ACIT, CHENNAI V. GoFrugal Technologies Pvt Ltd., CHENNAI

ITA 2016/CHNY/2015

• Counselvise Citation: 201621714 RSA 2015
• Duration Of Justice: 2 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2015
• Appeal Filed By: Department
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 25-09-2015
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: N V BALAJI
• Keywords: Wrong claim

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . . . , . ! , ' # $ [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.2016/MDS/2015 / ASSESSMENT YEAR : 2006-07 THE ASSTT. COMMISSIONER OF INCOME-TAX CORPORATE CIRCLE 2(1) CHENNAI VS. M/S G OFRUGAL TECHNOLOGIES PVT. LT D SREE NARAYANA COMPLEX NO.11, SARATHY NAGAR VIJAYA NAGAR, VELACHERRY CHENNAI 600 042 [PAN AACCA 4341F ] ( %& / APPELLANT) ( '(%& /RESPONDENT) / APPELLANT BY : SHRI P RADHAKRISHNAN, JCIT /RESPONDENT BY : SHRI N V BALAJI, ADVOCATE / DATE OF HEARING : 23 - 1 1 - 2015 ! / DATE OF PRONOUNCEMENT : 09 - 12 - 2015 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, CHENNA I, DATED 14.7.2015 AND PERTAINS TO ASSESSMENT YEAR 2006-07. 2. SHRI P RADHAKRISHNAN, LD. DEPARTMENTAL REPRESENTATI VE SUBMITTED THAT THE ASSESSEE CLAIMED A SUM OF ` 1,23,54,185/- AS EXEMPT U/S 10(33) OF THE ACT. THE ASSESSING OFFIC ER FOUND THAT THE ITA NO. 2016/15 :- 2 -: ABOVE SAID AMOUNT REPRESENTED THE PROFIT ON REDEMPT ION OF MUTUAL FUND UNITS WHICH ARE TAXABLE UNDER THE HEAD CAPITAL GAINS. HOWEVER, THE ASSESSEE CLASSIFIED THE SAME AS DIVIDEND AND C LAIMED EXEMPTION. THE MERE FACT THAT THE PROFIT ON REDEMPTION OF MUTU AL FUND UNITS WAS CLASSIFIED AS DIVIDEND INCOME AND CLAIMED EXEMPTION U/S 10(33) OF THE ACT WOULD AMOUNT TO FURNISHING INACCURATE PARTICULA RS. ON A QUERY FROM THE BENCH, THE LD. DR POINTED OUT THAT THE AS SESSEE HAS FURNISHED ALL THE PARTICULARS OF INCOME, BUT THE ON LY INACCURATE PARTICULARS IS THE CLAIM MADE BY THE ASSESSEE U/S 10(33) OF THE ACT BY WRONGLY CLASSIFYING THE PROFIT ON REDEMPTION OF MUT UAL FUND UNITS AS DIVIDEND. 3. ON THE CONTRARY, SHRI N V BALAJI, LD. COUNSEL FOR T HE ASSESSEE SUBMITTED THAT THE ASSESSEE DISCLOSED ALL THE INCO ME AND CLAIMED A SUM OF ` 1,23,54,185/- AS EXEMPT U/S 10(33) OF THE ACT. A CCORDING TO THE LD. COUNSEL, THE ASSESSEE INVESTED ITS SURPLUS FUNDS IN THE MUTUAL FUNDS AND FIXED DEPOSITS. THE MUTUAL FUND UNITS WO ULD NOT RESULT IN CAPITAL GAIN ON SALE. DURING THE YEAR UNDER CONSID ERATION THE ASSESSEE INVESTED ITS SURPLUS FUNDS IN EQUITY BASED MUTUAL FUNDS AND SOLD THE SAME WHICH GIVES CAPITAL GAIN. ACCORDING TO THE LD. COUNSEL, THE ACCOUNTANT OF THE ASSESSEE INSTEAD OF BOOKING THE PROFIT SEPARATELY, HAS CLASSIFIED THE INCOME FROM MUTUAL F UNDS AS DIVIDEND INCOME AND CLAIMED EXEMPTION. THIS IS A HUMAN ERRO R. ACCORDING TO ITA NO. 2016/15 :- 3 -: THE LD. COUNSEL, MAKING A CLAIM BEFORE THE ASSESSIN G OFFICER WOULD NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS OF INCO ME. IN FACT, THE ASSESSEE HAS FURNISHED ALL THE PARTICULARS OF INCOM E AND CLAIMED EXEMPTION U/S 10(33) OF THE ACT. MERELY BECAUSE T HE PROFIT ON REDEMPTION OF MUTUAL FUND WAS CLASSIFIED AS DIVIDEN D INCOME AND CLAIMED EXEMPTION U/S 10(33) OF THE ACT WOULD NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS. ACCORDING TO TH E LD. COUNSEL, DUE TO HUMAN ERROR, THE MISTAKE HAS HAPPENED AND ALL THE P ARTICULARS OF INCOME ARE AVAILABLE BEFORE THE ASSESSING OFFICER. ACCORDING TO THE LD. COUNSEL, THE CIT(A) HAS RIGHTLY DELETED THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THE PROFIT ON REDEMPTION OF MUTUAL FUND UNITS WAS CLAIMED BY THE ASSESSEE AS EXEMPT U/S 10(33) OF THE ACT BY TREATING THE SAME AS DIVIDEND INCOME. THE ASSESSING OFFICER HOWEVER, DISALLOWED THE CLAIM OF THE ASSESSEE. THE FACT REMAINS THAT THE ENTIRE PARTICU LARS OF INCOME IS AVAILABLE BEFORE THE ASSESSING OFFICER AND THE CLAI M MADE BY THE ASSESSEE ON REDEMPTION OF MUTUAL FUND UNITS IS ALSO AVAILABLE BEFORE THE ASSESSING OFFICER. THEREFORE, MERELY BECAUSE T HE ASSESSEE HAS MADE A WRONG CLAIM U/S 10(33) OF THE ACT, THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT IT WOULD NOT AMOUNT TO FURN ISHING INACCURATE ITA NO. 2016/15 :- 4 -: PARTICULARS OF INCOME. ON IDENTICAL SET OF FACTS, THE APEX COURT IN THE CASE OF PRICE WATER COOPERS P. LTD. VS CIT [2012] 3 48 ITR 306, HELD THAT MAKING A WRONG CLAIM BEFORE THE ASSESSING OFFI CER WOULD NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS OF INCO ME. IN VIEW OF THE ABOVE, THIS TRIBUNAL DO NOT FIND ANY REASON TO INT ERFERE WITH THE ORDER OF THE CIT(A) AND ACCORDINGLY, THE SAME IS CONFIRME D. 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH DECEMBER, 2015, AT CHENNAI. SD/- SD/- ( . ! ) (A. MOHAN ALANKAMONY) ' / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 9 TH DECEMBER, 2015 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF