Shri Mohanlal Kuberdas Joshi., Surat V. The DCIT, Circle-9, Surat

ITA 2254/AHD/2013

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 9447 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 07-12-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 05-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G C DAXINI
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER ./ ITA NO. 2254/AHD/2013 / ASSESSMENT YEAR : 2006-2007 MOHANLAL KUBERDAS JOSHI, 42, VISHALNAGAR CO-OP. HOUSING SOCIETY LTD., BHATAR ROAD, SURAT PAN : ABEPJ 5812 G VS DCIT, CIRCLE-9, SURAT / (APPELLANT) / (RESPONDENT) ASSESSEE BY : WRITTEN SUBMISSIONS (NONE) REVENUE BY : SHRI G C DAXINI, SR DR DATE OF HEARING : 0 7/12/2016 DATE OF PRONOUNCEMENT IN COURT : 17/01/20 17 / O R D E R THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-V, SUR AT DATED 27.06.2013 FOR ASSESSMENT YEAR 2006-2007. 2. THE SOLITARY GROUND RAISED IS AS UNDER:- THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ER RED IN PARTIALLY CONFIRMING PENALTY ON THE BASIS OF ADDITION MADE U/ S 50C OF THE ACT WHICH IS A DEEMING PROVISION. 3. AT THE TIME OF HEARING, NONE APPEARED FOR THE AS SESSEE; HOWEVER, WRITTEN SUBMISSIONS WERE FILED ON 04.07.2016 WITH T HE REQUEST TO CONSIDER THE SAME. CONSEQUENTLY, THIS APPEAL IS DECIDED EX-PARTE QUA THE ASSESSEE AFTER CONSIDERING THE SUBMISSIONS, CASE LAWS AND HE ARING THE LD. DEPARTMENTAL REPRESENTATIVE. IN THE WRITTEN SUBMI SSIONS, THE LD. COUNSEL FOR THE ASSESSEE HAS CONTENDED THAT:- (I) IT IS SUBMITTED THAT U/S 50C, ADDITION TO THE INCOM E OF THE ASSESSEE IS MADE ON THE BASIS OF A DEEMING PROVISION. WHILE THERE WOULD BE ONE FIGURE AS PER STAMP VALUATION AUTHORITY AND ANO THER FIGURE SMC-ITA NO. 2254/AHD/2013 MOHANLAL KUBERDAS JOSHI VS. DCIT AY : 2006-2007 2 CAN BE DIFFERENT AS PER VALUE DETERMINED BY DVO U/S . 50C(2) OF THE ACT. IN THE BACKGROUND OF THE ABOVE, NO PENALTY CA N BE LEVIED ON SUCH FIGURE. (II) RELIANCE IS PLACED ON THE FOLLOWING JUDGEMNETS:- (A) CHIMANLAL MANILAL PATEL ITA NO.508/AHD/2010 AHMEDABAD BENCH (B) HARESH P. SHAH ITA NO.2154/AHD/2010 AHME DABAD BENCH (C) RENU HINGORANI ITA NO.2210/MUM/2010 MUMBAI TRIBUNAL (D) JAGDISH DASWNI ITA NO.4181/MUM/2011 MU MBAI TRIBUNAL (E) C. BASKER ITA NO.997/MDS/2012 CHENNAI TRIBUNAL (F) MADAN THEATRES LTD. (260-CTR-75) CAL CUTTA HIGH COURT (G) KERMAN F. LAKDAWALA ITA NO.L810/AHD/2011 AHM EDABAD BENCH (III) THE ASSESSING OFFICER HAS NOT BROUGHT ANY EVIDENCE TO SHOW THAT ASSESSEE HAS RECEIVED ADDITIONAL AMOUNT AS PER VALU ATION DONE BY STAMP VALUATION AUTHORITY JUST BECAUSE ASSESSING OF FICER HAS ACCEPTED VALUATION AS PER STAMP VALUATION AUTHORITY IT CANNOT BE SAID THAT ASSESSEE HAS RECEIVED SUCH AMOUNT AND THE REFORE THERE CANNOT BE CONCEALMENT OF INCOME. THE DEPARTMENT APP EAL IS REQUIRED TO BE DISMISSED. (IV) IN THIS CASE, THE ASSESSEE DID NOT FILE APPEAL AGAI NST THE ORDER PASSED MAKING THE ABOVE ADDITION BUT AS HELD IN CAS E OF ORDER OF MUMBAI TRIBUNAL IN CASE OF RENU HINGORANI 'MERELY B ECAUSE THE ASSESSEE AGREED FOR ADDITION ON THE BASIS OF VALUAT ION MADE BY THE STAMP VALUATION AUTHORITY THAT BY ITSELF WOULD NOT BE CONCLUSIVE PROOF THAT THE SALE CONSIDERATION AS PER THIS AGREE MENT WAS INCORRECT AND WRONG.' ACCORDINGLY, THE ADDITION BEC AUSE OF THE DEEMING PROVISION DOES NOT ATTRACT PENALTY U/S. 271 (L)(C) OF THE ACT. 4. LD. DEPARTMENTAL REPRESENTATIVE SUPPORTED THE OR DERS OF THE AUTHORITIES BELOW AND CONTENDS THAT THE PROVISIONS OF SECTION 50C WERE VERY CLEAR AND THE ASSESSEE OUGHT TO HAVE OFFERED THE CA PITAL GAINS IN TERMS OF SECTION 50C. SMC-ITA NO. 2254/AHD/2013 MOHANLAL KUBERDAS JOSHI VS. DCIT AY : 2006-2007 3 5. I HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITI ES BELOW. THE AHMEDABAD BENCH OF ITAT IN ORDER DATED 22.06.2012 I N THE CASE OF CHIMANLAL MANILAL PATEL VS. ACIT, (2012) 33 CCH 647 AHDTRIB, (ITA NO.508/AHD/2010) HAS HELD AS UNDER:- 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD. IT IS A FACT THAT THE ADDITION HAS BEEN MADE BY THE AO IN THE REVISIONARY PROCEEDINGS. THE ADDITION HAS BEEN MADE ON THE BASI S OF PROVISIONS OF SECTION 50C. IT IS NOT THE CASE OF THE AO THAT THE ASSESSEE HAS RECEIVED CONSIDERATION OVER AND ABOVE THAN THAT DECLARED IN THE SALES DEED . THE AO HAS NOT DISPUTED THE CONSIDERATION RECEIVED BY THE ASSESSEE. THE ADD ITION HAS BEEN MADE ON THE BASIS OF DEEMING PROVISIONS OF SECTION 50C. THE ASS ESSEE HAS FURNISHED ALL THE FACTS OF SALE, DOCUMENTS/ MATERIAL BEFORE THE AO. T HE AO HAS NOT DOUBTED THE GENUINENESS OF THE DOCUMENTS/DETAILS FURNISHED BY T HE ASSESSEE. ONLY BECAUSE THE ASSESSEE AGREED TO THE ADDITIONS BECAUSE OF THE DEEMING PROVISIONS IT CANNOT BE CONSTRUED TO BE FILING OF INACCURATE PART ICULARS ON THE PART OF THE ASSESSEE. THE ASSESSEE AGREED TO ADDITION ON THE BA SIS OF VALUATION MADE BY THE STAMP VALUATION AUTHORITY CANNOT BE A CONCLUSIV E PROOF THAT THE SALE CONSIDERATION AS PER THE SALE AGREEMENT IS SEEMED T O BE INCORRECT AND WRONG. IN VIEW OF THESE FACTS WE ARE OF THE CONSIDERED VIE W THAT PENALTY CANNOT BE LEVIED ON THE BASIS OF DEEMING PROVISION. WE ACCORD INGLY DELETE THE SAME. IN THE CASE OF RENU HINGORANI VS. ACIT IN ITA NO.2 210/MUM/2010, ANOTHER CO-ORDINATE BENCH OF THIS TRIBUNAL HAS HELD AS UNDER:- 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND RE LEVANT RECORD. WE FIND THAT THE AO HAD MADE ADDITION OF RS.9,00,824/- BEIN G DIFFERENCE BETWEEN THE SALE CONSIDERATION AS PER SALE AGREEMENT AND THE VA LUATION MADE BY THE STAMP VALUATION AUTHORITY. THUS, THE ADDITION HAS B EEN MADE BY THE AO BY APPLYING THE PROVISIONS OF SECTION 50C OF THE ACT. IT IS EVIDENT FROM THE ASSESSMENT ORDER THAT THE AO HAS NOT QUESTIONED THE ACTUAL CONSIDERATION RECEIVED BY THE ASSESSEE BUT THE ADDITION IS MADE P URELY ON THE BASIS OF DEEMING PROVISIONS OF THE INCOME TAX ACT, 1961. THE AO HAS NOT GIVEN ANY FINDING THAT THE ACTUAL SALE CONSIDERATION IS MORE THAN THE SALE CONSIDERATION ADMITTED AND MENTIONED IN THE SALE AGREEMENT. THUS IT DOES NOT AMOUNT TO CONCEALMENT OF INCOME OR FURNISHING INACCURATE PART ICULARS OF INCOME. IT IS ALSO NOT THE CASE OF THE REVENUE THAT THE ASSESSEE HAS FAILED TO FURNISH THE RELEVANT RECORD AS CALLED BY THE AO TO DISCLOSE THE PRIMARY FACTS. THE ASSESSEE HAS FURNISHED ALL THE RELEVANT FACTS, DOCUMENTS/MAT ERIAL INCLUDING THE SALE AGREEMENT AND THE AO HAS NOT DOUBTED THE GENUINENES S AND VALIDITY OF THE DOCUMENTS PRODUCED BEFORE HIM AND THE SALE CONSIDER ATION RECEIVED BY THE ASSESSEE. UNDER THESE FACTS AND CIRCUMSTANCES, IT C ANNOT BE SAID THAT THE SMC-ITA NO. 2254/AHD/2013 MOHANLAL KUBERDAS JOSHI VS. DCIT AY : 2006-2007 4 ASSESSEE HAS NOT FURNISHED CORRECT PARTICULARS OF I NCOME. MERELY BECAUSE THE ASSESSEE AGREED FOR ADDITION ON THE BASIS OF VALUAT ION MADE BY THE STAMP VALUATION AUTHORITY WOULD NOT BE A CONCLUSIVE PROOF THAT THE SALE CONSIDERATION AS PER THIS AGREEMENT WAS INCORRECT A ND WRONG. ACCORDINGLY THE ADDITION BECAUSE OF THE DEEMING PROVISIONS DOES NOT IPSO FACTO ATTRACT THE PENALTY U/S 271(1)(C ). HENCE IN VIEW OF THE DECISI ON OF THE HONBLE SUPREME COURT IN THE CASE OF CIT V/S RELIANCE PETROPRODUCTS PVT.LTD (SUPRA), THE PENALTY LEVIED U/S 271(1)( C ) IS NOT SUSTAINABLE. THE SAME IS DELETED. SIMILAR VIEW HAS BEEN ADOPTED IN THE CASE OF SHRI JAGDISH DASWNI VS. ITO IN ITA NO.4181/MUM/2011 AND IN OTHER CASES MENT IONED BY THE ASSESSEE. ALL THESE JUDGMENTS HAVE SPECIFICALLY DE ALT WITH THE PROVISIONS OF SECTION 50C OF THE INCOME-TAX ACT; BESIDES, ALL THE DETAILS CONCERNING THE TRANSACTIONS WERE DULY MENTIONED IN THE RETURN OF I NCOME TO WHICH THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF CI T VS RELIANCE PETROPRODUCTS PVT. LTD, REPORTED IN 322 ITR 158(SC) , AS CONSIDERED BY THE ITAT IN THE CASE OF RENU HINGORANI (SUPRA), IS SQUA RELY APPLICABLE. IN VIEW OF THE ABOVE OBSERVATIONS AND JUDICIAL PRECEDENTS, THIS IS NOT A FIT CASE FOR LEVYING PENALTY U/S 271(1)(C) OF THE ACT, WHICH IS DELETED AND THE ASSESSEES APPEAL IS ACCORDINGLY ALLOWED. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. SD/- R.P. TOLANI (JUDICIAL MEMBER) AHMEDABAD; DATED 17/01/2017 *BIJU T., SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD