Smt. Anjanaben Narendrakumar Patel, Ahmedabad V. The Assistant Commissioner of Income Tax, Circle-2(2), Ahmedabad

ITA 1372/AHD/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 4097 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 06-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: LALIT P JAIN
• Assessee Lawyers: PRAMOD POPAT
• Section: 271(1)(c); 54B; 54F; 250; 201; 274; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH BEFORE: SHR I MAHAVIR PRASAD , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ANJANABEN NARENDRAKU M A R PATEL, C/203, UTSAV RESIDENCY, NEW C.G. ROAD, CHANDKHEDA, AHMEDABAD PAN: AWFPP4964R (APPELLANT) VS THE ACIT, CIRCLE - 2(2) , AHMEDABAD - 380014 (RESPONDENT) REVENUE BY : S H RI LALIT P. JAIN , S R. D . R. ASSESSEE BY: SHRI PRAMOD POPAT, A.R. DATE OF HEARING : 11 - 03 - 2 019 DATE OF PRONOUNCEMENT : 13 - 03 - 2 019 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT ME MBER : - THE SOLITARY GROUND OF APPEAL OF THE ASSESSEE IS AGAINST THE DECISION OF LD. CIT(A) - 10 AHMEDABAD VIDE ORDER DATED 28 TH MARCH, 2017 IN CONFIRMING THE PENALTY LEVIED U/S. 271(1)(C) OF THE AC T ON ACCOUNT OF COST OF IMPROVEMENT OF RS. 20 , 23 , 196/ - . T HE ASSESSEE HAS CHALLENGED THE VALIDITY OF THE SHOW CAUSE NOTICE ISSUED U/S. 274 R.W.S. 271(1)(C) OF THE ACT ON THE I T A NO . 1372 / A HD/20 17 A SS ESSMENT YEAR 2012 - 13 I.T.A NO. 1372 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ANJAN A BEN NARENDRAKUMAR PATEL VS. ACIT 2 GROUND THAT ASSESSING OFFICER HAS NOT MENTIONED THE DEFAULT OF THE ASSESSEE FOR WHICH THE PENALTY PROCEEDINGS HAS BEEN INITIATED. 2. THE FACT IN BRIEF IS THAT THE ASSESSEE HAS FILED RETURN OF INCOME ON 27 TH OCTOBER, 2012 DECLARING TOTAL INCOME AT RS. 33 , 87 ,060/ - . SUBSEQUENTLY , THE CASE WAS SELECTED UNDER SCRUTINY BY ISSUING OF NOTICE U/ S. 143(2) OF THE AC T ON 2 ND AUGUST, 2013. DURING THE CO U RS E OF ASSESSMENT , THE ASSESSING OFFICER HAS NOTICED THAT ASSESSEE HAS SOLD LAND AT GANDH INAGAR FOR RS. 2.87 CR ORES ON 22 JULY, 2011 AND THIS PROPERTY WAS PURCHASED ON 25 TH JULY, 2008 FOR RS. 18 LACS. THE ASSESSEE HAS CLAIMED VARIOUS EXPENSES LIKE COS T OF IMPROVEMENT OF RS. 15 LACS AND EXPENSES OF RS. 5, 0 2 ,578 / - IN CONNECTION WITH THE TRANSFER AND ALSO CLAIMED EXEMPTION U/S. 54B AND 54F. THE ASSESSING OFFICER HAS DENIED THE DEDUCTION OF RS. 1 , 08 , 70 , 056/ - CLAIMED U/S. 54B OF THE ACT AS THE ASSESSEE HAS FAILED TO FULFILL ANY CONDITION AS ENVISAGED U/S. 54F OF THE ACT. THE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF DEDUCTION U/S. 54F OF RS. 95 LACS ON THE GROUND THAT ASSESSEE HAS PURCHASED ONE RESIDENTIAL PROPERTY AND HAS ALSO CONSTRUCTED ONE HOUSE PRO PERTY IN VIOLATION OF CONDI TION MENTIONED IN SUB - SECTION (2) OF SECTION 54F OF THE ACT. THE ASSESSING OFFICER HAS ALSO DISALLOWED CLAIM OF INDEXED COST OF IMPROVEMENT OF RS. 20 , 23 , 196/ - AS THE ASSESSEE HAS FAILED TO SUBSTANTIATE WITH SUPPORTING DOCUMENT/E VIDENCES INCURRING OF AFORESAID EXPENSES CLAIMED UNDER THE H E AD COST OF IMPROVEMENT. THE ASSSESSEE HAS NOT FILED ANY APPEAL AGAINST THE QUANTUM ADDITION MADE BY THE ASSESSING OFFICER BEFORE THE LD. CIT(A). T HEREAFTER, THE ASSESSING OFFICER HAS LEVIED PEN ALTY U/S. 271(1)(C) OF THE ACT AN AMOUNT OF RS. 46 , 04 , 000/ - ON THE TOTAL DISALLOWANCE OF RS. 2 , 57 , 35 , 310/ - AS ELABORATED ABOVE IN THIS ORDER. I.T.A NO. 