DCIT, Circle - 12, Kolkata, Kolkata v. M/s. J.J. Exporters Ltd., Kolkata

ITA 480/KOL/2010 | 2005-2006
Pronouncement Date: 09-07-2010

Appeal Details

RSA Number 48023514 RSA 2010
Assessee PAN AAACJ6722H
Bench Kolkata
Appeal Number ITA 480/KOL/2010
Duration Of Justice 4 month(s) 1 day(s)
Appellant DCIT, Circle - 12, Kolkata, Kolkata
Respondent M/s. J.J. Exporters Ltd., Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 09-07-2010
Appeal Filed By Department
Bench Allotted B
Tribunal Order Date 09-07-2010
Assessment Year 2005-2006
Appeal Filed On 08-03-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : KOLKATA () BEFORE . . . . . . . . !' !' !' !' /AND . . . . . . . . #$ #$ #$ #$ % [BEFORE HONBLE SRI D. K. TYAGI JM & HONBLE SRI K. K. GUPTA AM] '& '& '& '& / ITA NO. 480 /KOL/2010 '() *+ '() *+ '() *+ '() *+/ // / ASSESSMENT YEAR : 2005-06 DEPUTY COMMISSIONER OF INCOME-TAX -VS- M/S. J. J. EXPORTERS LTD. CIRCLE-12 KOLKATA (PA NO.AAACJ 6722 H) (-. / APPELLANT ) (/-./ RESPONDENT ) FOR THE APPELLANT : / SRI PIYUSH KR. KOLHE FOR THE ASSESSEE: / SHRI R. SALARPURIA 0 / ORDER PER D. K. TYAGI JM ( . . . . . . . . ) THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AG AINST THE ORDER OF THE LD. CIT(A) KOLKATA DATED 04.11.2009 FOR THE ASSESSMEN T YEAR 2005-06 IN RESPECT OF DELETING THE PENALTY IMPOSED U/S. 271G OF THE I. T. ACT FOR VIOLATION OF PROVISIONS OF SEC. 92D(1) AND 92D(2) OF THE I. T. ACT. 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE FILED RETURN OF INCOME ON 31.10.2005 SHOWING TOTAL INCOME OF RS.7 98 07 420/- . ASSESSMENT WAS COMPLETED U/S. 143(3) ON 31.12.2007 DETERMINING A TOTAL INCOME OF RS.8 78 25 510/- MAKING VARIOUS ADDITIONS. DURING THE COURSE OF ASSESSMENT PROCEEDI NGS THE AO OBSERVED THAT THE ASSESSEE HAS ENTERED INTO INTERNATIONAL TRANSACTION WITH THE FIRM ASSOCIATED ENTERPRISES. THE TOTAL INTERNATIONAL TRANSACTION ENTERED INTO WA S RS.23 79 532/-. THE ASSESSEE FAILED TO FURNISH INFORMATION AS PER PROVISIONS OF SECTION 92D(3) AS PRESCRIBED IN RULE 10D. THE AO INITIATED PENALTY PROCEEDINGS U/S. 271G VIDE NOTICE DATED 31.12.2007. IN RESPONSE THE ASSESSEE FILED ITS WRITTEN SUBMISSION WHICH THE AO REPRODUCED IN HIS ORDER PASSED U/S. 271G OF THE I. T. ACT. AFTER PER USING THE WRITTEN SUBMISSION THE AO HELD THAT SINCE THE ASSESSEE COULD NOT FURNISH THE INFORMATION AS PER PROVISION OF SEC. 92(3) THE CASE IS SQUARELY COVERED BY THE PROVISION S OF SEC. 271G AND HENCE HE IMPOSED A PENALTY OF RS.10 75 313/- U/S. 271G OF TH E I. T. ACT. IN APPEAL THE LD. CIT(A) DELETED THE SAID PENALTY BY OBSERVING AS UND ER : I HAVE CAREFULLY EXAMINED THE SUBMISSIONS OF THE A PPELLANT WITH REFERENCE TO THE FACTS OF THE CASE. I FIND MERIT IN THE APPELLANTS SUBMI SSIONS. IT IS A FACT THAT THE APPELLANT FILED NECESSARY CERTIFICATE BY WAY OF FORM NO. 3CEB DISCLOSING THE DETAILS OF INTERNATIONAL TRANSACTIONS. AS SEEN FROM THE RECOR DS AND ORDERS THE AO BASED ON SUCH INFORMATION AS FURNISHED BY THE APPELLANT WITH REGA RD TO THE INTERNATIONAL TRANSACTIONS POINTED OUT THE DIFFERENCE IN PRICING BETWEEN THE A SSOCIATED ENTERPRISE AND THIRD PARTY 2 (UNRELATED) AND ACCORDINGLY MADE THE ADDITION. THE AO STATED IN THE PENALTY ORDER THAT THE APPELLANT VIOLATED THE PROVISIONS OF SECTION 92 D(1) & (2) OF THE ACT. HOWEVER THE AO HAS NOT ELABORATED AS TO HOW THE APPELLANT VIOLA TED THE ABOVE PROVISIONS. CONSIDERING THE FACTS AND SUBMISSIONS OF THE APPELL ANT I AM OF THE VIEW THAT THIS IS NOT A FIT CASE FOR LEVY OF PENALTY U/S. 271G OF THE I. T. ACT. I DIRECT THE AO TO DELETE THE PENALTY LEVIED. AGGRIEVED BY THE SAID ORDER NOW THE REVENUE IS IN APPEAL BEFORE US. 3. AT THE TIME OF HEARING BEFORE US THE LD. DR REL IED ON THE ORDER OF THE AO AND PRAYED BEFORE THE BENCH TO SET ASIDE THE ORDER OF T HE LD. CIT(A) AND RESTORE THAT OF THE AO. 4. ON THE OTHER HAND THE LD. COUNSEL FOR THE ASSES SEE WHILE REITERATING HIS SAME SUBMISSIONS AS SUBMITTED BEFORE THE LOWER AUTHORITI ES RELIED ON THE ORDER OF THE LD. CIT(A). HE ALSO SUBMITTED THAT SECTION 271G OF THE I. T. ACT PROVIDES THAT IF ANY PERSON WHO HAS ENTERED INTO AN INTERNATIONAL TRANSACTION FAILS TO FURNISH ANY SUCH INFORMATION OR DOCUMENT AS REQUIRED BY SUB-SEC TION (3) OF SECTION 92D THE ASSESSING OFFICER OR THE COMMISSIONER (APPEALS) MAY DIRECT THAT SUCH PERSON SHALL PAY BY WAY OF PENALTY A SUM EQUAL TO TWO PER CENT OF T HE VALUE OF THE INTERNATIONAL TRANSACTION FOR EACH SUCH FAILURE AT THE TIME OF ASSESSMENT PROCEEDINGS ALL THE INFOR MATION OR THE DOCUMENTS WHICH WERE REQUIRED U/S. 92D(3) AS REQUISITIONED BY THE AO FR OM TIME TO TIME WERE DULY SUBMITTED AND FURNISHED BY THE ASSESSEE TO THE AO. HE ALSO C ONTENDED THAT IN THE ASSESSMENT ORDER THE AO HAD NEVER MADE ANY SPECIFIC ALLEGATION THAT THE ASSESSEE HAD FAILED TO FURNISH ANY SUCH INFORMATION OR DOCUMENTS WHICH WER E REQUIRED BY HIM U/S. 92D(3) OF THE ACT AND ACCORDINGLY HE SUBMITTED THAT THE PENA LTY OF RS.10 75 313/- HAS BEEN IMPOSED BY THE AO MECHANICALLY AND ARBITRARILY WITH OUT APPRECIATING THAT SUCH PENAL PROVISION CAN NEVER BE IMPOSED ON THE ASSESSEE COMP ANY. HE ALSO CONTENDED THAT THE LD. CIT(A) HAS RIGHTLY DELETED THE PENALTY BY OBSE RVING THAT THE AO HAS NOT ELABORATED AS TO HOW THE ASSESSEE VIOLATED THE PROVISIONS OF S ECTION 92D(1) AND (2) OF THE ACT. HE LASTLY CONCLUDED THAT THE ORDER OF THE LD. CIT(A) M AY BE UPHELD. 5 AFTER HEARING BOTH THE PARTIES AND PERUSING THE M ATERIAL AVAILABLE ON RECORD WE FIND THAT THE AO HAS LEVIED THE PENALTY ON THE GRO UND THAT THE ASSESSEE FAILED TO FURNISH INFORMATION AND DOCUMENTS AS REQUIRED U/S. 92D(1) A ND 92D(2) OF THE I. T. ACT AND RULE 10D OF THE I. T. RULE IN RESPECT OF THE INTERNATION AL TRANSACTION ENTERED INTO BY THE ASSESSEE WITH THE ASSOCIATED ENTERPRISE. THE LD. CI T(A) DELETED THE SAID PENALTY BY OBSERVING THAT ASSESSEE FILED NECESSARY CERTIFICATE BY WAY OF FORM NO. 3CEB DISCLOSING THE DETAILS OF INTERNATIONAL TRANSACTIONS. THE AO BASED ON SUCH INFORMATION AS FURNISHED BY THE ASSESSEE WITH REGARD TO THE INTERNATIONAL TR ANSACTIONS POINTED OUT THE DIFFERENCE 3 IN PRICING BETWEEN THE ASSOCIATED ENTERPRISE AND TH IRD PARTY (UNRELATED) AND ACCORDINGLY MADE THE ADDITION. THE AO IN HIS ORDER HAS NOT ELAB ORATED AS TO HOW THE ASSESSEE VIOLATED THE ABOVE PROVISIONS. BEFORE US THE LD. DR DID NOT CONTROVERT THE ABOVE FINDING OF THE LD. CIT(A) BY PRODUCING ANY COGENT M ATERIAL/EVIDENCE. IN THIS VIEW OF THE MATTER WE DO NOT FIND ANY INFIRMITY IN THE ORD ER OF THE LD. CIT(A) AND THE SAME IS HEREBY UPHELD. THE APPEAL OF THE REVENUE IS THERE FORE DISMISSED. 6. IN THE RESULT THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 9.7.2010 SD/- SD/- . . . . . . . . #$ #$ #$ #$ % . . . . . . . . (K. K. GUPTA) (D. K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER ( (( (% % % %) )) ) DATED : 9TH JULY 2010 12 '(34 '5 JD.(SR.P.S.) 0 6 /''7 87*9- COPY OF THE ORDER FORWARDED TO: 1. -. /APPELLANT - DCIT CIRCLE-12 KOLKATA 2 /-. / J. J. EXPORTERS LTD. 23C ASHUTOSH CHOWDHURY AVE NUE KOLKATA-19. 3. '0(/ THE CIT KOLKATA 4. '0( ()/ THE CIT(A) KOLKATA 5. @' /'( / DR KOLKATA BENCHES KOLKATA 7 /'/ TRUE COPY 0(A/ BY ORDER B '4 / DEPUTY REGISTRAR .