SH. VIJAY KUMAR,PROP. , MOGA V. INCOME TAX OFFICER WARD-3, MOGA

ITA 129/ASR/2019

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 4353 (ITAT-AMRITSAR)
• Duration Of Justice: 3 year(s) 7 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-09-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 10-02-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: GHANSHAM SHARMA
• Keywords: Capital Gains
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A. No. 129/Asr/2019 Assessment Year: 2010-11 Sh. Vijay Kumar, Prop. M/s Ashok Kmar Ram Sarup, Old Grain Market, Moga. [PAN: ACYPK 8265F] Vs. Income Tax Officer, Ward-3, Moga (Appellant) (Respondent) Appellant by : None Respondent by: Sh. Ghansham Sharma, Sr. DR Date of Hearing: 15.09.2022 Date of Pronouncement: 22.09.2022 ORDER Per Dr. M. L. Meena, AM: This appeal has been filed by the assessee against the order dated 27.12.2018 passed by the Ld. Commissioner of Income Tax (Appeals)-3, Ludhiana, in respect of the Assessment Year 2010-11. 2. The assessee has raised the following grounds of appeal: ITA No. 129/Asr/2019 Vijay Kumar v. ITO 2 “1. That the ld. Commissioner of Income Tax (Appeals) erred in law as well as on facts while confirming penalty of Rs.1,13,676/- u/s 271(1)(c) made by A.O. The ld. AO has failed to confront the appellant with the material/evidence in his possession on the basis of which he has imposed penalty on the income of the appellant. He has also not afforded the reasonable opportunity to the appellant to revert the same. 2. Because the ld. CIT(Appeals) has erred in overlooking and in summarily rejecting the detailed statements of facts submitted along with memorandum of appeal, various documents and evidence placed in paper book filed while accepting the lop sided and factually incorrect version of the ld. AO. 3. Kindly stay the demand. 4. That the appellant craves leave to add/alter any of the grounds of appeal on or before the date of hearing. 5. That it is prayed that the addition may kindly be deleted and appeal be accepted.” 3. None attended for the assessee. After going through the appeal record and hearing the learned additional CIT DR, it is gathered that in the quantum appeal, the issue of addition on account of capital gains has been decided against the assessee. Since, the matter pertains to as old as the assessment year 2010-11, it is decided to hear the learned DR and decided the appeal on merits. 4. Apparently, the assessee has wrongly calculated long term as well as short term capital gains as discussed by the Assessing Officer in the penalty order; that when this, discrepancy was brought to the notice of the assessee, the assessee did not file any reply whatsoever with regard to the ITA No. 129/Asr/2019 Vijay Kumar v. ITO 3 discrepancy pointed out, rather on the on the other side the assessee objected to the issue of notice under section148. Accordingly, the Assessing Officer has recalculated the long term capital gain at Rs. 5,51,827 instead of (-) Rs.57,518/- shown by the assessee in the computation of income. It is observed from the penalty order that the assessee has not cared even to file proper reply at the time of penalty proceedings even after availing opportunities. The Assessing Officer has discussed the issue pertaining undisclosed long term capital gain and the assessee’s attitude towards the proceedings at the time of assessment proceeding as well in the penalty proceedings. Accordingly, in the penalty order, the penalty has been levied on account of deliberately furnishing inaccurate particulars of income on the part of assessee. 5. In appeal, the learned CIT appeal has confirmed the penalty amounting to Rs. 1,13,676/- under section 271(1)(c) for furnishing inaccurate particulars of income by observing wide paragraph 4.2 and 4.5 as under- “4.2 I have carefully considered rival submission. I have also considered different judicial pronouncements relied upon by the appellant. After considering all the facts of the case, I am not inclined to agree with the contention of appellant. Apparently this is the case wherein the assessee has wrongly calculated long term as well as short term capital gains. The Assessing Officer has mentioned in the penalty order, that when this, discrepancy was brought to the notice of the assessee, the assessee did not file any reply whatsoever with regard to the discrepancy pointed out, rather on the on the other side the assessee objected to ITA No. 129/Asr/2019 Vijay Kumar v. ITO 4 the issue of notice under section148. Accordingly the Assessing Officer has rightly recalculated the long term capital gain at Rs. 5,51,827 instead of (-) Rs.57,518/- shown by the assessee in the computation of income. It is also observed from the penalty order that the