SIKA PROPERTIES P. LTD, MUMBAI V. ITO 3(3)(2), MUMBAI

ITA 1793/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4911 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-10-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 27-03-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAILASH GAIKWAD
• Keywords: Business income; Set aside
• Section: 271(1)(c); 201; 143(2)

Judgement Text

T HE INCOME TAX APPELLATE TRIBUNAL SMC - I BENCH, MUMBAI SHRI SHAMIM YAHYA ( A M) I.T.A. NO. 1793 /MUM/ 201 9 (ASSESSMENT YEAR 2005 - 06 ) I.T.A. NO. 1794/MUM/2019 (ASSESSMENT YEAR 2006 - 07) SIKA PROPERTIES PVT. LTD. 1 ST FLOOR, CASSINATH BUILDING, 17 AK NAYAK MARG, FORT MUMBAI - 400 001. PAN : AAACS5212M V S . ITO - 3(3)(2) AAYAKAR BHAVAN M.K. ROAD MUMBAI - 400 020. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY NONE DEPARTMENT BY SHRI KAILASH GAIKWAD DATE OF HEARING 1 4 . 10 . 20 20 DATE OF PRONOUNCEMENT 15 . 10 . 20 20 O R D E R THESE ARE APPEALS BY THE ASSESSEE AGAINST RESPECTIVE ORDERS OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS) [IN SHORT LEARNED CIT(A)] CONFIRMING THE PENALTY LEVIED U/S. 271(1)(C) OF THE I.T. ACT FOR A.Y. 2005 - 06 & 2006 - 07 RESPECT IVELY. 2. BRIEF FACTS OF THE CASE PERTAINING TO PENALTY ARE THAT IN THE ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER MADE ADDITION ON ACCOUNT OF HOUSE PROPERTY INCOME . THE ASSESSEE HAS OFFERED LEASE RENTAL INCOME AS BUSINESS INCOME. THE ASSESSING OFFICER TREATED IT AS HOUSE PROPERTY INCOME. WHEN THE QUANTUM APPEAL REACHED ITAT, TH E ITAT SET ASIDE THE ISSUE RELATING TO ISSUE OF NOTICE TO THE ASSESSEE U/S. 143(2) OF THE I.T. ACT TO THE FILE OF THE ASSESSING OFFICER. BEFORE THE ORDER OF THE ITAT THE ASSESSING OFFICER ALSO LEVIED PENALTY U/S. 271(1)(C) OF THE ACT ON THE IMPUGNED ADDITIONS. WHEN THE MATTER REACHED TO THE LEARNED CIT(A), THOUGH HE NOTED THAT THE ITAT REMIT TED THE ISSUE REGARDING SERV ICE OF NOTICE TO THE FILE OF THE ASSESSING OFFICER, STILL HE PR OCEEDED TO CONFIRM THE PENALTY. SIKA PROPERTIES PVT. LTD. 2 3. AGAINST THIS ORDER THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. I HAVE HEARD LEARNED DEPARTMENTAL REPRESENTATIVE. NONE APPEARED ON BEHALF OF THE ASSESSEE. I NOTE THAT IN QUANTUM APPEAL , THE ITAT HAS SET ASIDE THE ASSESSMEN T ORDER TO THE FILE OF THE ASSESSING OFFICER TO EXAMINE THE ASSESSEES PLEA AS TO WHETHER THERE IS PROPER SERVICE OF NOTICE U/S. 1 43( 2 ) OF THE IT ACT OR NOT. IN THAT VIEW OF THE MATTER ADDITION NO LONGER SURVIVES AS IT IS . HENCE, THERE IS NO QUESTION OF SU STAINING PENALTY, ONCE THE MATTER IS AGAIN REMITTED TO THE FILE OF THE ASSESSING OFFICER. LEARNED CIT(A) HAS CLEARLY ERRED IN SUSTAINING THE PENALTY ON THE BASIS OF ADDITION WHICH IS AGAIN SUBJECT MATTER OF ASSESSING OFFICERS CONSIDERATION PURSUING TO ITA T R EMITTING THE MATTER . IN THESE CIRCUMSTANCES I N MY CONSIDERED OPINION INTEREST OF JUSTICE DEMANDS THAT SINCE THE MATTER IS BEFORE THE ASSESSING OFFICER IN AS MUCH AS ISSUE OF SERVICE OF NOTICE HAS BEEN REMITTED BY THE ITAT TO THE FILE OF THE ASSESSING OF FICER, THE ISSUE OF LEVY OF PENALTY ALSO NEEDS TO BE REMITTED TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL TAKE DECISION IN THIS REGARD AFTER FOLLOWING THE ITATS DIRECTION PERTAINING TO THE QUANTUM APPEAL. 4. IN THE RESULT, THES E APP EALS BY THE ASSESSEE STAND ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED UNDER RULE 34(4) OF THE ITAT RULES ON 15.10.2020. SD/ - (SH A MIM YAHYA ) ACCOUNTANT MEMBER MUMBAI ; DATED : 15 / 1 0 / 20 20 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI SIKA PROPERTIES PVT. LTD. 3 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR ) PS ITAT, MUMB AI