Shri Vinodkumar Sharma, Vadodara V. The Income Tax Officer, Ward-3(2), Vadodara

ITA 1298/AHD/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6545 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 29-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AOITA SHUKLA
• Assessee Lawyers: AMAR K SHAH
• Section: 271(1)(c)

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER ./ ITA NO. 1298/AHD/2017 / ASSESSMENT YEAR: 2010-11 SHRI VINODKUMAR SHARMA PROP: OF R.B. TRANSPORT CO. 4-RUTVI FLATS BHADRAM NAGAR NEW SAMA ROAD VADODARA 390 008. VS ITO, WARD-3(2) VADODARA. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI AMAR K. SHAH, AR REVENUE BY : AOITA SHUKLA, SR.DR / DATE OF HEARING : 08/03/2019 /DATE OF PRONOUNCEMENT : 30/04/2019 O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER : ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST ORDER OF THE LD.CIT(A)- 4, VADODARA DATED 5.1.2017 PASSED FOR THE ASSTT.YEAR 2010-11. 2. SOLE GRIEVANCE OF THE ASSESSEE IS THAT THE LD.CI T(A) HAS ERRED IN CONFIRMING PENALTY OF RS.1,02,800/- IMPOSED BY THE AO UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT. 3. BRIEF FACTS OF THE CASE ARE THAT IS AN INDIVIDUA L. HE HAS FILED RETURN OF INCOME ON 25.3.2011 DECLARING TOTAL INCOME AT RS .2,83,880/-. ON SCRUTINY OF THE ACCOUNTS, IT REVEALED TO THE AO THA T THE ASSESSEE WAS ITA NO.1298 /AHD/2017 - 2 - HAVING 1/4 TH SHARE IN AN IMMOVABLE PROPERTY WHICH WAS SOLD ON 25.1.2010 FOR A CONSIDERATION OF RS.82,49,000/-. T HE ASSESSEE HAS SHOWN SHORT TERM CAPITAL GAIN AT RS.62,583/- ON SALE OF I MMOVABLE PROPERTY. THE ASSESSEE HAS CLAIMED CERTAIN EXPENDITURE WHICH WAS INCURRED FOR DEVELOPMENT OF THE PROPERTY. THE LD.AO DID NOT ACC EPT THE CLAIM OF THE ASSESSEE FULLY AND HE MADE AN ADDITION OF RS.6,65,3 55/-. THE DETAILS OF THE EXPENDITURE CLAIMED BY THE ASSESSEE VIS--VIS A LLOWED/DISALLOWED BY THE AO READ AS UNDER: PARTICULARS AMOUNT OF EXPENSE CAPITALIZED BY THE APPELLANT (RS.) AMOUNT ALLOWED BY THE AO (RS.) AMOUNT OF ADDITION MADE BY THE AO (RS.) BROKERAGE ON PURCHASE OF LAND 39,000/- 9,750/- 29,250/- EARTH FILLING, FENCING AND SECURITY CHARGES FOR THE YEAR 2008- 09 AND 2009-10 12,67,472/- 7,43,870/- 5,23,602/- BROKERAGE ON SALE 1,50,000/- 37,500/- 1,12,500/- TOTAL 6,65,352/- 4. THE LD.AO THEREAFTER INITIATED PENALTY PROCEEDIN GS FOR CONCEALMENT OF INCOME. HOWEVER, IN THE SHOW CAUSE NOTICE, ISSUED UNDER SECTION 274 READ WITH SECTION 271(1)(C) OF TH E ACT, HE HAS MENTIONED BOTH THE EXPRESSIONS FOR VISITING THE ASS ESSEE WITH PENALTY I.E. FOR CONCEALMENT OF INCOME OR FURNISHING OF INACCURA TE PARTICULARS. IN THE PENALTY ORDER AVAILABLE ON PAGE NO.14 OF THE PAPER BOOK, THE LD.AO OBSERVED THAT PENALTY WAS INITIATED FOR CONCEALMENT OF INCOME, BUT IS BEING IMPOSED FOR FURNISHING INACCURATE PARTICULARS . APPEAL TO THE CIT(A) DID NOT BRING ANY RELIEF TO THE ASSESSEE. ITA NO.1298 /AHD/2017 - 3 - 5. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. A PERUSAL OF PENALTY ORDER WOULD INDICATE THAT THE LD.AO HAS OBSERVED THAT THE ASSESSEE HAS A DMITTED QUA A FACT THAT HE HAS FURNISHED INACCURATE PARTICULARS. HE M ADE REFERENCE TO THE ASSESSMENT ORDER. WE HAVE PERUSED THE ASSESSMENT O RDER. THE ASSESSEE HAS NOWHERE ADMITTED THAT HE HAS FURNISHED INACCURA TE PARTICULARS. WHAT THE ASSESSEE HAS ADMITTED IS THAT, IN CASE THE EXPENSES ARE PARTLY DISALLOWED, THEN HE DID NOT DISPUTE. IT COULD NOT BE CONSTRUED THAT THE ASSESSEE HAS ADMITTED ALLEGATIONS THAT HE HAS FURNI SHED INACCURATE PARTICULARS. THE AO HAS NOWHERE BROUGHT ANY MATERI AL OR REASONING FOR HARBOURING THIS PLEA. THE ONLY QUESTION IS THAT, O UT OF TOTAL EXPENDITURE CLAIMED BY THE ASSESSEE, PARTLY NOT ACCEPTED BY THE AO. HIS EXPLANATION QUA THE EXPENDITURE WAS NOT FOUND TO BE FALSE. THE ASSESSEE COULD NOT SUBSTANTIATE HIS CLAIM OF EXPENDITURE WITH HELP OF EVIDENCE. IN THESE CIRCUMSTANCES PENALTY UPON THE ASSESSEE CANNOT BE I MPOSED WITH HELP OF EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT. IF THE AO WAS ABLE TO DEMONSTRATE THAT THE EXPLANATION OF THE EXPENDITURE GIVEN BY THE ASSESSEE WAS FALSE, THEN HIS CASE CAN BE APPRECIATE D. TAKING INTO CONSIDERATION ALL THESE FACTS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT PENALTY IS NOT IMPOSABLE UPON THE ASSESSEE. WE ACC ORDINGLY ALLOW THE APPEAL OF THE ASSESSEE AND DELETE IMPUGNED PENALTY. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . PRONOUNCED IN THE OPEN COURT ON 30 TH APRIL, 2019. SD/- SD/- (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED, 30/04/2019