Smt. Sujatha Kesavan, CHENNAI V. ITO, CHENNAI

ITA 1155/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4465 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 23-09-2013
• Assessment Year: 1997-1998
• Appeal Filed On: 24-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: T N BETGERI IRS
• Assessee Lawyers: R KUMAR
• Keywords: Speculation loss; Reassessment proceedings

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ITA NO.1155(MDS)/2012 ASSESSMENT YEAR : 1997-98 SMT. SUJATHA KESAVAN, C/O SRI T.N.SEETHARAMAN, ADVOCATE, NO.384 (OLD NO.196), LLOYDS ROAD, CHENNAI 600 086. PAN AAHPK7068H. VS. THE INCOME-TAX OFFICER, WARD II(4), CHENNAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI R.KUMA R, ADVOCATE RESPONDENT BY : SHRI T.N.BETGER I, IRS, JCIT DATE OF HEARING : 23 RD SEPTEMBER, 2013 DATE OF PRONOUNCEMENT : 23 RD SEPTEMBER, 2013 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT THIS IS A PENALTY APPEAL FILED BY THE ASSESSEE. THE PENALTY IS LEVIED UNDER SECTION 271(1)(C) OF THE IN COME-TAX ACT, 1961. THE RELEVANT ASSESSMENT YEAR IS 1997-98. TH E APPEAL IS - - ITA 1155 OF 2012 2 DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF I NCOME- TAX(APPEALS)-VI AT CHENNAI, DATED 29-2-2012. 2. THE GROUND RAISED BY THE ASSESSEE IN THE PRESEN T APPEAL IS THAT THE COMMISSIONER OF INCOME-TAX(APPEA LS) HAS ERRED IN CONFIRMING THE PENALTY OF ` 4,28,840/-. IT IS THE CASE OF THE ASSESSEE THAT THE ASSESSING OFFICER HAS NOT INI TIATED THE PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) IN THE COURSE OF REASSESSMENT PROCEEDINGS AND AS SUCH IMPOSITION OF PENALTY IS AGAINST LAW. THE ASSESSEE HAS FURTHER STATED THAT THE INCOME- TAX PROCEEDINGS WERE FULLY ATTENDED TO BY THE ASSES SEE THROUGH HER CHARTERED ACCOUNTANT. THE CHARTERED ACCOUNTANT PASSED AWAY AND IN SUCH CIRCUMSTANCES MANY OF THE DETAILS ARE NOT AT PRESENT AVAILABLE WITH THE ASSESSEE. 3. WE HEARD BOTH SIDES IN DETAIL. 4. THE HONBLE ANDHRA PRADESH HIGH COURT IN THE CA SE OF CHENNAKESAVA PHARMACEUTICALS VS. CIT, 349 ITR 19 6, HAS HELD THAT THE ASSESSING OFFICER SHOULD RECORD IN TH E ASSESSMENT ORDER HIS SATISFACTION THAT THE ASSESSEE HAS EITHER CONCEALED THE INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOM E AND IF NO - - ITA 1155 OF 2012 3 SUCH SATISFACTION IS RECORDED IN THE ASSESSMENT ORD ER, NO PENALTY IS LEVIABLE UNDER SECTION 271(1)(C) OF THE ACT. 5. IN THE PRESENT CASE, ON GOING THROUGH THE ASSESSMENT ORDER, WE FIND THAT THERE IS NO SUCH DIS CUSSION OF SATISFACTION MADE BY THE ASSESSING OFFICER IN THE A SSESSMENT ORDER. THEREFORE, THE ABOVE JUDGMENT OF THE HONBL E ANDHRA PRADESH HIGH COURT APPLIES TO THE CASE AND ON THIS LEGAL GROUND ITSELF THE PENALTY LEVIED IN THE PRESENT CASE IS TO BE DELETED. 6. SECONDLY, THE ADDITIONAL INCOME HAPPENED TO BE THE RESULT OF A DISPUTE WHETHER THE LOSS RETURNED BY TH E ASSESSEE WAS BUSINESS LOSS OR SPECULATION LOSS. THIS IS A D ISPUTABLE ISSUE, EVEN THOUGH THE ISSUE WILL BE DECIDED ON THE FACTS OF THE CASE. BUT FOR THIS DISPUTE, THE ASSESSEE HAS NOT C ONCEALED ANY PARTICULARS OF INCOME OR SHE HAS FURNISHED ANY INAC CURATE PARTICULARS. THEREFORE, THERE CANNOT BE A CASE OF CONCEALMENT. AT THE MAXIMUM, THE CASE COULD BE THAT THE CLAIM OF THE ASSESSEE THAT THE LOSS WAS BUSINESS LOSS COULD NOT BE ACCEPTED. THAT CLAIM OF DISALLOWANCE AS SUCH IS NOT A GROUND TO LEVY PENALTY UNDER SECTION 271(1)(C). - - ITA 1155 OF 2012 4 7. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE PENALTY LEVIED IN THE PRESENT CASE IS DELETED. 8. IN RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON MONDAY, THE 23 RD OF SEPTEMBER, 2013 AT CHENNAI. SD/- SD/- (VIKAS AWASTHY) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED, THE 23 RD SEPTEMBER, 2013. V.A.P. COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GF.