The ITO, 2(1), Ujjain V. Shri Narayan Mali, Indore

ITA 248/IND/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2359 (ITAT-INDORE)
• Duration Of Justice: 9 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-01-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 06-04-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Cost of acquisition; Difference of opinion; Non compliance
• Section: 143(3); 54B; 54F; 148; 154

Judgement Text

ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.248/IND/2017 ASSESSMENT YEAR: 2009-10 ORDER PER MANISH BORAD, AM. THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-1, INDORE [IN SHORT REFERRED TO AS THE CIT (A)] DATED 27.09.2016 ARISING OUT OF THE ORDER U/S 271(1)(C) OF THE INCOME TAX ACT DATED 27.03.2015 FR AMED BY THE INCOME TAX OFFICER-2(5), INDORE PERTAINING TO ASSES SMENT YEAR 2009-10. INCOME TAX OFFICER 2 (1), AAYAKAR BHAWAN, UJJAIN V S. NARAYAN MALI, 348.MALI MOHALLA, BIJALPUR, INDORE ( REVENUE ) (RE SPONDENT ) PAN NO.BMTPP8254P RE VENUE BY SHRI K.G. GOYAL , SR. DR RESPONDENT BY SHRI S. S . DESHPANDE ,CA (AR) DATE OF HEARING: 10.01.2018 DATE OF PRONOUNCEMENT: 12.01.2018 ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 2 2. BRIEFLY STATED OF FACTS AS CULLED OUT FROM THE R ECORDS ARE THAT ASSESSMENT U/S 143(3) OF THE I.T. ACT WAS FRAMED IN THE CASE OF ASSESSEE ON 29.12.2011 ASSESSING INCOME AT RS.2,52, 000/- AND AGRICULTURE INCOME AT RS.85,000/-. SUBSEQUENTLY TH E LEARNED ASSESSING OFFICER (IN SHORT LD.A.O) ON THE BASIS OF INFORMATION RECEIVED REGARDING SALE OF LAND ON 28.9.2008 WHEREI N STAMP VALUATION AUTHORITY ADOPTED STAMP VALUATION AT RS.2 ,90,80,000/- AS AGAINST SALE CONSIDERATION SHOWN AT RS.1,83,20,000/ - , REOPENED THE ASSESSEES CASE AND ISSUED NOTICE U/S 148 OF TH E ACT. DUE TO NON COMPLIANCE ON THE PART OF THE ASSEESEE AS THE N OTICES WERE NOT SENT TO THE PROPER ADDRESS, THERE WERE NO SUBMISSIO N ON RECORD GIVEN BY THE ASSESSEE AND THE LD.A.O ACCORDINGLY FR AMED EX-PARTE ORDER U/S 154 RWS 143 OF THE ACT CALCULATING THE LO NG TERM CAPITAL GAIN AT RS.96,93,340/-. 3. SIMULTANEOUSLY PENALTY PROCEEDINGS U/S 271(1)(C ) OF THE ACT WERE INITIATED. IN QUANTUM APPEAL BEFORE THE LD. C IT(A) ASSESSEE PARTLY SUCCEEDED. SUBSEQUENTLY THE LD.A.O ISSUED N OTICE U/S 271(1)(C) OF THE ACT VIDE ORDER DATED 27.3.2015 AND IMPOSED PENALTY OF RS.19,38,700/- ON THE ALLEGED CONCEALMENT OF INC OME OFRS.96,93,340/-. AGAINST THIS PENALTY ASSESSEE PR EFERRED AN APPEAL BEFORE THE LD.CIT(A) AND SUCCEEDED. THE LD. CIT(A) WAS OF THE VIEW THAT THE ALLEGED TRANSACTION OF SALE OF LA ND HAS BEEN SHOWN BY THE ASSESSEE IN THE RETURN OF INCOME THROUGH HIN DU UNDIVIDED FAMILY (HUF) AND ALL NECESSARY DETAILS HAVE BEEN SU BMITTED THEREIN ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 3 AND THEREFORE THERE WAS NO CASE OF FURNISHING INCOR RECT PARTICULARS OF INCOME. 4. NOW THE REVENUE HAS FILED AN APPEAL BEFORE THE TRIBUNAL AGAINST THE ORDER OF LD.CIT(A) AND SUPPORTED THE PENALTY O RDER OF LD.A.O. THE LD. COUNSEL FOR THE ASSESSEE RELIED ON THE FIND INGS OF LD. CIT(A). 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. THE REVENUES SOLE GRIEVANCE IS AGAINST THE ORDER OF LD.CIT(A) DELETING RS.19,38,700/- LEVIED BY THE A.O U/S 271(1)(C). WE FIND THAT THE IMPUGNED PENALTY IS LEVIED ON CON CEALMENT OF LONG TERM CAPITAL GAIN ARISED ON ACCOUNT OF SALE OF AGRICULTURAL LAND SITUATED AT BIJALPUR NEAR REJENDRA NAGAR, INDORE. THE SALE AGREEMENT WAS ENTERED ON 25.9.2008. THE AGRICULTURE LAND WAS JOINTLY HELD BY SMT. NANDI BAI PATEL, NARAYAN MALI (ASSESSEE) AND DAYARAM MALI. THE ALLEGED TRANSACTIONS OF SALE OF AGRICULTURE LAND AND LONG TERM CAPITAL GAIN WAS SHOWN IN THE RETURN OF INCOME FILED BY THE ASSESSEE ON 31/12/2011 IN THE STATUS OF HUF. IT WAS CONTENDED BY THE COUNSEL FOR THE ASSESSEE BEFORE TH E LOWER AUTHORITIES THAT THE SALE TRANSACTION AND LONG TERM CAPITAL GAIN WERE SHOWN IN THE RETURN OF INCOME OF HUF ON THE ADVICE OF TAX CONSULTANT. HOWEVER, ALL NECESSARY DETAILS INCLUDI NG THE CLAIM OF DEDUCTION/REBATE U/S 54B AS WELL AS 54F IN RESPECT OF PURCHASE OF NEW AGRICULTURE LAND AND RESIDENTIAL HOUSE WERE SHO WN IN THE RETURN OF INCOME FILED BY THE ASSESSEES HUF. ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 4 6. NOW THE ISSUE BEFORE US IS WHETHER THE LD.A.O WA S JUSTIFIED IN LEVYING PENALTY U/S 271(1)(C) OF THE ACT ON THE LON G TERM CAPITAL GAIN ASSESSED IN THE HAND OF ASSESSEE. WE FIND THAT THE LD.CIT(A) DELETED THE IMPUGNED PENALTY OBSERVING AS FOLLOWS; 5. GROUND NOS. 1 TO 3: ALL THE ABOVE GROUNDS OF T HE APPELLANT ARE DIRECTED AGAINST THE LEVY OF PENALTY OF RS.1938 700/- U/S 271(1)(C) OF THE ACT. THE DETAILED FACTS OF THE CA SE AS PER THE PENALTY ORDER ARE REPRODUCED AT PARA NO.2 ABOVE AND THE DETAILED SUBMISSIONS OF THE APPELLANT ARE REPRODUCE D AT PARA NO.3 ABOVE. 5.1 THE CRUX OF THE APPELLANTS ARGUMENT IS THAT TH E PENALTY ORDER HAS BEEN PASSED BY THE AO WITHOUT TAKING NOTE OF THE SUBMISSION THAT THE LTCG WAS SHOWN BY THE APPELLANT IN THE HANDS OF NARAYAN PATEL MALI HUF IN THE RETURN FILED IN THE CASE OF HUF BEFORE THE ITO 2(1), UJJAIN. IT IS ALSO ARG UED THAT THE ORDER HAS BEEN PASSED WITHOUT ISSUING NOTICES AT TH E CURRENT ADDRESS. DURING THE COURSE OF APPELLATE PROCEEDING S THE APPELLANT HAS ALSO CONTENDED THAT THERE WAS NO CONC EALMENT AND OR SUBMISSION OF INACCURATE PARTICULARS OF INCO ME WAS ALL THE FACTS WERE DISCLOSED IN THE RETURN FILED IN THE CASE OF HUF AND THE LTCG WAS SHOWN IN THE HANDS OF THE HUF ON B EING ADVISED THAT SINCE THE PROPERTY WAS ANCESTRAL PROPE RTY IT WILL AMOUNT TO BE PROPERTY OF HUF. 5.2 ON PERUSAL OF THE ASSESSMENT ORDER AND PENALTY ORDER, IT IS SEEN THAT PENALTY HAS BEEN LEVIED ON THE ADDITION O F RS.9693340/- BEING LTCG DETERMINED WITHOUT EVEN ALL OWING THE COST OF ACQUISITION AND EXPENSES INCURRED TOWAR DS THE TRANSACTION AND WITHOUT EXAMINING THE CLAIM OF EXEM PTION U/S 54B/54F WHICH WAS SHOWN IN THE HANDS OF HUF. THUS A CLAIM WAS MADE BY THE APPELLANT AND A VIEW HAD BEEN ADOPT ED BASED ON CONSULTATION THAT THE PROPERTY BELONGED TO THE HUF. THE AO WAS HOWEVER NOT IN AGREEMENT WITH SUCH CLAIM . NO DOUBT RETURN OF INCOME SHOWING LTCG IN THE HANDS OF THE APPELLANT INDIVIDUAL WAS NOT FILED HOWEVER ALL RELE VANT FACTS WERE ALREADY ON RECORD BY WAY OF THE RETURN IN THE CASE OF THE ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 5 HUF. THE CLAIM EVEN IF DISALLOWED THAT THE PROPERT Y BELONGED TO HUF HAS BEEN NEGATED ON A DIFFERENCE OF OPINION AND THEREFORE THE CLAIM WARRANTED TO BE SEEN ON MERITS. THE DISA LLOWANCE WAS THUS MERELY A REJECTION OF A CLAIM ON ACCOUNT O F DIFFERENCE OF OPINION WHICH DOES NOT ATTRACT THE RIGOURS OF PE NALTY U/S 271(1)(C)OF THE ACT. 5.2 FROM THE MATERIAL ON RECORD IT IS EVIDENT THAT ALL DETAILS IN RESPECT OF THE CLAIM WERE AVAILABLE ON RECORD. IT I S NOT THE CASE THAT THE CLAIM HAS BEEN ESTABLISHED TO BE BOGUS OR UNTRUE BY WAY OF ANY MATERIAL EVIDENCE PLACED ON RECORD. NO MATERIAL FACTS WERE SUPPRESSED OR CONCEALED AND THE PARTICUL ARS PLACED ON RECORD WERE IN NO WAY FOUND TO BE FALSE OR INCOR RECT. IN THE LIGHT OF THE ABOVE THE CONTENTION OF THE APPELLANT THAT NO PENALTY WAS ATTRACTED IS FOUND TO BE JUSTIFIED IN THE LIGHT OF THE VARIOUS JUDICIAL PRONOUNCEMENTS INCLUDING THE JUDGMENT OF T HE HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS 322 ITR 158 (SC), WHEREIN IT HAS BEEN HELD AS UNDER :- THE ARGUMENT OF THE REVENUE THAT SUBMITTING N INCO RRECT CLAIM FOR EXPENDITURE WOULD AMOUNT TO GIVING INACCURATE P ARTICULARS OF SUCH INCOME IS NOT CORRECT. BY NO STRETCH OF IMAGI NATION CAN THE MAKING OF AN INCORRECT CLAIM IN LAW TANTAMOUNT TO F URNISHING INACCURATE PARTICULARS. A MERE MAKING OF THE CLAIM , WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO F URNISHING INACCURATE PARTICULARS REGARD THE INCOME OF THE ASS ESSEE. IN VIEW OF THE ABOVE THE PENALTY OF RS.1938700/- IS DIRECTED TO BE DELETED. THESE GROUNDS OF THE APPELLANT ARE THE REFORE ALLOWED. 7. FROM THE DETAILED FINDINGS OF THE LD.CIT(A) AND IN LIGHT OF JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS 322 ITR 158 (SC) AS WELL AS GIVEN FACTS AND CIRCUMSTANCES OF THE CASE WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE HAS FILED ALL THE DETAILS OF THE ALLEGED T RANSACTION OF SALE OF AGRICULTURE LAND AS WELL AS VARIOUS REBATES AND EXE MPTIONS CLAIMED ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 6 WHICH HAVE BEEN SHOWN IN THE INCOME TAX RETURN FILE D BY THE ASSESSEE IN THE CAPACITY OF HIS HUF. IT CANNOT BE P RESUMED THAT THE ASSESSEE CONCEALED PARTICULARS OF INCOME OR FURNISH ED INACCURATE PARTICULARS OF INCOME BECAUSE THE ASSESSEE HAS SHOW N TRANSACTION OF SALE OF AGRICULTURE LAND IN THE HANDS OF ASSESSE ES HUF AS THE PROPERTY IN QUESTION WAS ANCESTRAL. WE, THEREFORE FIND NO REASON TO INTERFERE IN THE FINDINGS OF LD. CIT(A) DELETING TH E PENALTY U/S 271(1)(C) OF THE ACT LEVIED AT RS.19,38,700/- BY TH E LD. A.O. 8. WE ACCORDINGLY DISMISS THE APPEAL OF REVENUE. THE ORDER PRONOUNCED IN THE OPEN COURT ON 12.01.201 8. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 12 JANUARY, 2018 COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER PRIVATE SECRETARY/DDO, INDORE ITA NO.248/IND/2017 ASST. YEAR 2009-10 NARAYAN MALI 7 1. DATE OF DICTATION : 10/01/2018 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER : 10/01/2018 3. DATE ON WHICH APPROVED DRAFT COMES TO THE SR.P.S./P .S: 10.1.2018 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT: 10.1.2018 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.: 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK: 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK: 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISSTANT R EGISTRAR FOR SIGNATURE OF THE ORDER. 9. DATE OF DESPATCH OF THE ORDER: