DCIT 1(3), MUMBAI v. STANDARD CHARTERED INVESTMENTS AND LOANS (INDIA) LTD, MUMBAI

ITA 2096/MUM/2009 | 2004-2005
Pronouncement Date: 29-01-2010 | Result: Dismissed

Appeal Details

RSA Number 209619914 RSA 2009
Bench Mumbai
Appeal Number ITA 2096/MUM/2009
Duration Of Justice 9 month(s) 25 day(s)
Appellant DCIT 1(3), MUMBAI
Respondent STANDARD CHARTERED INVESTMENTS AND LOANS (INDIA) LTD, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 29-01-2010
Appeal Filed By Department
Order Result Dismissed
Bench Allotted I
Tribunal Order Date 29-01-2010
Assessment Year 2004-2005
Appeal Filed On 03-04-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES I : MUMBAI BEFORE SHRI D. MANMOHAN HONBLE VICE PRESIDENT AND SHRI PRAMOD KUMAR ACCOUNTANT MEMBER ITA. NO.2096/MUM/2009 ASSESSMENT YEAR 2004-2005 ACIT 1 (3) MUMBAI 400 020. VS. M/S. STANDARD CHARTERED INVESTMENTS AND LOANS (INDIA) LTD. MUMBAI 400 020 PAN AAHCS-6432-N (APPLICANT) (RESPONDENT) FOR APPLICANT : MS. VANDANA SAGAR SR. D.R. FOR RESPONDENT : -NONE- ORDER PER SHRI D. MANMOHAN V.P. PENALTY OF RS.2 96 164/- LEVIED BY THE ASSESSING OFFICER UNDER SECTION 271 (1) (C) OF THE ACT BUT CANCELLED BY THE CIT(A) IS THE SUBJECT MATTER OF DISPUTE BEFORE US. THE FOLLOWING GROUNDS WERE URGED BY THE REVENUE. 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED CIT(A) ERRED IN CANCELING T HE PENALTY OF RS.2 96 164/- LEVIED U/S. 271 (1) (C.) O F THE I.T. ACT HOLDING THAT FAILURE TO RETURN THE CORRECT INCOME SHOULD ARISE FROM FRAUD OR GROSS NEGLECT OR TOTAL FRIVOLOUS CLAIM ON THE ASSESSEES PART TO ATTRACT PENALTY. 2. THE APPELLANT CRAVES LEAVE TO ADD TO AMEND OR WITHDRAW THE AFORESAID GROUND OF APPEAL. 2 2. IT MAY BE NOTICED THAT THE ASSESSMENT WAS COMPL ETED BY DETERMINING THE TOTAL INCOME AT RS.33 83 960/- AS AGAINST DECLARED INCOME OF RS.25 58 415/- BY DISALLOWING THE CLAIM OF DEDUCTION OF RS.8 25 545/-. CONSEQUENT TO THE DISALLOWANCE MADE BY THE ASSESSING OFFICER THE IMPUGNED PENALTY WAS LEVIED. ON AN APP EAL FILED BY THE ASSESSEE THE LEARNED CIT(A) DELETED THE PENALTY BY OBSERVING AS UNDER : 6.3. I HAVE CAREFULLY CONSIDERED THE APPELLANT SUB MISSION. IT IS NOT A CASE WHERE ANY PARTICULARS REGARDING CL AIM MADE HAS BEEN CONCEALED. IT IS A MATTER OF DEBATE WHETHER THE DEBT ISSUE EXPENSE WHICH HAS BEEN DISALLOWED BY THE A.O. WAS AN ALLOWABLE ITEM OR NOT . IT IS NOT A CASE WHERE A FRIVOLOUS CLAIM HAS BEEN MADE OR THE APPELLANT HAS MANIPULATED ITS ACCOUNT TO MAKE FALSE CLAIM. THE COMPANY HAS CLEARLY SHOWN IN THE RETURN OF INCOME THE TREATMENT GIVEN TO THE DEBT IS SUE EXPENSES IN THE BOOKS AND ALSO IN THE RETURN OF INC OME. IF THE PART OF THE EXPENSES WERE HELD NOT ALLOWABLE DURING THE YEAR THE CONCLUSION CANNOT BE DRAWN THA T THE APPELLANT SOUGHT TO CONCEAL THE INCOME OR IT FI LED INACCURATE PARTICULARS OF INCOME. EVERY DISALLOWANC E CANNOT RESULT INTO LEVY OF CONCEALMENT PENALTY. DISALLOWANCE OF AN EXPENSE PER SE CANNOT MEAN THAT THE APPELLANT FURNISHED INCORRECT PARTICULARS OF IT S INCOME. FAILURE TO RETURN THE CORRECT INCOME SHOULD ARISE FRAUD OR GROSS NEGLECT OR TOTAL FRIVOLOUS CLA IM ON THE APPELLANTS PART WHICH IS NOT THE CASE HERE. T HE A.O. IS ACCORDINGLY DIRECTED TO DELETE THE PENALTY LEVIED U/S. 271 (1) (C) AT RS.2 96 164/-. 3 3. AGGRIEVED REVENUE IS IN APPEAL BEFORE US. AT T HE TIME OF HEARING IT WAS BROUGHT TO OUR NOTICE THAT THE DISAL LOWANCE MADE BY THE ASSESSING OFFICER WHICH IS THE BASIS FOR LEVY OF P ENALTY WAS SET ASIDE BY THE ITAT TO THE FILE OF THE ASSESSING OFFICER VIDE ITA. 6978/MUM/2007 DATED 22-09-2009. SINCE THE VERY BASIS FOR LEVY OF PENALTY NO LONGER SUBSISTS WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT(A) AND ACCORDINGLY DISMISS THE APPEAL FILED BY THE REV ENUE. PRONOUNCED ACCORDINGLY. SD/- SD/- (PRAMOD KUMAR) (D.MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI DATE 29 TH JANUARY 2010. VBP/- COPY TO 1. ACIT 1 (3) ROOM NO. 540/564 5 TH FLOOR AAYAKAR BHAVAN M.K. ROAD NEW MARINE LINES MUMBAI 400 020. 2. M/S. STANDARD CHARTERED INVESTMENTS AND LOANS (I NDIA) LTD. 53 M.G. ROAD METRO HOUSE FORT MUMBAI 400 020 PAN AAHCS-6432-N 4. CIT(A)-XXI MITTAL COURT B WING R.NOS. 13 & 14 3 RD FLOOR NARIMAN POINT MUMBAI 400 021. 5. CIT CITY-I MUMBAI 6. D.R. I BENCH MUMBAI. 7. GUARD FILE. (TRUE COPY) BY ORDER ASST. REGISTRAR ITAT MUMBAI BENCHES MUMBAI. 4 SNO DATE INITIALS 1 DRAFT DICTATED ON 18-01-2010 SR.P.S 2. DRAFT PLACED BEFORE AUTHOR 19-01-2010 SR.P.S 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER V.P. 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER A.M 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.P.S 6. KEPT FOR PRONOUNCEMENT ON SR.P.S 7. FILE SENT TO THE BENCH CLERK SR.P.S 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER