M/S HARYANA KASHMIR TRANSPORT CARRIERS,YAMUNANAGAR vs. ACIT, YAMUNANAGAR

Per Sanjay Garg, Judicial Member:

The captioned appeals have been preferred by the assessee against the separate orders dated 16.02.2016 of Commissioner of Income Tax (Appeals), [hereinafter referred to as ‘CIT(A)’]-2, Gurgaon. The assessee is aggrieved in both the appeals by the action of CIT(A) in confirming the levy of penalty u/s 271(1)(c) of the Income-tax Act, 1961 (in short 'the Act').

ITA Nos. 503 & 504/Chd/2016 Haryana Kashmir Transport Carriers, Yamunanagar 2

rate after rejecting the books of account of the assessee. He has further

submitted that identical additions were made by the Department for

assessment year 2006-07 also i.e. by estimating the GP rate, however, no

penalty proceedings were initiated by the Department for assessment year

2006-07. He has further submitted that so far as assessment year 2008-09

is concerned, the Assessing officer had made addition by way of estimating

the GP, however, no penalty proceeding were initiated. Subsequently, the

case was examined by the Ld. Commissioner of Income tax by exercising

his revisionary jurisdiction u/s 263 of the Act, in consequence of which,

addition to the income of the assessee on account of insurance claim was

made. The Ld. Assessing officer has levied the penalty in respect of the

addition made by the him in respect of insurance claim. He has further

submitted that so far as assessment year 2011-12 is concerned, penalty has

been levied for the first time by the Department in respect of additions

made on account of estimation of GP profit. The Ld. Counsel has submitted

that for the assessment years i.e. assessment year 2008-09 & assessment

year 2011-12, there was neither a case of furnishing of inaccurate

particulars of income nor of concealment of income.

lower authorities.

assessment year 2008-09 was made on account of insurance claim received

by the assessee. Ld. Counsel for the assessee has submitted that even the

issue of making addition into the income of the assessee on account of

insurance calm is a debatable issue. He has further relied upon the

ITA Nos. 503 & 504/Chd/2016 Haryana Kashmir Transport Carriers, Yamunanagar 3

decision of the Hon'ble Jurisdictional High Court of Punjab & Haryana

High Court in the case of ,CIT Vs. Sangrur Vanaspati Mills Ltd’ (2008) (2)

TMI 285 (P&H) in this respect.

books of account of the assessee were rejected in the earlier assessment

year also and further the income was estimated on GP rate, why did not

the assessee take necessary steps to maintain the proper accounts and

remove the discrepancy because of which the books of account were

rejected. Ld. counsel in this respect has submitted that for assessment year

2006-07, the order of the Tribunal upholding the addition on estimation

basis had been passed on 27.4.2011, whereas, the return for assessment

year 2008-09 had filed by the assessee on 29.9.2008. So far as the

assessment year 2011-12 is concerned, the Ld. Counsel has submitted that

the financial year was already over on 30.4.2011 and the accounts had

already been finalized, and the assessee was under the bona fide belief that

the books of account maintained by it would be accepted as such by the

Assessing officer. The Ld. Counsel has further submitted that even

subsequent to assessment year 2011-12, no such additions have been made

by the income tax authorities into the income of the assessee.

overall facts and circumstances of the case, we do not find that this is a

case of furnishing of inaccurate particulars of income or concealment of

income on the part of the assessee. Therefore, the penalty levied by the

lower authorities u/s 271(1)(c) of the Act for the assessment years under

ITA Nos. 503 & 504/Chd/2016 Haryana Kashmir Transport Carriers, Yamunanagar

consideration, in our view, is not sustainable in the eyes of law; the same

is accordingly ordered to be deleted.

In the result, both the appeals of the assessee are hereby allowed.

Order pronounced in the Open Court on 26.03.2018

Sd/- Sd/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated : 26.03.2018 Rkk Copy to: 1. The Appellant 2. The Respondent 3. The CIT 4. The CIT(A) 5. The DR