NOORJAHAN T. MUJAHID, MUMBAI V. ASST CIT 17(3), MUMBAI

ITA 1591/MUM/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9858 (ITAT-MUMBAI)
• Duration Of Justice: 4 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-07-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2006-2007
• Appeal Filed On: 07-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR
• Assessee Lawyers: R S KHANDELWAL; NEELKANTH KAHNDELWAL
• Keywords: Application of stay; Accommodation entries
• Section: 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI B.R. BASKARAN (AM) & SHRI AMARJIT SINGH (JM) S.A. NO. 265/MUM/2017 & I.T.A. NO. 1591 /MUM/20 17 (ASSESSMENT YEAR 20 06 - 07 ) MS. NOORJAHAN T. MUJAHID PLOT NO. 131 YOUTH QURESHI APARTMENT 1 S T FLOOR , CARTER ROAD OPP. JOGGERS PARK BANDRA WEST , MUMBAI. PAN NO. AIAPM8446N VS. ACIT 17(3) 6 TH FLOOR PIRAMAL C HAMBERS LALBAUG, PAREL MUMBAI - 400012. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY SHRI R.S. KHANDELWAL & SHRI NEELKANTH KAHNDELWAL DEP ARTMENT BY S HRI SUMAN KUMAR DATE OF HEARING 16 . 6 . 201 7 DATE OF PRONOUNCEMENT 12 . 7 . 201 7 O R D E R PER B.R. BASKARAN (AM) : - THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 25 - 01 - 2017 PASSED BY LD CIT(A) - 32, MUMBAI AND IT RELATES TO THE ASSESSMENT YEAR 2006 - 07. THE ASSESSEE IS AGGRIEVED BY THE DECISION OF LD CIT(A) IN CONFIRMING THE PENALTY OF RS.22.93 LAKHS LEVIED BY THE AO U/S 271(1)(C) OF THE ACT. 2. WE HEARD THE PARTIES AND PERUSED THE RECORD. THE ASSESSEE FILED HER RETUR N OF INCOME DECLARING A TOTAL INCOME OF RS.47,85,380/ - ON 28.03.2008, WHICH INCLUDED SHORT TERM CAPITAL GAIN OF RS.46,04,454/ - . THEREAFTER THE AO ISSUED A NOTICE U/S 142(1) ON 01.12.2008, WHEREIN SEVERAL DETAILS WERE CALLED FOR. IT IS THE CONTENTION OF T HE ASSESSEE THAT SHE FILED A REVISED COMPUTATION OF STATEMENT, SINCE THERE WAS A MISTAKE IN THE AMOUNT OF SHORT TERM CAPITAL GAIN DECLARED IN THE ORIGINAL RETURN OF INCOME. THE ASSESSEE FIELD THE REVISED COMPUTATION THROUGH A LETTER DATED 15 - 04 - 2008, WHICH WAS FILED ON 21.05.2008 MS. NOORJAHAN T. MUJAHID 2 AND BEARS THE SEAL OF THE OFFICE OF THE AO. IN THE REVISED COMPUTATION, THE SHORT TERM CAPITAL GAIN WAS ENHANCED BY RS.67,77,492/ - . HOWEVER, THE AO DID NOT TAKE NOTICE OF THIS REVISED COMPUTATION. DURING THE COURSE OF HEARING, T HE ASSESSEE FILED THE DETAILS TO THE AO ON 8.12.2008, ON THE BASIS OF WHICH, THE AO ASSESSED THE SUM OF RS.67,77,492/ - AS INCOME OF THE ASSESSEE. THE ASSESSEE HAD DECLARED SHORT TERM CAPITAL GAIN OF RS.44,66,911/ - ON SALE OF SHARES OF A PENNY STOCK NAMED M/S KARUNA CABLES. THE AO TOOK THE VIEW THAT THE ASSESSEE HAS OBTAINED ACCOMMODATION ENTRIES BY WAY OF SHORT TERM CAPITAL GAINS AND ACCORDINGLY ASSESSED THE SAME AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES AND ALSO ASSESSED 5% THEREOF AMOUNTING TO RS.2,23,345/ - AS EXPENDITURE INCURRED IN OBTAINING ARTIFICIAL CAPITAL GAIN. ACCORDINGLY HE TOOK THE VIEW THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS INCOME AND ALSO FURNISHED INACCURATE PARTICULARS OF INCOME RELATING TO CAPITAL GAINS. THE AO ACCORDING LY LEVIED A PENALTY OF RS.22,93,735/ - ON ALL THE THREE ADDITIONS REFERRED ABOVE. 3. BEFORE LD CIT(A), THE ASSESSEE CONTENDED THAT THE ASSESSEE HAS FILED REVISED COMPUTATION OF INCOME BEFORE THE ISSUE OF NOTICE BY THE AO AND HENCE THERE IS NO CONCEALMEN T. THE LD CIT(A) ALSO DID NOT RECOGNISE THE REVISED COMPUTATION BY OBSERVING THAT THE ACKNOWLEDGEMENT SEAL WAS NOT LEGIBLE. ACCORDINGLY HE CONFIRMED THE PENALTY LEVIED BY THE AO. 4. BEFORE US, THE LD A.R SUBMITTED THAT THE ASSESSEE HAD CHALLENGED THE MATTER OF ASSESSMENT OF SHORT TERM CAPITAL GAIN OF RS.44,66,911/ - AS UNDISCLOSED INCOME OF THE ASSESSEE AND ALSO THE ADDITION OF RS.2,23,345/ - TOWARDS ESTIMATED EXPENSES, BY FILING APPEAL BEFORE THE TRIBUNAL. HE SUBMITTED THAT THE CO - ORDINATE BENCH OF TR IBUNAL HAS SET ASIDE THE ORDER OF THE AO ON THE ABOVE SAID TWO ISSUES, VIDE ITS ORDER DATED 30.04.2014 PASSED IN ITA NO.960/MUM/2011. ACCORDINGLY HE SUBMITTED THAT THE PENALTY LEVIED ON THE ABOVE SAID TWO ADDITIONS IS LIABLE TO BE DELETED. WE AGREE WITH THE SAME. MS. NOORJAHAN T. MUJAHID 3 5. WITH REGARD TO THE PENALTY LEVIED ON THE AMOUNT OF RS. 67,77,492/ - , THE LD A.R SUBMITTED THAT THE ASSESSEE HAS FURNISHED A LEGIBLE COPY OF THE LETTER DATED 15.04.2008 AND THE DATE OF ACKNOWLEDGEMENT IS CLEARLY VISIBLE AS 21 ST MAY 2008. ACC ORDINGLY HE SUBMITTED THAT THE ASSESSEE HAS BROUGHT THE MISTAKE IN THE AMOUNT OF SHORT TERM CAPITAL GAINS TO THE KNOWLEDGE OF THE AO BEFORE ITS DETECTION BY HIM. ACCORDINGLY HE SUBMITTED THAT THE LD CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIE D ON THAT AMOUNT. 6. ON THE CONTRARY, THE LD D.R EXPRESSED DOUBTS ABOUT THE CLAIM OF THE ASSESSEE AND ACCORDINGLY HE SUBMITTED THAT HE WILL OBTAIN A REPORT FROM THE AO IN THIS REGARD. THE LD D.R FILED A LETTER DATED 22.6.2017, WHEREIN HE HAS STATED TH AT THE DETAILS CALLED FOR BY HIM WERE NOT FORTHCOMING FROM THE END OF THE AO. ACCORDINGLY THE LD D.R HAS SUBMITTED THAT THE CASE MAY BE DECIDED ON THE BASIS OF DOCUMENTS AVAILABLE ON RECORD. 7. HAVING HEARD RIVAL SUBMISSIONS, WE NOTICE THAT THE ASSESS EE HAS FILED REVISED COMPUTATION OF INCOME ON 21 - 05 - 2008, WHEREIN THE ASSESSEE HAS DECLARED CORRECT AMOUNT OF SHORT TERM CAPITAL GAIN. AS NOTICED EARLIER, THE AO DID NOT TAKE INTO ACCOUNT THIS REVISED COMPUTATION DURING THE COURSE OF ASSESSMENT PROCEEDING S. THE ASSESSEE DECLARED THE CORRECT AMOUNT OF CAPITAL GAIN BEFORE THE AO AGAIN IN DECEMBER, 2008. HENCE THE AO HAS TAKEN THE VIEW THAT THE ASSESSEE HAS COME FORWARD TO DECLARE THE SAME AFTER THE RECEIPT OF NOTICE ISSUED BY HIM. ACCORDINGLY THE AO HAS T AKEN THE VIEW THAT THE ASSESSEE HAS DECLARED THE ADDITIONAL AMOUNT OF CAPITAL GAIN AFTER ITS DETECTION BY HIM. THE LD CIT(A) HAS REJECTED THE CONTENTION OF THE ASSESSEE THAT THE ADDITIONAL INCOME WAS DECLARED BY THE ASSESSEE BEFORE ITS DETECTION, ONLY ON THE REASONING THAT THE ACKNOWLEDGEMENT SEAL OF THE AO IS NOT LEGIBLE IN THE LETTER. NOW THE ASSESSEE HAS FILED A LEGIBLE COPY, WHERE FROM WE NOTICE THAT THE LETTER DATED 15 - 04 - 2008 THROUGH WHICH THE REVISED COMPUTATION WAS FILED, BEARS THE MS. NOORJAHAN T. MUJAHID 4 ACKNOWLEDGEMENT SEAL OF 21 - 05 - 2008. THOUGH THE LD D.R HAS DISPUTED THIS DOCUMENT, YET HE COULD NOT CONTRADICT THE SAME. HENCE THE CONTENTION OF THE ASSESSEE THAT SHE HAS FILED THE REVISED COMPUTATION OF INCOME ON 21.05.2008 NEEDS TO BE ACCEPTED. SINCE THE ASSESSEE HAS DISCLOSED THE ADDITIONAL INCOME BEFORE THE ISSUE OF ANY NOTICE BY THE AO, IT HAS TO BE HELD THAT THE ASSESSEE HAS DECLARED THE SAME BEFORE ITS DETECTION BY THE AO, MEANING THEREBY THE SAME HAS BEEN DECLARED VOLUNTARILY. ACCORDINGLY WE ARE OF THE VIEW THA T THE AO WAS NOT JUSTIFIED IN LEVYING PENALTY THEREON. ACCORDINGLY WE SET ASIDE THE ORDER PASSED BY LD CIT(A) AND DIRECT THE AO TO DELETE THE IMPUGNED PENALTY. 8. SINCE, WE HAVE DISPOSED OF THE APPEAL, THE STAY APPLICATION BECOMES INFRUCTUOUS. ACCORDINGL Y, WE DISMISS THE SAME. 9 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED AND STAY APPLICATION IS DISMISSED . ORDER HAS BE EN PRONOUNCED IN THE COURT ON 12 . 7 .201 7. SD SD/ - (AMARJIT SINGH ) (B.R.BASKARAN) JUDICIAL MEM BER ACCOUNTANT MEMBER MUMBAI ; DATED : 12 / 7 / 20 1 7 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FIL E. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) PS ITAT, MUMBAI