DCIT 8(3)(2), MUMBAI V. VINAMRA UNIVERSAL TRADERS P.LTD, MUMBAI

ITA 2019/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8507 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 08-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PADMAJA; S K PODAR
• Assessee Lawyers: VIJAYA MEHTA
• Keywords: Capital asset; Business income; Speculation loss; Wrong claim; Difference of opinion; Change of opinion
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'F' BENCH, MUMBAI BEFORE SHRI JASON P. BOAZ, ACCOUNTANT MEMBER AND SHRI SANDEEP GOSAIN , JUDICIAL MEMBER ITA NO. 2019/MUM/2015 (ASSESSMENT YEAR: 2010-11) DY. C.I.T. 8(3)(2) VS. M/S. VI NAMRA UNIVERSAL ROOM NO. 615, 6 TH FLOOR AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400020 TRADERS PVT. LTD. JAI CENTRE, 1 ST FLOOR 34, P. DMELLO RD., OPP. RED GATE MUMBAI 400009 PAN AACCV5090J APPELLANT RESPONDENT APPELLANT BY: MS. S. PADMAJA & SHRI S.K. PODAR RESPONDENT BY: SHRI VIJAYA MEHTA & SHRI GOVIND JAVE RI DATE OF HEARING: 21.12.2016 DATE OF PRONOUNCEMENT: 31.01.2017 O R D E R PER JASON P. BOAZ, A.M. THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDE R OF THE CIT(A)-14, MUMBAI DATED 23.12.2014 DELETING THE PENALTY LEVIED BY THE ASSESSING OFFICER (AO) UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT 'THE ACT') FOR A.Y. 2010-11. 2. THE FACTS OF THE CASE, BRIEFLY STATED, ARE AS UNDER : - 2.1 THE ASSESSEE COMPANY, ENGAGED IN THE BUSINESS O F TRADING IN SHARES, SECURITIES AND DERIVATIVES FILED ITS RETURN OF INCO ME FOR A.Y. 2010-11 ON 09.10.2010 DECLARING LOSS OF ` 53,17,58,095/- ON ACCOUNT OF TRADING IN SHARES/SECURITIES AND LOSS SUFFERED IN SHARES DEALT , WHICH IS REFLECTED AS INVESTMENTS. THE CASE WAS TAKEN UP FOR SCRUTINY AND THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT VIDE ORDE R DATED 28.02.2013, WHEREIN THE ASSESSED LOSS OF THE ASSESSEE WAS DETER MINED AT ` 6,06,47,737/-, THEREBY REDUCING THE RETURNED LOSS BY ` 47,11,10,358/-. PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT WERE SIMULTANEOU SLY INITIATED BY THE AO FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND CONCEALMENT OF INCOME. ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 2 THE ASSESSEE HAS NOT CHALLENGED THE ORDER OF ASSESS MENT DATED 28.02.2013 FOR A.Y. 2010-11 AND THEREFORE THE SAME HAS ATTAINE D FINALITY. 3. THE AO THEN TOOK UP PENALTY PROCEEDINGS UNDER SECTI ON 271(1)(C) OF THE ACT AND AFTER REJECTING THE EXPLANATIONS PUT FO RTH BY THE ASSESSEE, THE AO VIDE ORDER DATED 30.08.2013 PROCEEDED TO LEVY PE NALTY OF ` 16,01,30,411/- UNDER SECTION 271(1)(C) OF THE ACT F OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. ON APPEAL BY THE ASSESSEE, THE LEARNED CIT(A)-16, MUMBAI VIDE THE IMPUGNED ORDER DATED 22. 12.2014 DELETED THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT B Y THE AO FOR A.Y. 2010- 11. 4.1 AGGRIEVED BY THE ORDER OF THE CIT(A)-14, MUMBAI DATED 22.12.2014, DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT IN THE CASE ON HAND FOR A.Y. 2010-11, REVENUE HAS PREFERRED THE AP PEAL, RAISING THE FOLLOWING GROUNDS: - 1.(I) THE LEARNED CIT(A) HAS ERRED ON FACTS AND I N LAW IN DELETING THE PENALTY U/S.271(1)(C) OF THE INCOME TAX ACT, 19 61 OF RS.16,01,30,411/- IMPOSED BY THE ASSESSING OFFICER WITHOUT PROPERLY APPRECIATING THE FACTUAL AND LEGAL MATRIX OF THE CASE AS CLEARLY BROUGHT OUT BY THE ASSESSING OFFICER IN THE ORDER IMPOSING PENALTY. (II) THE LEARNED CIT(A) HAS ERRED ON FACTS AND IN LAW WITHOUT APPRECIATING THE FACT THAT IF THE CASE OF THE ASSES SEE HAD NOT BEEN PICKED UP FOR SCRUTINY THE ASSESSEE WOULD HAVE NOT WITHDRAWN THE PATENTLY WRONG CLAIM OF DEDUCTION AND THEREFORE RATIO DECENDI OF SUPREME COURT IN CASE OF MAK DATA PVT. LTD. VS. CIT 2013) 40 SCD 925 AS REPORTED IN CIVIL APPEA L NO.9772 OF 2013 CLEARLY APPLIES. (III) THE LD. CIT APPEAL HAS ERRED IN LAW AND ON F ACTS IN NOT APPRECIATING THAT CONCEALMENT IS TO BE RECKONED WIT H REFERENCE TO THE RETURNED INCOME AND THE FACT THAT THE ASSESS EE HAD CLAIMED INCOME/LOSS IN WRONG HEAD WAS IRRELEVANT IN THIS REGARD. 2. THE LD.CIT(A)'S ORDER IS CONTRARY TO LAW AND ON FACTS AND DESERVES TO BE SET ASIDE AND A.O 'S ORDER MAY BE RE STORED. 3. THE APPELLANT CRAVES LEAVE TO AMEND OR AFTER ANY GROUND OR ADD A NEW GROUND THAT MAY BE NECESSARY. 4.2 THE LEARNED D.R. FOR REVENUE WAS HEARD IN SUPPO RT OF THE GROUNDS RAISED AND SUBMITTED THAT THE PENALTY LEVIED BY THE AO UNDER SECTION 271(1)(C) OF THE ACT IS ABSOLUTELY CORRECT AND THE ASSESSEE HAS NOT ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 3 CHALLENGED THE ORDER OF ASSESSMENT FOR A.Y. 2010-11 IN QUANTUM MATERIAL AS IT HAS ADMITTEDLY MADE INCORRECT AND INCOMPLETE CLAIMS. 4.3 PER CONTRA, THE LEARNED A.R. OF THE ASSESSEE SU BMITTED THAT THE LEARNED CIT(A) IN THE IMPUGNED ORDER HAD CORRECTLY DELETED THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT FOR A.Y. 2010-11, SINCE THIS IS NOT A CASE OF EITHER CONCEALMENT OF INCOME OR FURNISHIN G OF INACCURATE PARTICULARS OF INCOME JUSTIFYING THE LEVY OF PENALT Y US 271(1)(C) OF THE ACT. THE LEARNED A.R. OF THE ASSESSEE SUBMITS THAT IT IS MERELY A CASE WHEREIN THE LOSS CLAIMED BY THE ASSESSEE AS CAPITAL LOSS HA S BEEN ASSESSED BY THE AO AS SPECULATION LOSS TO BE CARRIED FORWARD TO THE SUBSEQUENT YEARS FOR SET OFF AGAINST SPECULATION INCOME, AS THE ASSESSEE MADE A FULL AND COMPLETE DISCLOSURE OF ALL FACTS/DETAILS IN RESPECT OF THE CLAIM MADE BY IT. THEREFORE, THE CONTENTION OF THE LEARNED A.R. IS TH AT MERE CHANGE OF HEAD OF INCOME DOES NOT CONSTITUTE FURNISHING OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME FOR LEVYING PENALTY US 271 (1)(C) OF THE ACT. 4.4.1 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUS ED AND CAREFULLY CONSIDERED THE MATERIAL ON RECORD. ON A PERUSAL OF THE RECORD BEFORE US, IT IS SEE THAT THE LEARNED CIT(A) HAS DELETED THE PENA LTY LEVIDED UNDER SECTION 271(1)(C) OF THE ACT FOR A.Y. 2010-11, IN THE CASE ON HAND. SHE IS OF THE VIEW THAT IN THE GIVEN FACTS OF THE CASE THIS IS NO T A CASE FOR LEVY OF THE SAID PENALTY, MERELY ON THE BASIS OF INCOME/LOSS CHANGED DUE TO MERE CHANGE OF HEAD OF INCOME; HOLDING AS UNDER IN PARAS 3.4 TO 3. 6 THEREOF: - 3.4 I HAVE GONE THROUGH THE FACTS AND SUBMISSIONS . THE UNDISPUTED FACTS IN THE CASE ARE, THE ASSESSEE FILED RETURN OF INCOME REFLECTING LOSS OF RS. 53,17,58,095/- WHICH WERE ON ACCOUNT OF TRADING IN SHARES AND SECURITIES AND LOSS SUFFERED IN THE SHARES DEAL T, WHICH WERE REFLECTED BY THE APPELLANT AS THEIR INVESTMENT. THE A.O. HAS NOT ACCEPTED, THE PLEA OF THE ASSESSEE THAT THEY WERE H AVING TWO DIFFERENT BASKETS I.E. STOCKS AS WELL AS INVESTMENT PORTFOLIO FOR DEALING IN SHARES AND SECURITIES. FOR THE REASONS MENTIONED IN THE ASSESSMENT ORDER, THE A.O. HAS CONCLUDED THAT ACTUALLY THE ASS ESSEE DID NOT HAVE ANY INVESTMENT BUT THEY WERE THEIR STOCKS ONLY AND AS A RESULT THEREOF LOSS CLAIMED AS LONG TERM CAPITAL LOSE WAS CONSIDER ED AS SHARE TRADING LOSS. THIS HAS RESULTED INTO REDUCED BUSINE SS INCOME OF THE ASSESSEE. THE SHORT TERM CAPITAL LOSS ON ACCOUNT OF NON DELIVERY OF SHARES WERE CONSIDERED AS SPECULATIVE LOSS AND THUS ALONGWITH SPECULATIVE LOSS ALREADY DECLARED FROM SUCH ACTIVIT Y BY THE ASSESSEE, THE SAME WAS ASSESSED AT A FIGURE OF RS.500,90,344/ -. HAVING ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 4 CONSIDERED THESE FACTS, PENALTY LEVIED FOR THE DIFF ERENCE IN INCOME U/S 271(1)(C), THUS IN EFFECT HAS REMAINED ONLY ON ACCO UNT OF CHANGE OF HEADS, WHICH AS PER ASSESSEE WAS RETURNED AS CAPITA L GAIN AT RS.3,93,69,620/-, AS WELL BUSINESS LOSS AT RS.21,27 ,95,300/- ON THE OTHER HAND AS PER A.O., THE SAME HAS REMAINED AS BU SINESS LOSS AT RS.21,27,95,300/- AS SPECULATION LOSS AT RS.47,16,5 3,686/-, WHICH HAS BEEN ALLOWED TO BE CARRIED FORWARDED ALSO. THIS MAKES TWO THINGS CLEAR OUT OF PENALTY ORDER PASSED IN THE CAS E THAT PENALTY WAS LEVIED ON ACCOUNT OF THE DIFFERENCE IN THE INCOME S O ASSESSED AND THEN IT WAS LEVIED ON THE BASIS OF DETAILS AVAILABL E ON RECORD AND DISCLOSED BY THE APPELLANT IN THE RETURN OF INCOME. IT IS NOT THE CASE OF A.O. THAT ANY TRANSACTION DONE IN ANY OF THESE SHAR ES OR/AND SECURITIES WERE NOT REFLECTED OR THERE WAS ANY INAC CURACY OF FIGURES GIVEN IN RETURN RELATED TO PURCHASE AND SALES OF TH ESE SHARES; OR TIME OF HOLDING WAS NOT REFLECTED AND WHICH WAS SUBSEQUE NTLY DISCOVERED BY A.O. ON HIS OWN DURING THE COURSE OF ASSESSMENT PROCEEDINGS. IT IS ALSO NOTEWORTHY THAT THE APPELLANT IS IN THE BUSINE SS SINCE F.Y. 2007- 08 RELEVANT TO A.Y. 2008-09 AND THIS BEING A.Y. 201 0-11, THIS WAS EFFECTIVELY THIRD YEAR OF BUSINESS OF THE APPELLANT , WHERE CONSISTENTLY THE ACTIVITY UNDER THE BASKET OF INVESTMENT PORTFOL IO AND TRADING HAVE BEEN REFLECTED. EVEN IF IT IS CONSIDERED FOR A WHIL E THAT SUCH MAINTENANCE OF TWO DIFFERENT PORTFOLIO ONE FOR INVE STMENT AND OTHER FOR TRADING, CANNOT BE CONSIDERED SO, FOR THE LONG TERM CAPITAL LOSS AS RETURNED BY APPELLANT, EVEN THEN WHAT HAS ACTUALLY BEEN DONE BY THE A.O. IS ASSESSING THE SAME LOSS UNDER THE HEAD 'BUS INESS LOSS' AGAINST THE LOSS RETURNED AS LTCL UNDER THE HEAD CA PITAL GAIN WHILE TAKING A VIEW THAT EXPLANATION TO SEC 73, A DEEMING PROVISION ARE APPLICABLE IN CASE OF ASSESSEE 3.5 ON THESE GIVEN FACTS AND UNDER THE CIRCUMSTANCE S WHEN THE ACTIVITY AND TRANSACTIONS WERE DULY DECLARED AND CO MPLETE DETAILS WERE ACCURATELY FURNISHED IN THE RETURN OF INCOME, MERELY BECAUSE OF CHANGE OF HEAD FOR ASSESSING PARTICULAR GAIN/LOSS F OR THE REASONS GIVEN BY THE A.O. IN THE ASSESSMENT ORDER, EVEN IF IS UPHELD, IT REMAINS AT THE MOST CHANGE OF CHARACTER OF INCOME. IT IS WELL ACCEPTED A FACT THAT ASSESSMENT PROCEEDINGS AND PENALTY PROC EEDINGS ARE TWO DIFFERENT AND DISTINCT PROCEEDINGS AND ONLY BECAUSE AN INCOME IS ASSESSED AND FINALLY ADMITTED SO, IT AUTOMATICALLY DOES NOT LEAD AND ATTRACT LEVY OF PENALTY U/S.271(1)(C). IN THE INSTA NT CASE. THE AMOUNT OF INCOME/LOSS RETURNED HAS NOT UNDERGONE ANY CHANGE A ND SAME HAS BEEN ASSESSED UNDER A DIFFERENT HEAD OF INCOME, BY TAKING A VIEW THAT PROVISIONS OF SEC. 3; A DEEMING ONE, ARE APPLI CABLE IN THE CASE OF APPELLANT. THUS, I FIND RATIO OF DECISIONS GIVEN IN CASE OF MISS HARRON MAHMOOD ADAM VS. ACIT-12 (3) , MUMBAI (ITA NO. 1636 /MUM/20 13), CIT VS. SPK STEELS PVT. LTD (270 ITR 156 MP), BHARAT R. RUIA CITED AND RELIED UPON BY THE APPELLANT ARE SQUARELY APPLICABLE ON THE FACTS IN CASE OF APPELLANT AND HENCE IT DOES NOT AT TRACT PROVISIONS OF PENALTY U/S.271(1)(C) AS NEITHER THERE IS A CASE OF FURNISHING OF WRONG PARTICULARS NOR INACCURATE PARTICULARS AND IN FACT THE ADEQUACY AND DETAILS AVAILABLE AND DECLARED SO IN THE RETURN FIL ED ONLY, ENABLED THE A.O. TO WORK OUT THE BUSINESS LOSS AND SPECULATIVE LOSS TO BE ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 5 ASSESSED FOR THE A.Y. 2010-11. IT ALSO CANNOT BE SA ID TO BE A CASE OF CONCEALMENT OF INCOME AS THE INCOME/LOSS WERE DULY REFLECTED AND THE CHANGE IN QUANTUM HAS HAPPENED ON ACCOUNT OF CHANGE OF HEAD OF THE SAID GAIN. THE A. 0. HAS RELIED UPON DECISION GIVEN BY HONBLE SUPREME COURT IN [2008] 172 TAXMAN 386 (SC) COMMISS IONER. OF INCOME TAX, AHMEDABAD VS GOLD COIN HEALTH FOOD (F) AND (2012) 27 TAXMANN.COM 87 (SC) SUPREME COURT OF INDIA, COMMISS IONER OF INCOME TAX V/S. UNIPOL CHEMICALS INTERMEDIATES LTD . AS REPRODUCED IN PARA 3.1 ABOVE. I HAVE GONE THROUGH THE SAME. TH ESE DECISIONS ARE ON THE ISSUE WHETHER PENALTY U/S. 271(1)(C) IS LEVI ABLE IN CASE OF ASSESSED INCOME BEING LOSS. I FIND HERE IN THE INST ANT CASE, THIS ISSUE IS NOT DISPUTED AND IS CLEAR FOLLOWING THE RATIO OF THE DECISION GIVEN BY THE HON'BLE SUPREME COURT IN THE CASE OF JCIT, SURA T V/S. SAHELI LEASING & INDUSTRIES LTD. (2010) [191 TAXMANN 165 ( SC)] ALSO. THE ISSUE IN THE INSTANT CASE IS WHETHER PENALTY Y/S.27 1(1)(C) IS LEVIABLE IN A CASE WHERE THE LOSS RETURNED UNDER ONE HEAD OF IN COME BY TAX PAYER IS ASSESSED UNDER OTHER HEAD OF INCOME BY THE A.O.. IT IS NOTED THAT IN THE CASE OF RELIANCE PETRO PRODUCTS REPORTE D IN 322 ITR 158, THE KEY ARGUMENT BEFORE HON'BLE COURT ON BEHALF OF REVENUE WAS THAT SUBMITTING AN INCORRECT CLAIM IN LAW FOR AN EXPENDI TURE, WHICH CAN BE A CLAIM OF LOSS AS WELL, WOULD AMOUNT TO GIVING INA CCURATE PARTICULARS OF SUCH INCOME. THE HON'BLE COURT DID NOT CONCUR WI TH THIS SIMPLISTIC VIEW OF THE MATTER AND OBSERVED: 'WE DO NOT THINK THAT SUCH CAN BE THE INTERPRETATIO N OF THE CONCERNED WORDS. THE WORDS ARE PLAIN AND SIMPLE. IN ORDER TO EXPOSE THE ASSESSEE TO THE PENALTY UNLESS THE CASE IS STRICTLY COVERED BY THE PROVISION, THE PENALTY PROVISION CAN NOT BE INVOKED. BY ANY STRETCH OF IMAGINATION, MAKING AN I NCORRECT CLAIM IN LAW CANNOT TANTAMOUNT TO FURNISHING INACCU RATE PARTICULARS. IN CIT VS. ATUL MOHAN BINDAL (2()09) 2 25 CTR (SC) 248 : (2009) 28 DTR (SC) I : (2009) 9 SCC 589, WHER E THIS COURT WAS CONSIDERING THE SAME PROVISION, THE COURT OBSERVED THAT THE AO HAS TO BE SATISFIED THAT A PERSON HAS C ONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURA TE PARTICULARS OF SUCH INCOME. THIS COURT REFERRED TO ANOTHER DECISION OF THIS COURT IN UNION OF INDIA VS. DHARAM ENDRA TEXTILE PROCESSORS (2007) 212 CTR (SC) 432 (2008) 1 3 SCC 369, AS ALSO, THE DECISION IN UNION OF INDIA VS. RA JASTHAN SPINNING & WEAVING MILLS (2009) 224 CTR (SC) ; (200 9) 23 DTR (SC) 158 (2009) 13 SCC 448 AND REITERATED IN PA RA 13 THAT: IT GOES WITHOUT SAYING THAT FOR APPLICABILITY OF S. 271(1)(C), CONDITIONS STATED THEREIN MUST EXIST,' 8. THEREFORE, IT IS OBVIOUS THAT IT MUST BE SHOWN T HAT THE CONDITIONS UNDER S. 271(1)(C) MUST EXIST BEFORE THE PENALTY IS IMPOSED. THERE CAN BE NO DISPUTE THAT EVERYTHING WO ULD DEPEND UPON THE RETURN FILED BECAUSE THAT IS THE ON LY DOCUMENT, WHERE THE ASSESSEE CAN FURNISH THE PARTIC ULARS OF HIS INCOME. WHEN SUCH PARTICULARS ARE FOUND TO BE I NACCURATE, ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 6 THE LIABILITY WOULD ARISE. IN DILIP N. SHROFF VS. J T. CIT & ANR. (2007) 210 CTR (SC) 228 : (2007) 6 SCC 329, THIS CO URT EXPLAINED THE TERMS 'CONCEALMENT OF INCOME' AND 'FU RNISHING INACCURATE PARTICULARS'. THE COURT WENT ON TO HOLD THEREIN THAT IN ORDER TO ATTRACT THE PENALTY UNDER S. 271(1)(C), MENS REA WAS NECESSARY, AS ACCORDING TO THE COURT, THE WORD 'INA CCURATE' SIGNIFIED A DELIBERATE ACT OR OMISSION ON BEHALF OF THE ASSESSEE. IT WENT ON TO HOLD THAT CL, (III) OF S. 2 71(1) PROVIDED FOR A DISCRETIONARY JURISDICTION UPON THE ASSESSING AUTHORITY, IN AS MUCH AS THE AMOUNT OF PENALTY COULD NOT BE LESS THAN THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF SUCH CONCEALMENT OF PARTICULARS OF INCOME, BUT IT MAY NO T EXCEED THREE TIMES THEREOF. IT WAS POINTED OUT THAT THE TE RM 'INACCURATE PARTICULARS' WAS NOT DEFINED ANYWHERE I N THE ACT AND, THEREFORE, IT WAS HELD THAT FURNISHING OF AN A SSESSMENT OF THE VALUE OF THE PROPERTY MAY NOT BY ITSELF BE FURN ISHING INACCURATE PARTICULARS. IT WAS FURTHER HELD THAT TH E ASSESSEE MUST BE FOUND TO HAVE FAILED TO PROVE THAT HIS EXPL ANATION IS NOT ONLY NOT BONA FIDE BUT ALL THE FACTS RELATING T O THE SAME AND MATERIAL TO THE COMPUTATION OF HIS INCOME WERE NOT DISCLOSED BY HIM. IT WAS THEN HELD THAT THE EXPLANA TION MUST BE PRECEDED , BY A FINDING AS TO HOW AND IN WHAT MANNER, THE ASSESSEE HAD FURNISHED THE PARTICULARS OF HIS INCOM E. THE COURT ULTIMATELY WENT ON TO HOLD THAT THE ELEMENT O F MENS REA WAS ESSENTIAL. IT WAS ONLY ON THE POINT OF MENS REA THAT THE JUDGMENT IN DILIP N. SHROFF VS. JT. CIT & ANR. (SUP RA) WAS UPSET. IN UNION OF INDIA VS. DHARARNENDRA TEXTILE P ROCESSORS (CITED SUPRA), AFTER QUOTING FROM S. 271 EXTENSIVEL Y AND ALSO CONSIDERING S. 271(1)(C), THE COURT CAME TO THE CON CLUSION THAT SINCE S. 271(1)(C) INDICATED THE ELEMENT OF STRICT LIABILITY ON THE ASSESSEE FOR THE CONCEALMENT OR FOR GIVING INACCURA TE PARTICULARS WHILE FILING RETURN, THERE WAS NO NECES SITY OF MENS REA. THE COURT WENT ON TO HOLD THAT THE OBJECTIVE B EHIND ENACTMENT OF S. 271(1)(C) R/W EXPLANATIONS INDICATE D WITH THE SAID SECTION WAS FOR PROVIDING REMEDY FOR LOSS OF R EVENUE AND SUCH A PENALTY WAS A CIVIL LIABILITY AND, THEREFORE , WILLFUL CONCEALMENT IS NOT AN ESSENTIAL INGREDIENT FOR ATTR ACTING CIVIL LIABILITY AS WAS THE CASE IN THE MATTER OF PROSECUT ION UNDER S. 276C OF THE ACT. THE BASIC REASON WHY DECISION IN D ILIP N. ,SHROFF VS. JT. CIT & ANR. (CITED SUPRA) WAS OVERRU LED BY THIS COURT IN UNION OF INDIA VS. DHARAMENDRA TEXTILE PRO CESSORS (CITED SUPRA), WAS THAT ACCORDING TO THIS COURT THE EFFECT AND DIFFERENCE BETWEEN S. 271(1)(C) AND S. 276C OF THE ACT WAS LOST SIGHT OF IN CASE OF DILIP N. SHROFF VS. JT. CIT & A NR. (CITED SUPRA). HOWEVER, IT MUST BE POINTED OUT THAT IN UNI ON OF INDIA VS. DHARAMENDRA TEXTILE PROCESSORS (CITED SUPRA), N O FAULT WAS FOUND WITH THE REASONING IN THE DECISION IN DILIP N . SHROFF VS. JT. CIT & ANR. (CITED SUPRA), WHERE THE COURT EXPLA INED THE MEANING OF THE TERMS 'CONCEAL' AND 'INACCURATE'. IT WAS ONLY THE ULTIMATE INFERENCE IN DILIP N. SHROFF VS. JT. C IT & ANR. (CITED ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 7 SUPRA) TO THE EFFECT THAT MENS REA WAS AN ESSENTIAL INGREDIENT FOR THE PENALTY UNDER S. 271(1)(C) THAT THE DECISIO N IN DILIP N. SHROFF VS. JT. CIT & ANR. (CITED SUPRA) WAS OVERRUL ED.' 3.6 THUS, ON THESE GIVEN FACTS, I AM OF THE CONSIDE RED VIEW THAT THIS IS NOT A CASE WHERE PENALTY LEVIED U/S.271(1)(C) MEREL Y ON THE BASIS OF FIGURE OF INCOME/LOSS CHANGED DUE TO CHANGE OF HEAD OF INCOME, CAN BE SUSTAINED AND HENCE PENALTY LEVIED FOR THE AMOUN T OF RS.16,01,30,411/- IS DELETED HEREWITH. THE GROUNDS TAKEN BY THE APPELLANT IN GROUND NOS.1 TO 4 ARE ALLOWED. 4.4.2 ON AN APPRECIATION OF THE FACTS ON RECORD, TH E UNDISPUTED FACTS ARE THAT THE ASSESSEE HAS EARNED INCOME OF ` 30,89,48,730/- FROM SHARE TRADING AND HAS INCURRED CAPITAL LOSS OF ` 25,88,58,386/- ON SALE OF SHARES RESULTING IN NET INCOME OF ` 5,00,90,344/-; WHICH HAS BEEN TREATED AS BUSINESS INCOME BY THE AO. IN ADDITION THERETO, T HE BUSINESS LOSS OF ` 21,27,95,300/- DECLARED BY THE ASSESSEE AND LOSS ON SALE OF CAPITAL ASSETS AMOUNTING TO ` 25,88,58,386/- HAVE BEEN ASSESSED AS SPECULATIVE L OSS BY THE AO. IN THIS FACTUAL MATRIX, IT IS EVIDENT THAT THE SAID PENALTY UNDER SECTION 271(1)(C) OF THE ACT WAS LEVIED ONLY ON ACC OUNT OF CHANGE OF HEADS OF INCOME. IN THE ORDER OF ASSESSMENT FOR A.Y. 2010 -11 IT IS SEEN THAT THE AMOUNT OF BUSINESS LOSS OF ` 21,27,95,300/- DECLARED BY THE ASSESSEE HAS REMAINED UNCHANGED, WHEREAS THE CAPITAL LOSS OF ` 25,88,58,386/- DECLARED BY THE ASSESSEE HAS ALSO BEEN CONSIDERED AS BUSINES S LOSS BY THE AO, WHO WENT ON TO TREAT BOTH THESE LOSSES AS LOSS FROM SP ECULATION BUSINESS. WE FIND THAT THE ONLY DIFFERENCE BETWEEN THE RETURNED INCOME AND ASSESSED INCOME FOR ASSESSMENT YEAR UNDER CONSIDERATION IS T HAT THE LOSS ON SALE OF CAPITAL ASSET AMOUNTING TO ` 25,88,386/- DECLARED BY THE ASSESSEE HAS BEEN TREATED AS SPECULATION LOSS BY THE AO. IN THIS FACTUAL MATRIX OF THE CASE ON HAND AS DISCUSSED ABOVE, THE QUESTION FOR O UR CONSIDERATION IS WHETHER PENALTY UNDER SECTION 271(1)(C) OF THE ACT CAN BE LEVIED WHEN THE DECLARED INCOME GETS ASSESSED UNDER A DIFFERENT HEA D THAN THE HEAD UNDER WHICH IT WAS RETURNED/DECLARED? 4.4.3 IT IS CERTAINLY NOT THE AOS CASE THAT THE AS SESSEE CONCEALED OR HID SOME FACT FROM THE AO WHICH THE AO DETECTED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. ALL THE MATERIAL DISCLOSURE S PERTAINING TO THE ABOVE CLAIMS HAVE BEEN MADE BY THE ASSESSEE IN ITS BOOKS OF ACCOUNT AND COMPUTATION OF TOTAL INCOME. IN THESE FACTUAL CIRCU MSTANCES, WE ARE OF THE ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 8 CONSIDERED VIEW THAT MERE CHANGE OF OPINION ON AN I SSUE LEADING TO A CHANGE OF HEAD OF THE SAME INCOME FROM ONE HEAD TO ANOTHER CANNOT CONSTITUTE CONCEALMENT OF INCOME OR FURNISHING OF I NACCURATE PARTICULARS OF INCOME. IN OUR VIEW, THE ABOVE ISSUE IS NO LONGER R ES-INTAGRA, AS THE SIMILAR ISSUE HAS BEEN DECIDED BY THE HON'BLE BOMBAY HIGH C OURT IN THE CASE OF CIT VS. BENNETT COALMAN & CO. LTD. (ITA NO. 2117 OF 2012) WHEREIN AT PARA 3 THEREOF IT HAS