NAVALBEN JAWHAR DEDHIA, MUMBAI V. ASST CIT CEN CIR 23, MUMBAI

ITA 2797/MUM/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0242 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 09-05-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 11-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: B V JHAVERI
• Keywords: Search and seizure; Revised return
• Section: 143(3); 153A; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH I, MUMBAI BEFORE D.T. GARASIA, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.2797/M/2015 ASSESSMENT YEAR: 2010-11 SMT. NAVALBEN JAWAHAR DEDHIA (LEGAL HEIR OF LATE SHRI JAWHAR D. DEDHIA), SHOP NO.10, BONNEY PLAZA, S.V. ROAD, ANDHERI (WEST), MUMBAI 400 058 PAN: AABPD 2382B VS. ASSTT. COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE-23, ROOM NO.409, 4 TH FLOOR, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI - 400020 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI B.V. JHAVERI, A.R. REVENUE BY : SHRI SAURABHKUMAR RAI, D.R. DATE OF HEARING : 27.07.2017 DATE OF PRONOUNCEMENT : 18.08.2017 O R D E R PER D.T. GARASIA , JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSES SEE AGAINST THE ORDER DATED 09.02.2015 OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO ASSESSMENT Y EAR 2010-11. 2. THE ONLY ISSUE INVOLVED IN THIS APPEAL IS LEVY O F PENALTY OF RS.15,25,842/- UNDER SECTION 271(1)(C) OF THE ACT I N RESPECT OF UNDISCLOSED INCOME OF RS.49,38,000/-. DURING THE COURSE OF SEA RCH, DETAILS RELATING TO UNACCOUNTED SALES/PURCHASES WERE FOUND ONLY FOR A P ERIOD OF THREE MONTHS FROM JANUARY 2010 TO MARCH 2010, BUT HE STILL EXTRA POLATED UNACCOUNTED SALES FOR THE REMAINING NINE MONTHS FROM APRIL 2009 TO DE CEMBER 2009 OF THE YEAR ALSO AND OFFERED PROFITS ON SUCH UNACCOUNTED SALES AND THAT IT WAS DONE WITH A VIEW TO BUY PEACE AND WITH A VIEW TO AVOID PROTRACT ED LITIGATION. THE ASSESSEE, ITA NO.2797/M/2015 SMT. NAVALBEN JAWAHAR DEDHIA (LEGAL HEIR OF THE LATE SHRI JAWHAR D. DEDHIA) 2 ACCORDINGLY, CONTENDED BEFORE THE ASSESSING OFFICER (HEREINAFTER REFERRED TO AS THE AO) THAT PENALTY UNDER SECTION 271(1)(C) SHOULD NOT BE LEVIED ON HER. HOWEVER, AO REJECTED THE CONTENTIONS OF THE ASSESSE E AND HELD THAT SINCE THE INCOME OF RS.49,38,000/- WAS NOT DISCLOSED BY THE A SSESSEE IN THE RETURN OF INCOME FILED UNDER SECTION 139(1), SHE HAD CONCEALE D THE PARTICULARS OF HER INCOME. ACCORDINGLY, AO LEVIED THE PENALTY OF RS.1 5,25,842/- AND LD. CIT(A) HAS CONFIRMED THE SAME. 3. DURING THE COURSE OF HEARING, LD. A.R. HAS SUBMI TTED BEFORE US THAT ASSESSEE HAS FILED THE RETURN OF INCOME ON 24.09.10 UNDER SECTION 139(1). PURSUANT TO THE SEARCH CARRIED OUT, IN RESPONSE TO NOTICE UNDER SECTION 153A OF THE ACT, THE ORIGINAL RETURN FILED BY THE ASSESSEE ON 24.09.10 HAS ABATED I.E. NON-EST IN LAW. THEREFORE, ASSESSEE HAS FILED A RE TURN UNDER SECTION 153A OF THE ACT ON 08.11.11 DECLARING TOTAL INCOME OF RS.51 ,34,120/-. THE SAID RETURN WAS PROCESSED AND ASSESSMENT WAS PASSED U/S143(3) R .W.S. 153A OF THE ACT WHEREBY AO HAS MADE THE FURTHER ADDITION OF RS.5,09 ,000/- TO THE INCOME DECLARED BY THE ASSESSEE. THE ASSESSEE ALSO DISCLO SED THE INCOME OF RS.44,29,000/- ON THE BASIS OF MATERIAL FOUND AT TH E PREMISES OF ZAMKUDI GROUP OF CONCERNS. LD. A.R. SUBMITTED THAT THE ISS UE IN CONTROVERSY IS COVERED BY THE DECISION OF JURISDICTIONAL HIGH COURT IN THE CASE OF PR. CIT VS. NEERAJ JINDAL [(2017) 79 TAXMANN.COM 96] (DELHI HIGH COURT ), IN THE CASE OF KIRIT DAHYABHAI PATEL VS. ACIT (2015) 280 CTR 216 (GUJ.), PARAG M. SANGHVI VS. DCIT IN ITA NO.1232 TO 1235/M/2012 DATED 23.11.15, CIT VS. MODI INDUSTRIAL CORPORATION (195 TAXMAN 68). 4. LD. D.R. RELIED UPON THE ORDERS OF THE REVENUE A UTHORITIES. 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. THE ASSESSEE HAS FILED FRESH RETURN OF INCOME FOR ASSESSMENT YEAR IN WHICH A NOTICE HAS BEEN ISSUED AND ONCE THE AO HAS ACCEPTED THE REVISED RET URN FILED UNDER SECTION ITA NO.2797/M/2015 SMT. NAVALBEN JAWAHAR DEDHIA (LEGAL HEIR OF THE LATE SHRI JAWHAR D. DEDHIA) 3 153A THE ORIGINAL RETURN UNDER SECTION 139 ABATES A ND BECOME NON-EST. IT IS TRITE TO SAY THAT THE 'CONCEALMENT' HAS TO BE SEEN WITH REFERENCE TO THE RETURN THAT IT IS FILED BY THE ASSESSEE. THUS, FOR THE PUR POSE OF LEVYING PENALTY UNDER SECTION 271(1)(C), WHAT HAS TO BE SEEN IS WHETHER T HERE IS ANY CONCEALMENT IN THE RETURN FILED BY THE ASSESSEE UNDER SECTION 153A , AND NOT VIS A VIS THE ORIGINAL RETURN UNDER SECTION 139. THE ASSESSEE HA S FILED THE RETURN UNDER SECTION 153A OF THE ACT ON 08.11.11 DECLARING TOTAL INCOME OF RS.51,34,120/-. THE SAID RETURN WAS PROCESSED AND ASSESSMENT WAS PA SSED U/S143(3) R.W.S. 153A OF THE ACT WHEREBY AO HAS ACCEPTED THE RETURN AND NO ADDITION WAS MADE BY THE AO. THEREFORE, WE ARE OF THE VIEW THAT NO PENALTY CAN BE LEVIED. OUR VIEW IS SUPPORTED BY VARIOUS DECISIONS OF JURIS DICTIONAL HIGH COURT WHEREIN IT IS HELD AS UNDER: THE QUESTION BEFORE THE HONBLE HIGH COURT WAS AS UNDER: (I) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF TH E CASE AND IN LAW, THE TRIBUNAL WAS JUSTIFIED IN HOLDING THAT THE RESPONDENT- ASSES SEE WAS ENTITLED TO MAKE A CLAIM WHICH WAS NOT MADE IN THE RETURN OF INCOME ORIGINAL LY FILED UNDER SECTION 153A R.W.S. 143(3) OF THE ACT BEFORE THE ASSESSING OFFIC ER AND ALSO BEFORE THE APPELLATE AUTHORITIES UNDER THE ACT ?' THE HONBLE HIGH COURT HELD THAT: 11. IN THE PRESENT FACTS FOR THE SUBJECT ASSESSMENT YEA RS IT IS AN UNDISPUTED POSITION THAT THE PENDING ASSESSMENT BEFORE THE ASS ESSING OFFICER CONSEQUENT TO RETURN FILED UNDER SECTION 139(1) OF THE ACT FOR TH E SUBJECT ASSESSMENT YEARS HAD ABATED. THIS WAS O N ACCOUNT OF THE SEARCH AND AS PROVIDED IN SECOND P ROVISO TO SECTION 153A(1) OF THE ACT. THE CONSEQUENCE OF NOTI CE UNDER SECTION 153A(1) OF THE ACT IS THAT ASSESSEE IS REQUIRED TO FURNISH FRE SH RETURN OF INCOME FOR EACH OF THE SIX ASSESSMENT YEARS IN REGAR D TO WHICH A NOTICE HAS BEEN ISSUED. IT IS THIS RET URN WHICH IS FILED CONSEQUENT TO THE NOTICE WHICH WOULD BE SUBJECT OF ASSESSEMENT BY THE REVENUE FOR THE FIRST TIME IN THE CASE OF ABATE D ASSESSMENT PROCEEDINGS. CONSEQUENT TO NOTICE UNDER SECTION 153A OF THE ACT THE EARLIER RETURN FILED FOR THE PURPOSE OF ASSESSMENT WHICH IS PENDING, WOULD BE TR EATED AS NON EST IN LAW. 6. WE ALSO FIND THAT SIMILAR DECISION WAS TAKEN IN THE CASE OF PR. CIT VS. NEERAJ JINDAL WHEREIN IT IS HELD AS UNDER: '21. THUS, IT IS CLEAR THAT WHEN THE A.O HAS ACCEPT ED THE REVISED RETURN FILED BY THE ASSESSEE UNDER SECTION 153A, NO OCCASION ARISES TO REFER TO PREVIOUS RETURN FILED ITA NO.2797/M/2015 SMT. NAVALBEN JAWAHAR DEDHIA (LEGAL HEIR OF THE LATE SHRI JAWHAR D. DEDHIA) 4 UNDER SECTION 139 OF THE ACT. FOR ALL THE PURPOSES, INCLUDING FOR THE PURPOSE OF LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT, THE RETURN THAT HAS TO BE LOOKED AT IS THE ONE FILED UNDER SECTION 153A. WHAT IS CLE AR FROM THIS IS THAT SECTION 153A IS IN THE NATURE OF A SECOND CHANCE GIVEN TO THE ASSES SEE, WHICH INCIDENTALLY GIVES HIM AN OPPORTUNITY TO MAKE GOOD OMISSION, IF ANY, IN TH E ORIGINAL RETURN. ONCE THE A.O ACCEPTS THE REVISED RETURN FILED UNDER SECTION 153A , THE ORIGINAL RETURN UNDER SECTION 139 ABATES AND BECOMES NON - EST. NOW, IT I S TRITE TO SAY THAT THE 'CONCEALMENT' HAS TO BE SEEN WITH REFERENCE TO THE RETURN THAT IT IS FILED BY THE ASSESSEE. THUS, FOR THE PURPOSE OF LEVYING PENALTY UNDER SECTION 271(1)(C), WHAT HAS TO BE SEEN IS WHETHER THERE IS ANY CONCEALMENT IN T HE RETURN FILED BY THE ASSESSEE UNDER SECTION 153A, AND NOT VIS A VIS THE ORIGINAL RETURN UNDER SECTION 139.' 7. CONSIDERING ALL ABOVE DECISIONS OF VARIOUS HIGH COURTS INCLUDING JURISDICTIONAL HIGH COURT, WE HOLD THAT IN THIS CAS E, THE ASSESSEE HAS FILED THE RETURN FOR A.Y. 2010-11 ON 22.09.10 DECLARING TOTAL INCOME OF RS.9,93,545/-. THERE WAS A SEARCH AND SEIZURE CARRIED OUT IN THE P REMISES OF ZAMKUDI GROUP ON 09.10.10 AND SOME PAPERS WERE FOUND FROM THE PRE MISES OF ZAMKUDI GROUP. IN RESPONSE TO THE NOTICE UNDER SECTION 153 F REPLY WAS FILED AND ASSESSEE HAS DECLARED UNDISCLOSED INCOME OF RS.44,2 9,000/-. THE ACIT HAS ACCEPTED THE RETURN FILED BY THE ASSESSEE UNDER SEC TION 153A OF THE ACT, THEREFORE, NO PENALTY CAN BE LEVIED. THEREFORE, WE DELETE THE SAME. 8. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18.08.2017. SD/- SD/- (RAJESH KUMAR) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 18.08.2017. * KISHORE, SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ ITA NO.2797/M/2015 SMT. NAVALBEN JAWAHAR DEDHIA (LEGAL HEIR OF THE LATE SHRI JAWHAR D. DEDHIA) 5 BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.