assessee has not cared even to file proper reply at the time of penalty proceedings even after availing opportunities. The Assessing Officer has in detail discussed the issue pertaining undisclosed long term capital gain and the assessee’s attitude towards the proceedings at the time of assessment proceeding as well in the penalty proceedings. In view of the facts as discussed in the penalty order in my considered view the penalty has been levied on account of deliberately furnishing inaccurate particulars of income on the part of assessee. The assessee has claimed wrong long term capital loss instead of the long term capital gain of Rs. 5,51,827/-. Another ground taken up by the assessee is that the quantum appeal was pending with CIT appeal at the time of levy of penalty has no force. Further it is also a matter of record that the quantum appeal of assessee has also already been decided by me vide my order in Appeal No. 390/IT/CIT(A)- 3/LDH/2017-18 dated 24.08.2018, against the appellant. Hence this contention of appellant also sans any substance. I have held in the quantum appeal as under: 4.5 The Reliance place by the assessee on the various judicial pronouncements is considered but not accepted on the following grounds; There is no bonafide intention on the part of the assessee as there was no discloser of any material facts about long term capital gain amounting to Rs. 5,51,827. The Assessing Officer has brought out the facts in the penalty order that the assessee has claimed long term capital gain amounting to Rs. 57,518/- introduction incorrect long term capital gain as discussed above. Hence it cannot be termed on the part of the assessee that assessee was ignorant of legal position hence the discrepancy crept in while calculating the correct capital gain. Hence, the ratio of the referred case does not apply to the case of the assessee. Thus, there is no dispute over the fact that the assessee has furnished inaccurate particulars of its income to the extent of Rs. 5,51,827/- by submitting inaccurate particulars of income. Under the Circumstances the penalty levied under section 271(1) (c) amounting to Rs. 1,13,676/- is hereby sustained.” 6. The appellant assessee raised contentions in the grounds that the ld. Commissioner of Income Tax (Appeals) erred in law as well as on facts while confirming penalty of Rs.1,13,676/- u/s 271(1)(c) levied by A.O. who ITA No. 129/Asr/2019 Vijay Kumar v. ITO 5 failed to confront the appellant with the material/evidence in his possession on the basis of which he has imposed penalty on the income of the appellant; that the assessee has also not afforded the reasonable opportunity to revert the same. It is also contended that the ld. CIT (Appeals) has erred in overlooking the facts and summarily rejecting the detailed statements of facts submitted along with memorandum of appeal, various documents and evidence placed in paper book filed while accepting incorrect version of the ld. AO. In upholding the penalty. He prayed for deleting the penalty. 7. The Ld. additional CIT DR supported the impugned order. He contended that the AO has discussed the facts in the penalty order that there was no bonafide intention on the part of the assessee to disclose any material facts about long term capital gain amounting to Rs. 5,51,827. The Assessing Officer has brought out the facts in the penalty order that the assessee has claimed long term capital gain amounting to Rs. 57,518/- by introduction of incorrect long term capital gains. Hence it cannot be termed on the part of the assessee that assessee was ignorant of legal position hence the discrepancy crept in while calculating the correct capital gain. He prayed that the impugned order may be sustained. ITA No. 129/Asr/2019 Vijay Kumar v. ITO 6 8. We have heard the learned the additional CIT-DR, perused the material on record, impugned order and judicial pronouncements relied upon by the appellant before the Ld. CIT(A). Admittedly, the assessee has wrongly calculated long term as well as short term capital gains and when this, discrepancy was brought to the notice of the assessee by the AO, the assessee did not file any reply whatsoever with regard to the discrepancy pointed out, rather the assessee objected to the issue of notice under section148. Accordingly, the Assessing Officer has recalculated the long term capital gain at Rs. 5,51,827 instead of (-) Rs.57,518/- shown by the assessee in the computation of income. From the penalty order, it is observed that the assessee has not filed proper reply at the time of penalty proceedings even after availing several opportunities. Thereafter, the appellant is not bothered to file any written documentary evidence to prove its bonafide intention for the mistake