Sh. Himanshu Jain, Chandigarh V. ACIT, Chandigarh

ITA 1081/CHANDI/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 6517 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 03-10-2019
• Assessment Year: 2007-2008
• Appeal Filed On: 21-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARVIND SUDARSHAN SR DR
• Assessee Lawyers: VEJ JAIN
• Keywords: Question of law; Set aside
• Section: 271(1)(c); 143(3); 132

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BE NCH A, CHANDIGARH .., !' '# $, % &' BEFORE: SHRI. N.K.SAINI, VP & SHRI , SANJAY GARG, J M ./ ITA NOS. 1081 & 1082/CHD/2018 / ASSESSMENT YEAR : 2007-08 & 2008-09 SHRI HIMANSHU JAIN # 1138, SECTOR 21-B CHANDIGARH ACIT CENTRAL CIRCLE-II CHANDIGARH ./ PAN NO: ADUPJ7267R / APPELLANT / RESPONDENT ! ' / ASSESSEE BY : SHRI VEJ JAIN, ADVOCATE # ! ' / REVENUE BY : SHRI ARVIND SUDARSHAN, SR. DR $ % ! &/ DATE OF HEARING : 03/10/2019 '()* ! &/ DATE OF PRONOUNCEMENT : 21/10/2019 &(/ ORDER PER N.K. SAINI, VICE PRESIDENT THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDER EACH DATED 30/06/2018 FOR THE A.Y. 2007-08 AND 2008-09 PASSED BY THE LD. CIT(A)- 3,GURGAON. 2. COMMON ISSUE INVOLVED IN BOTH THESE APPEALS RELATES TO THE CONFIRMATION OF PENALTY LEVIED BY THE A.O. UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS ACT), BOTH THESE APPEALS WERE HEARD TOGETHER, SO, THESE ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2 3. AT THE FIRST INSTANCE, WE WILL DEAL WITH THE APPEAL IN ITA NO. 1081/CHD/2018 FOR THE ASSESSMENT YEAR 2007-08. 4. FACTS OF THE CASE IN BRIEF ARE THAT A SEARCH AND SEIZ URE OPERATION UNDER SECTION 132 OF THE ACT WAS CARRIED OUT AT THE RESIDENTIAL AND B USINESS PREMISES OF M/S IND SWIFT GROUP OF CASES ON 26/05/2011. DURING THE COURSE OF S EARCH CERTAIN INCRIMINATING MATERIALS WERE FOUND WHICH REVEALED THAT TRANSACTIONS OF RS. 25,90,000/- WERE RECORDED FOR THE FINANCIAL YEAR 2006-07 RELEVANT TO THE ASSESSM ENT YEAR UNDER CONSIDERATION. THE ASSESSMENT IN THIS CASE WAS COMPLETED UNDER SECTION 153 A(1)(B) R.W.S 143(3) OF THE ACT, ON 31/01/2014 AT AN INCOME OF RS. 77,12,420/- BY MAKI NG THE ADDITION OF RS. 25,90,000/-. THE A.O. INITIATED THE PENALTY PROCEEDINGS UNDER SECTION 2 71(1)(C) OF THE ACT AND SINCE NO REPLY WAS FURNISHED FROM THE ASSESSEE SIDE. THE A.O . PASSED THE EX-PARTE ORDER AND CONSIDERED THE AMOUNT OF RS. 25,90,000/-AS UNDISCLOSED INCOME FOR WHICH THE ASSESSEE CONCEALED THE PARTICULARS OF HIS INCOME. 5. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER T O THE LD. CIT(A) WHO ALSO PASSED THE EX-PARTE ORDER AND SUSTAINED THE PENALTY LEV IED BY THE A.O. 6. NOW THE ASSESSEE IS IN APPEAL. 7. LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISS UE RELATING TO THE QUANTUM ADDITION IS PENDING BEFORE THE HON'BLE JURISDICTIONAL H IGH COURT. IT WAS POINTED OUT THAT THE INVESTMENT IN PROPERTY WAS IN JOINT NAME AND THE ASSESS EE PURCHASED THE SAME JOINTLY WITH SHRI C.D. SINGLA S/O SHRI AMI CHAND R/O H.NO . 