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Income Tax Appellate Tribunal, MUMBAI BENCH “B”, MUMBAI
Before: SHRI G.S.PANNU & SHRI SANDEEP GOSAIN
ORDER PER G.S.PANNU,A.M:
The captioned three appeals by the Revenue pertain to assessment years 2003-04, 2005-06 and 2006-07, and since they involve a common issue, they have been clubbed, heard together and a consolidated order is being passed for the sake of convenience and brevity.
Since the issue raised in these appeals are identical, is taken as the lead case, which is directed against
(A.Y. 2003-04) (A.Y. 2005-06) ITA No.5663/Mum/2015, (A.Y. 2006-07) order passed by the CIT(A)-51, Mumbai dated 09/09/2015, deleting the penalty imposed under section under section 271(1)(c) of the Act dated 26/03/2014. The Grounds of appeal raised by the assessee in this appeal read as under:- i. "On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the penalty levied u/s 271(1)(c) ignoring the fact that Shri Giriraj Vijayvargiya has admitted to giving accommodation entries and therefore filed in accurate particulars income. ii. "On the facts and in the circumstances of the circumstances of the case and in law, the Ld. CIT(A) erred in relying on his own order for A.Y.2004-05 without appreciating that the Assessee has admitted giving accommodation entries in the current year and therefore distinct from that of 2004-05." iii. "On the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in ignoring the finding of the settlement commission which was in turn concurred by the Hon'ble High Court that the transactions, are not genuine and therefore is liable for penalty u/s 271(1)(c) of the Act.´
The brief facts of the case are that assessee company is engaged in the business of trading in ferrous and non-ferrous metals. The assessee filed its original returns of income on 17/10/2003 showing an income of Rs.8,87,134/-. The assessment was reopened by issuing a notice under section 148 of the Act on 30/03/2010. The reasons for reopening the assessment was that during the course of search action under section 132 of the Act in the case of Shri Giriraj Vijayvargiya the Assessing Officer found that Shri Giriraj Vijayvargiya had given accommodation entries in the form of gifts, loans and share application money. Shri Giriraj Vijayvargiya admitted in a statement under section 132(4) of the Act that he is not having any source of gifts, loans or share application money and the beneficiaries paid him cash for the equivalent amount in cheque and a commission of 2-3 to5%. The (A.Y. 2003-04) (A.Y. 2005-06) ITA No.5663/Mum/2015, (A.Y. 2006-07)
Assessing Officer while passing order under section 143(3) r.w.s. 147 of the Act dated 31/12/2010 has also initiated penalty proceedings under section 271(1)(c) of the Act for concealment of income, which was ultimately levied at Rs.71,69,925/- vide order dated 26/03/2014(supra). Against the order passed under section 271(1)(c) of the Act, the assessee filed an appeal before the CIT(A). The CIT(A), following his earlier orders for assessment years 2003-04 to 2006-07, on identical issue has allowed the appeal of the assessee and deleted the penalty.
4. Aggrieved, Revenue is in appeal before the Tribunal. At the time of hearing, it was submitted by the Ld. Representative for the assessee that the assessee has challenged the order passed under section 143(3) r.w.s. 147 of the Act, which was further confirmed by the CIT(A), before the Tribunal. The Tribunal vide order in dated 13/05/2016 has quashed the assessment order. A copy of the above order of the Tribunal has been placed on record by the Ld. Representative for the assessee.
The Ld. Departmental Representative did not controvert the factual position asserted by the assessee.
We have carefully considered the rival submissions. In view of the aforesaid decision of the Tribunal dated 13/05/2016 (supra) in the quantum proceedings, the order passed by the Assessing Officer under section 271(1)(c) has become infructuous and, therefore, the action of the CIT(A) deleting the penalty is affirmed, albeit on a different ground. Accordingly, the appeal filed by the Revenue is dismissed.
(A.Y. 2003-04) (A.Y. 2005-06) ITA No.5663/Mum/2015, (A.Y. 2006-07)
ITA No.5662/Mum/2015, (A.Y. 2005-06) & (A.Y. 2006-07)
It was a common point between the parties that facts and circumstances in these appeals are pari-materia to those considered by us in 2003-04, in the earlier paragraphs, inasmuch as, for assessment years 2005-06 and 2006-07, the assessment orders passed u/s. 143(3) r.w.s. 147 of the Act have been quashed by the Tribunal vide order dated 17/05/2016 in thus, our decision for assessment year 2003- 04 shall apply mutatis mutandis in these appeals also. 6. In the result, the captioned appeals of the Revenue are dismissed.
Order pronounced in the open court on 21/03/2018.