RUKMANGADHAR REDDY, CHENNAI V. ITO SALARY WARD II(3), CHENNAI

ITA 1504/CHNY/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 5733 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 13-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G D JAYANTHI ANGAYARKANNI
• Assessee Lawyers: N VIJAY KUMAR
• Keywords: TDS; Set aside
• Section: 271(1)(c)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . !', $ '% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.1504/CHNY/2019 ' (' / ASSESSMENT YEARS : 2011-12 SHRI RUKMANGADHAR REDDY, PLOT NO.8, MURUGESANAR STREET, THIRUVALLUVAR NAGAR, MUGALIVAKKAM, CHENNAI - 600 116. PAN : AEGPR 2052 D V. THE INCOME TAX OFFICER, SALARY WARD II(3), CHENNAI - 600 034. (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : SHRI N. VIJAY KUMAR, CA ,-*+ . / / RESPONDENT BY : MS. G.D. JAYANTHI ANGAYARKANNI, JCIT 0 . 1$ / DATE OF HEARING : 21.08.2019 23( . 1$ / DATE OF PRONOUNCEMENT : 01.10.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -12, CHENNAI, DATED 28.02.2019 AND PERTAINS TO ASSESSMENT YEAR 2011-12. 2. SHRI N. VIJAY KUMAR, THE LD. REPRESENTATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ASSESSEE IS A MEDICAL PROFESSION AL. ACCORDING TO THE 2 I.T.A. NO.1504/CHNY/19 LD. REPRESENTATIVE, APART FROM PENSION, THE ASSESSE E ALSO RECEIVED CONSULTATION CHARGES FROM HOSPITAL. AS PER THE INF ORMATION AVAILABLE, THE ASSESSEE WAS IN RECEIPT OF 11,40,450/- AFTER DEDUCTING TDS TO THE EXTENT OF 1,16,598/-. BY OVERSIGHT, ACCORDING TO THE LD. REP RESENTATIVE, THIS CONSULTATION CHARGES OF 11,40,450/- WAS NOT DISCLOSED TO THE DEPARTMENT. HOWEVER, WHEN IT WAS POINTED OUT DURIN G THE COURSE OF ASSESSMENT PROCEEDING, ACCORDING TO THE LD. REPRESE NTATIVE, IT WAS OFFERED FOR TAXATION AND THE ASSESSEE ALSO PAID THE TAXES, THEREFORE, THERE CANNOT BE ANY LEVY OF PENALTY UNDER SECTION 271(1)( C) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 3. ON THE CONTRARY, MS. G.D. JAYANTHI ANGAYARKANNI, THE LD. DEPARTMENTAL REPRESENTATIVE, SUBMITTED THAT THE CON SULTATION CHARGES OF 11,40,450/- WAS ADMITTEDLY NOT DISCLOSED TO THE DEP ARTMENT IN THE RETURN OF INCOME. THEREFORE, IT IS A CLEAR CASE OF CONCEA LMENT OF INCOME. ONLY AFTER ISSUING NOTICE BY THE ASSESSING OFFICER, ACCO RDING TO THE LD. D.R., THE ASSESSEE ADMITTED THE INCOME AND PAID THE TAXES . HAD THE RETURN NOT BEEN SELECTED FOR SCRUTINY, THE INCOME WOULD NOT HA VE BEEN SUBJECTED TO TAX AT ALL. THEREFORE, ACCORDING TO THE LD. D.R., THE CIT(APPEALS) HAS RIGHTLY CONFIRMED THE PENALTY LEVIED BY THE ASSESSI NG OFFICER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS NOT IN DISPUTE THAT 3 I.T.A. NO.1504/CHNY/19 THE ASSESSEE HAS RECEIVED 11,40,450/- TOWARDS CONSULTATION CHARGES FROM HOSPITAL APART FROM PENSION. IN THE RETURN OF INCOME, THE ASSESSEE HAS DISCLOSED ONLY THE PENSION AND THE CONSULTATION CHARGE WAS NOT DISCLOSED TO THE DEPARTMENT. IT IS NOT IN DISPUTE THAT THE TAX WAS DEDUCTED AT SOURCE. THEREFORE, IT IS OBVIOUS THAT THE PAYMENT OF 11,40,450/- TO THE ASSESSEE WAS WELL WITHIN THE KNO WLEDGE OF THE DEPARTMENT. THE TAX DEDUCTED FROM THE CONSULTATION CHARGES PAID BY THE HOSPITAL WAS DISCLOSED TO THE DEPARTMENT BY WAY OF TDS RETURN BY THE HOSPITAL. THEREFORE, IT CANNOT BE SAID THAT THE AS SESSEE HAS INTENTIONALLY CONCEALED ANY PART OF HIS INCOME. WHEN THE TAX WAS DEDUCTED AND THE TDS RETURN WAS FILED, NO ONE CAN SAY THAT THERE WAS ANY INTENTION TO CONCEAL THE INCOME OR PART OF INCOME. 5. THE QUESTION ARISES FOR CONSIDERATION IS WHEN TH E ASSESSEE BY OVERSIGHT OMITTED TO DISCLOSE THE CONSULTATION CHAR GES WHICH WAS SUBJECTED TO TDS, WHETHER THERE WAS ANY CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME? TH E APEX COURT EXAMINED THIS ISSUE IN PRICE WATERHOUSE COOPERS PVT . LTD. V. CIT (2012) 348 ITR 306 AND FOUND THAT BY INADVERTENT MISTAKE, WHEN THE INCOME WAS NOT DISCLOSED TO THE DEPARTMENT THAT CANNOT BE A REASON TO LEVY PENALTY. IN VIEW OF THIS JUDGMENT OF APEX COURT, T HIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT AN INADVERTENT OMISSION TO DISCLOSE THE INCOME 4 I.T.A. NO.1504/CHNY/19 WHICH WAS SUBJECT MATTER TO TDS CANNOT BE A REASON TO LEVY PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THEREFORE, WE ARE UNABLE TO UPHOLD THE ORDERS OF THE LOWER AUTHORITIES. ACCORDINGLY, THE ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE PENALTY LEV IED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE ACT IS DELET ED. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 1 ST OCTOBER, 2019 AT CHENNAI. SD/- SD/- (. !') ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) $ / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 1 ST OCTOBER, 2019. KRI. . ,167 87(1 /COPY TO: 1. *+/ APPELLANT 2. ,-*+/ RESPONDENT 3. 0 91 () /CIT(A)-12, CHENNAI 4. PRINCIPAL CIT- 3, CHENNAI 5. 7: ,1 /DR 6. ;' < /GF.