Smt. Nalini S. Desai, Baroda V. The Dy.CIT, Circle-5, Baroda

ITA 2380/AHD/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8670 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2009-2010
• Appeal Filed On: 25-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Keywords: Capital asset
• Section: 2(14); 148

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER ./ ITA NOS. 2379/AHD/2014 / A.Y. 2009-10 SHRI MUKESH R. SHROFF, PROP. MOVI PALACE, G-5, CHARBHUJA COMPLEX, WATER TANK, NEAR AMBALAL PARK, KARELIBAUG, BARODA PAN : AMWPS 6459 F VS DCIT, CIRCLE-5, VADODARA ./ ITA NOS. 2380/AHD/2014 / A.Y. 2009-10 SMT. NALINI S. DESAI (ALIA SMT. NALINI R. SHROFF), 47, RANCHHODPARK SOCIETY, AMIT NAGAR CHAR RASTA, VIP ROAD, BARODA PAN : AALPD 8910 D VS DCIT, CIRCLE-5, VADODARA / (APPELLANT) / (RESPONDENT) BY ASSESSEE(S) : NONE BY REVENUE : SHRI V.K. SINGH, SR DR / DATE OF HEARING : 14/08/2017 /DATE OF PRONOUNCEMENT: 22/08/2017 / O R D E R PER S.S. GODARA, JUDICIAL MEMBER :- THESE TWO ASSESSEES HAVE INSTITUTED THEIR INSTANT A PPEALS AGAINST THE CIT(A)-V, BARODAS SEPARATE ORDERS; BOTH DATED 17.06.2014, IN CASE NOS.CAB(A)-V/82/13-14 & CAB(A)- V/83/13-14 UPHOLDING RESPECTIVE PENALTIES OF RS.4,98,682/- AND RS.4,99,691/- , IN ITA NOS. 2379 & 2380/AHD/2014 MUKESH SHROFF & NALINI DESAI VS. DCIT A.Y :- 2009-10 - 2 - PROCEEDINGS UNDER SECTION 271(1)(C) OF THE INCOME-T AX ACT, 1961; IN SHORT THE ACT. CASES CALLED TWICE. NONE APPEARS AT THESE ASSESSEES BEHEST DESPITE THE FACT THAT THE REGISTRY HAS ALREADY ISSU ED IDENTICAL RPAD NOTICE DATED 06.07.2017. WE, THEREFORE, PROCEED EX-PARTE AGAINST THESE TWO ASSESSEES FOR ADJUDICATION OF INSTANT APPEALS. 2. LD. DEPARTMENTAL REPRESENTATIVE IS VERY FAIR IN INFORMING US AT THE OUTSET THAT THESE TWO ASSESSEES ARE BROTHER AND SISTER. THE IMPUGNED PENAL ACTION HAS BEEN STATED TO HAVE BEEN EMANATED FROM AN IDENTICAL CAPITAL GAINS ADDITION PERTAINING TO T HE VERY ASSET. WE, THEREFORE TREAT FORMER ASSESSEES APPEAL ITA NO.237 9/AHD/2014 AS THE LEAD CASE. 3. WE COME TO RELEVANT FACTS. THIS ASSESSEE CO-OWN ED AGRICULTURAL LAND SITUATED IN REVENUE SURVEY NO.316.H.2-97-26 A T VILLAGE KHATAMBA, TAL. WAGHODIA, DIST. VADODARA. HE SOLD TH E SAME THROUGH HIS POWER OF ATTORNEY HOLDER/BROTHER SHRI V INAY R. SHROFF ON 28.03.2008. THE SAID REGISTERED DOCUMENTS COULD COMPLETE ALL REGISTRATION FORMALITIES ONLY BY 04.04.2008. THE A SSESSEE, THEREFORE, DID NOT DECLARE ANY CAPITAL GAINS ARISING THERE FRO M AT THE FIRST INSTANCE. THE ASSESSING OFFICER ISSUED SECOND 148 N OTICE DATED 22.02.2012, BASED ON INCOME-TAX DATA BASE. THE ASS ESSEE SUBMITTED IN FURTHERANCE TO THE SAID NOTICE THAT HE HAD BEEN HAV ING A BONA FIDE BELIEF OF THE IMPUGNED CAPITAL GAINS WERE NOT TAXAB LE IN ASSESSMENT YEAR 2009-10 SINCE ITS SALE DEED DATED 28.03.2008 H AD BEEN REGISTERED ON 04.04.2008, I.E., RELEVANT ACCOUNTING PERIOD PER TAINING TO ITA NOS. 2379 & 2380/AHD/2014 MUKESH SHROFF & NALINI DESAI VS. DCIT A.Y :- 2009-10 - 3 - ASSESSMENT YEAR 2009-10. HIS FURTHER CASE WAS THAT THE LANDS IN QUESTION WERE SITUATED WELL BEYOND 8 KMS FROM MUNIC IPAL LIMITS NOT FALLING A CAPITAL ASSET UNDER SECTION 2(14) OF THE ACT. THE ASSESSING OFFICER THEREAFTER COMPUTED ASSESSEES SHORT TERM C APITAL GAINS COMING TO RS.51,71,000/-. HE, THEREFORE, ADDED ASS ESSEES 1/3 RD SHARE THEREIN COMING TO RS.17,23,666/- IN ASSESSMENT ORDE R DATED 31.12.2012. THE ASSESSING OFFICER CONCLUDED IN ASS ESSMENT ORDER THAT ASSESSEES LAND WAS WELL WITHIN 8 KMS FROM THE MUNI CIPAL LIMIT. HE ALSO INITIATED THE IMPUGNED SECTION 271(1)(C) PENAL TY PROCEEDINGS ALLEGING CONCEALMENT OF INCOME. THE ASSESSEE DID N OT PREFER ANY APPEAL AGAINST THE SAID ADDITION. QUANTUM PROCEEDI NGS THEREFORE ATTAINED FINALITY. 4. WE NOW ADVERT TO THE IMPUGNED PENALTY PROCEEDING S. HE FILED HIS WRITTEN SUBMISSIONS DATED 12.04.2013 REITERATIN G HIS QUANTUM STAND ADOPTED IN THE COURSE OF SCRUTINY. THE ASSES SING OFFICER REITERATED CONTENTS OF ITS SHOW-CAUSE NOTICE TO CON CLUDE THAT THE ASSESSEES ACT AND CONDUCT IN NOT DECLARING THE ABO VE SHORT TERM CAPITAL GAINS AT THE FIRST INSTANCE EMANATED TO CON CEALMENT OF INCOME. HE, THEREFORE, LEVIED THE PENALTY IN QUESTION AMOUN TING TO RS.4,98,682/-, AS CONFIRMED IN THE LOWER APPELLATE PROCEEDINGS. 5. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENT ATIVE. CASE RECORDS STAND PERUSED WITH HIS ABLE ASSISTANCE. MR . SINGH DERIVES STRONG SUPPORT FROM BOTH THE LOWER AUTHORITIES ORD ERS IMPOSING THE IMPUGNED CONCEALMENT PENALTY AGAINST THE ASSESSEE. THERE IS NO DISPUTE BY NOW THAT THE ASSESSEE HAD ADOPTED TWO FO LD STANDS I.E. HE ITA NOS. 2379 & 2380/AHD/2014 MUKESH SHROFF & NALINI DESAI VS. DCIT A.Y :- 2009-10 - 4 - WAS NOT CLEAR AS TO WHETHER THE IMPUGNED CAPITAL GA INS WERE TAXABLE IN ASSESSMENT YEAR 2008-09 OR 2009-10 SINCE THERE W AS DIFFERENCE IN DATE OF SALE DEED AND ITS REGISTRATION (SUPRA). HI S NEXT PLEA WAS THAT HE WAS UNDER BONA FIDE BELIEF ABOUT HIS AGRICULTURAL LAND TO BE NOT SITUATED WITHIN 8 KMS OF THE MUNICIPAL LIMIT. IT I S EVIDENT THAT BOTH THE LOWER AUTHORITIES ARE VERY FAIR IN NOT DISPUTIN G ASSESSEES PRIMARY CONTENTION TO HAVE SOLD HIS AGRICULTURAL LAND ALONG WITH OTHER TWO CO- OWNERS. THE LAND IN QUESTION WAS, THEREFORE, AGRIC ULTURAL. NEXT QUESTION IS ABOUT ITS DISTANCE, I.E., WHETHER IT WA S WITHIN 8 KMS OR BEYOND SUCH A DISTANCE FROM VADODARA CITYS MUNICIPA L LIMIT. THERE IS NO MATERIAL IN ASSESSMENT ORDER RECORDED AT ASSE SSING OFFICERS BEHEST THAT ASSESSEES LAND SOLD WAS VERY MUCH WITH IN 8 KMS WITH THE HELP OF OVERWHELMING EVIDENCE NOR DOES HE QUOTE ANY SPECIFIC MATERIAL WHICH COULD INDICATE THAT THE ASSESSEES BONA FIDE BELIEF TO THIS EFFECT WAS WHOLLY MISFOUNDED. ALL THESE LEADS US TO A CONCLUSION THAT THE ASSESSEE WAS HAVING A BONA FIDE BELIEF THAT HIS CO-OWNED AGRICULTURAL LAND SOLD IN RELEVANT PREVIOUS YEAR BY WAY OF SALE DEED REGISTERED ON 04.04.2009 WAS NOT A CAPITAL ASSET. THE SAME IS FURTHER STRENGTHENED FROM THE FACT THAT HE DID NOT PREFER A NY APPEAL AGAINST THE QUANTUM ADDITION DISPUTING ASSESSING OFFICERS CONCLUSION (SUPRA). WE, THEREFORE, DEEM IT AS A FIT CASE TO H OLD THE ASSESSEES MISTAKE AS A BONA FIDE ONE NOT INVITING THE IMPUGNED CONCEALMENT PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THE AS SESSING OFFICER IS, THEREFORE, DIRECTED TO DELETE THE SAME. FORMER ASS ESSEES APPEAL ITA NO.2379/AHD/2014 SUCCEEDS. ITA NOS. 2379 & 2380/AHD/2014 MUKESH SHROFF & NALINI DESAI VS. DCIT A.Y :- 2009-10 - 5 - 6. SAME ORDER FOLLOWS IN LATTERS ASSESSEES APPEAL ITA NO.2380/AHD/2014 AS LEARNED DEPARTMENTAL REPRESENTA TIVE HAS FAIRLY INDICATED THAT SHE IS THE OTHER CO-OWNER IN THE VERY CAPITAL ASSET/AGRICULTURAL LAND FORMING SUBJECT MATTER OF I SSUE IN EARLIER CASE INVOLVING IDENTICAL FACTS AND EXPLANATION. 7. THESE TWO ASSESSEES APPEALS SUCCEED IN THEIR RE SPECTIVE APPEALS ITA NOS. 2379 & 2380/AHD/2014. ORDER PRONOUNCED IN THE COURT ON 22 ND AUGUST , 201 7 AT AHMEDABAD SD/- SD/- (N.K. BILLAIYA) ACCOUNTANT MEMBER (S.S. GODARA) JUDICIAL MEMBER AHMEDABAD; DATED 22/08/2017 *BT ! '! / 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