ITO, Ward-4, Sonepat. Vs. Parshant Generator Co., 1401, Sector-06, Bahadurgarh.
September, 04th 2014
IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH `F', NEW DELHI
BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER
SHRI J.S. REDDY, ACCOUNTANT MEMBER
ITA No. 1131/Del/2013
Assessment Year: 2008-09
ITO, vs. Parshant Generator Co.,
Ward-4, 1401, Sector-06,
Appellant by : Shri Manoj Kumar Chopra, Sr. DR
Respondent by : None
PER DIVA SINGH, J.M.
This is an appeal filed by the Revenue against the order dated
18/12/2012 of CIT(A)-Rohtak pertaining to 2008-09 assessment year on
the following grounds:
1. "On the facts and in the circumstances of the case, the ld. CIT(A) has
erred in law and in facts by deleting the penalty u/s 271(1)(c) of the I.T.
Act, amounting to Rs. 8,31,315/- imposed by AO as the addition was
made on account of non-payment of outstanding CST before filing of
return thereby concealing and furnishing inaccurate particulars of
income; the ld.CIT(A) deleted the said penalty without appreciating the
facts of the case;
2. That the appellant craves for the permission to add, delete or amend the
ground of appeal before or at the time of hearing of appeal."
2. At the time of hearing an adjournment was moved on behalf of the
assessee. However, on considering the material available on record and
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hearing the ld. Sr. DR it was considered appropriate to proceed with the
hearing in the said appeal.
3. The relevant facts of the case are that in the case of the assessee
disallowance of Rs. 32,82,056/- was made u/s 43B of the Act in respect of
CST payable. Out of the said disallowance, Rs. 24,32,056/- was upheld
by the CIT(A) in appeal vide his order no. 370/RTK/2010-11 dated
02.05.2011. The AO made a disallowance of FBT of Rs. 13,708/- which
was not pressed in appeal. On the said disallowances, the AO initiated
penalty proceedings u/s 271(1)(c) of the Act. In response to the show
cause given by the AO, the assessee contended that CST payable was
treated as allowable expenditure due to difference of opinion. The AO
however held that the explanation offered by the assessee is not
sustainable and levied minimum penalty of Rs. 8,31,315/-.
4. The issue was challenged in the appeal before the CIT(A)
contending that the assessee has neither concealed the particulars of
income nor furnished inaccurate particulars of income. Reliance was
placed upon the following decisions:
1) PWC Vs. CIT (2010) 25 Taxman.com 400 (SC);
2) CIT vs. Ajay Singh & Co. (2002) 253 ITR 630 (P&H) and
3) CIT vs. Reliance Petro Products (P) Ltd. (2010) 189 Taxman 322 (SC).
5. Considering the same the CIT(A) came to the following conclusion:
4. "I have considered the issue and the submissions made by the
AR. Regarding the CST payable as on 31.03.2008 of Rs. 32,82,056/-
, the assessee furnished photo copies of the receipts from which the
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AO disallowed the payments made after the due date of filing return
i.e. 30.09.2008 u/s 43B of the Act. During the appeal proceedings,
the assessee demonstrated that an amount of Rs. 8.50 lacs was paid
before the due date of filing return and accordingly relief to this
extent was granted. It is not in dispute that the payments of
outstanding CST were not made. The disallowance arose only
because of the time limitation of payment i.e. before the due date of
filing return. The payments made after the due date are allowable
as deduction u/s 43B in the subsequent assessment year. It has been
held in the case of CIT vs. Reliance Petroproducts (P) Ltd. (supra)
that claim of expenditure made by the assessee, which was not
accepted or acceptable to revenue, by itself would not attract
penalty u/s 271(1)(c). the other case laws relied upon by the AR
also support this ratio. In view of the above, it is held that it is not a
fit case for levy of penalty u/s 271(1)(c) and as such it is deleted and
the grounds of appeal are allowed."
6. Aggrieved by this the Revenue is in appeal before the Tribunal.
7. Ld. Sr. DR places reliance upon the penalty order. On behalf of
the assessee an adjournment had been moved on account of a
bereavement in the family of the assessee. After hearing the ld. Sr. DR
and on going through the material available on record and the judgments
relied upon namely: The decision of the Apex Court in the case of PWC
vs. CIT cited (supra) and CIT vs. Reliance Petroproducts P. Ltd. cited
(supra) in the facts as they stand which have not been assailed by the
revenue we find no good reason to interfere with the finding arrived at as
admittedly there was neither any concealment nor any furnishing of
inaccurate particulars. Being satisfied with the reasoning and finding the
departmental appeal is dismissed.
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8. The said order was pronounced in the court after hearing the ld.
Sr. DR and considering the petition of the assessee's seeking time.
9. In the result, the appeal of the Revenue is dismissed.
The pronouncement in the open court on 29th August 2014.
(J.S. REDDY) (DIVA SINGH)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Copy forwarded to: -
5. DR, ITAT
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