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Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK
Before: S/SHRI N.S SAINI & PAVAN KUMAR GADALE
Per N.S.Saini, AM
These are appeals filed by the assessee against the separate orders
of the CIT(A)-Cuttack, both dated 23.4.2015 for the assessment years
2003-04 & 2004-05.
In both the appeals, the common ground taken is that the CIT(A)
erred in confirming the levy of penalty u/s.271(1)(c) of the Act of
Rs.2,58,396/- for the assessment year 2003-04 and Rs.3,13,545/- for the
assessment year 2004-05.
The brief facts of the case are that the Assessing Officer during the
course of assessment proceedings found that the assessee had stated
2 ITA Nos. 337 & 338/ CTK/ 2015 Asse ssment Years : 2 003 -04 & 20 04- 05 that security deposit receivable of Rs.4,63,240/- but had not shown the
withheld amount receivable of Rs.2,33,446/- in the assessment year
2003-04, which was released to the assessee in the next financial year.
He, therefore, treated excess of assets over liabilities of Rs.2,33,446/-
which represented the income of the assessee firm from undisclosed
source and added the same to the income of the assessee.
Similarly, for the assessment year 2004-05, the Assessing Officer
observed that the assessee had not included contract receipts of
Rs.5,02,822/- into its gross receipts. Therefore, the Assessing Officer
rejected the book results of the assessee by invoking the provisions of
section 145 of the Act and estimated the income of the assessee @ 8%
of the gross receipts arrived at by him.
The above additions made in assessment year 2003-04 and 2004-
05 were confirmed in appeal by the CIT (A) as well as by the Tribunal.
Thereafter, the Assessing Officer levied penalty u/s.271(1)(c) of the
Act at Rs.2,58,396/- for the assessment year 2003-04 and Rs.3,13,545/-
for the assessment year 2004-05 on the ground of furnishing inaccurate
particulars of income by the assessee.
On appeal, the CIT(A) confirmed the levy of penalty.
Before us, the contention of ld A.R. of the assessee is that the
assessee has filed appeal before the Hon’ble High Court of Odisha and
Hon’ble High Court has admitted the appeals of the assessee in I.T.A.
3 ITA Nos. 337 & 338/ CTK/ 2015 Asse ssment Years : 2 003 -04 & 20 04- 05 No.64/2009 and in I.T.A. No.65/2009 for the assessment years 2003-04
and 2004-05. Therefore, it was his submission that as the appeal against
the order of the Tribunal was admitted by the Hon’ble High Court on
substantial questions of law, the issue is debatable one and hence, no
penalty is leviable on the assessee u/s.271(1)(c) of the Act.
On the other hand, ld D.R. supported the orders of lower
authorities.
We find that the Hon’ble Bombay High Court in the case of CIT vs.
M/s. Advaita Estate Development Pvt Ltd., in Income Tax Appeal No.1498
of 2014 order dated 17.2.2017 has held as under:
“Mr Dalal, the ld Counsel for the respondent-assessee invited our “attention to the order of the Tribunal dated 18th march 2011 in the case of Nayan Builders and Developers Pvt Ltd. On perusal of the Tribunal order dated 18th March, 2011 we note that the Tribunal in Nayan Buildes and Developers Pvt Ltd (supra) had deleted the penalty only on the ground that as substantial question of law had been admitted by this Court in quantum proceedings the issue is debatable. It was on the basis of the aforesaid reasoning of the Tribunal in Nayan Builders and Developers Pvt Ltd. (supra), that this Court held that no penalty is imposable. Thus, the distinction sought to be made by Mr Tqejveer Singh does not assist the revenue, as it does not exist.” 11. In the instant case, it is not in dispute that the appeals have been
admitted by Hon’ble High Court of Odisha on the additions confirmed by
the Tribunal in I.T.A. No.64/2009 and in I.T.A. No.65/2009 for the
assessment years 2003-04 and 2004-0 on the substantial questions of
law.
4 ITA Nos. 337 & 338/ CTK/ 2015 Asse ssment Years : 2 003 -04 & 20 04- 05 12. Thus, the facts in the present appeals are identical to the facts
which were before the Hon’ble Bombay High Court in the case of M/s.
Advaita Estate Development Pvt Ltd (supra). Therefore, respectfully
following the same, we set aside the orders of lower authorities and
delete the levy of penalty of Rs.2,58,396/- for the assessment year 2003-
04 and Rs.3,13,545/- for the assessment year 2004-05 and allow the
ground of appeal of the assessee.
In the result, both the appeals of the assessee are allowed.
Order pronounced in the open court on 31 /08/2017. Sd/- sd/- (Pavan Kumar Gadale) (N.S Saini) JUDICIALMEMBER ACCOUNTANT MEMBER Cuttack; Dated 31 /08/2017 B.K.Parida, SPS Copy of the Order forwarded to : 1. The Appellant : M/s. Bijay Kumar Mohapatra, At/PO: Randia, Bhadrak 2. ITO, Bhadrak Ward, The Respondent. Bhadrak 3. The CIT(A)- Cuttack 4. Pr.CIT- Cuttack 5. DR, ITAT, Cuttack 6. Guard file. BY ORDER, //True Copy// SR.PRIVATE SECRETARY ITAT, Cuttack