TULSIDAS KHIMJI P. LTD,MUMBAI vs. ACIT 2(3)(1), MUMBAI

सुनवाईकीतारीख/ : 21/09/2020 Date of Hearing घोषणाकीतारीख / : 21/09/2020 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member): - 1. Aforesaid appeal by assessee for Assessment Year [in short referred to as ‘AY’] 2014-15 contest levy of penalty u/s 271(1)(c) as confirmed by Ld. Commissioner of Income-Tax (Appeals)-6, Mumbai, [in short referred to as ‘CIT(A)’] vide Appeal No. CIT(A)- Tulsidas Khimji Private Limited Assessment Year-2014-15 6/IT-14/2017-18 order dated 30/04/2019. The grounds raised by the assessee read as under: - 1.1 The Ld. CIT(A) erred in confirming the action of the AO by levying penalty u/s.271(1)(c) of the Income Tax Act, 1961 with regard to Income mismatch as per 26AS and as per the books of Account. 1.2 While doing so he failed to appreciate that (i) the said penalty was levied by the AO on an erroneous understanding of law which was confirmed by the CIT(A) without according any independent reasoning whatsoever. 1.3 It is submitted that in the facts and circumstances of the case and in law no such penalty was called for.

Though during course of hearing none appeared for assessee, however, we find that factual matrix as narrated in the orders of lower authorities is quite adequate to adjudicate this appeal. Therefore, the matter was proceeded further with the assistance of Ld. DR, Shri Amit Pratap Singh, who contended that penalty was justified. 2.1 Facts leading to imposition of penalty are that while framing an assessment u/s 143(3) for year under consideration, an addition of Rs.9,79,921/- was made to the income of the assessee owing to mismatch in income as per books vis-à-vis income as reported in Form 26AS. The assessee submitted that it was engaged as cleating and forwarding agent and there would be numerous clients who deduct TDS on many occasions but would deposit the tax after filing of the tax return by the assessee. But finding the explanation to be not tenable, the aforesaid difference was added to the income of the assessee. 2.2 Consequently, penalty proceedings were initiated in the quantum assessment order and show-cause notice for levy of Tulsidas Khimji Private Limited Assessment Year-2014-15 penalty was issued. Although the assessee explained various factors which would give rise to mismatch in income as per books vis-à-vis income as reported in Form 26AS, the same could not convince Ld. AO and the assessee was saddled with penalty of Rs.3,02,800/- u/s 271(1)(c) vide order dated 28/06/2017. Though, the assessee contested the penalty before Ld. first appellate authority, however, the same was confirmed vide appellate order dated 30/04/2019 against which the assessee is in further appeal before us. 2.3 While contesting penalty before Ld. CIT(A), the assessee tabulated as well as explained the party-wise differences giving rise to mismatch in Form No. 26AS. The submissions are extracted on page 4 & 5 of the impugned order, which we have carefully perused. On the strength of the same, the assessee raised a plea to delete the quantum additions also. However, Ld. CIT(A) opined that no cognizance of the reconciliation could be taken since the appeal was against the proceedings u/s 271(1)(c) and not against the quantum proceedings. The assessee’s another contention that tax was paid on the basis of Book Profit u/s 115JB was also rejected since as per quantum order, the mismatch difference was added while computing Book Profits u/s 115JB also. Finally, the action of Ld. AO in imposing the penalty was upheld. Aggrieved, the assessee is in further appeal before us.