357, SECTOR 6, PANCHKULA IN EQUAL PARTNERSHIP BUT THE A.O. CONSIDERED THE TRANSACT ION IN THE HANDS OF THE ASSESSEE ONLY. IT WAS SUBMITTED THAT THE ASSESSEE INFORMED THE A.O. ABOUT THE RELEVANT FACTS AND 3 ALSO STATED IN RESPONSE TO THE SHOW CAUSE NOTICE DT. 24/ 01/2014 THAT THE SAID LAND WAS IN DISPUTE AND COURT CASES WERE PENDING AT JMIC RAJPU RA AGAINST SELLERS FOR NON EXECUTION OF SALE AGREEMENT. A REFERENCE WAS MADE TO PAGE NO. 9 & 10 OF THE ASSESSEES COMPILATION. HE ALSO FURNISHED THE COPY O F THE ORDER OF HON'BLE JURISDICTIONAL HIGH COURT DT. 11/02/2019 IN ITA NO. 55 2018 (O&M) WHEREIN IT HAS BEEN OBSERVED THAT THE SAID O&M WAS ADMITTED FOR DETERMINATION OF SUBSTANT IAL QUESTION OF LAW. IT WAS ACCORDINGLY SUBMITTED THAT WHEN THE SUBSTANTIAL QUESTION O F LAW HAS BEEN ADMITTED, THE ADDITION ITSELF BECOMES DEBATABLE AND THE PENALTY UND ER SECTION 271(1)(C) OF THE ACT IS NOT LEVIABLE. RELIANCE WAS PLACED ON THE JUDG MENT OF HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. DR. HARSHA N. BILIANGADY [ 2015) REPORTED IN 379 ITR 529 (KARNATAKA). 8. IN HIS RIVAL SUBMISSIONS THE LD. SR. DR STRONGLY S UPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 9. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIE S AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. ON A SIMILAR ISSUE T HE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. DR. HARSHA N. BILIANGADY (SUPRA) HE LD AS UNDER: WHERE PENALTY WAS IMPOSED IN RESPECT OF ANY ADDIT ION WHERE THE HIGH COURT HAS ADMITTED THE APPEAL ON SUBSTANTIAL QUESTION OF LAW, THEN THE SUSTAINABILITY OF THE ADDITION ITSELF BECOMES DEBATABLE, AND IN SUCH CIRCUMSTANCES PENALTY COULD NOT BE LEVIED UNDER SECTION 271(1)(C). IN THE PRESENT CASE THE CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEE THAT THE SUBSTANTIAL QUESTION OF LAW RELATING TO THE QUANTUM ADDI TION IS PENDING BEFORE THE HON'BLE JURISDICTIONAL HIGH COURT THEREFORE WE DEEM IT APPROPRIATE TO SET ASIDE THIS ISSUE 4 BACK TO THE FILE OF THE A.O. TO BE DECIDED THE SAME A FTER THE OUTCOME OF THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT ON QUANTUM ADDIT ION. 10. THE FACTS RELATING TO THE ISSUE RAISED IN ITA NO. 1082/CHD/2018 ARE IDENTICAL TO THE FACTS INVOLVED IN ITA NO. 1081/CHD/2018, THEREFORE OUR FINDINGS GIVEN IN THE FORMER PART OF THIS ORDER SHALL APPLY MUTATIS MUTANDIS IN THIS CASE ALSO. 11. IN THE RESULT, BOTH THE ABOVE APPEALS OF THE ASSESS EE ARE ALLOWED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE OPEN COURT ON 21/10/2019 ) SD/- SD/- '# $ .., (SANJAY GARG ) ( N.K. SAI NI) % &'/ JUDICIAL MEMBER / VICE PRESIDENT AG DATE: 21 /10/2019 (+ ! ,- .- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. $ / / CIT 4. $ / ()/ THE CIT(A) 5. -23 4, & 4, 67839/ DR, ITAT, CHANDIGARH 6. 38 :%/ GUARD FILE