1372 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ANJAN A BEN NARENDRAKUMAR PATEL VS. ACIT 3 3. AGGRIEVED ASSESSEE HAS FILED APPEAL BEFORE THE LD. CIT(A). THE LD. CIT(A) HAS DELETED THE PENALTY LEVIED BY TH E ASSESSING OFFICER ON ACCOUNT OF DENIAL OF EXEMPTION U/S. 54B AND 54F OF THE ACT. HOWEVER, THE LD. CIT(A) HAS SUSTAINED PENALTY ONLY IN RESPECT OF CLAIM OF COST OF IMPROVEMENT OF RS. 20 , 23 , 196/ - ON THE GROUND THAT ASSESSEE HAS FAILED TO FURNISH THE COMPL ETE DETAIL/ DOCUMENTARY EVIDENCES IN SUPPORT OF THIS CLAIM. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, THE LD. COUNSEL HAS CONTENDED THAT IN THE SHOW CAUSE NOTICE ISSUED BY T H E ASSESSING OFFICER U/S. 274 R.W.S. 271(1)(C) OF THE ACT, T HE ASSESSI NG OFFICER HAS NOT DELETED THE INAPPROPRIATE WORDS AND PART OF THE NOTICE, THEREFORE, IT WAS NO T CLEAR WHAT WAS DEFAULT COMMITTED BY THE ASSESSEE. THE LD. COUNSEL HAS ALSO PLACED RELIANCE ON THE DECISION OF HON BLE KARNATKA HI G H COURT IN THE CASE OF CIT V S. MAN J UNATH COTTON AND GINING FACTORY (2013) 35 ITR TAXMAN .COM 250 (KARNATAKA) AND DECISION OF SUPREME COURT IN T H E CASE OF CIT VS. SSA S EMERAL D MEADOWS REPORTED IN (2016) 73 TAXMAN.COM 248 (SC). ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATIVE HAS P LACED RELIANCE ON THE ORDER OF LD. CIT(A). 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD CAREFULLY. IT IS NOTICED THAT IN ABSENCE OF SUPPORTING DOCUMENT/EVIDENCES THE CLAIM OF THE ASSESSEE OF COST OF IMPROVEMENT TO THE AMOUNT O F RS. 20 , 23 , 196/ - WAS REJ ECTED. IT IS NOTICED THAT IN SPITE OF PROVIDING ADEQUATE OPPORTUNITIES THE ASSESSEE HAS FAILED TO SUBSTANTIATE THE GENUINENESS OF SUCH EXPENSES BEFORE THE LOWER AUTHORITIES. WE HAVE ALSO GONE THROUGH THE PENAL TY ORDER PASSED U/S . 271(1)(C) OF THE ACT AND IT IS NOTICED THAT ASSESSING OFFICER HAS CATEGORICALLY CONCLUDED THAT IT IS CASE OF I.T.A NO. 1372 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ANJAN A BEN NARENDRAKUMAR PATEL VS. ACIT 4 FURNISHING OF INACCURATE PARTICULARS OF INCOME WHICH ATTRACT THE PENALTY PROCEEDINGS U/S. 271(1)(C) OF THE ACT. AFTER CONSIDERING THE DETAIL ED FINDINGS OF THE LD. CIT(A) OF THE LD. CIT(A) AND THE DECISION OF HON BLE GUJARAT HIGH COURT IN THE CASE OF SUNITA TRANSPORT, WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSSSEE. SINCE THE ASSESSING OFFICER HAS CLEARLY MENTIONED THAT IMPUGNED PENALTY WAS INITIATED FOR CONCEALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME AND THE ASSESSEE HAS NOT USED THE WORDS OR. FINALLY, WHILE PASSING THE PENALTY ORDER U/S. 271(1)(C) OF THE ACT, THE ASSESSING OFFICER HAS CATEGORICALLY STATED THAT THE PENALTY HAS BEEN LEVIED FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME, THEREFORE, WE DO NOT FIND ANY MERIT IN THE TECHNICAL GROUND OF DEFAULT IN ISSUING THE NOTICE U/S. 274 OF THE ACT RAISED BY THE ASSSESSEE. REGARDING CONTENTION OF THE ASSESSEE THAT ASSESSING OFFICER HAS FAILED TO SPECIFY CHARGE WHETHER PENALTY IS BEING IMPOSED FOR FURNISHING INACCURATE PARTICULARS OR CONCEALMENT OF INCOME. WE FIND THAT THIS ASPECT HAS BEEN CONSIDERED BY THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF SNITA TRANSPORT P. LD. VS. ACIT 42 TAXMANN.COM 54 (GUJ). IN THIS CASE THE HON'BLE HIGH COURT HAS OBSERVED THAT FOR THE PURPOSE OF ISSUING SHOW CAUSE, THE ID.AO CAN USE EXPRESSION 'AND/OR' IN BETWEEN WHETHER EXPLANATION