Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, MUMBAI “E” BENCH, MUMBAI
Before: SHRI SHAILENDRA KUMAR YADAV, & SHRI RAJESH KUMAR.
अपीलाथ� क� ओर से /By Appellant : Shri Harsh Bhuta, A.R. ��यथ� क� ओर से/By Respondent : Shri J. Saravanan, D.R. सुनवाई क� तार�ख/Date of Hearing : 28.06.2016 घोषणा क� तार�ख/Date of Pronouncement : 29.06.2016 ORDER PER SHAILENDRA KUMAR YADAV, J.M: This appeal has been filed by assessee against the order of Commissioner of Income-Tax (Appeals)-41, Mumbai, dated 29.10.2013 for A.Y. 2006-07 on following grounds:
A.Y. 06-07 [M/s. Sweety NX vs. DCIT] Page 2
1. On the facts and in the circumstances of the case, the Learned CIT(A) has erred in facts and in law in directing the Assessing Officer (AO) to recompute minimum penalty u/s 271 (1) (c) of I. T. Act on concealed income of Rs. 30,86,813/-
2. On the facts and in the circumstances of the case, the Learned CIT(A) has erred in facts and in law in rejecting the assessee's contention that penalty u/s 271 (1) (c) is not leviable as the basis of addition made by AO was not upheld by CIT(A) in quantum appeal.
3. On the facts and in the circumstances of the case, the Learned CIT(A) has erred in facts and in law in rejecting the assessee's contention that penalty u/s 271 (1) (c) is not leviable on the enhanced concealed income as determined by the Learned CIT(A) in the quantum appeal on a different basis and for which penalty proceeding u/s 271 (1) (c) was not initiated by CIT(A).”
2. At the outset of hearing, ld. Authorized Representative has brought to our knowledge that quantum addition has been deleted by ITAT Mumbai ‘E’ Bench in & 2587/Mum/2011 by observing as under:
“10. We have given a thoughtful consideration to the orders of the authorities below. We have also gone through the relevant documentary evidences brought on record and referred before us. It is an undisputed fact that the entire addition is based upon the balance sheet found from the computer which is placed at page-8 of the Paper book. We find that the closing stock is shown at Rs. 88,18,414/-, at page-9 is the profit & loss account where the closing stock is shown at Rs. 45,16,50/-. It is also an undisputed fact that the trading profit and loss account at page-9 of the Paper Book is as per audit report and is an audited statement of accounts whereas balance sheet at page-8 is an unsigned, unverified and unaudited. A.Y. 06-07 [M/s. Sweety NX vs. DCIT] Page 3 Moreover, in the said balance sheet, we find the cash in hand shown as a negative balance of Rs. 27.01 lakhs. In our understanding of accountancy, no balance sheet can have a negative figure for cash in hand. Moreover, no adverse inference has been drawn by the AU in so far as the audited statements of accounts are concerned. No discrepancy /error/fallacy has been shown in the audited statement of accounts.
10.1. As mentioned elsewhere, the entire addition is based upon the balance sheet which in itself is an unreliable document and cannot justify the additions.
Apart from the alleged balance sheet, there is no other material on record before the AU to indicate that the assessee had unexplained stock. The AU had neither conducted any enquiry nor made any effort to establish the fact by bringing cogent material evidence on record to show that the amounts shown in the balance sheet are true and correct. When the assessee has maintained regular books of account and has submitted the audited statement of accounts, the same cannot be disbelieved without bringing cogent material on record to prove them wrong. No additions can be made merely on the basis of the impugned balance sheet which by its very nature is not final. That besides the balance sheet found during the search proceeding being unsigned one no importance can be attached to such a document when the assessee has submitted audited P&L account and balance sheet, which cannot be discarded unless there is strong evidence to prove them wrong.
11.1. Considering the facts in totality as mentioned hereinabove, in our considered opinion, no additions need to be made on the given set of facts, we accordingly set aside the findings of the Ld. CIT(A) and direct the AO to delete the impugned additions. Ground No. 3 & 4 are accordingly allowed.”
Nothing contrary was brought to our knowledge on behalf of Revenue. So, we find that quantum addition which is basis A.Y. 06-07 [M/s. Sweety NX vs. DCIT] Page 4 of penalty does not survive. In view of the Tribunal’s decision in quantum, penalty u/s.271(1)(c) of the Act does not survive. Same is directed to be deleted.
As a result, appeal filed by assessee is allowed.
Pronounced in the open Court on this the 29th day of June, 2016.
Sd/- Sd/- (RAJESH KUMAR) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai: Dated 29/06/2016 True Copy S.K.SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, मुंबई / DR, ITAT, Mumbai 6. गाड� फाइल / Guard file. By order/आदेश से,
उप/सहायक पंजीकार, आयकर अपील�य अ�धकरण, मुंबई ।