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Income Tax Appellate Tribunal, INDORE BENCH, INDORE
Before: SHRI KUL BHARAT & SHRI MANISH BORAD
M/s. Satkar Industries P. Ltd. ACIT-II Main Road, Anjad, Indore बनाम/ Dist: Barwani Vs. (Appellant) (Revenue ) P.A. No.AAMCS1015J Appellant by Written Submission Revenue by Smt. Vineeta Dube, Sr -DR Date of Hearing: 06.10.2020 Date of Pronouncement: 26.11.2020 आदेश / O R D E R PER KUL BHARAT, J.M: This appeal by the assessee is directed against the order of ld. Commissioner of Income Tax(appeals) (in short ‘Ld. CIT(’A)-II Indore dated 01.05.2017 pertaining to assessment year 2012-13. The assessee has raised following grounds of appeal: “On the facts and in the circumstances of the cases:-
Satkar Industries P. Ltd. /ITANo.597/2017
1.That, on the facts and circumstances of the case, the Ld. CIT (A)-II erred with the penalty order passed by Ld. A.O. is bad in law and on facts. 2.That, the appellant neither concealed any income nor furnished any inaccurate particulars of its income. 3.That, Ld. CIT (A) erred to not considering all the points which has been pressed before him in written submission dt. 28.04.2017. Merely because the assessee agreed for addition and accordingly assessment order was passed on the basis of this addition and tax and interest has been duly paid thereon in absence of any material or record to show concealment, it cannot be said that said addition amounts to concealment for which reliance is made on the decision on CIT V s. Manjunathan Cotton & Ginning Factory (2012) 83 CCH 0282, (2013) 92 DTR 0111,CIT V. Gem Granites 86 CCH 0160, ACIT Vs Maloo Electrodes Pvt. Ltd. (2010) 14 ITJ 398 (ITAT Nagpur), CIT Vs Rajeev Garg and others (2009) 224 CTR 321 (Punjab and Hariyana), CIT Vs Suresh Chand Mittal (2000) 241 ITR 124 (M.P), CIT Vs Jalaram Oil Mills (2002) 253 ITR 192 and CIT Vs. Metachem Industries ltd. (2007) ITJ 310 (M.P). 4.That, Ld. CIT (A)-II erred to confirm the penalty levied by Ld. AO. U / s 271(1)(c), more particularly when appellant submitted total ware bouts of the unsecured lender relating to the identity, genuineness & creditworthiness, just to avoid litigation and under a bona fide belief that penalty will not be levied accepted the addition, does not leads to inference that particulars were inaccurate and penalty shall be levied, for which reliance is placed on.- •CIT Kanpur Vs. Awadh Fertilizers P Ltd. [2013] 35 Taxmann.com 453 (Allahabad HC) •Vikram Bhatia Vs. ITO [2014] 161 TTJ 37 (Lucknow Trib.) •Yogesh Kumar Chhotalal Shah Vs ITO [ITA No. 2811/Ahd/2012] •Nishant Construction P Ltd V s ACIT [IT A No. 2920/ Ahd/2012] •ACIT Vs Sub hag Textile Pvt Ltd. [ITA No. 145/DeJf2009] 2
Satkar Industries P. Ltd. /ITANo.597/2017
5. That, on fact and circumstances of the case Ld. CIT (A)-II erred to confirm the r penalty levied by Ld. AO. U Is 271 (1) (c) of LT. Act, 1961, while assessee has provided full co- operation during assessment and disclosed detailed particular about income and reason thereof. 6.That, it is a settled law that assessment proceedings and penalty proceedings are separate to each other. The appellant discharged onus lies upon him by offering explanation about the credit hence, penalty levied ul s 271(1)(c) is unjustified. Reliance can be made on the decision of SHRI BHERULAL PAGARIA, UJJAIN Vs. ITO (2009) 12 ITJ 572 (IT AT, INDORE). Further, assessee at no point of time has admitted that income treated is concealed income. No penalty u] s 271(1)(c) is leviable. Reliance can be made on the decision of SHRI NIRMAL COMMERCIAL LTD. Vs. CIT (2008) 218 CTR 581, BOMBAY & CIT Vs. METACHEM INDUSTRIES LTD. (2007) 7 ITJ 310 (M.P.). 7.That, the appellant requests to kindly set aside and quash the penalty order as passed by Ld. CIT (A)-II, being no malafide intention of the assessee. 8.That, the appellant craves leave to add/alter any of the grounds of appeal on or before the date of hearing.”
The facts giving rise to the present appeal are that the assessee is a Private Limited Company and filed return of Income on 22.09.2012 declaring total income of Rs.24,57,702/- from the business of ginning and pressing of cotton. The AO made an addition of Rs.4,41,700/- on account of disallowances u/s 40A(3) at Rs. 3,00,000/-.
Further, the AO also made an addition u/s 68 at 3
Satkar Industries P. Ltd. /ITANo.597/2017 Rs.1,47,000/-, on which the AO imposed the penalty at Rs.45,000/- u/s 271(1)(c) of the Act. The assessee went into appeal before the Ld. CIT(A) who also confirmed the action of the AO. Therefore, the assessee is before this Tribunal.
Before us, a written synopsis was filed by the assessee wherein it was contended that the penalty, so imposed was bad in law as the same was levied in such a casual manner without specifically replying on one particular limb of levying the penalty as is evident from the notice issued u/s 271(1)(c) of the Act by the AO. The relevant case laws were also cited in the written synopsis.
On the other hand, Ld. Sr. DR defended the orders of the revenue authorities.
We have heard rival contentions and perused the records placed before us and carefully gone through the written submission and decisions referred and relied by the Ld. Counsel for the assessee. From going through the 4
Satkar Industries P. Ltd. /ITANo.597/2017 notice it is well evident that in the notice the specific charge/limb u/s 271(1)(c) of the Act was not mentioned. The Ld. A.O has not struck off one of the charge which is not relevant to the assessee. It is not clear as to whether the penalty has been levied for concealment of income or furnishing of inaccurate particulars of income. Therefore, the judgment of Hon’ble High Court in the case of Pr. CIT V/s Kulwant Singh Bhatia (2018) 33 ITJ 777(MP) is squarely applicable on this issue wherein the revenue’s appeal was dismissed by the Hon’ble High Court observing as follows:- “on due consideration of the arguments of the Learned Counsel of the respondent, so also considering the fact that the ground mentioned in show cause notice would not satisfy the requirement of law, as notice was not specific, we are of the view that the Learned Tribunal has rightly relying on the decision of CIT V/s Manjunath Cotton Ginning Factory (supra) and CIT V/s SSA’S Emeralds Meadows (supra) rightly allowed the appeal of the assessee and set aside the order of penalty imposed by the authorities”.
Satkar Industries P. Ltd. /ITANo.597/2017
Since the facts and circumstances are same, we are of the view that since the AO did not specifically mentioned as to on which particular limb, the penalty proceedings were initiated, the penalty is liable to be deleted in view of the aforesaid facts in the light of jurisdictional High Court decision in case of Pr. CIT V/s Kulwant Singh Bhatia (supra).
In result, appeal filed by the assessee is allowed.
Order was pronounced in the open court on 26 .11.2020.