ACIT CC-40, MUMBAI v. CLASSIC SHARE STOCK BROKING SERVICES LTD, MUMBAI

ITA 700/MUM/2010 | 2005-2006
Pronouncement Date: 30-12-2010 | Result: Dismissed

Appeal Details

RSA Number 70019914 RSA 2010
Assessee PAN AABCS4255R
Bench Mumbai
Appeal Number ITA 700/MUM/2010
Duration Of Justice 11 month(s) 1 day(s)
Appellant ACIT CC-40, MUMBAI
Respondent CLASSIC SHARE STOCK BROKING SERVICES LTD, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 30-12-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 30-12-2010
Date Of Final Hearing 15-12-2010
Next Hearing Date 15-12-2010
Assessment Year 2005-2006
Appeal Filed On 28-01-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL 'C' BENCH MUMBAI BEFORE SHRI R.S. PADVEKAR JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH ACCOUNTANT MEMBER ITA NO. 700/MUM/2010 (ASSESSMENT YEAR: 2005-06) ACIT CENTRAL CIRCLE 40 CLASSIC SHARES & STOCK BROK ING ROOM NO. 653 6TH FLOOR SERVICES LTD. RADHA BHAVAN AAYAKAR BHAVAN M.K. ROAD VS. 1ST FLOOR 121 NAGINDAS MASTER ROAD MUMBAI 400020 MUMBAI 400023 PAN - AABCS 4255 R APPELLANT RESPONDENT APPELLANT BY: SHRI AJIT KUMAR SINHA RESPONDENT BY: SMT. PAYAL GADDA O R D E R PER B. RAMAKOTAIAH A.M. THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER OF THE CIT(A)-38 MUMBAI DATED 12.11.2009 DELETING THE PENALTY UNDER SECTION 271D AND 271E RESPECTIVELY. 2. THE FACTS IN BRIEF ARE THAT THE A.O. NOTICED THAT T HE ASSESSEE HAD RECEIVED AN AMOUNT OF LOAN OF ` 6 38 580/- FROM M/S. NAKSHATRA SOFTWARE PVT. LTD. AND MADE REPAYMENT OF A LOAN OF ` 7 77 550/- TO M/S TRIUMPH SECURITIES LTD. OTHERWISE THAN BY ACCOUNT PAYEE CH EQUE OR DRAFT IN VIOLATION OF SECTION 269SS AND 269T RESPECTIVELY. A CCORDINGLY PENALTY OF ` 6 38 580/- UNDER SECTION 271D AND RS7 77 500/- UNDE R SECTION 271E RESPECTIVELY WERE LEVIED. THE ASSESSEES CONTENTION THAT THE ABOVE TRANSACTIONS OF LOAN AND REPAYMENT WERE NOT IN CASH BUT THROUGH JOURNAL ENTRIES AND THEREFORE PROVISIONS OF SECTION 269SS A ND 269T ARE NOT ATTRACTED WAS NOT ACCEPTED BY THE A.O. HE REFERRED TO THE JOI NT PARLIAMENTARY COMMITTEES REPORT ON THE STOCK MARKET SCAM AND HEL D THAT THE ASSESSEE AND THE ASSOCIATE GROUP ENTITIES IN CONNIVANCE WITH CERTAIN BANKERS AND ITA NO. 700/MUM/2010 CLASSIC SHARES & STOCK BROKING SERVICES LTD. 2 FINANCIAL INSTITUTIONS WERE INDULGING IN LARGE SCAL E MANIPULATION OF SHARE PRICES; THE ASSESSEE AND GROUP CONCERNS HAD EVADED INCIDENCE OF TAX IN VARIOUS HANDS. WITH REFERENCE TO THE ITAT DECISION CANCELLING THE PENALTY IN OTHER CASES THE A.O. HELD THAT THE DEPARTMENT HAD P REFERRED APPEAL BEFORE THE HON'BLE BOMBAY HIGH COURT WHICH WAS STILL PEND ING. BEFORE THE CIT(A) THE LEARNED A.R. REITERATED THE ARGUMENTS MADE BEFO RE THE A.O. AND SUBMITTED THAT IN ASSESSEES OWN CASE FOR A.Y. 2001 -02 AND 2002-03 THE TRIBUNAL HAD CANCELLED THE PENALTY. HE ALSO SUBMITT ED A LIST OF ITAT ORDERS IN THE CASE OF GROUP CONCERNS WHEREIN UNDER IDENTIC AL FACTS THE PENALTY UNDER SECTION 271D AND 271E WERE CANCELLED BY THE I TAT. 3. THE CIT(A) FOLLOWING THE ITAT ORDER IN ASSESSEES OWN CASE GAVE A FINDING AS FOLLOWS: - 3.6 I HAVE CONSIDERED THE FACTS AND SUBMISSIONS AN D HAVE PERUSED THE PENALTY ORDERS AND THE ORDERS OF THE ITAT IN TH E APPELLANTS OWN CASE AND IN CASE OF OTHER ASSOCIATE CONCERNS OF THE APPE LLANT. IT IS SEEN THAT UNDER IDENTICAL FACTS THE TRIBUNAL HAD DELETED THE PENALTY FOR A.YS. 2000-01 AND 02002-03 U/S. 271D AND 271E RESPECTIVEL Y ON THE GROUND THAT PENALTY WAS NOT LEVIABLE IN RESPECT OF TRANSAC TIONS BASED ON JOURNAL ENTRIES. RESPECTFULLY FOLLOWING THE ITAT JUDGEMENTS IN THE APPELLANT OWN CASE AND IN THE CASE OF APPELLANTS GROUP CONCERNS I.E. N H SECURITIES LTD. PANTHER FINCAP & MANAGEMENT SERVICES LTD. PE NALTY LEAVED U/S. 271D AND 271E ARE HEREBY CANCELLED. THEREFORE THE APPEAL AGAINST BOTH THE PENALTY ORDERS IS ALLOWED. 4. SINCE THE CIT(A) FOLLOWED THE COORDINATE BENCH DECI SION IN ASSESSEES OWN CASE WE CONFIRM THE ORDER OF THE CIT(A). THERE IS NO NEED TO MODIFY THE ORDER BOTH ON LAW AND ON FACTS. 5. IN THE RESULT APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DECEMBER 2010. SD/- SD/- (R.S. PADVEKAR) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED: 30 TH DECEMBER 2010 ITA NO. 700/MUM/2010 CLASSIC SHARES & STOCK BROKING SERVICES LTD. 3 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 38 MUMBAI 4. THE CIT CENTRAL-IV MUMBAI CITY 5. THE DR C BENCH ITAT MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT MUMBAI BENCHES MUMBAI N.P.