SUNEIL DEV ANAND, MUMBAI V. ACIT 16(1), MUMBAI

ITA 1245/MUM/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5725 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 22-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AARJU GARODIA
• Keywords: Sale consideration of property below Jantri Value; Opportunity of being heard
• Section: 143(3); 50C; 139(5); 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH J MUMBAI BEFORE SHRI JOGINDER SINGH (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 1245/MUM/2017 ASSESSMENT YEAR: 2010 - 11 SHRI SUNEIL DEV ANAND 2, IRIS PARK, JUHU MUMBAI - 400049. VS. ASST. CIT RANGE 16(1) 4 TH FLOOR AAYAKAR BHAVAN MUMBAI - 400020. PAN NO. ADDPA8754H APPELLANT RESPONDENT ASSESSEE BY : NONE REVENUE BY : MS. AARJU GARODIA, DR DATE OF HEARING : 03/07/2018 DATE OF PRONOUNCEMENT : 11/07/2018 ORDER PER N.K. PRADHAN, AM THIS IS AN APPEAL FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YEAR IS 2010 - 11. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 4 [IN SHORT CIT(A) ], MUMBAI AND ARISES OUT OF THE PENALTY IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT 1961, (THE ACT). THOUGH THE CASE WAS FIXED FOR HEARING BEFORE THE TRIBUNAL ON 03.07.2018, NEITHER THE ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE APPEARED. HENCE, WE DECIDE THE APPEAL AFTER HEARING THE LD. DR AND EXAMINING THE RELEVANT MATE RIALS ON RECORD. SHRI SUNEIL DEV ANANAD ITA NO. 1245/MUM/2017 2 2. THE GROUND OF APPEAL READS AS UNDER: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN UPHOLDING THE PENALTY LEVIED BY THE LD. AO OF RS.1,61,90,000/ - U/S 271(1)(C) OF THE IT ACT 1961 AND THE REASON ASSIGNED FOR DOING SO ARE WRONG AND CONTRARY TO THE PROVISION OF INCOME TAX ACT AND RULES MADE THERE UNDER. 3. IN A NUTSHELL, THE FACTS OF THE CASE ARE THAT THE ASSESSEE/APPELLANT BEING A LEGAL HEIR FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR (AY) 2 010 - 11 OF THE DECEASED ASSESSEE (LATE DEV PISHORIMAL ANAND) ON 17.04.2014 DECLARING TOTAL INCOME OF RS. 4,76,13,246/ - . THE ASSESSING OFFICER (AO) COMPLETED THE ASSESSMENT U/S 143(3) R.W.S. 147 ON 25.03.2015 ASSESSING THE TOTAL INCOME AT RS.7,25,01,250/ - . TH EREAFTER, THE AO INITIATED THE PENALTY PROCEEDINGS U/S 271(1)(C) ON THE ASSESSEE FOR FURNISHING INACCURATE PARTICULARS OF INCOME. ACCORDINGLY, THE AO LEVIED A PENALTY OF RS.1,61,90,000/ - U/S 271(1)(C) ON THE ASSESSEE FOR CONCEALING HIS TAXABLE INCOME. 4. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). A PERUSAL OF THE APPELLATE ORDER DATED 13.12.2016 SHOWS THAT, THE LD. CIT(A) DECIDED THE ISSUE EX - PARTE MENTIONING THAT THE ASSESSEE FAILED TO APPEAR BEFORE HIM ON 18.10. 2016 AND 05.12.2016. DURING THE COURSE OF APPELLATE PROCEEDINGS, THE LD. CIT(A) OBSERVED THAT THOUGH THERE WAS NO PERSONAL REPRESENTATION, THE ASSESSEE THROUGH STATEMENT OF FACTS ATTACHED TO THE APPEAL MEMO PLEADED THAT MR. DEV P. ANAND EXPIRED ON 03.12.2 012 I.E. BEFORE THE DUE DATE OF FILING THE RETURN OF INCOME U/S 139(5) OF THE ACT. MR. SUNEIL ANAND WAS NOT AWARE OF THE FACT OF NON - FILING OF THE RETURN OF INCOME. SHRI SUNEIL DEV ANANAD ITA NO. 1245/MUM/2017 3 HOWEVER, ADVANCE TAX WAS PAID. ALSO IT WAS MENTIONED THAT WHILE FILING THE RETURN OF INCOME ON 17.04.2014, IN RESPONSE TO NOTICE U/S 148, ALL THE DUE TAXES WERE PAID. THEREFORE, THE LEGAL HEIR SHOULD NOT BE PENALIZED FOR GENUINE REASONS. ALSO IT WAS STATED IN THE STATEMENT OF FACTS THAT ADDITION WAS MADE BY INVOKING SECTION 50C OF THE ACT. HOW EVER, THE LD. CIT(A) WAS NOT CONVINCED WITH THE ABOVE SUBMISSION MADE IN THE STATEMENT OF FACTS AND HELD THAT : 3 2. I HAVE CIRCUMSPECTED THE ENTIRE SPECTRUM OF FACTS AND OF CIRCUMSTANCES OF THE CASE. IT IS AT THE OUTSET TO BE KEPT INTO NOTICE TH AT THIS MATTER RELATES TO F.Y. 2009 - 10 A.Y. 2010 - 11 WHICH DUE DATE FOR FILING RETURN OF INCOME WAS 30 08.2010 AND IF AS AUDIT WAS TO BE DONE BEING THE CASE OF INDIVIDUAL, RETURN WAS TO BE FILED ON OR BEFORE 31.10.2010. OBVIOUSLY, IN A.Y. WHEN RETURN OF INCO ME WAS DUE, MR. DEV P. ANAND WAS VERY MUCH ALIVE. FURTHER, IT IS TO BE NOTED THAT IN THIS YEAR THERE WAS A RECEIPT OF A N AMOUNT OF RS.12 CRORES FROM SUNNYSIDE DEVELOPERS. THE LD. A.R IN HIS LETTER DATED 04.03.2014 HAS ADMITTED THE FACT THAT PROPERTY UNDER REFERENCE WAS SOLD OUT AND SALE PROCEEDS OF RS.13,78,14,000/ - WAS RECEIVED ON 03.04.2009. THUS, THERE WAS AN ACCRUAL OF LTCG, HENCE, THE ASSESSEE WAS TO DEPOSIT FULL ADVANCE - TAX IN F . Y.2009 - 10 AND WAS TO FILE RETURN OF INCOME ON OR BEFORE DUE DATE. AS IS EVIDENT, THE ASSESSEE HAS NOT FILED ANY SUCH RETURN OF INCOME HENCE, REASON WAS RECORDED AND NOTICE U/S 148 WAS RIGHTLY ISSUED ON 31. 03. 2014. IT IS VERY APPARENT THAT TAXABLE INCOME WAS NOT SHOWN BY THE APPELLANT EVEN AFTER BECOMING LEGAL HEIR, AFTER DEMI SE OF DEV P. ANAND ON 03.12.2011. FURTHER, IT IS TO BE NOTED THAT MR. SUNEIL DEV ANAND IS THE S ON OF DISEASED PERSON HENCE, NOTICE WAS VALIDLY ISSUED IN HIS NAME AND OPPORTUNITY WAS GIVEN FOR REPRESENTATION. THE CONTENTION THAT QUANTUM OF PENALTY MAY BE RE STRICTED TO RS.64,68,793/ - IS NOT TENABLE BECAUSE ASSESSING OFFICER HAS TO WORK OUT THE ACTUAL L.T.C.G. NOT SHOWN IN INCOME. IT IS VERY EVIDENT THAT VALUE OF THE SHRI SUNEIL DEV ANANAD ITA NO. 1245/MUM/2017 4 PROPERTY AS ON 01.04.1981 WAS OF RS.20326185/ - AND AS PER THE FINDING OF THE ASSESSING OFFICER , MARKET VALUE OF THE PROPERTY WAS ON HIGHER SIDE HENCE, INCOME WAS ASSESSED AT RS.7,25,01,250/ - AND THUS, ASSESSING OFFICER HAS RIGHTLY CALCULATED THE TAXABLE CAPITAL GAIN OF RS.6 , 95 , 34 , 694/ - . THUS, FOR DIFFERENCE HE HAS LEVIED PENALTY OF RS.1,61,90,000/ - . SINCE THE ASSESSING OFFICER HAS HELD THAT 100% OF TAX SOUGHT TO BE EVADED IS TO BE TAKEN, AS AN AMOUNT FOR LEVY OF PENALTY U/S 271(1)(C) OF THE INCOME - TAX ACT, 1961 WHICH IS MINIMUM ONE, THERE IS NO OPTION BUT TO SUSTAIN THE PENALTY, CONSIDERING THE FAC TS & CIRCUMSTANCES OF THE CASE. THUS, THE LEVY OF PENALTY OF RS.1,61,90,000/ - IS SUSTAINED. 5. CONSIDERING THE FACTS OF THE CASE IN THE LIGHT OF THE DEATH OF MR. DEV PISHORIMAL ANAND , WE SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO HIM TO HEAR THE MATTER AFRESH AND PASS AN ORDER, AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. WE DIRECT THE ASSESSEE TO APPEAR BEFORE HIM ALONG WITH THE RELEVANT DOCUMENTS/EVIDENCE. 6 . IN THE RESULT, THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11/07/2018. SD/ - SD/ - ( JOGINDER SINGH ) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 11/07/2018 RAHUL SHARMA, SR. P.S. SHRI SUNEIL DEV ANANAD ITA NO. 1245/MUM/2017 5 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI