The DCIT, Central Circle-3(1), Baroda V. Shri Bhavanbhai Rukhabhai Bharwad, Baroda

ITA 166/AHD/2017

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 9880 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-12-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2012-2013
• Appeal Filed On: 19-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ANIL R SHAH; KINJAL V SHAH A RS
• Keywords: Sale consideration of property below Jantri Value

Judgement Text

, C IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH, AHMADABAD BEFORE: SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH , ACCOUNTANT MEMBER ITA NO. 166/AHD/2017 WITH CROSS OBJECTION NO. 30/AHD/2017 ASSESSMENT YEAR : 2012-13 DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-3(1), 5 TH FLOOR, AAYKAR BHAVAN, RACE COURSE CIRCLE, VADODARA 390 007 V S . SHRI BHAVANBHAI RUKHABHAI BHARVAD 111, MOTI BIPOD GAM, BHARWAD, BHARWAD VAAS, BAPOD, BARODA PAN NO. ACGPB2964E (APPELLANT/RESPONDENT) .. (RESPONDENT/CROSS OBJECT OR) /BY REVENUE SHRI KAMLESH MAKWANA, SR. D.R. /BY ASSESSEE SHRI ANIL R. SHAH & KINJAL V. SHAH, A.RS. /DATE OF HEARING 03/12/2018 /DATE OF PRONOUNCEMENT 05/12/2018 O R D E R PER : RAJPAL YADAV, JUDICIAL MEMBER THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINS T THE ORDER OF THE LEARNED CIT(A)-12, AHMEDABAD, DATED 25.10.2016 PASS ED FOR A.Y. 2012-13. ON RECEIPT OF NOTICE IN THE REVENUES APPEAL, ASSES SEE HAS ALSO FILED CROSS OBJECTION BEARING NO. 30/AHD/2017. ITA NO.166/AHD/17 WITH CO NO. 30/AHD/2017 A.Y.2012-13 (DCIT VS. SHRI BHAVANBHAI R. BHARVAD) PAGE 2 2. THE GRIEVANCE OF THE REVENUE IS THAT LEARNED CIT (A) HAS ERRED IN DELETING THE PENALTY OF RS.25LAKHS LEVIED UNDER S.2 71AAA OF THE INCOME TAX ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SEARCH AN D SEIZURE OPERATION WAS CARRIED OUT ON 09 TH AUGUST, 2011 IN THE ANIL BHOLABHAI PATEL GROUP OF CASES. THE ASSESSEE WAS ALSO COVERED IN THE SEARCH ACTION. STATEMENT OF SHRI ANIL BHOLABHAI PATEL WAS RECORDED UNDER S.132(4) OF THE INCOME TAX ACT. HE HAS DECLARED AN UNEXPLAINED INCOME OF RS.35 CRORES ON B EHALF OF THE FIRMS AND OTHER GROUP MEMBERS. THE OTHER GROUP MEMBERS CONCU RRED WITH HIS STATEMENT AND UNDERTAKING. THUS, A SUM OF RS.2.50C RORE WAS ALLOCATED TO THE ASSESSEE AS UNEXPLAINED INCOME WHICH WAS OFFERED FO R TAXATION. THE AO HAS ACCEPTED THE DECLARATION MADE BY THE ASSESSEE AND I NCLUSION OF THIS AMOUNT IN RETURN OF INCOME. HOWEVER, HE INITIATED THE PENALT Y PROCEEDINGS UNDER S.271AAA OF THE INCOME TAX ACT. ACCORDING TO THE A O, THE ASSESSEE FAILED TO SUBSTANTIATE THE MANNER IN WHICH INCOME WAS EARN ED AND THEREFORE, HE LEVIED PENALTY UNDER S.271AAA OF THE INCOME TAX ACT . 4. DISSATISFIED WITH THE LEVY OF PENALTY, ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A). THE LEARNED CIT(A) SATISFIED WITH THE EXPLANATION OF THE ASSESSEE THAT HE HAS FULFILLED ALL THE CONDITIONS O F SUB-CLAUSE (2) OF SECTION 271AAA OF THE INCOME TAX ACT. THE LEARNED CIT(A) H AS DELETED THE PENALTY. 5. WITH THE ASSISTANCE OF LEARNED REPRESENTATIVES, WE HAVE GONE THROUGH THE RECORDS CAREFULLY. SUB-SECTION (1) OF SECTION 271AAA CONTEMPLATES THAT PENALTY @ 10% WILL BE LEVIED UPON AN ASSESSEE IN AD DITION TO TAX, IF ANY PAYABLE BY HIM ON UNDISCLOSED INCOME OF THE SPECIFIED PREVI OUS YEAR. EXPLANATION TO THIS SECTION GIVES MEANING OF UNEXPLAINED INCOME AS WELL AS SPECIFIED YEARS. ITA NO.166/AHD/17 WITH CO NO. 30/AHD/2017 A.Y.2012-13 (DCIT VS. SHRI BHAVANBHAI R. BHARVAD) PAGE 3 THERE IS NO DISPUTE ABOUT THESE TERMS IN THE PRESEN T CASE. THE DISPUTE IS THAT SUB-SECTION (2) CARVED OUT EXCEPTIONS WHICH ABSOLVE THE ASSESSEE FROM LEVY OF PENALTY UNDER S.271AAA OF THE ACT. THESE CONDIT IONS READ AS UNDER: (2) NOTHING CONTAINED IN SUB-SECTION (1) SHALL APP LY IF THE ASSESSEE,- (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UND ER SUB-SECTION (4) OF SECTION 132, ADMITS THE UNDISCLOSED INCOME AND SPEC IFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED; (II) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLO SED INCOME WAS DERIVED; AND (III) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RESPECT OF THE UNDISCLOSED INCOME. AS FAR AS FULFILLMENT OF CONDITIONS AT 3 ARE CONCE RNED THERE IS NO DISPUTE BETWEEN THE ASSESSEE AND REVENUE. THE DISP UTE RELATES WITH REGARD TO CONDITION NOS. (I) & (II). ACCORDING TO THE AO, AS SESSEE FAILED TO SPECIFY THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED AND FA ILED TO SUBSTANTIATE THAT MANNER. A PERUSAL OF THE RECORD WOULD INDICATE THA T INCOME WAS EARNED FROM LAND TRANSACTION, CAPITAL GAINS ETC. THIS WAS DISC LOSED DURING THE COURSE OF SEARCH. AS FAR AS SUBSTANTIATION OF THE MANNER IS CONCERNED, IT WAS NOT ASKED DURING COURSE OF SEARCH NOR DURING COURSE OF ASSESS MENT PROCEEDINGS. THE LEARNED FIRST APPELLATE AUTHORITY HAS CATEGORICALLY RECORDED A FINDING THAT ASSESSEE HAS BROADLY SPECIFIED THE MANNER IN WHICH THE UNDISCLOSED INCOME HAS BEEN EARNED AND FULFILLED THE CONDITIONS. TO O UR MIND, LEARNED FIRST APPELLATE AUTHORITY HAS APPRECIATED THE CONTROVERSY IN RIGHT PERSPECTIVE AND NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE C IT(A), HENCE APPEAL OF THE REVENUE IS DISMISSED. 6. AS FAR AS CROSS OBJECTION IS CONCERNED, SUB-SECT ION (IV) OF SECTION 253 CONTEMPLATES THAT ON RECEIPT OF NOTICE RESPONDENT C AN FILE CROSS OBJECTION WITHIN 30 DAYS AGAINST ANY PART OF THE IMPUGNED ORD ER. THE CROSS OBJECTION IS ITA NO.166/AHD/17 WITH CO NO. 30/AHD/2017 A.Y.2012-13 (DCIT VS. SHRI BHAVANBHAI R. BHARVAD) PAGE 4 MAINTAINABLE IF ASSESSEE IS AGGRIEVED WITH ANY PART OF THE IMPUGNED ORDER. WE FIND THAT ASSESSEE HAS NOT EXPRESSED HIS GRIEVAN CE AGAINST ANY PART RATHER CROSS OBJECTION HAS BEEN FILED IN SUPPORT OF CIT(A) S ORDER WHICH IS NO MAINTAINABLE, HENCE, THIS CROSS OBJECTION IS ALSO D ISMISSED. 7. IN THE RESULT, APPEAL OF THE REVENUE AS WELL AS CROSS OBJECTION OF THE ASSESSEE IS DISMISSED. THIS ORDER PRONOUNCED IN OPEN COURT ON 05/12/2 018 SD/- SD/- (AMARJIT SINGH) (RAJPAL YADAV) ACCOUNTANT MEMBER J UDICIAL MEMBER AHMEDABAD: DATED 05/12/2018 TRUE COPY S.K.SINHA / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. !'!#$ % / CONCERNED CIT 4. % - / CIT (A) 5. &'( ))#$ , #$ , ' / DR, ITAT, AHMEDABAD 6. (,- / GUARD FILE. BY ORDER/ , / ! #$ , '