ITO, Wd 1(1), Nashik, Nashik V. M/s. Shubhkamana Builders Pvt.Ltd., Nashik

ITA 1232/PUN/2008

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56433 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 28-06-2011
• Assessment Year: 2001-2002
• Appeal Filed On: 17-09-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K K OZHA
• Assessee Lawyers: SUNIL PATHAK
• Keywords: Difference of opinion

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER AND SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER I.T.A. NO. 1232/PN/2008 : A.Y. 2001-02 I.T.O. WARD 1(1) NASIK APPELLANT VS. M/S. SHUBHAKAMANA BUILDERS PVT. LTD., 7 THAKKARS, NEAR NEHRU GARDEN, NASIK PAN AAACL 2769 E RESPONDENT APPELLANT BY: SHRI K.K. OZHA RESPONDENT BY : SHRI SUNIL PATHAK DATE OF HEARING: 30-8-2011 DATE OF PRONOUNCEMENT: 30-8-2011 ORDER PER SHAILENDRA KUMAR YADAV, JM THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST T HE DELETION OF PENALTY U/S 271(1)(C) OF THE ACT. 2. THE ASSESSEE COMPANY HAS SHOWN TWO PLOTS AS FIXE D ASSETS AND NOT AS STOCK IN TRADE OF HIS BUSINESS AS THE ASSESSEE WANTED TO CONSTRUCT A HOSTEL ON THESE PLOT S FOR WORKING MEN, WORKING WOMEN AND STUDENTS. THE ASSES SEE THEREFORE CLAIMED THAT SALE OF SAID TWO PLOTS RESUL TED IN LONG TERM CAPITAL GAIN. THOUGH, THE ASSESSEES CON TENTION ABOUT SHOWING THE SAID PLOTS IN THE BALANCE SHEET F ILED FOR 10 YEARS UNDER THE HEAD FIXED ASSET AND NOT AS STOC K IN TRADE WAS CORRECT, THE ASSESSEE COULD NOT SUBSTANTI ATE THE SECOND PART OF HIS CONTENTION THAT IT WANTED TO CON STRUCT HOSTEL ON SAID PLOT WITH CORROBORATIVE EVIDENCE. T HE 2 ITA NO. 1232/PN/2008 SHUBHAKAMANA BUILDERS A.Y. 2001-02 EXPLANATION BY THE ASSESSEE WAS POSSIBLE/PLAUSIBLE AND HENCE BONAFIDE AND THEREFORE, COVERED BY EXPLANATIO N 1 TO SECTON271(1)(C). MOREOVER, THE ISSUE WITH REGARDS T O QUANTUM WAS FOUND DEBATABLE BY THE CIT(A). IT IS UNDISPUTED THAT THE ASSESSEE HAS MADE FULL DISCLOSU RE OF ALL THE RELEVANT FACTS IN THE RETURN OF INCOME FILE D. MERE REJECTION OF A LEGAL CLAIM OF THE ASSESSEE FOR TAXA BILITY OF INCOME UNDER A PARTICULAR HEAD OF INCOME IS NOT BY ITSELF SUFFICIENT TO WARRANT IMPOSITION OF PENALTY. CASES INVOLVING GENUINE DIFFERENCE OF OPINION ON MATTERS OF LAW BET WEEN THE ASSESSEE AND THE ASSESSING OFFICER ARE CLEARLY OUTS IDE THE SCOPE OF EXPLANATION 1 TO SECTION 271(1) PROVIDED T HE ASSESSEE HAS MADE FULL DISCLOSURE OF ALL THE RELEVA NT FACTS AND ALSO ACTED BONAFIDE. IN VIEW OF ABOVE DISCUSSI ON, CIT(A) WAS JUSTIFIED IN DELETING THE PENALTY LEVIED BY THE ASSESSING OFFICER BY INVOKING PROVISIONS OF SECTION 271(1)(C) OF THE ACT. THE SAME IS UPHELD. 3. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. DECISION IS ALREADY PRONOUNCED IN THE OPEN COURT ON THE DATE OF HEARING VIZ. 30-8-2011. S D/ - (D. KARUNAKARA RAO) ACCOUNTANT MEMBER S D/ - SHAILENDRA KUMAR YADAV JUDICIAL MEMBER PUNE DATED THE 30 TH AUGUST 2011 ANKAM COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A)- I NASIK 4. THE CIT I NASIK 5. THE D.R, ITAT PUNE BENCH, PUNE 6. GUARD FILE BY ORDER 3 ITA NO. 1232/PN/2008 SHUBHAKAMANA BUILDERS A.Y. 2001-02 ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES, PUNE.