H.N HARDASANI & M.N. HARDASANI L/H OF LATE SMT. KHUSHALIBAI N. N. HARDASANI, MUMBAI V. ITO 19(3)(2), MUMBAI

ITA 1218/MUM/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83973 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-10-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 01-09-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 12-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N PADMANABAN
• Keywords: Cost of acquisition

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H , MUMBAI BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTAT MEMBER I.T.A.NO. 1218/M/2013 (AY 2007 - 2008) H.N. HARDASANI & M.N. HARDASANI, L/HS OF LATE SMT. KHUSHALIBAI N. HARDASANI, FLAT NO.502, A WING, KOHINOOR II, INDRA DARSHAN CROSS ROAD, OSHIWARA, ANDHERI (W), MUMBAI 400 053. PAN: ABMPH 7760 D VS. ITO - 19(3)(2), PIRAMAL CHAMBERS, PAREL, MUMBAI - 400 012. (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI N. PADMANABAN , DR DATE OF HEARING: 16.10.2014 DATE OF ORDER: 29 .10.2014 O R D E R PER D. KARUNAKARA RAO, AM : THIS APPEAL FILED BY THE ASSESSEE ON 12.2.2013 IS AGAINST THE ORDER OF THE CIT (A) - 18, MUMBAI DATED 11.12.2012 U/S 271(1)(C) OF THE ACT FOR THE ASSESSMENT YEAR 2007 - 2008. 2. THE ONLY ISSUE RAISED IN THIS APPEAL RELATES TO THE DECISION OF THE CIT (A) IN CONFIRMING THE PENALTY OF RS. 3,55,077/ - . IT IS ARGUED IN TH E GROUNDS THAT THE SAID PENALTY IS NOT SUSTAINABLE IN LAW IN VIEW OF THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS (322 ITR 156) (SC) AND MANY OTHER DECISIONS. BRIEFLY STATED RELEVANT FACTS OF THE CASE ARE THAT T HE ASSESSEE RETURNED THE CAPITAL GAINS , IN THE COMPUTATION OF GAINS, THE ASSESSEE ADOPTED THE MARKET VALUE OF THE TRANSFERRED ASSET AT RS. 4433/ - PER SQUARE FEET AS ON 1.4.1981. AFTER CONSIDERING THE REPLY FROM THE ASSESSEE IN THIS REGARD, AO REJECTED THE SAME AS IT WAS BASED ON THE VALUERS REPORT (M/S. CHHATBAR & CO ) AND THRUST ON THE ASSESSEE, THE COST OF ACQUISITION @ RS.1600/ - PER SQUARE FEET AS ON 1.4.1981. FOR THIS, AO RELIED ON THE DIRECTORY & REFERENCE BOOK OF INDIAN VALUERS. THIS DIFFERENCE 2 HAS RESULTED IN THE ADDITION TO THE CAPITAL GAINS WHICH IS THE SUBJECT MATTER OF PENALTY U/S 271(1)(C) OF THE ACT. 2. DURING THE PROCEEDINGS BEFORE US, NONE APPEARED ON BEHALF OF THE ASSESSEE TO REPRESENT ITS CASE. 3. ON THE OTHER HAND, LD DR RELIED ON THE OR DERS OF THE REVENUE AUTHORITIES. 4. WE HAVE HEARD THE LD DR AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AS WELL AS THE RELEVANT MATERIAL PLACED BEFORE US. ON PERUSAL OF THE RELEVANT PAPERS FILED BEFORE US , THE CLAIM OF THE ASSESSEE THAT THE ASSESSING OFFICERS VALUE OF RS. 1600/ - PER SQUARE FEET HAS NO BASIS APPEARS FAIR . THE FIGURE OF RS. 1200/ - BORNE OUT OF THE SAID DIRECTORY AND REFERENCE BOOK, WHICH WAS ALSO NOT CONSIDERED BY THE AO. THUS, FIGURE OF RS. 1600/ - IS WITHOUT ANY BASIS AND P ENALTY SHOULD NOT BE ATTRACTED ON SUCH AD - HOC AND ESTIMATED ADDITIONS. W E FIND MERIT IN THE CLAIM OF THE ASSESSEE. AS SUCH, IT IS A SETTLED LEGAL PROPOSITION THAT THE PENALTY CANNOT BE LEVIED ON THE ISSUE, WHICH IS DEBATABLE IN NATURE. CONSIDERING THE SA ME, WE DELETE THE PENALTY CONFIRMED BY THE CIT (A). ACCORDINGLY, GROUNDS RAISED BY THE ASESSEE ARE ALLOWED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOU NCED IN THE OPEN COURT ON 29 TH OCTOBER, 2014. SD/ - SD/ - (VIJAY PAL RAO ) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 2 9 .10.2014. AT :MUMBAI OKK COPY TO : 1. APPELLANT 2. RESPONDENT 3. THE CIT (A), CONCERNED. 4. THE CIT CONCERNED. 5. THE DR H , BENCH, ITAT, MUMBAI. 6. GUARD FILE. // TRUE COPY// BY ORDER ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI