Shri Rajesh V.Rathod, Ahmedabad V. The ACIT.,(OSD),Circle-10, Ahmedabad

ITA 1488/AHD/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62968 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 05-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA
• Assessee Lawyers: J M TRIVEDI
• Keywords: Business income; Depreciation

Judgement Text

, , , , A, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, A BENCH . .. . . .. . , !' !' !' !', , , , #$ %&'( #$ %&'( #$ %&'( #$ %&'(, , , , )* + )* + )* + )* + ) ' ) ' ) ' ) ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND ANIL CHATURVEDI, ACCOUNTANT MEMBER) ITA NO.1488/AHD/2012 [ASSTT.YEAR : 2007-2008] SHRI RAJESH V. RATHOD G-21, RATNMAMANI COMPLEX C.G. ROAD ELLISBRIDGE, AHMEDABAD PAN : ABEPR 1892 A /VS. ACIT (OSD), CIR.10 AHMEDABAD. ( (( (-. -. -. -. / APPELLANT) ( (( (/0-. /0-. /0-. /0-. / RESPONDENT) 1& 2 3 )/ ASSESSEE BY : SHRI J.M. TRIVEDI + 2 3 )/ REVENUE BY : SHRI RAJ MEHRA 5 2 &(*/ DATE OF HEARING : 4 TH SEPTEMBER, 2012 678 2 &(*/ DATE OF PRONOUNCEMENT : 05-10-2012 )9 / O R D E R PER G.C. GUPTA, VICE-PRESIDENT: THIS APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2007-2008 IS DIREC TED AGAINST THE ORDER OF THE CIT(A) DATED 09.05.2012. 2. THE ONLY ISSUE IN THIS APPEAL OF THE ASSESSEE IS REGARDING VALIDITY OF PENALTY OF RS.24,431/- IMPOSED UNDER SE CTION271(1)(C) OF THE ACT. ITA NO.1488/AHD/2012 -2- 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT THE ASSESSEE HAS PLACED ALL MATERIAL FACTS RELEVANT TO THE ASSES SMENT BEFORE THE AO. THE PENALTY HAS BEEN IMPOSED MERELY ON ACCOUNT OF D ISALLOWANCE OF DEPRECIATION OF RS.41,212/- AND TREATING SHARE INCO ME OF RS.57,937/- AS BUSINESS INCOME. THE LEARNED DR HAS RELIED ON T HE ORDERS OF THE AO AND THE CIT(A). 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND HAVE PE RUSED THE ORDERS OF THE AO AND THE CIT(A). WE FIND THAT THE PENALTY UNDER SECTION 271(1)(C) HAS BEEN IMPOSED IN THIS CASE ON ACCOUNT OF DISALLOWANCE OF DEPRECIATION AND BY TREATING THE SH ARE INCOME AS BUSINESS INCOME OF THE ASSESSEE. WE FIND THAT ALL THE MATERIAL FACTS NECESSARY FOR THE ASSESSMENT WERE DISCLOSED BY THE ASSESSEE AT THE TIME OF ASSESSMENT ITSELF. THE DISALLOWANCE/TREATI NG OF SHARE INCOME AS BUSINESS INCOME IS ON ACCOUNT OF HONEST DIFFEREN CE OF OPINION BETWEEN THE ASSESSEE AND THE DEPARTMENT ON THE ALLO WABILITY OF THE DEPRECIATION AND THE CORRECT HEAD OF INCOME UNDER W HICH THE SHARE INCOME WAS ASSESSABLE IN THE CASE OF THE ASSESSEE. THERE IS NO MATERIAL BEFORE US TO SUGGEST THAT THE EXPLANATION OF THE ASSESSEE IN THIS REGARD WAS NOT BONA FIDE . IN VIEW OF THESE FACTS, WE FIND THAT THERE IS NO JUSTIFICATION FOR IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT, WHICH IS ACCORDINGLY CANCELLE D AND THE GROUNDS OF THE APPEAL OF THE ASSESSEE ARE ALLOWED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( %&'( %&'( %&'( %&'( / ANIL CHATURVEDI) )* + )* + )* + )* + /ACCOUNTANT MEMBER ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT