DCIT -CC-7(3), MUMBAI V. KAVITA SINGH, MUMBAI

ITA 1597/MUM/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 3482 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-03-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2008-2009
• Appeal Filed On: 18-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURBINDER SINGH
• Assessee Lawyers: SHRUTI DESAI
• Keywords: Unexplained investment; Set aside
• Section: 271(1)(c); 143(3); 153A; 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H MUMBAI BEFORE SHRI SAKTIJIT DEY (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 1597/MUM/2019 ASSESSMENT YEAR: 2008-09 DEPUTY COMMISSIONER OF INCOME TAX-CC-7(3), ROOM NO. 655, 6 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020. VS. MRS. KAVITA SINGH, 2B, SWAPNLOK, L.J. ROAD, NEAPEANSEA ROAD, MUMBAI-400 006 PAN NO. ANDPS 0896 C APPELLANT RESPONDENT REVENUE BY : MR. GURBINDER SINGH, DR ASSESSEE BY : MS. SHRUTI DESAI , AR DATE OF HEARING : 22/02/2021 DATE OF PRONOUNCEMENT : 02/03/2021 ORDER PER N.K. PRADHAN, A.M. THIS IS AN APPEAL FILED BY THE REVENUE. THE RELEVAN T ASSESSMENT YEAR IS 2008-09. THE APPEAL IS DIRECTED AGAINST THE ORDER O F THE COMMISSIONER OF INCOME TAX (APPEALS)-49, MUMBAI [IN SHORT CIT(A)] AND ARISES OUT OF PENALTY LEVIED U/S 271(1)(C) OF THE INCOME TAX ACT 1961, (T HE ACT). 2. THE GROUND OF APPEAL FILED BY THE REVENUE READS AS UNDER : ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW, WHETHER THE LD. CIT(A) WAS CORRECT IN DELETING THE PENALTY AS LEVIED BY THE AO ; WHEREIN THE AO WAS SATISFIED THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOM E AND FURNISHED INACCURATE ITA NO. 1597/M/2019 MRS KAVITA SINGH 2 PARTICULARS IN RESPECT OF INVESTMENTS IN PAINTINGS AND JEWELLERY WITHIN THE MEANING OF SECTION 271(1)(C) AND HAS ALLOWED THE APPEAL OF THE ASSESSEE CONSIDERING ONLY THE FACT THAT THE NOTICE WAS ISSUED U/S 274 R.W.S. 271( 1)(C)/271AAA OF THE I.T. ACT. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSING OFFICER (AO) COMPLETED THE ASSESSMENT U/S 143(3) R.W.S. 153A ON 30.12.2009. ADDITION OF RS.2,28,95,000/- ON ACCOUNT OF UNEXPLAINED INVESTME NT IN PAINTINGS AND RS.41,81,027/- ON ACCOUNT OF UNEXPLAINED JEWELLERY WAS MADE BY THE AO. LATER ON, THE AO LEVIED A PENALTY OF RS.95,00,000/- U/S 2 71(1)(C) OF THE ACT. 4. AGGRIEVED BY THE PENALTY LEVIED BY THE AO, THE A SSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A). WE FIND THAT VIDE ORDER DATED 17.12.2018, THE LD. CIT(A) DELETED THE SAID PENALTY ON MERITS BY OBSERV ING THAT : 6.8 EVEN ON MERITS, AS COULD BE SEEN FROM THE FACT S AND CIRCUMSTANCES OF THE CASE, 98% OF THE ADDITIONS HAVE BEEN DELETED BY THE HON'B LE ITAT WITH REGARD TO UNEXPLAINED INVESTMENT IN PAINTINGS. WITH REGARD TO THE ADDITION ON ACCOUNT OF INVESTMENT IN UNEXPLAINED PAINTINGS, THE HON'BLE IT AT HAS GIVEN RELIEF TO THE TUNE OF RS.2,04,35,000/- AND NO PENALTY CAN BE LEVIED ON TH IS DELETION MADE BY THE HON'BLE ITAT. WHAT HAS BEEN CONFIRMED IS ONLY AN INVESTMENT TO THE TUNE OF RS.4,60,000/- FOR FIVE PAINTINGS. OUT OF THIS, TWO PAINTINGS ARE VERY OLD, ONE OF NAINA DALAL COSTING RS.3,00,000/- WHICH WAS MADE IN 1973 AND THE OTHER OF WILLIAM DANIAL COSTING RS.50,000/- WHICH WAS MADE IN 1843. THE ASSESSEE IS NOT EXPECTED TO PRESERVE THE BILLS FOR SUCH A LONG PERIOD. THE ADDITION HAS BEEN CONFIRMED IN THE ABSENCE OF EVIDENCE FROM THE ASSESSEE BUT THIS IS NOT A CASE W HICH WOULD WARRANT LEVY OF PENALTY EITHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS. WITH REGARD TO THE ADDITION ON ACCOUNT OF UNEXPLAINED IN VESTMENT IN JEWELLERY, IT HAS ALREADY BEEN MENTIONED THAT THE SAME HAS BEEN RESTO RED TO THE FILE OF THE AO FOR RE- ADJUDICATION. WHEN THE ADDITION ITSELF HAS BEEN SET ASIDE, THERE IS NO CASE FOR LEVY OF PENALTY ON THIS ADDITION. ITA NO. 1597/M/2019 MRS KAVITA SINGH 3 5. BEFORE US, THE LD. DEPARTMENTAL REPRESENTATIVE S UPPORTS THE ORDER PASSED BY THE AO. ON THE OTHER HAND, THE LD. COUNSE L FOR THE ASSESSEE RELIES ON THE ORDER OF THE LD. CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RELEVANT MATERIALS ON RECORD. IN THE INSTANT CASE, THE TRIBUNAL HAS DE LETED ADDITION TO THE TUNE OF RS.2,04,35,000/- ON ACCOUNT OF UNEXPLAINED INVESTME NT IN PAINTINGS. AS RECORDED BY THE LD. CIT(A), WHAT HAS BEEN CONFIRMED IS ONLY AN INVESTMENT TO THE TUNE OF RS.4,60,000/- ON FIVE PAINTINGS. OUT OF THIS, TWO PAINTINGS ARE VERY OLD, ONE OF NAINA DALAL COSTING RS.3,00,000/- WHICH WAS MADE IN 1973 AND THE OTHER OF WILLIAM DANIAL COSTING RS.50,000/- WHICH W AS MADE IN 1843. WE CONCUR WITH THE OBSERVATION OF THE LD. CIT(A) THAT THE ASSESSEE IS NOT EXPECTED TO PRESERVE THE BILLS FOR SUCH A LONG PERIOD. WITH REGARD TO ADDITION ON ACCOUNT OF UNEXPLAINED INVESTMENT IN JEWELLERY, WE FIND THA T THE SAME HAS BEEN RESTORED TO THE FILE OF THE AO FOR ADJUDICATION. IN SUCH A SCENARIO, THE LD. CIT(A) HAS RIGHTLY DELETED THE PENALTY LEVIED BY THE AO. W E AFFIRM THE ORDER OF THE LD. CIT(A). 7. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 02/03/2021. SD/- SD/- (SAKTIJIT DEY) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; DATED: 02/03/2021 RAHUL SHARMA, SR. P.S. ITA NO. 1597/M/2019 MRS KAVITA SINGH 4 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./ASSISTANT REGISTRAR) ITAT, MUMBAI