SHRI DEEPAK BAID,JAIPUR vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2, JAIPUR

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ITA 1111/JPR/2018Status: DisposedITAT Jaipur24 January 2019AY 2009-104 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that there was no conscious intention to conceal income as the interest was offered to tax as soon as the bifurcation was available in the succeeding year. Therefore, it was not a fit case for penalty.

What were the facts?

The assessee advanced Rs. 1.60 lacs to M/s Bhawani Gas Service, which repaid part of the advance during the assessment year. The repayment lacked bifurcation of principal and interest. In the subsequent year, the balance was repaid, and the excess amount received over the principal was offered as interest income.

What were the issues?

Whether penalty under Section 271(1)(c) is leviable when interest income, though not offered in the year of accrual due to lack of bifurcation, was offered in the subsequent year upon receipt of details.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES “A”, JAIPUR

Before: SHRI RAMESH C SHARMA, AM & SHRI VIJAY PAL RAO, JM vk;dj vihy la-@ITA No. 1111/JP/2018

For Appellant: Shri Himanshu Goyal (CA) jktLo dh vksj ls@
Hearing: 22/01/2019Pronounced: 24/01/2019

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES “A”, JAIPUR Jh jes'k lh 'kekZ] ys[kk lnL; ,oa Jh fot; iky jko] U;kf;d lnL; ds le{k BEFORE: SHRI RAMESH C SHARMA, AM & SHRI VIJAY PAL RAO, JM vk;dj vihy la-@ITA No. 1111/JP/2018 fu/kZkj.k o"kZ@Assessment Year :2009-10 cuke Deepak Baid, Deputy Commissioner of Vs. B-114A, Tej Kunj, Dayanand Income Tax, Marg, Tilak Nagar, Jaipur- Circle-2, Jaipur. 302004. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AEQPB 5538 J vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Himanshu Goyal (CA) jktLo dh vksj ls@ Revenue by : Shri J.C. Kulhari (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 22/01/2019 mn?kks"k.kk dh rkjh[k@ Date of Pronouncement : 24/01/2019 vkns'k@ ORDER PER: R.C. SHARMA, A.M.

This is the appeal filed by assessee against the order of ld.CIT(A)-I, Jaipur dated 31/07/2018 for the A.Y.2009-10 in the matter of imposition of penalty of Rs. 15,000/- U/s 271(1)(c) of the Income Tax Act, 1961 (in short the Act).

2.

Rival contentions have been heard and record perused. The facts in brief are that during the year under consideration, the assessee had advanced Rs. 1.60 lacs to M/s Bhawani Gas Service. During the ITA 1111/JP/2018_ 2 Deepak Baid Vs DCIT assessment year itself, M/s Bhawani Gas Service repaid some part of the advance money. However, no details was given to the assessee by M/s Bhawani Gas Service as regards the bifurcation of amount paid on account of portion of interest and principal. In the next year, balance full and final amount was received by the assessee from M/s Bhawani Gas Service. The excess amount received over and above the original amount advanced by the assessee was duly credited and offered for tax amounting to Rs. 43,867/- under the head interest received account.

While passing the order U/s 143(3) of the Act, the Assessing Officer held that proportionate interest relating to the year under consideration was not offered by the assessee in the return of income, therefore, levied penalty of Rs. 15,000/-, which was confirmed by the ld. CIT(A), against which the assessee is in further appeal before us.

3.

We have considered the rival contentions and carefully gone through the orders of the authorities below and found from the record that the amount of loan repaid to the assessee during the year was without bifurcation, therefore, the assessee could not offer the proportionate interest during the year under consideration, however, in the subsequent year when the balance amount was received, the assessee offered amount received in excess of the principal as interest income and also paid tax thereon. Thus, there does not appear to be any ITA 1111/JP/2018_ 3 Deepak Baid Vs DCIT conscious intention of assessee to conceal particulars of income in so far as the same was offered to tax as soon as bifurcation of loan and interest was received during the immediately succeeding year. There is no dispute to the fact that the assessee had offered the interest income in the immediately subsequent year in the return filed in due course. From the record we found that even in the quantum appeal, the ld. CIT(A) has not confirmed the addition made by the Assessing Officer on account of proportionate interest accrued to the assessee but the matter was restored to the file of the Assessing Officer for verifying the actual position. Keeping in view the totality of the facts and circumstances of the case, it is not a fit case for imposition of penalty U/s 271(1)(c) of the Act.

Accordingly, the Assessing Officer is directed to delete the penalty of Rs. 15,000/-.

4.

In the result, appeal of the assessee is allowed. Order pronounced in the open court on 24th January, 2019.

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