BEEN HELD AS UNDER: - 3. SO FAR AS QUESTION (II) IS CONCERNED, THE RESPO NDENT- ASSESSEE HAD CLAIMED PREMIUM ON REDEMPTION OF DEBENTURES AS INCO ME FROM CAPITAL GAINS. WHEREAS THE ASSESSING OFFICER HELD THAT THE REDEMPTION OF DEBENTURES IS REVENUE RECEIPT ASSESSABLE TO TAX UND ER THE HEAD INCOME FROM OTHER SOURCES. THE CIT(A) CONFIRMED THE ORDER OF THE ASSESSING OFFICER. THE RESPONDENT-ASSESSEE DID NOT FILE ANY FURTHER APPEAL ON THE QUANTUM PROCEEDINGS. THEREAFTER, THE ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT O N THE RESPONDENT- ASSESSEE. THE CIT(A) ALSO CONFIRMED THE LEVY OF PEN ALTY UPON THE RESPONDENT-ASSESSEE. ON FURTHER APPEAL, THE TRIBUNA L HELD THAT THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE RESP ONDENT- ASSESSEE HAD DISCLOSED THAT THE AMOUNT RECEIVED AS PREMIUM O N REDEMPTION OF DEBENTURES IN ITS COMPUTATION OF INCOME. FURTHER, T HE TRIBUNAL RECORDS THAT IT IS NOT THE CASE OF THE DEPARTMENT THAT THE RESPONDENT-ASSESSEE HAD CONCEALED ANY PARTICULARS OF INCOME OR FURNISHE D INACCURATE PARTICULARS OF INCOME BY STATING INCORRECT FACTS. T HE ASSESSING OFFICER CONSIDERED THE SAID PREMIUM RECEIVED ON REDEMPTION OF DEBENTURES TO BE TAXABLE UNDER THE HEAD INCOME FROM OTHER SOURCES WH ILE THE RESPONDENT- ASSESSEE CONSIDERED THE SAME TO BE TAXABLE UNDER TH E HEAD CAPITAL GAINS. IN VIEW OF THE FACT THAT THERE IS ONLY A CHA NGE OF HEAD OF INCOME AND IN THE ABSENCE OF ANY FACTS THAT THE CLAIM OF T HE ASSESSEE WAS NOT BONAFIDE, THE TRIBUNAL DELETED THE PENALTY IMPOSED UNDER SECTION 271(1)(C) OF THE ACT. THE REVENUE HAS NOT BEEN ABLE TO POINT OUT THAT THE FINDING OF THE TRIBUNAL IS PERVERSE. IN THESE CIRCU MSTANCES, WE SEE NO REASON TO ENTERTAIN THE PROPOSED QUESTION (II). 4.4.4 IN THE FACTUAL MATRIX OF THE CASE AS DISCUSSE D ABOVE THAT THERE IS ONLY CHANGE IN THE HEAD OF INCOME AND IN THE ABSENC E OF ANY FACTS THAT THE CLAIM OF THE ASSESSEE WAS NOT BONA FIDE AND RESPECT FULLY FOLLOWING THE DECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CA SE OF CIT VS. BENNETT COLEMAN & CO. LTD. IN ITA NO. 2117 OF 2012, WE DO N OT FIND ANY REASON TO INTERFERE WITH OR DEVIATE FROM THE VIEW TAKEN BY TH E LEARNED CIT(A) AND THEREFORE UPHOLD THE IMPUGNED ORDER OF THE LEARNED CIT(A) DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT F OR A.Y. 2010-11. ITA NO. 2019/MUM/2015 M/S. VINAMRA UNIVERSAL TRADERS PVT. LTD. 9 CONSEQUENTLY, GROUNDS (I) TO (III), 2 & 3 RAISED BY REVENUE (SUPRA) ARE DISMISSED. 5. IN THE RESULT, REVENUES APPEAL FOR A.Y. 2010-11 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST JANUARY, 2017. SD/ - SD/ - (SANDEEP GOSAIN) (JASON P. BOAZ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI, DATED: 31 ST JANUARY, 2017 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -14, MUMBAI 4. THE CIT - 8, MUMBAI 5. THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.