER SECTION 143(3) OF THE ACT ON 31.03.2004 BY THE LEARNED ASSE SSING OFFICER THE TOTAL - 2 - INCOME OF THE ASSESSEE CAME TO BE ASSESSED A T RS.3 2 62 020/- IN PLACE OF THE RETURNED INCOME OF THE ASSESSEE AT RS.5 15 166/ -. IN THE ASSESSMENT SO FRAMED THE LEARNED ASSESSING OFFICER MADE THE FOLL OWING ADDITIONS. (A) INTEREST PAID TO PROPRIETARY CONCERN DISALLOWED RS.17 12 535/- (B) DISALLOWANCE OF SHORT TERM CAPITAL LOSS RS.9 00 600/- (C) DISALLOWANCE OF LONG TERM CAPITAL LOSS RS.11 5 5 036/- 4. IN APPEAL FILED BY THE ASSESSEE AGAINST THE SAID ASSESSMENT THE ADDITIONS MADE BY THE LEARNED ASSESSING OFFICER WHI LE COMPLETING THE ASSESSMENT WAS UPHELD BY THE LEARNED COMMISSIONER O F INCOME TAX(APPEALS) VIDE ITS ORDER DATED 30.12.2004. 5. THEREAFTER THE LEARNED ASSESSING OFFICER COMMEN CED PENALTY PROCEEDINGS AGAINST THE ASSESSEE BY ISSUING NOTICE UNDER SECTION 271(1)(C) OF THE ACT ON 10.11.2005 FOR CONCEALMENT OF PARTICU LARS OF INCOME AND NOT BEING SATISFIED WITH THE EXPLANATION OF THE ASSESSE E LEVIED THE PENALTY OF RS.17 50 000/- BEING THE AMOUNT OF TAX SOUGHT TO BE EVADED BY THE ASSESSEE. IN FURTHER APPEAL THE PENALTY WAS CONFI RMED BY THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS). 6. THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASS ESSEE POINTED OUT THAT FILING ORDER OF THE TRIBUNAL IN THE QUANTUM AP PEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF IN COME TAX(APPEALS) IN ITA NO.1151/AHD/2005 DATED 3.04.2009 THAT OUT OF TH E THREE DISALLOWANCES MADE BY THE LEARNED ASSESSING OFFICER THE TRIBUNAL DELETED THE TWO DISALLOWANCES ON ACCOUNT OF SHORT TERM CAPITAL LOSS RS.9 00 600/- AND LONG TERM CAPITAL LOSS OF RS.11 55 036/-. HE FURTHER SU BMITTED THAT THE ONLY DISALLOWANCE WHICH WAS MADE AFTER THE ORDER OF THE TRIBUNAL WAS ON - 3 - ACCOUNT OF INTEREST EXPENSES OF RS.17 12 535/-. HE SUBMITTED THAT THE TRIBUNAL HAS ALSO FOUND THAT THE INTEREST EXPENSES OF RS.17 12 535/- WAS A BONAFIDE EXPENDITURE OF THE ASSESSEE AND MERELY DIS AGREED WITH THE PLEA OF THE ASSESSEE AND HELD THAT IT IS ALLOWABLE AS A COS T OF THE ASSET UNDER THE HEAD CAPITAL GAINS ON TRANSFER OF CAPITAL ASSETS AN D IS NOT ALLOWABLE UNDER THE HEAD BUSINESS EXPENDITURE. THUS IT IS SUBMITTE D THAT ASSESSEE HAS DISCLOSED ALL THE MATERIAL FACTS RELEVANT FOR THE C OMPUTATION OF INCOME AND THE ADDITION WAS MADE BECAUSE THE DEDUCTION WAS FOU ND TO BE ALLOWABLE UNDER THE HEAD CAPITAL GAINS AND NOT UNDER THE HEAD BUSINESS INCOME. AS ONLY ISSUE WAS RELATING TO THE COMPUTATION OF INCOM E AND NO DEFECT WAS FOUND IN FURNISHING OF MATERIAL FACTS PENALTY UNDER SECTION 271(1)(C) WAS NOT LEVIABLE. 7. THE LEARNED DEPARTMENTAL REPRESENTATIVE COULD NO T CONTROVERT THE ABOVE SUBMISSIONS OF THE LEARNED AUTHORISED REPRESE NTATIVE OF THE ASSESSEE. 8. ON THE ABOVE FACTS AND CIRCUMSTANCES WE FIND TH AT PENALTY IN RESPECT OF THE TWO ADDITIONS WHICH WERE DELETED BY THE TRIB UNAL IN THE QUANTUM APPEAL COULD NOT SURVIVE BY ITS OWN. FURTHER THE ONLY ADDITION IN RESPECT OF WHICH PENALTY WAS LEVIED AND WAS SUSTAINED IN QU ANTUM APPEAL WAS RELATING TO THE DEDUCTION OF INTEREST EXPENDITURE. WE FIND THAT GENUINENESS OF INTEREST EXPENDITURE IS NOT IN DOUBT OR DEBATE. THE ASSESSEE IS NOT FOUND TO HAVE FURNISHED ANY INACCURATE PARTICULARS OF INT EREST EXPENDITURE. THE ONLY DISPUTE WAS REGARDING THE HEAD UNDER WHICH SUC H INTEREST EXPENDITURE WAS DEDUCTABLE. IN THE ABOVE CIRCUMSTANCES IN OUR CONSIDERED VIEW SIMPLY BECAUSE A CLAIM FOR DEDUCTION OF THE ASSESSE E WAS FOUND AS NOT ALLOWABLE PENALTY UNDER SECTION 271(1)(C) CANNOT BE LEVIED. WE THEREFORE - 4 - DELETE THE PENALTY LEVIED UNDER SECTION 271(1)(C) O F THE ACT OF RS.17 50 000/- AND ALLOW THE APPEAL OF THE ASSESSEE . ORDER SIGNED DATED AND PRONOUNCED IN THE COURT ON 14 TH DAY OF MAY 2010. SD/- SD/- (BHAVNESH SAINI) ( N.S. SAINI ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; ON THIS 14 TH DAY OF MAY 2010 PARAS COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT(APPEALS)-IV AHMEDABAD. 5. THE DR AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER //TRUE COPY// (DY./ASSTT.REGISTRAR) ITAT AHMEDABAD DATE INITIALS 1. DRAFT DICTATED ON 6.05.2010 --------------- ---- 2. DRAFT PLACED BEFORE AUTHORITY 10.05.2010 ---- --------------- 3. DRAFT PROPOSED & PLACED 10.05.2010 ----------- -------- JM BEFORE THE SECOND MEMBER 4. DRAFT DISCUSSED/APPROVED 10.05.2010 ---------- --------- JM BY SECOND MEMBER 5. APPROVED DRAFT COMES TO P.S 11.05.2010 -------- ------------ 6. KEPT FOR PRONOUNCEMENT ON 14.05.2010 --------- ----------- 7. FILE SENT TO THE BENCH CLERK 14.05.2010 ------ -------------- 8. DATE ON WHICH FILE GOES TO THE ---------------- -------------------- 9. DATE OF DISPATCH OF ORDER ---------------- --- ------------------