in computation of long term capital gains in the quantum appeal as well as penalty appeal either before the Ld. CIT (A) or before us. Merely, raising allegation against the Ld. CIT (A) that the ld. CIT(Appeals) has overlooked the facts and summarily rejecting the detailed statements of facts submitted along with memorandum of appeal, various documents and evidence placed in paper book filed while accepting incorrect version of the ld. AO., without supporting relevant material evidence would not discharge the appellant from the charge of furnishing ITA No. 129/Asr/2019 Vijay Kumar v. ITO 7 inaccurate particulars of income by way of filing wrong computation of long term capital gains in the return of income as computed by the AO and confirmed by the Ld. CIT(A) in quantum appeal and penalty appeal after affording adequate opportunity of being heard to the appellant and due consideration of the written submission made before him and also distinguished the case laws relied by the assessee. 9. The Assessing Officer has discussed the issue pertaining undisclosed long term capital gain in detail and the assessee’s attitude towards the proceedings at the time of assessment proceeding as well in the penalty proceedings. It is seen that the penalty has been levied on account of deliberately furnishing inaccurate particulars of income by the assessee. It is noted that the assessee has claimed wrong long term capital gain of Rs. - Rs. 57,518/-, instead of the long term capital gain of Rs. 5,51,827/-. Under the circumstances, it cannot be accepted that the assessee was ignorant of legal position hence the discrepancy crept in while calculating the correct capital gain. It is evident from record that the quantum appeal of assessee has already been decided by the CIT(A) vide its order in Appeal No. 390/IT/CIT(A)- 3/LDH/2017-18 dated 24.08.2018, against that appellant assessee has not filed appeal in the Tribunal as per record till date. ITA No. 129/Asr/2019 Vijay Kumar v. ITO 8 10. Considering the facts of the case, we are of the considered view that the ld. CIT (A) has rightly observed that the appellant has no bonafide intention in discloser of any material facts about long term capital gain of - Rs. 57,518/-. Thus, the AO has brought out the facts in the assessment order and the penalty order that the assessee has claimed long term capital gain amounting to loss of Rs. - 57,518/- an incorrect long term capital gain as discussed above. Considering the factual matrix and legal intricacies, we find no infirmity or perversity in the observation and finding of the Ld. CIT(A) that undisputedly the assessee has furnished inaccurate particulars of its income to the extent of Rs. 5,51,827/- by submitting inaccurate particulars of income under the head Long Term Capital Gains. 11. In the case of MAK Data (P.) limited Vs. Commissioner of income Tax, [2013] 38 taxmann.com 448(SC), the Hon’ble apex court observed that voluntary disclosure does not release the assessee from mischief of panel proceedings under section 271(1)(c) of the act. In the present case, although the assessee has disclosed the long-term capital gains in the return of income but understated the said long-term capital gain in the computation of income to the extent of Rs. 5,51,827/-, and thereby submitted inaccurate particulars of income under the head Long Term Capital Gains to the satisfaction of the assessing officer and so confirmed ITA No. 129/Asr/2019 Vijay Kumar v. ITO 9 by the learned CIT appeal in the quantum appeal and subsequently confirmed the penalty order. 12. In another case of “Gangotri Textiles Ltd. Vs. DCIT”, the Hon’ble Madras High Court has observed that it was only when notice was issued under section 143(2), assessee, for first time, the assessee stated that due to inadvertence, it did not disclose particulars relating to capital gains, it was clear that assessee did not act bonafidely and, therefore, penalty under section 271(1)(c) was rightly levied. SLP was dismissed against impugned order of Hon’ble High Court. 13. In view of the above, we find no merit and substance in the contentions raised by the appellant in the grounds of appeal and rejected the same to be absolutely without bonafides. Accordingly, the impugned order of the Ld. CIT(A) confirming the penalty levied under section 271(1) (c) amounting to Rs. 1,13,676/- is hereby sustained. 14. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open court on 22.09.2022 Sd/- Sd/- (Anikesh Banerjee) (Dr. M. L. Meena) Judicial Member Accountant Member *GP/Sr/PS* Copy of the order forwarded to: ITA No. 129/Asr/2019 Vijay Kumar v. ITO 10 (1) The Appellant: (2) The Respondent: (3) The CIT(Appeals) (4) The CIT concerned (5) The Sr. DR, I.T.A.T True Copy By Order