M/S. NATH BROS. EXIM INTERNATIONAL LTD.,NEW DELHI vs. ACIT, NEW DELHI

PDF · subscribers
ITA 2673/DEL/2014Status: DisposedITAT Delhi09 October 2015AY 2007-084 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 the double claim was due to a bonafide human error and not an intentional concealment. Relying on Supreme Court and Delhi High Court judgments, the Tribunal decided to delete the penalty.

What were the facts?

The assessee claimed a deduction of Rs. 2,64,784/- under Section 43B. This amount was mistakenly claimed as a deduction in both the assessment year 2006-07 and 2007-08 due to an accounting error. The Assessing Officer and CIT(A) levied penalty for furnishing inaccurate particulars.

What were the issues?

Whether a penalty under Section 271(1)(c) is leviable when a double deduction claim arises from a bonafide accounting mistake.

Which sections of the Income-tax Act were involved?

Section 43B,Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(2)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, DELHI BENCH ‘SMC-2’, NEW DELHI

Before: SHRI J. SUDHAKAR REDDY

Hearing: 09.09.2015Pronounced: 9.10.2015

ORDER This is an appeal filed by the assessee directed against the order of the Commissioner of Income Tax (Appeals)-XVI, New Delhi dated 11.03.2014, for the assessment year 2007-08, where a penalty levied by the Assessing Officer u/s 271(1)(c), was confirmed.

2.

The assessee company is engaged in the business of manufacturing and Export of readymade garments, garment made- ups and silk fabrics. The issue on which penalty was levied on the assessee u/s 271(1)(c) of the Act is a disallowance by the A.O. of Rs. 2,64,784/-, claimed as deduction u/s 43(B) of the Act by the assessee.

2 Nath Bros. Exim International Ltd. N.D.

3.

The assessee explained that it was due to a bonafide accounting mistake, the amount in question was claimed both for the assessment year 2006-07, as well as using the current assessment year 2007-08. The Assessing Officer as well as the CIT(A) came to the conclusion that the assessee furnished inaccurate particulars and that the claim in this year was conceded, only after detected by the department. They held, that penalty u/s 271(1)(c) is rightly levied. Aggrieved the assessee is in appeal before us.

4.

We have heard Shri S.K. Sarkar ld. Counsel for the assessee and Shri Raman Kant Garg, the ld. Sr. DR on behalf of the Revenue.

5.

On hearing the rival contentions, I am of the considered opinion that the claim of Rs. 2,64,854/- was due to a human error. The amount was paid, after the end of the financial year 2005-06, but before the due date for filing the return of income for the assessment year 2006-07. This was claimed as deduction during the assessment year 2006-07. The accountant made a mistake of not excluding this amount, from the expenditure recorded in the books for the assessment year 2007-08. Hence, I applying the ratio laid down the Hon’ble Supreme Court in the case of 322 ITR 158 (SC) in the case of Reliance Petro Products and the judgment of the Hon’ble Delhi High Court in the case reported in 328 ITR 44 in the case of CIT Vs. Escorts Finance Ltd. (2010) delete the penalty levied.

3 Nath Bros. Exim International Ltd. N.D.

6.

In the result this appeal of the assessee is allowed. (Order Pronounced in the Court on 9/10/2015).

More judgments on Section 43B

All 7,161 judgments and leading authorities on Section 43B →

Recent GST High Court judgments

Search GST case law →