9911796707
TMI Blog2013 (6) TMI 277X X X X Extracts X X X X X X X X Extracts X X X X ..... acts, arising out of the above orders, are as under:- The assessee / respondent is a company engaged in the manufacture of pistol, pins and heat treatment equipments. The relevant assessment is 1997-1998 and the corresponding accounting year ended on 31.03.1997. The assessee filed the return of income for the assessment year on 01.12.1997. The said return was processed under Section 143 (1) (a) of the Act. Later notice under Section 143 (2) of the Act was issued. The Assessing Officer completed the assessment under Section 143 (3) of the Act and determined the total income at Rs.99,240/-. While completing the assessment, the Assessing Officer made an addition of Rs.23,75,000/-, under the head 'Commission Income'. The Assessing Officer also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ross commission receipt is valid?" T.C.No.1456 of 2007:- "Whether on the facts and circumstances of the case the Income Tax Appellate Tribunal was right in law in deleting the penalty of Rs.10,21,250/- levied under Section 271 (1) (c) of the Act is valid?" 3. Learned counsel for the Revenue / appellant vehemently contended that the orders passed by the Tribunal are wrong, illegal, without basis and arbitrary. It was contended by the learned counsel for the Revenue that the Tribunal is wrong in giving direction to the Assessing Officer to give deduction in respect of the brokerage on gross commission of Rs.23,80,000/-. The Tribunal failed to appreciate that the assessee company failed to produce any evidence in support of its claim that i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceived commission at 15% on the value of the transaction. The total commission received on bogus and lease back commission is at Rs.23,80,000/-. The Managing Director of the Assessee Company has not disputed the receipt of the commission, but he contended that on earning of the said commission, he paid brokerage at 8-9%, therefore, he claims deduction. The Assessing Officer rejected the claim and estimated the same on the ground that there is no supporting documents available on record and allowed only Rs.5,000/- as estimated expenditure. The Tribunal, after considering the facts and circumstances of the case, has held that the assessee would have certainly incurred expenditure by way of commission at 8-9%. Therefore, the Tribunal directed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer determined the total income at Rs.99,240/- by making certain addition. The main addition made is on commission on bogus sales and lease back transaction of Rs.23,75,000/-. In the course of the assessment proceedings, the Assessing Officer initiated the penalty under Section 271 (1) (c) of the Act and levied a minimum penalty of Rs.10,21,250/-. On appeal, the Commissioner of Income-Tax confirmed the order of the penalty. The assessee filed the appeal against the CIT (Appeals) before the Tribunal. The Tribunal allowed the appeal, by following this Court's judgment reported in (2006) 282 ITR 607 (Mad) (referred to supra) and the Apex Court's judgment reported in 249 ITR 670 (SC) (referred to supra), and held that the penalty can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellate Tribunal merely deleted the penalty as there is no positive income. The Tribunal had not considered the case on merits whether there is violation of provision of Section 271(1)(c) of the Act. Since this Court is of the considered view that penalty can be levied even when the assessee's income of return is shown as loss, we set aside the order of the Income Tax Appellate Tribunal with a direction to the Tribunal to reconsider the matter after giving opportunity to the assesee to enable them to file explanation, whether there is violation of provision of Section 271(1)(c) of the Act and pass orders in accordance with law.
9. In the result, T.C.(A).No.1456 of 2007 is disposed of with the above direction. No costs. X X X X Extracts X X X X X X X X Extracts X X X X
|