OF THE ASSESSEE IS BEING SOUGHT FOR CONCEA LMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. HOWEVER, WHILE PASSING THE FINAL ORDER, THE AO HAS TO SPECIFY HIS CONCLUSION WHETHER HE VISITED THE ASSESSEE WITH PENALTY FOR CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS. THE DISCUSSION MADE BY THE HON'BLE HIGH COURT IN PARA - 9 IN THIS REGARD IS WORTH TO NOTE. IT READS AS UNDER: '9. REGARDING THE CONTENTION THAT THE ASSESSING OFFICER WAS AMBIVALENT REGARDING UNDER WHICH HEAD THE PENALTY WAS BEING IMPOSED NAMELY FOR CONCEALIN G THE PARTICULARS OF INCOME OR FURNISHING I.T.A NO. 1372 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ANJAN A BEN NARENDRAKUMAR PATEL VS. ACIT 5 INACCURATE PARTICULARS, WE MAY RECORD THAT THOUGH IN THE ASSESSMENT ORDER THE ASSESSING OFFICER DID ORDER INITIATION OF PENALTY ON BOTH COUNTS, IN THE ULTIMATE ORDER OF PENALTY THAT HE PASSED, HE CLEARLY HELD THAT LEVY OF PENALTY IS SUSTAINED IN VIEW OF THE FACT THAT THE ASSESSEE HAD CONCEALED THE PARTICULARS OF INCOME. THUS INSOFAR AS FINAL ORDER OF PENALTY WAS CONCERNED, THE ASSESSING OFFICER WAS CLEAR AND PENALTY WAS IMPOSED FOR CONCEALING PARTICULARS OF INCOME. IN LIGHT OF THIS, WE MAY PERUSE THE DECISION OF THIS COURT IN CASE OF MANU ENGINEERING WORKS (SUPRA). IN THE SAID DECISION, THE DIVISION BENCH CAME TO THE CONCLUSION THAT LANGUAGE OF 'AND/OR' MAY BE PROPER IN ISSUING A NOTICE FOR PENALTY, BUT IT WAS INCUMB ENT UPON THE ASSESSING AUTHORITY TO COME TO A POSITIVE FINDING AS TO WHETHER THERE WAS CONCEALMENT OF INCOME BY THE ASSESSEE OR WHETHER ANY INACCURATE PARTICULARS OF SUCH INCOME HAD BEEN FURNISHED BY THEM. IF NO SUCH CLEAR CUT FINDING IS REACHED BY THE AUT HORITY, PENALTY CANNOT BE LEVIED. IT WAS A CASE IN WHICH IN FINAL CONCLUSION THE AUTHORITY HAD RECORDED THAT 'I AM OF THE OPINION THAT IT WILL HAVE TO BE SAID THAT THE ASSESSEE HAD CONCEALED ITS INCOME AND/OR THAT IT HAD FURNISHED INACCURATE PARTICULARS OF SUCH INCOME.' IT WAS IN THIS RESPECT THE BENCH OBSERVED THAT 'NOW THE LANGUAGE OF 'AND/OR' MAY BE PROPER IN ISSUING A NOTICE AS TO PENALTY ORDER OR FRAMING OF CHARGE IN A CRIMINAL CASE OR A QUASI - CRIMINAL CASE, BUT IT WAS INCUMBENT UPON THE IAC TO COME TO A POSITIVE FINDING AS TO WHETHER THERE WAS CONCEALMENT OF INCOME BY THE ASSESSEE OR WHETHER ANY INACCURATE PARTICULARS OF SUCH INCOME HAD BEEN FURNISHED BY THE ASSESSEE. NO SUCH CLEAR CUT FINDING WAS REACHED BY THE IAC AND, ON THAT GROUND ALONE, THE ORDER OF PENALTY PASSED BY THE IAC WAS LIABLE TO BE STRUCK DOWN.' IN THE PRESENT CASE, THE L D.AO HAS CONCLUSIVELY HELD IN THE PENALTY ORDER THAT PENALTY IS BEING IMPOSED FOR FURNISHING INACCURATE PARTICULARS OF INCOME. 5. ON MERIT, WE FIND THAT ASSESSEE HA S FAILED TO SUBSTANTIATE WITH RELEVANT EVIDENCES AND MATERIAL OF HER CLAIM OF INCURRING THE AFORESAID IMPROVEMENT EXPENSES, THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE DECISION OF LD. CIT(A). ACCORDINGLY , THE APPEAL OF THE ASSESSEE IS DISMISSED. 6 . IN THE RESULT, T HE APPEAL OF THE ASSESSEE IS DISMISSED . ORDER PR ONOUNCED IN THE OPEN C OURT ON 13 - 03 - 201 9 SD/ - SD/ - ( MAHAVIR PRASAD ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 13 / 03 /2019 / COPY OF ORDER FORWARDED TO: - I.T.A NO. 1372 /AHD/20 17 A.Y. 2012 - 13 PAGE NO ANJAN A BEN NARENDRAKUMAR PATEL VS. ACIT 6 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,