The Dy. CIT, Central Circle-1, Baroda V. Siddharth Incorporation, Baroda

ITA 1103/AHD/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8578 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 4 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 29-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD SMC BENC H (BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 1103/AHD/2016 (ASSESSMENT YEAR: 2012-13) DEPUTY COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-1, BARODA V/S SIDDHARTH INCORPORATION 3, DARSHAN PARK SOCIETY, VIP ROAD, KARELIBAUG, BARODA- 390018 (APPELLANT) (RESPONDENT) PAN: ABOFS5986N APPELLANT BY : SHRI JAMES KURIAN, SR. D. R. RESPONDENT BY : NONE ( )/ ORDER DATE OF HEARING : 31 -08-201 7 DATE OF PRONOUNCEMENT : -09-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-12, AHMEDABAD DATED 02.12.2015 PERTAINING TO A.Y. 2012- 13. ITA NO. 1103 /AHD/2016 . A.Y. 2011-1 2 2 2. THE ONLY GRIEVANCE OF THE REVENUE IS THAT THE LD. C IT(A) ERRED IN DELETING THE PENALTY OF RS. 10,00,000/- LEVIED U/S. 271AAA OF TH E ACT. 3. THE CBDT HAS DIRECTED THE REVENUE NOT TO PREFER APP EAL BEFORE THE TRIBUNAL VIDE A CIRCULAR NO. 21 OF 2015 DATED 10.12.2015 WHE RE THE TAX EFFECT IS LESS THAN RS. 10 LACS. THIS APPEAL BY THE REVENUE IS DIS MISSED IN THE LIGHT OF THE AFOREMENTIONED CIRCULAR OF THE CBDT. 4. FOR THE SAKE OF COMPLETENESS OF THE ADJUDICATION, W E FIND THAT THE ASSESSEE DESERVES IMMUNITY FROM THE LEVY OF PENALTY U/S. 271 AAA OF THE ACT BY VIRTUE OF THE IMMUNITY CONDITION AS CONTAINED IN CLAUSE (I I) OF THE PROVISION WHICH HAS BEEN UPHELD BY VARIOUS SUPERIOR JUDICIAL AUTHORITIE S. TO NAME ONE OF SUCH JUDICIAL DECISION, WE DRAW SUPPORT FROM THE DECISIO N OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF MAHENDRA C. SHAH 172 TAXM ANN.COM 58 AND THE RELEVANT FINDINGS READ AS UNDER:- ......THE REASON WAS NOT FAR TO SEEK. IN THE FIRST INSTANCE, THE STATEMENT WAS BEING RECORDED IN THE QUESTION AND ANSWER FORM AND THERE WOULD BE NO OCCASION FOR AN ASSESSEE TO STATE AND MAKE AVERMENTS IN THE EXACT FORMAT STIPULATED BY THE PROVISIONS, CONSIDERING THE SETTING IN WHICH SU CH STATEMENT WAS BEING RECORDED. SECONDLY, CONSIDERING THE SOCIAL ENVIRONM ENT, IT IS NOT POSSIBLE TO EXPECT FROM AN ASSESSEE, WHETHER LITERATE OR ILLITE RATE, TO BE SPECIFIC AND TO THE POINT REGARDING THE CONDITIONS STIPULATED BY THE EX CEPTION NO. 2 WHILE MAKING STATEMENT UNDER SECTION 132(4). THE VIEW TAKEN BY T HE TRIBUNAL TO THE EFFECT THAT EVEN IF THE STATEMENT DOES NOT SPECIFY THE MANNER I N WHICH THE INCOME IS DERIVED, IF THE INCOME IS DECLARED AND TAX THEREON IS PAID, THERE WOULD BE SUBSTANTIAL COMPLIANCE NOT WARRANTING ANY FURTHER DENIAL OF THE BENEFIT UNDER THE EXCEPTION NO. 2 IN THE EXPLANATION 5 WAS COMMENDABLE. [PARA 1 5] ITA NO. 1103 /AHD/2016 . A.Y. 2011-1 2 3 HENCE, THE TRIBUNAL WAS JUSTIFIED IN COINING TO THE CONCLUSION THAT INSOFAR AS THE VALUE OF DIAMONDS WAS CONCERNED, THE ASSESSEE HAVIN G MADE A DECLARATION UNDER SECTION 132(4) 'AND HAVING PAID TAXES THEREON, HAD FULFILLED ALL THE CONDITIONS FOR AVAILING OF THE BENEFIT OF IMMUNITY FROM LEVY OF PE NALTY AS PROVIDED UNDER THE EXPLANATION 5 TO SECTION 271(1)(C). 5. THIS BINDING DECISION OF THE HONBLE JURISDICTIONAL HIGH COURT WAS DELETED BY THE CO-ORDINATE BENCH IN THE CASE OF SULOCHANADEVI A. AGARWAL IN ITA NO. 1052/AHD/2012. THE RELEVANT FINDING READS AS UNDER: - '......WE HAVE HEARD THE SUBMISSIONS OF THE REVENUE AND CAREFULLY PERUSED THE MATERIALS ON RECORD. THE LEARNED CIT(A) HAD DELETED THE PENALTY DUE TO THE FOLLOWING REASONS: 1) THE ASSESSEE HAD VOLUNTARILY DISCLOSED THE SUM OF R S.50,00,000/- DURING THE SEARCH PROCEEDINGS WITH REQUEST THAT NO PENALTY SHO ULD BE LEVIED IN RESPECT OF SUCH DISCLOSURE. 2) (2) DURING THE POST SEARCH PROCEEDINGS NO SPECIFIC QUESTION AS REGARDS MANNER OF EARNING OF UNDISCLOSED INCOME OR SUBSTANTIATION THE REOF WAS PUT FORTH BY THE REVENUE 3) THE ASSESSEE HAD ALSO PAID DUE TAX FOR THE UNDISCLO SED INCOME OF RS.50,00,000/- DECLARED VOLUNTARILY. 4) IN THE DECISION RENDERED BY THE JURISDICTIONAL HIGH COURT OF GUJARAT IN THE CASE OF CIT VS MAHENDRA C. SHAH (2008) 299 ITR 305 (GUJ) IT WAS HELD THAT WHEN UNDISCLOSED INCOME ADMITTED BY THE ASSESSEE HAS BEE N OFFERED FOR TAX IN THE RETURN OF INCOME AND THE TAX THEREOF DULY PAID, PEN ALTY CANNOT BE LEVIED, SPECIFICALLY, IN THE ABSENCE OF ANY QUESTION IN THI S RESPECT BY THE AO. AT THIS JUNCTURE, WE MUST ADMIT THAT THE REASONS PO INTED OUT BY THE LEARNED CIT(A) ARE JUSTIFIABLE FOR DELETING THE PENALTY LEVIED BY THE LEARNED AO U/S 271 AAA OF THE ITA NO. 1103 /AHD/2016 . A.Y. 2011-1 2 4 ACT. THEREFORE, WE DO NOT FIND ANY HESITATION TO CONFIRM THE ORDER OF THE LEARNED CIT(A). 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 6. RESPECTFULLY FOLLOWING THE AFOREMENTIONED JUDICIAL DECISIONS, WE DECLINE TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). ON M ERITS ALSO, APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 06 - 09- 20 17 SD/- SD/- (MAHAVIR PRASAD) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 06/09/2017 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD