THAKKAR TRADING P.LTD, MUMBAI V. DCIT 8(3)(1), MUMBAI

ITA 1357/MUM/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7883 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 27-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V JUSTIN
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH E MUMBAI BEFORE SHRI D.T. GARASIA (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 1357 /MUM/ 2017 ASSESSMENT YEAR: 2012 - 13 M/S THAKKAR TRADING PVT. LTD. SUGAR HOUSE, 93/95, KAZI SAYED STREET, MEZZAINE FLOOR, MUMBAI - 400003 VS. DCIT - 8(3)(1), ROOM NO. 615, 6 TH FLOOR, AAYAKAR BHAVAN M.K. ROAD, MUMBAI - 400020. PAN NO. AAACT3715A APPELLANT RESPONDENT ASSESSEE BY : MR. M.M. GOLVALA , AR REVENUE BY : MR. V. JUSTIN , DR DATE OF HEARING : 13/11/2017 DATE OF PRONOUNCEMENT : 27/12/2017 ORDER PER N.K. PRADHAN, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YEAR IS 2012 - 1 3 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - 14 , MUMBAI AND ARISES OUT OF THE PENALTY ORDER U/S 271(1)(C) OF THE INCOME TAX ACT 1961, (THE ACT). 2. THE GROUND RAISED BY THE ASSESSEE IN THIS APPEAL IS AGAINST THE OR DER OF THE LD. CIT(A) CONFIRMING THE PENALTY OF RS.2,84,013/ - IMPOSED BY THE AO U/S 271(1)(C) ON THE DISALLOWANCE OF RS.13,13,050/ - MADE U/S 50C OF THE ACT. M/S THAKKAR TRADING ITA NO. 1357/MUM/2017 2 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE - COMPANY FILED ITS RETURN OF INCOME FOR THE AY 2012 - 13 ON 28.09.2012 DECLARING TOTAL INCOME OF RS.2,11,64,159/ - . THE ASSESSING OFFICER (AO) NOTICED DURING THE COURSE OF ASSESSMENT PROCEEDINGS THAT THE ASSESSEE HAD SOLD IMMOVABLE PROPERTY FOR A CONSIDERATION OF RS.1,14,00,000/ - . THE AO FOUND THAT THE STAMP DUTY VALUATION ON THE SAID PROPERTY WAS RS.1,27,13,050/ - . THEREFORE, HE MADE A DISALLOWANCE OF RS.13,13,050/ - (RS.1,27,13,050/ - MINUS RS.1,14,00,000/ - ) U/S 50C OF THE ACT. SUBSEQUENTLY, THE AO LEVIED A MINIMUM PENALTY OF RS.2,84,013/ - U/S 271(1)(C) ON THE ABOVE AMOUNT. IN APPEAL, THE LD. CIT(A) HAS CONFIRMED THE LEVY OF THE ABOVE PENALTY BY THE AO. 4. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE SUBMITS THAT THE ASSESSEE HAD NEITHER CONCEALED ITS INCOME NOR FURNISHED INACCURATE PARTICU LARS OF SUCH INCOME. THEREFORE, IT IS SUBMITTED BY HIM THAT THE PENALTY LEVIED BY THE AO BE DELETED. ON THE OTHER HAND, THE LD. DR SUPPORTS THE ORDER PASSED BY THE LD. CIT(A). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. THE QUESTION ARISES WHETHER PENALTY U/S 271(1)(C) CAN BE LEVIED ON A DIFFERENCE BETWEEN THE STAMP DUTY VALUATION AND THE AMOUNT SHOWN AS SALE CONSIDERATION BY A TAXPAYER. WE MAY FRUITFULLY REFER HERE TO THE JUDGEMENT OF THE HON'BLE CALCUTTA HIGH CO URT IN THE CASE OF CIT V. MADAN THEATRES LTD . (GA NO. 684 OF 2013), AND THE M/S THAKKAR TRADING ITA NO. 1357/MUM/2017 3 JUDGEMENT OF THE HON'BLE MADRAS HIGH COURT IN THE CASE OF CIT V. APSARA TALKIES (155 ITR 303). IN MADAN THEATRES LTD . (SUPRA), THE ASSESSEE SOLD THE PROPERTY AT RS. 2,51,50,000/ - . FOR THE PURPOSE OF STAMP DUTY, HOWEVER, THE VALUE WAS ESTIMATED AT RS. 5,19,77,000/ - . THE AO FIXED THE SALE PRICE AT RS. 5,19,77,000/ - AND IMPOSED A PENALTY OF RS. 30,09,989/ - U/S 271(1)(C) OF THE ACT. THE HON'BLE HIGH COURT OBSERVED THAT THE ASSESSEE HAD OFFERED FOR TAXATION THE ACTUAL AMOUNT RECEIVED. IT IS ONLY ON THE BASIS OF THE DEEMED CONSIDERATION THAT THE PROCEEDINGS U/S 271(1)(C) WAS INITIATED. THEREFORE, THE HON'BLE HIGH COURT DISMISSED THE APP EAL FILED BY THE REVENUE. IN APSARA TALKIES (SUPRA), THE HON'BLE HIGH COURT HELD THAT THE ONLY BASIS FOR THE ADDITION IN THE ASSESSMENT AS WELL AS FOR THE LEVY OF PENALTY IS THAT FURNISHED BY THE DEPARTMENTAL VALUERS ESTIMATED FIGURE AND THEREFORE A VALU ATION ESTIMATE, WITHOUT MORE, CANNOT JUSTIFY A FINDING OF CONCEALMENT. 5.1 THE ISSUE BEING SAME, WE FOLLOW THE RATIO LAID DOWN IN THE ABOVE JUDGMENTS AND DELETE THE PENALTY OF RS.2,84,013/ - IMPOSED BY THE AO U/S 271(1)(C). 6. IN THE RESULT, THE APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27/12/2017. SD/ - SD/ - (D.T. GARASIA ) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER M/S THAKKAR TRADING ITA NO. 1357/MUM/2017 4 MUMBAI ; DATED: 27/12/2017 RAHUL SHARMA, SR. P.S. 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