THE DCIT, CIRCLE-1(1)(1), AHMEDABAD vs. M/S. AAHAR PRODUCTS PVT.LTD..(NOW KNOWN AS ANIL NUTRIENTS LTD), AHMEDABAD

PDF · subscribers
ITA 3135/AHD/2015Status: DisposedITAT Ahmedabad23 March 2018AY 2008-093 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the Assessing Officer made the GP addition based on a comparison with other companies, but failed to establish that the assessee had furnished inaccurate particulars of income. Therefore, the Tribunal found no reason to interfere with the CIT(A)'s deletion of the penalty.

What were the facts?

The assessee filed its return of income, which was later revised with significant additions by the Assessing Officer for unexplained loans, creditors, and GP. The CIT(A) provided partial relief on the GP addition. The Assessing Officer levied a penalty under Section 271(1)(c) for furnishing inaccurate particulars of income.

What were the issues?

Whether a penalty under Section 271(1)(c) can be levied solely on the basis of additions made by the Assessing Officer, particularly when the additions are estimated and the assessee has not been proven to have furnished inaccurate particulars of income.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 143(3),Section 145(iii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “C” BENCH

Before: Shri S. S. Godara & Shri Amarjit Singh

For Respondent: Shri Prasoon Kabra, Sr. D.R

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “C” BENCH Before: Shri S. S. Godara, Judicial Member And Shri Amarjit Singh, Accountant Member ITA No. 3135/Ahd/2015 Assessment Year 2008-09

The DCIT, M/s. Aahar Products Pvt. Circle-1(1)(1), Ltd., (Now known as Anil Ahmedabad Vs Nutrients Ltd.) PAN: (Appellant) AAGCS5565F (Respondent)

Revenue by: Shri Prasoon Kabra, Sr. D.R. Assessee by: None Date of hearing : 07-02-2018 Date of pronouncement : 16-04-2018 आदेश/ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:-

This Revenue’s appeal for A.Y. 2008-09, arises from order of the CIT(A)-1, Ahmedabad dated 28-08-2015, deleting the penalty of Rs. 18,02,877/-, in proceedings under section 271(1)(c) of the Income Tax Act, 1961; in short “the Act”.

2.

In this case return of income declaring income of Rs. 1,50,59,284/- was filed on 30th September, 2008. Subsequently, the order u/s. 143(3) of the act was passed on 14th December, 2010 by determining the total income at Rs. 5,71,31,833/- after making the following additions:- 1 Unexplained unsecured loans 39,43, 083/- 2 Unexplained creditors 4,10,72,257/- 3 G.P. addition 4,30,19,408/-

I.T.A No. 3135/Ahd/2015 A.Y. 2008-09 Page No 2 DCIT vs. M/s. Aahar Products Pvt. Ltd

The ld. CIT(A) has provided part relief and restricted the GP addition to the extent of Rs. 53,04,140/-. During the course of penalty proceeding he assessing officer has responded that vide letter dated 4th March, 2004 stating that all necessary particulars were submitted and no discrepancy has been pointed out in the submission and penalty cannot be levied merely on the basis of addition which have been partly confirmed by the ld. CIT(A). The assessing officer has not accepted the explanation stating that books result was rejected as per provision of section 145(iii) and gross profit of the assessee was determined after making comparison with other companies engaged in the similar nature of business. Consequently, the assessing officer has levied penalty of Rs. 18,02,877/- u/s. 271(1)(c) of the act for furnishing inaccurate particulars of its income.

3.

Aggrieved assessee filed appeal before the ld. CIT(A). The ld. CIT(A) has deleted the penalty levied by the assessing officer stating that lump sum addition was made which is purely subjective and would not lead to conclusion that assessee has concealed income or furnished inaccurate particulars of income. During the course of penalty proceedings before us, the ld. counsel has supported the order of the assessing officer. On the other hand, no-body has attended from the side of the assessee.

4.

We have perused the material on record and noticed that the assessing officer has estimated the gross profit on the ground that it is on the lower side in comparison to the other companies. However we observe that assessee has made this addition without establishing that the assessee has furnished inaccurate particulars of income or furnished inaccurate particulars of such income. Therefore, after considering the detailed findings of the Ld. CIT(A) and a number of judicial pronouncements elaborated by the ld. CIT(A), we do not find any reason to interfere with the decision of the ld. CIT(A). Accordingly, the appeal of the revenue is dismissed.

5.

In the result, the appeal of the revenue is dismissed. Order pronounced in the open court on 16-04-2018

Sd/- Sd/- (S.S. GODARA) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER

I.T.A No. 3135/Ahd/2015 A.Y. 2008-09 Page No 3 DCIT vs. M/s. Aahar Products Pvt. Ltd

Ahmedabad : Dated 16/04/2018 आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से, उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद

More judgments on Section 271(1)(c)

All 25,141 judgments and leading authorities on Section 271(1)(c) →

Recent GST High Court judgments

Search GST case law →