ITO Ward-I, V. B.B. Singhal, Hisar

ITA 2884/DEL/2008

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 8076 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 12-05-2009
• Assessment Year: 2004-2005
• Appeal Filed On: 09-09-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S REHMAN
• Section: 271(1)(c); 143(1); 143(2); 147; 148; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH `B : NEW DELHI) BEFORE HONBLE SR. VICE PRESIDENT SHRI R.P. GARG A ND HONBLE JUDICIAL MEMBER, SHRI A.D. JAIN ITA NO.2884/DEL./2008 (ASSESSMENT YEAR : 2004-05) ITO, WARD 1, VS. SHRI B.B. SINGHAL, HISAR. DELHI ROAD, HISAR. (PAN/GIR NO.AKJPS6582L) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI RAMESH GOYAL, CA REVENUE BY : SHRI S. REHMAN, DR ORDER PER R.P. GARG, SR.VP THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER OF THE CIT(A) FOR THE ASSESSMENT YEAR 2004-05 IN DELETING THE PENALTY OF RS.5,00,000 IMPOSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE I.T. ACT. 2. THE ASSESSEE FILED A RETURN DECLARING AN INCOME OF RS.2,43,191 ON 1.11.2004 WHICH WAS PROCESSED U/S 143(1) ON 30.3.2006. IT WA S NOTICED LATER ON THAT THE ASSESSEE CLAIMED INCOME TO THE EXTENT O RS.13,80,759 AS EXEM PT BEING EX-GRATIA BENEFIT RECEIVED ON RETIREMENT. HOWEVER, AN AMOUNT OF RS.5,00,000 W AS SHOWN AS EXEMPT U/S 10 OF THE I.T. ACT AS PER THE FORM NO.16 ISSUED BY NEW INDIA ASSURANCE COMPANY LTD., HISAR. SINCE THE ASSESSEE CLAIMED EXEMPTION IN EXCESS OF W HAT IS ADMISSIBLE UNDER THE ACT, PROCEEDINGS U/S 147 WERE INITIATED BY THE ASSESSING OFFICER TO BRING THE TAX, THE EXCESS DEDUCTION CLAIMED IN RETURN AND A NOTICE U/S 148 WA S ISSUED ON 12.04.2006. ACCORDINGLY, A NOTICE U/S 143(2) WAS ISSUED ON 30.5.2006 FIXING THE CASE FOR 18.06.2006. THE ASSESSEE WAS REQUIRED TO GIVE THE BASIS FOR CLAIMING DEDUCTI ON OF RS.13,80,759 PARTICULARLY WHEN IN THE SALARY CERTIFICATE ISSUED BY THE EMPLOYER, T HIS DEDUCTION WAS RESTRICTED TO RS.5,00,000 ONLY AND ALSO ISSUED A SHOW-CAUSE NOTIC E AS TO WHY THIS CLAIM SHOULD NOT BE RESTRICTED TO RS.5,00,000 ONLY. THE ASSESSEE SUBMI TTED THAT THE DEDUCTION WAS CLAIMED ON THE BASIS OF A NEWSPAPER REPORT OF BHASKAR NEWS, NE W DELHI IN WHICH IT WAS PUBLISHED THAT THE ENTIRE AMOUNT OF EX-GRATIA PAYMENT RECEIVE D UNDER A VOLUNTARY RETIREMENT SCHEME WAS EXEMPT FORM INCOME TAX. THE RELIANCE PLACED BY THE ASSESSEE ON THE AFORESAID NEWS IN THE NEWSPAPER IS CERTAINLY MISLEADING AND THE AS SESSEE WAS NOT ALLOWED TO AVOID PROPER TAX LIABILITY BY THE ASSESSING OFFICER AND THE PENA LTY PROCEEDINGS FOR CONCEALMENT U/S 271(1)(C) WAS INITIATED AND A PENALTY OF RS.5,00,00 0 WAS IMPOSED ON THE ASSESSEE FOR CONCEALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS THEREOF.. 3. THE COMMISSIONER OF INCOME-TAX (APPEALS) DELETED THE PENALTY IMPOSED BY THE ASSESSING OFFICER BY FOLLOWING THE JUDGMENTS OF THE HONBLE SUPREME COURT AND THE HIGH COURTS AS UNDER: 1. DILIP N. SHROFF (KARTA OF D.N. SHROFF (HUF) VS. JCIT & OTHERS, 291 ITR 519 (SC) 2. T. ASHOK PAI VS. CIT, 292 ITR 11 (SC) 3. VIRTUAL SOFT SYSTEM LTD. VS. CIT (SC) 4. CIT VS. GHOHAL INVESTMENT LTD. ITA NO.38/2006 (D EL.) 5. CIT VS. JAI BHARAT MARUTI LIMITED (ITA 1135/200 6 (DEL.) AFTER CONSIDERING THE SUBMISSION MADE BY THE AR AND THE FACTS AND CIRCUMSTANCES INVOLVED IN THIS APPEAL, THE COMMISSIONER OF INCOME -TAX (APPEALS) ALSO RELIED ON THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE O F D.N. SHROFF VS. JCIT, 291 ITR 519 IN WHICH THE ISSUE HAS BEEN EXAMINED OF FURNISHING OF INACCURATE PARTICULARS AND CONCEALMENT OF INCOME IN DELETING THE PENALTY IMPOS ED U/S 271(1)(C) BY THE ASSESSING OFFICER. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL PLACED ON RECORD. LD.AR OF THE ASSESSEE RELIED ON THE DECISI ON OF THE HONBLE HIGH COURT OF RAJASTHAN IN THE CASE OF A.R. ENTERPRISES (P.) LTD. , VS. CIT, REPORTED IN (2008) 215 CTR 306 IN WHICH REFERRING THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF DILIP N. SHROFFVS. JCIT, (2007) 210 CTR (SC) 228 DELETED TH E PENALTY IMPOSED U/S 271(1)(C) OF THE ACT. LD.AR OF THE ASSESSEE ALSO CITED THE DECI SION IN THE CASE OF CIT VS. MICA WOOD (P.) LTD. REPORTED IN 170 TAXMAN 256 (DEL.) IN SUPP ORT OF THE CLAM OF THE ASSESSEE. KEEPING IN VIEW THE FINDINGS MADE BY THE COMMISSION ER OF INCOME-TAX (APPEALS) IN HIS ORDER AND ALSO THE AFORESAID JUDGMENTS CITED BY THE LD.AR, WE ARE OF THE VIEW THAT THE PENALTY LEVIED BY THE ASSESSING OFFICER DESERVES TO BE DELETED. WE, THEREFORE, UPHOLD THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) A ND DISMISS THE APPEAL OF THE REVENUE. 5. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 6. ORDER PRONOUNCED IN OPEN COURT ON 30.06.2009. (A.D. JAIN) (R.P. GARG) JUDICIAL MEMBER SR. VICE PRESIDENT DATED: JUNE 30, 2009. *SKB* COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A), ROHTAK. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. AR/ITAT