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Income Tax Appellate Tribunal, DELHI BENCH: ‘E’ NEW DELHI
Before: SHRI R.K. PANDA & SHRI K.NARSIMHA CHARY
Challenging the orders passed by the learned Commissioner of Income Tax (Appeals)-31, New Delhi (“Ld. CIT(A)”) in the case of the Orient Patways (Agra) for the assessment year 2013-14 and in the case of Patways (Indore) for the assessment years 2011-12 and 2013-14, Revenue preferred these appeals on identical grounds. We, therefore, find it just and convenient to dispose of these three appeals by way of this common order with reference to the facts in the case of the Orient Patwaries (Agra) for the assessment year 2013-14.
Brief facts of the case are that the assessees are the companies engaged in the business of development, construction and maintenance of highway projects in Uttar Pradesh and Rajasthan on Build, Operate and Transfer (BOT) basis. For the assessment year 2013-14, the assessee filed the return of income on 29/9/2013 declaring nil income with the current year loss to the tune of Rs. 10,85,07,142/-. Assessment under section 143(3) of the Act was complete by order dated 18/3/2016 at a loss of Rs.7,55,58,440/- after making a disallowance of Rs. 55,32,54,343/- on account of depreciation and an addition of Rs. 12,93,76,740/- on account of business expenses.
Proceedings under section 271(1)(c) of the Act to levy the penalty were initiated in respect of the disallowances/additions, and were complete by order dated 30/09/2016 with the levy of penalty of Rs. 1,01,81,149/-.
Assessee preferred appeal before the Ld. CIT(A) and contended that the reason for reduction of the loss was on account of disallowance of claim for depreciation on road to the tune of Rs. 16,25,25,442/- and in turn allowed the expenditure on construction of the road to be amortised and written off over the period of agreement resulting in allowing Rs. 12,95,76,740/-, and there is no difference in the cost of road on which depreciation was claimed by the assessee and lateron written off was granted by the learned Assessing Officer hence the penalty cannot be sustained.
Ld. CIT(A) by way of impugned order dealt with this issue and recorded that a similar question had arisen in assessee’s own case for the immediately preceding year, namely, assessment year 2012-13 and on a consideration of the contentions and material before him, in the light of the decisions reported in CIT vs. Brahmaputra Consortium Ltd (2012) 348 ITR 339 and ACIT vs. Reliance Petro Products Private Limited (2010) 322 ITR 158, his predecessor had taken the view that the penalty cannot be sustained. Since the facts and circumstances and the basis for levy of the penalty was identical, for this year also Ld. CIT(A) had taken a similar view and deleted the penalty.
Challenging the said order deleting the penalty, Revenue preferred this appeal contending that the incorrect claim of depreciation on roads was withdrawn by the assessee on 14/03/2015, namely, after a lapse of one year since the issue of CBDT circular dated 23/4/2014 and after receiving the specific show cause notice dated 12/03/2015 from the learned Assessing Officer. It is further submitted by the Ld. DR that it is abetted case of furnishing of inaccurate particulars of the income of the assessee leading to the concealment of income as the assessee never bothered to revise its return of income filed under section 139(1) of the Act and withdrew its claim only when there was no alternative.
Per contra, at the outset it is brought to our notice by the Ld. AR that there is nothing illegality or irregularity in the Ld. CIT(A) following the order passed by his predecessor in the preceding assessment year, namely, for the assessment year 2012-13. He further submitted that such an order of the Ld. CIT(A) for the assessment year 2012-13 was upheld by a coordinate Bench of this Tribunal in by order dated 28/02/2018. He further brought to our notice that the these orders of the Tribunal were challenged before the Hon’ble High Court by Revenue, and the Hon’ble High Court by order dated 28/08/2018 upheld the findings of the Tribunal and dismissed the revenues appeal.
We have gone through the record in the light of the submissions made on either side. There is no dispute of the fact that the findings of the Ld. CIT(A) for assessment year 2012-13 were upheld by a coordinate Bench of this Tribunal in ITA 2965/del/2016 by order dated 28/02/2018 and the appeal of the Revenue preferred against such order of the Tribunal was dismissed by the Hon’ble High Court by way of decision reported in (2018) 103 CCH 10 (Delhi). We further find that following the decision of the Hon’ble High Court this Tribunal in the case of ACIT vs. M/s Oriental Nagpur Byepass Constructions Private Limited in by order dated 14/10/2019 held that the penalty levied under similar circumstances cannot be sustained.
It is not the case of the Revenue that the facts involved in this case for this year are in any way different from the facts involved from the earlier years so as to prompt us to take a different view. In view of the consistent view taken by all the appellate fora, in the case of assessee and its sister concerns, we are of the considered opinion that rule of consistency demands that similar addition has to be taken under similar circumstances in assessee’s own case. We accordingly, hold that the penalty levied by the learned Assessing Officer cannot be sustained. and 3173/del/2017
On a perusal of the record we find that the facts and circumstances and the basis for levy of penalty in these two appeals are identical to the facts and circumstances involved in ITA No. 3171/Del/2013. In case of orient Patways (Indore) Private Limited also, for the assessment year 2012-13, coordinate Bench of this Tribunal upheld the deletion of penalty and the same wasconfirmed by the Hon’ble High Court. The issue, in case of Patways (Indore) Private Limited also is no longer res integra and has squarely been covered by the decision of Hon’ble High Court. We, therefore, while respectfully following the consistent view hold that the penalty levied for assessment years 2011-12 and 2013-14 is not sustainable and the appeals of the Revenue or devoid of merits and dismissed the same. In the result all thethree appeals of Revenue are dismissed. Order pronounced in the Open Court on 19th Nov, 2019. Sd/- Sd/- (R.K. PANDA) (K. NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 19th Nov, 2019