RELIABLE METAL INDUSTRIES,MUMBAI vs. ACIT -25(3), MUMBAI

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ITA 758/MUM/2018Status: DisposedITAT Mumbai22 March 2019AY 2010-113 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the assessee's claim was substantially accepted and the additions were reduced, it did not indicate furnishing of inaccurate particulars or concealment of income. Therefore, the penalty was deleted.

What were the facts?

The assessee's appeal for AY 2010-11 challenged a penalty imposed under Section 271(1)(c). Initially, additions were made for alleged bogus purchases, leading to a penalty. Subsequently, the additions were reduced by the first appellate authority.

What were the issues?

Whether penalty under Section 271(1)(c) is leviable when additions are reduced substantially and do not indicate concealment of income.

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, “D” BENCH, MUMBAI

Before: HON’BLE SHRI MAHAVIR SINGH, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

Per Manoj Kumar Aggarwal (Accountant Member)

1.

Aforesaid appeal by assessee for Assessment Year [in short referred to as ‘AY’] 2010-11 contest the order of Ld. Commissioner of Income-Tax (Appeals)-37, Mumbai, [in short referred to as ‘CIT(A)’], Appeal No. CIT(A)-37/IT-679/ACIT -25(3)/15-16 dated 18/11/2017 qua confirmation of certain penalty u/s 271(1)(c).

2.

Upon perusal of quantum assessment order u/s 143(3) dated 23/12/2015, it transpires that the assessee has been saddled with 2 M/s. Reliable Metal Industries Assessment Year :2010-11 estimated addition of Rs.3.31 Lacs, being 25% of alleged bogus purchases. Against the same, penalty proceedings were initiated u/s 271(1)(c) in the quantum assessment order and the assessee has been saddled with penalty of Rs.1.02 Lacs by Ld. AO vide order dated 15/06/2016. 3. Subsequently, upon further appeal against quantum additions, the estimated additions were reduced to 12.5% by Ld. first appellate authority vide order dated 18/11/2017. Therefore, keeping in view the same, the Ld. first appellate authority, while adjudicating appeal against penalty, directed Ld. AO to reduce the penalty accordingly. Still aggrieved, the assessee is in further appeal before us.

4.

After hearing rival submissions and perusal of relevant material on record, the undisputed position that emerges is the fact that the penalty has been levied / confirmed merely against estimated disallowances of 12.5%. Nevertheless, the assessee’s claim has been accepted substantially which do not suggest that there was furnishing of inaccurate particulars of income or concealment of income within the meaning of Section 271(1)(C). Therefore, the factual matrix does not inspire to concur with the stand of first appellate authority. Hence, we delete the impugned penalty.

5.

The appeal stands allowed. Order pronounced in the open court on 22nd March, 2019. (Mahavir Singh) (Manoj Kumar Aggarwal) "ाियक सद" / Judicial Member लेखा सद" / Accountant Member मुंबई Mumbai; िदनांक Dated : 22/03/2019 Sr.PS, Jaisy Varghese

3 M/s. Reliable Metal Industries Assessment Year :2010-11 आदेशकी"ितिलिपअ"ेिषत/Copy of the Order forwarded to : अपीलाथ"/ The Appellant

1.

""थ"/ The Respondent 2. आयकरआयु"(अपील) / The CIT(A) 3. आयकरआयु"/ CIT– concerned 4. िवभागीय"ितिनिध, आयकरअपीलीयअिधकरण, मुंबई/ DR, ITAT, Mumbai 5. गाड"फाईल / Guard File 6. आदेशानुसार/ BY ORDER,

उप/सहायक पंजीकार (Dy./Asstt.

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