Sajjankumar Suganchand Agarwal,Huf, ... vs Assessee

आयकर अपीलीय अिधकरण, अिधकरण, अहमदाबाद यायपीठ ''B'', अहमदाबाद । IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, "B" BENCH सव ौी ौी जी. जी.सी. सी.गु ा, माननीय उपा!य", उपा!य", एवं अिनल चतुवद ' (, (, लेखा सदःय के सम" । BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND ANIL CHATURVEDI, ACCOUNTANT MEMBER)

ITA No.1974/Ahd/2011 [Asstt.Year : 2004-2005]

Sajjankumar Saganchand बनाम/Vs. DCIT, Cir.2 Agrawal - HUF Surat. Prop. Adarsh Synthetics 3008, Momia Complex Kadodara Road, Surat.

PAN : AAEHS 1773 G

(अपीलाथ. / Appellant) (ू0यथ. / Respondent)

िनधा 1रती क2 ओर से/ : Assessee by Shri R.B. Shah राजःव क2 ओर से/ : Revenue by Shri Roopchand, Sr.DR सुनवाई क2 तार(ख/ : Date of Hearing 7th January, 2015 घोषणा क2 तार(ख/ : Date of Pronouncement 02-02-2015

आदे श / O R D E R

PER G.C. GUPTA, VICE-PRESIDENT: This appeal by the assessee for the Asstt.Year 2004-2005 is directed against the order of the CIT(A).

2. Only effective ground of the appeal of the assessee is ground no.1, which is reproduced as under:

"1. On the facts and in circumstances of the case as well as law on the subject, the ld.CIT(A) has erred in confirming the action of the ITA No.1974/Ahd/2011

AO in imposing penalty u/s.271(1)(c) of the Act on addition of Rs.6,02,721/- made on account of disallowance of commission."

3. The learned counsel for the assessee submitted that penalty under section 271(1)(c) of the Act was levied on the assessee on disallowance of sales commission paid by the assessee. He submitted that all the material facts were disclosed by the assessee before the AO at the time of assessment itself. He submitted that the assessee has filed confirmation letter and contra account copies of the payees and also the copies of bills were filed. He submitted that the assessee has requested for issue of summons to the payees of the commission, and the AO did not accept the request of the assessee. The learned DR has relied on the orders of the AO and the CIT(A).

4. We have considered rival submissions and perused the orders of the AO and the CIT(A). We find that the penalty levied on disallowance of commission on sales was confirmed by the CIT(A). We find that all the material particulars with regard to the claim of commission paid by the assessee were disclosed by the assessee at the time of its assessment. The assessee has claimed that it has filed confirmation letter and contra account copies of payees and this fact could not be controverted on behalf of the Revenue. The assessee has also filed copies of relevant bills. The assessee has requested for issue of summons to the payee parties of commission and same was not accepted by the AO. We find that facts of the case may justify the disallowance of commission income, which was confirmed by the Tribunal, but do not justify the levy of penalty for concealment of income or filing of inaccurate particulars of income under section 271(1)(c) of the Act. It is a case of disallowance of certain expenses claimed by the assessee and all the relevant facts were placed before the AO by the assessee at the time of assessment itself. The -2- ITA No.1974/Ahd/2011

assessee's conduct by filing confirmation and contra account copies of payees and copies of the relevant bills, seems to be bona fide and do not justify levy of penalty under section 271(1)(c) of the Act. In these facts, we cancel the penalty levied under section 271(1)(c) of the Act, and the ground of the appeal of the assessee is allowed.

5. In the result, the appeal of the assessee is allowed.

Order pronounced in Open Court on the date mentioned hereinabove.

Sd/- Sd/- अिनल चतुव'द( / ANIL CHATURVEDI) (अिनल (जी. जी.सी. सी.गु ा/G.C. GUPTA) लेखा सदःय /ACCOUNTANT MEMBER उपा!य" /VICE-PRESIDENT

Copy of the order forwarded to: 1) : Appellant 2) : Respondent 3) : CIT(A) 4) : CIT concerned 5) : DR, ITAT. BY ORDER

DR/AR, ITAT, AHMEDABAD

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