2013 (2) TMI 753 - AT - Income Tax

Summary

Issues involved:
The judgment involves challenges to the cancellation of penalty u/s 271(1)(c) of the Income-tax Act, 1961 for AY 2001-02, 2002-03, and 2003-04. Additionally, it addresses the quashing of reassessment proceedings u/s 147/148 of the IT Act for AY 2003-04 and dismissal of appeals by the assessee for AY 2001-02 & 2002-03.

Penalty u/s 271(1)(c) - AY 2001-02, 2002-03, and 2003-04:
The Revenue challenged the cancellation of penalty imposed u/s 271(1)(c) for disallowance of royalty payments due to non-deduction of tax at source u/s 40(a)(i) in AY 2001-02 and 2002-03, and disallowance of 75% royalty in AY 2003-04. The CIT(A) canceled the penalty citing the issue as debatable, not amounting to concealment of income or furnishing inaccurate particulars. The ITAT upheld the CIT(A)'s order, citing the assessee's claim not constituting inaccurate particulars as per the decision in CIT Vs. Reliance Petroproducts Pvt.Ltd.

Reassessment Proceedings u/s 147/148 - AY 2003-04:
The Revenue appealed the quashing of reassessment proceedings u/s 147/148 for AY 2003-04. The ITAT held that as the original assessment was completed u/s 143(3) and no failure to disclose material facts existed, the reassessment was time-barred. Citing relevant case laws, the ITAT upheld the CIT(A)'s decision, dismissing the Revenue's appeal.

Assessee's Appeals - AY 2001-02 & 2002-03:
The assessee's appeals for AY 2001-02 & 2002-03 were dismissed as the assessee failed to appear, and the notice sent was returned unserved. Following ITAT Rules and legal precedents, the appeals were dismissed, allowing the assessee to move for a recall upon providing reasons for non-furnishing of address change.

In conclusion, the ITAT upheld the CIT(A)'s decisions in canceling penalties and quashing reassessment proceedings, while dismissing the appeals by both the Revenue and the assessee for various assessment years.