The ACIT, Circle-7(2), Ahmedabad V. Shri Rajesh Dhirubhai Patel, Ahmedabad

ITA 2851/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9611 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 09-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 09-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B PANDA
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD - , , BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ./ I.T.A. NO.2851/AHD/2015 ( / ASSESSMENT YEAR : 2009-10) THE ACIT CIR-7(2) AHMEDABAD / VS. SHRI RAJESH DHIRUBHAI PATEL D-43, PARIMAL BUNGALOWS NR.SARDAR CHOWK KRISHNANAGAR AHMEDABAD-382 345 $ ./ ./ PAN/GIR NO. : AGOPP 9136 E ( $' / APPELLANT ) .. ( ()$' / RESPONDENT ) $' * / APPELLANT BY : SHRI B.PANDA SR.DR ()$' + * / RESPONDENT BY : MS.ARTI N.SHAH, AR ,- + . / DATE OF HEARING 09/02/2016 /0 + . / DATE OF PRONOUNCEMENT 10/02/2016 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-7, AHMEDABAD [CIT(A) IN SHORT] DATED 14/07/2015 PERTAINING TO ASSESSMENT Y EAR (AY) 2009-10. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF A PPEAL:- ITA NO.2851 /AH D/2015 ACIT VS. SHRI RAJESH DHIRUBHAI PATEL ASST.YEAR 2009-10 - 2 - 1. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DEL ETING THE PENALTY OF RS.13,65,434/- IMPOSED U/S.271(1)(C) OF THE ACT, IGNORING THE FACT THAT THE ASSESSEE DID NOT OFFER THE CAPITAL GAIN BY TAKING SALE CONSIDERATION VALUE AS PER STAMP VALUATION AUTHORIT Y AND THE ADDITION WAS CORRECTLY MADE BY THE A.O. TAKING THE VALUE AS PER 50C OF THE ACT. 2. ON FACT AND CIRCUMSTANCES OF THE CASE, THE LD.CIT(A ) HAS ERRED IN LAW AND ON FACTS IN DELETING THE PENALTY AS ABOVE, OVERLOOKING THE GRAVITY OF DEFAULT COMMITTED BY THE ASSESSEE. 3. IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE CIT( A) BE SET ASIDE AND THAT OF THE A.O. BE RESTORED TO THE ABOVE EXTENT. 2. BRIEFLY STATED FACTS ARE THAT THE CASE OF THE AS SESSEE WAS PICKED UP FOR SCRUTINY ASSESSMENT AND THE ASSESSMENT U/S.143( 3) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS THE ACT) WAS FRAMED VIDE ORDER DATED 23/12/2011, THEREBY THE ASSESSING OFFICER (AO IN SHORT) MADE ADDITION IN RESPECT OF CAPITAL GAIN BY INVOKING THE PROVISIONS OF SECTION 50C OF THE ACT. THE AO ALSO INITIATED PENALTY PROC EEDINGS U/S.271(1)(C) OF THE ACT AND SUBSEQUENTLY IN QUANTUM PROCEEDINGS THE LD.CIT(A) HAS CONFIRMED THE ADDITION VIDE ORDER DATED 20/12/2012. THE AO PASSED PENALTY U/S.271(1)(C) VIDE ORDER DATED 24/03/2014. THE ASSESSEE BEING AGGRIEVED BY THE SAID ORDER, PREFERRED AN APPEAL BE FORE THE LD.CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS AND THE JUDIC IAL PRONOUNCEMENTS ON THE ISSUE, VIDE ORDER DATED 14/07/2015, DIRECTED THE AO TO DELETE THE PENALTY. AGGRIEVED BY THE ORDER OF THE LD.CIT(A) , NOW THE REVENUE IS IN APPEAL BEFORE US. ITA NO.2851 /AH D/2015 ACIT VS. SHRI RAJESH DHIRUBHAI PATEL ASST.YEAR 2009-10 - 3 - 3. THE ONLY EFFECTIVE GROUND IN THIS APPEAL IS AGAI NST THE DELETION OF ADDITION OF RS.13,65,434/-. 4. THE LD.SR SUBMITTED THAT THE LD.CIT(A) WAS NOT J USTIFIED IN DELETING THE ADDITION. HE RELIED UPON THE ORDER OF THE AO. 4.1. ON THE CONTRARY, LD.COUNSEL FOR THE ASSESSEE M S.ARTI N.SHAH SUPPORTED THE ORDER OF THE LD.CIT(A) AND SUBMITTED THAT ALL EVIDENCES HAVE BEEN DULY PLACED BEFORE THE AO. THERE WAS NO CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF SUCH INCOME AND THE ADDITION HAS BEEN MADE MERELY ON THE BASIS OF DEEMING FICTION U/S.50C OF THE ACT WITHOUT CARRYING OUT ANY FURTHER ENQUIRY. SHE SUBMITTED THAT THE QUANTUM PROCEEDINGS AND PENALTY PROCEEDINGS ARE TWO DIFFERENT ASPECTS. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT TH E ADDITION WAS MADE ON THE BASIS OF INVOKING THE PROVISIONS OF SECTION 50C OF THE ACT. THE REVENUE HAS ALSO NOT PLACED ANY MATERIAL EVIDENCE O N RECORD TO PROVE THAT THE AO HAS MADE ENQUIRY AND CONSEQUENCE OF SUC H ENQUIRY SOME MATERIAL WAS GATHERED WHICH WAS NOT DISCLOSED BY TH E ASSESSEE. THE LD.CIT(A) AFTER CONSIDERING THE SUBMISSIONS HAS DE CIDED THE ISSUE BY OBSERVING AS UNDER:- 3.4. I HAVE CONSIDERED THE PENALTY ORDER, ASSESSME NT ORDER AND THE SUBMISSIONS MADE BY THE APPELLANT. A PERUSAL OF TH E ORDER U/S.143(3) SHOWS THAT THE ADDITION OF RS.42,28,700/- WAS MADE BY THE AO ON ITA NO.2851 /AH D/2015 ACIT VS. SHRI RAJESH DHIRUBHAI PATEL ASST.YEAR 2009-10 - 4 - ACCOUNT OF THE DEEMING PROVISIONS OF SECTION 50C OF THE I.T.ACT. ALL THE DETAILS REGARDING SALE OF LAND HAD BEEN PRODUCED BY THE APPELLANT BEFORE THE AO DURING THE COURSE OF ASSESSMENT PROCE EDINGS. THE ADDITION ON ACCOUNT F CAPITAL GAINS WAS MADE ONLY O N ACCOUNT OF PROVISION OF SECTION 50C WHEREBY THE AO TOOK THE VA LUE OF THE PROPERTY AT RS.1,07,78,700/- INSTEAD OF RS.65,50,000/- AS PE R THE SALE DEED SUBMITTED BY THE APPELLANT. SECTION 271(1)(C) OF T HE I T ACT STATES AS UNDER:- IF THE ASSESSING OFFICER OR THE COMMISSIONER (APPE ALS) OR THE COMMISSIONER IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT, IS SATISFIED THAT ANY PERSON: (A) OMITTED (B) .; OR (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURN ISHED INACCURATE PARTICULARS OF SUCH INCOME; OR (D) .. HE MAY DIRECT THAT SUCH PERSON SHALL PAY BY WAY OF PENALTY.. 3.5. IN THE PRESENT CASE IT CANNOT BE SAID THAT THE APPE LLANT CONCEALED PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE P ARTICULARS OF SUCH INCOME. ALL THE DOCUMENTS AND FACTS WERE BEFO RE THE AO AT THE TIME OF ASSESSMENT PROCEEDINGS. THE ADDITION W AS MADE ONLY ON ACCOUNT OF A DIFFERENT VIEW TAKEN BY THE A.O. T HE HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS PVT.LTD. (322 ITR 158) HAS HELD AS UNDER:- A GLANCE AT THE PROVISIONS OF SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961, SUGGESTS THAT IN ORDER TO B COVERED BY IT, TH ERE HAS TO BE CONCEALMENT OF THE PARTICULARS OF THE INCOME OF THE APPELLANT. SECONDLY, THE APPELLANT MUST HAVE FURNISHED INACCUR ATE PARTICULARS OF HIS INCOME. THE MEANING OF THE WORD PARTICULARS USED IN SECTION 271(1)(C) WOULD EMBRACE THE DETAILS OF THE CLAIM MA DE. WHERE NO INFORMATION GIVEN IN THE RETURN IS FOUND TO BE INCO RRECT OR INACCURATE, THE ASSESSEE CANNOT BE HELD GUILTY OF FURNISHING IN ACCURATE PARTICULARS. IN ORDER TO EXPOSE THE ASSESSEE TO PENALTY, UNLESS THE CASE IS STRICTLY ITA NO.2851 /AH D/2015 ACIT VS. SHRI RAJESH DHIRUBHAI PATEL ASST.YEAR 2009-10 - 5 - COVERED BY THE PROVISION, THE PENALTY PROVISION CAN NOT BE INVOKED. BY NO STRETCH OF IMAGINATION CAN MAKING AN INCORRECT C LAIM TANTAMOUNT TO FURNISHING INACCURATE PARTICULARS. THERE CAN BE NO DISPUTE THAT EVERYTHING WOULD DEPEND UPON THE RETURN FILED BY TH E ASSESSEE, BECAUSE THAT IS THE ONLY DOCUMENT WHERE THE ASSESSE E CAN FURNISH THE PARTICULARS OF HIS INCOME. WHEN SUCH PARTICULARS A RE FOUND TO BE INACCURATE, THE LIABILITY WOULD ARISE. TO ATTRACT PENALTY, THE DETAILS SUPPLIED IN THE RETURN MUST NOT BE ACCURATE, NOT EX ACT OR CORRECT, NOT ACCORDING TO THE TRUTH OR ERRONEOUS. WHERE THERE IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS O R FALSE THERE IS NO QUESTION OF INVITING THE PENALTY UNDER SECTION 271( 1)(C). A MERE MAKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDI NG THE INCOME OF THE ASSESSEE. SUCH A CLAIM MADE IN THE RETURN CANN OT AMOUNT TO FURNISHING INACCURATE PARTICULARS. IN VIEW OF THE DISCUSSION ABOVE AND THE RULING OF H ONBLE SUPREME COURT, I AM OF THE VIEW THAT THIS IS NOT A CASE WHE RE THE APPELLANT HAS FURNISHED INACCURATE PARTICULARS OF INCOME. 3.6 AS REGARDS THE ADDITION OF RS.1,05,000/- ON A CCOUNT OF LONG TERM CAPITAL GAIN ON SALE OF SHOP, THE APPELLANT HAD DEC LARED THE SAME IN HIS RETURN OF INCOME. THE AO COULD ALSO HAVE HAD INDEP ENDENT ENQUIRIES CONDUCTED, IF HE WAS NOT SATISFIED WITH THE EXPLANA TION OFFERED BY THE APPELLANT. FURTHER, IT IS SETTLED LAW THAT PENALTY PROCEEDINGS ARE SEPARATE FROM ASSESSMENT PROCEEDINGS. EVEN DURING P ENALTY PROCEEDINGS, NO STEPS HAVE BEEN TAKEN BY THE AO TO ESTABLISH THAT THE APPELLANT FURNISHED INACCURATE PARTICULARS OF INCOM E. IN VIEW OF THE ABOVE DISCUSSION, THE APPELLANTS CASE DOES NOT ATT RACT PROVISIONS OF SECTION 271(1)(C) AND PENALTY OF RS.13,65,434/- IS DELETED. 5.1. THE ABOVE FINDING OF THE LD.CIT(A) REMAINS UNC ONTROVERTED AS THE REVENUE HAS NOT PLACED ANY MATERIAL ON RECORD SUGGE STING THAT THERE WAS CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF SUCH INCOME BY THE ASSESSEE. THEREFORE, WE ARE OF THE CONSIDERED ITA NO.2851 /AH D/2015 ACIT VS. SHRI RAJESH DHIRUBHAI PATEL ASST.YEAR 2009-10 - 6 - VIEW THAT THE RATIO LAID DOWN BY THE HONBLE APEX C OURT RENDERED IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT.LTD. REP ORTED AT (2010) 322 ITR 0158 (SC) IS RIGHTLY APPLIED BY THE LD.CIT(A). UNDER THESE FACTS, WE DO NOT SEE ANY REASON TO INTERFERE WITH THE ORDE R OF THE LD.CIT(A), SAME IS HEREBY UPHELD. THUS, THE GROUND RAISED IN THE REVENUES APPEAL IS REJECTED. 6. IN THE RESULT, REVENUES APPEAL STANDS DISMISSED . ORDER PRONOUNCED IN THE COURT ON WEDNESDAY, THE 10 TH DAY OF FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( MANISH BORAD ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 10/ 02 /2016 4..., ,.../ T.C. NAIR, SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ()$' / THE RESPONDENT. 3. 56 7 / CONCERNED CIT 4. 7 ( ) / THE CIT(A)-7, AHMEDABAD 5. 8,9 (56 , . 560 , / DR, ITAT, AHMEDABAD 6. 9;< =- / GUARD FILE. / BY ORDER, )8 ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD