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Income Tax Appellate Tribunal, “H”, BENCH MUMBAI
Before: SHRI R.C.SHARMA, AM & SHRI PAWAN SINGH, JM
आदेश / O R D E R PER R.C.SHARMA (A.M):
This is an appeal filed by the assessee against the order of CIT(A) for the assessment year 2010-11 in the matter of penalty imposed u/s.271(1)( c) of the IT Act. 2. The following grounds have been taken by the Assessee.
1. On the facts and circumstances the case The Learned Commissioner of income Tax ( Appeals ) 18 has failed to appreciate the fact that the Penalty levied on Depreciation claim on sale of Gala was originally initiated in Assessment year 2009- 10 and which was deleted by The Learned Assessing Officer for that year.
2. The Learned Commissioner of income Tax (Appeals) 18 has failed to appreciate the fact that it was just accounting error of offering income of Rs.84,423 in the Assessment year 2010-11 instead of in the Assessment year 2011-12. The Appellant also states that the Learned Commissioner of Income Tax (Appeals)
M/s. Shroff Textiles Limited failed to appreciate the fact that Tax Deducted at Source on the said income has not been claimed by the Appellant. 3 The Appellant Craves leave to add, to alter or to amend any one or more of Grounds as mentioned herein above, as and when necessary.
Rival contentions have been heard and record perused.
Facts in brief are that during the assessment proceedings, the A.O. has observed that as per AIR database information, the assessee had received contractual receipts from Automobile Corporation of Goa Ltd., and Modern Petro Packaging amounting to Rs.60,403/- and Rs.24,020/- respectively. However, in the return of income, the assessee had not accounted for the said receipts of Rs.84,423/-. When it was confronted to the assessee during the assessment proceedings, it has agreed for the addition to this extent. AO also levied penalty of Rs.54,000/- u/s. 271(1)(c) in respect of these amounts.
By the impugned order, CIT(A) confirmed the penalty of Rs.54,000/- so imposed by the AO against which assessee is in further appeal before us.
We have considered rival contentions and carefully gone through the orders of the authorities below and found from record that M/s. ACGL, Goa from whom the interest of Rs.60,403/- was received, is the sale party of the assessee. Assessee was not charging any interest to them for delayed payments. As the assessee had received the payments on regular basis, the said amount being received, the assessee’s accounts clerk had adjusted the said amount against their regular sales M/s. Shroff Textiles Limited receivable from M/s. ACGL, Goa. However, after scrutinizing in detail and after cross confirmation with M/s. ACGL, Goa, the assessee understood that M/s. ACGL, Goa had paid interest under MSEMED Act, which the assessee was not aware of. Hence, as the said amount was not shown as a separate income, assessee had considered the same and offered this income during the year and also paid the income tax on it alongwith the interest thereon, which is well before completion of security assessment. Accordingly, it is not a fit case for levy of penalty in respect of accounting entry mistakenly made by the Accountant and which the assessee has accepted during the assessment proceedings itself and paid tax thereon.
With respect to the contractual receipt of Rs.24,020/-, we found that paying party has accounted for it in the Financial Year 2009-2010, whereas assessee has accounted its income in the Financial Year 2010-11 corresponding to the Assessment year 2011-12. However, assessee has not claimed tax deducted on the said amount of Rs.24,020/-, even though same has been deducted by the party in the assessment year 2010-11. Considering the aspect of accounting assessee agreed for addition of Rs.24,020 during the year itself. It is not a case of concealment of income in so far as same has already been offered by the assessee in the assessment year 2011-12 and due taxes were also paid thereon. Moreover when pointed out by the AO regarding year in which amount is to be offered, the assessee fairly
M/s. Shroff Textiles Limited agreed for the same. Accordingly, we do not find any justification for levy of penalty on this amount. 8. In the result, appeal of the assessee is allowed.