TaxTMI 
TaxTMI 
TaxTMI 
2013 (5) TMI 613
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of the aforesaid sum and added to the income of the assessee invoking the provisions of section 40(a) (ia) of the Act and also initiated penalty proceedings u/s 271 (1) ( c ) read with 274 of the Act for furnishing inaccurate particulars of income on 20-12-2007. However, the learned CIT(A) vide his order dated 04-12-2008 sustained an addition of Rs.1,76,49,772/- in view of the amendment brought in the section vide Finance Act, 2008. Thereafter, the learned AO levied penalty u/s 271 (1) (c ) of the Act vide his order dated 30-03-2010 for an amount of Rs.59,40-,914/- being 100% of the tax evaded on the addition sustained by the learned CIT(A) of Rs.1,76,49,772/-. On appeal before the learned CIT(A), the penalty was deleted. The relevant portion of the order of the learned CIT(A) is reproduced herein below for reference: "Even the addition which was sustained in appeal on that amount TDS had been deposited in the government account in June 2005 and August 2005, though it should have been deposited by March 2005. Thus there was no loss to revenue only a slight delay in deposit of TDS in government account. Thus after going through rival submissions I am of the opinion that there was....
X X X X Extracts X X X X
X X X X Extracts X X X X
....re to the tax audit report along with the return of income filed. Only from this information furnished by the assessee, the learned AO could find the discrepancy with regard to the short remittance of TDS in the government treasury. Thus, the assessee has not furnished any inaccurate particulars of income in his return of income as pointed out by the learned AO. The ITAT Ahmedabad "D" Bench has taken a view on this issue in ITA No.228/Ahd/2010 in the case of DCIT Vs M/s. L. G. Chaudhary for the assessment year 2006-07 vide order dated 16-03-2012 that in similar situation, penalty cannot be levied. The relevant Para of the order is reproduced herein below: "4. We have heard the rival submissions and perused the orders of the authorities below. The learned DR relied on the order of the AO. On the other hand, the learned AR submitted before us that the issue under consideration is covered by the decision of ITAT Ahmedabad "A" Bench dated 30-07-2010 in ITA Nos. 789 to 791/Ahd/2007 in the case of DCIT Vs Mazdal Ltd. and the decision of ITAT "D" Bench dated 22-02-2011 in ITA No.2865/Ahd/2010 in the case of ACIT Vs M/s. Saraswati Construction Co., wherein the issue has been decided by th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....CIT(A) on proper appreciation of facts has rightly deleted the penalty made by the AO on both the above issues. The learned DR also has not produced any material on record to controvert the findings of the learned CIT(A). 4.2 The same issue has also been decided in favour of the assessee by the ITAT Ahmedabad "B" Bench vide order dated 13- 03-2012 in ITA No.1041/Ahd/2010 for AY 2006-07 in the case of M/s. Lucky Star International by dismissing the departmental. The findings of the Tribunal in Para 6 to 8 are reproduced as under:- "6. We have heard the learned both the parties, perused the orders of the authorities below and considered the materials on record. During the course of hearing of the appeal the learned DR relied upon the order of the authorities below. On the other hand, the learned AR referring to Para 3 and 4 of the penalty order, submitted that all the additions in respect of commission expenses of Rs.10,46,163/-, clearing and forwarding expenses of Rs.2,01,037/- and fees and legal expenses of Rs.1,10,200/- (totalling to Rs.13,57,400/-) have been disallowed holding that the assessee has violated the provisions of section 40(a) (ia) of the IT Act and that the AO has ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sideration the overall facts and circumstances particularly the amount of disallowance vis a vis the returned income, we are of the view that it is a bonafide lapse at the end of the assessee. There is no deliberate attempt to conceal the particulars of income. Ld. CIT(A) has rightly appreciated the facts and circumstances we do not see any reason to interfere in his order." The assessee further submitted that the facts in the above case are identical to that of the present case of the assessee and the issue is covered by the above decision. 6.2 The assessee further submitted that the issue is also covered by the decision of ITAT Hyderabad "A" Bench dated 17th Jume, 2010 in the case of ACIT Vs M/s. Seaways Shipping Ltd. in ITA No.80/H/2011 for AY 2005-06 (PB 9 to 11) wherein also identical issue has been decided by the Tribunal in favour of the assessee and against the Revenue vide Para 5 of its order by holding as under: " At the time of hearing on 16.6.2011, none appeared on behalf of the assessee. We heard the Departmental Representative. In this case, penalty is levied for disallowance of expenditure u/s 40(a) (ia) of the Income Tax Act. Non deduction of TDS by the assessee w....