SHINGAR COSMETICS P. LTD, MUMBAI V. ITO WD NO. 8(3) (1), MUMBAI

ITA 2886/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 7168 (ITAT-MUMBAI)
• Duration Of Justice: 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2010
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: E
• Assessment Year: 2003-2004
• Appeal Filed On: 06-05-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NEENA GUPTA
• Assessee Lawyers: N K BHUTA
• Keywords: Sale consideration of property below Jantri Value; Reasonable cause; Tax effect; Set aside; Capital Gains
• Section: 271(1)(c); 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI N.V. VASUDEVAN, JM AND SHRI T.R. SOO D, AM I.T.A.NO.2886/MUM/2009 ASSESSMENT YEAR :2003-04 M/S. SHINGAR COSMETICS PVT. LTD., KALPTARU 71, NUTAN LAXMI SOC. N.S. ROAD NO.8, JVPD SCHEME, VILE PARLE(WEST), MUMBAI 400 049. PAN: AABCS 9694 J. VS. THE INCOME-TAX OFFICER, WARD NO.8(3)(1), MUMBAI. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI N.K. BHUTA RESPONDENT BY : SHRI NEENA GUPTA O R D E R PER T.R. SOOD, AM: IN THIS APPEAL THE ASSESSEE HAS RAISED VARIOUS GROUNDS BUT AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SU BMITTED THAT THE MAIN ISSUE IS REGARDING CONFIRMATION OF LEVY OF PENALTY AMOUNTING TO RS. 2,16,260/- UNDER SECTION 271(1)(C) OF THE ACT. 2. AFTER HEARING BOTH THE PARTIES, WE FIND THAT PEN ALTY HAS BEEN LEVIED IN RESPECT OF TWO ADDITIONS - (I) ADDITION ON ACCOUNT OF SHORT TERM CAPITAL GAINS OF RS.2,43,393/- AND (II) CESSATION OF TRADING LIABILI TY AMOUNTING TO RS.3,45,081/-. 3. WE FURTHER FIND THAT THE FIRST ADDITION HAS BEEN DELETED IN THE QUANTUM APPEAL BY THE TRIBUNAL IN ITA NO. 3109/MUM/2007 DAT ED 5TH DAY OF NOVEMBER 2009, COPY OF WHICH HAS BEEN PLACED BEFORE US. PARA 11 OF THIS ORDER READS AS UNDER: RESPECTFULLY FOLLOWING THE RATIO OF THE CO-ORDINAT E BENCH IN ASSESSEES OWN CASE FOR THE A.Y.20044-05 IN ITA NO. 1785/MUM/2007, WE HOLD THAT THE PROVISIONS OF SEC. 50C ARE NOT APPLICABLE TO TRANSFER OF THE RIGHTS OF THE ASSESSE E IN THE FLAT AT VAPI AND THE ADDITION TO THE SHORT TERM CAPITAL GAINS BY THE AO BY APPLYING PROVISIONS OF SEC.50C IS DELETED. IN VIEW OF OUR DECISION IN FAVOR OF THE ASSESSEE ON THIS GROUND, THE OTHER CON DITIONS OF THE ASSESSEE ARE NOT CONSIDERED. 2 4. IN VIEW OF THE ABOVE DELETION, PENALTY CANNOT BE LEVIED IN RESPECT OF ADDITION ON ACCOUNT OF SHORT-TERM CAPITAL GAINS AMO UNTING TO RS. 2,43,393/-. 5. AS FAR AS THE ISSUE REGARDING ADDITION ON ACCOUN T OF CESSATION OF TRADING LIABILITY UNDER SECTION 41 IS CONCERNED, THE SAME H AS BEEN SET ASIDE TO THE FILE OF THE ASSESSING OFFICER VIDE PARA 22 OF THE TRIBUNAL ORDER IN QUANTUM APPEAL. THEREFORE, WE DELETE THE PENALTY IN RESPECT OF ADDI TION ON ACCOUNT OF SHORT TERM CAPITAL GAINS AMOUNTING TO RS.2,43,393/- AND SET AS IDE THE PENALTY PROCEEDINGS TO THE FILE OF THE ASSESSING OFFICER FOR RE-CONSIDERAT ION AFTER DECIDING THE ISSUE OF ADDITION AND DECIDE THE SAME AFRESH. 6. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON THIS 30 TH DAY OF MARCH 2010. SD. SD. (N.V. VASUDEVAN) (T. R. SOOD) JUDICIAL MEMBER AC COUNTANT MEMBER MUMBAI DATED THE 30 TH MARCH, 2010. KN COPY TO: 1. THE ASSESSEE 2. THE REVENUE 3. THE CIT-VIII, MUMBAI 4. THE CIT(A)-XXIX, MUMBAI 5. THE DR E BENCH, MUMBAI BY ORDER /TRUE COPY/ ASST. REGISTRAR, ITAT, MUMBAI 3 ORDER PRONCOUNCED ON . 2. AT THE TIME OF HEARING NONE APPEARED ON BEHALF O F THE ASSESSEE- APPELLANT AS WELL AS NO PETITION FOR ADJOURNMENT WA S FILED. WE FIND FROM THE RECORDS THAT ASSESSEE-APPELLANT WAS SERVED NOTICE B Y REGISTERED POST ACKNOWLEDGEMENT DUE TWICE AND THE ACKNOWLEDG EMENT CARDS DULY SIGNED BY THE ASSESSEE ON 25.07.2007 AND 16.11.2 007 , RECEIVED BACK. IT IS THEREFORE, PRESUMED THAT THE ASSESSEE IS NOT INT ERESTED IN PURSUING THE APPEAL FILED BY IT. IT HAS BEEN HELD BY THE HONBLE MADHYA PRADESH HIGH COURT IN ESTATE OF LATE TUKOJIRAO HOLKAR VS. CWT (2 23 ITR 480)(MP) THAT IF THE PARTY, AT WHOSE INSTANCE THE REFERENCE IS MADE, FAILS TO APPEAR AT THE HEARING OR FAILS IN TAKING STEPS FOR PREPARATION OF PAPER-BOOKS, SO AS TO ENABLE HEARING OF THE REFERENCE, THE COURT IS NOT B OUND TO ANSWER THE REFERENCE. THE DECISION OF THE DELHI BENCH OF THE TRIBUNAL IN CIT VS. MULTIPLAN (INDIA) PVT. LTD., 38 ITD 320 (DEL.) IS A LSO TO THE SAME EFFECT. IN THE FACTS OF THE CASE WE HOLD THAT THE ASSESSEE IS NOT INTERESTED IN PURSUING THE PRESENT APPEAL BEFORE THE TRIBUNAL, ACCORDINGLY THE APPEAL OF THE ASSESSEE IS DISMISSED AS UNADMITTED. THE ASSESSEE, IF SO ADVISED, SHALL BE FREE TO MOVE THE TRIBUNAL PRAYING FOR RECALLING OF THIS ORDER PROVIDED THE ASSESSEE IS ABLE TO ESTABLISH THE REASONABLE CAUSE BEHIND THE NON- APPEARANCE ON THE DATE OF HEARING AND IN THAT CASE THE TRIBUNAL MAY IN ITS DISCRETION RECALL THIS ORDER AND THE APPEAL MAY BE RESTORED FOR RE-HEARING. 3. IN THE RESULT, APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 18.12.2 007. 4 2. FROM THE GROUNDS FILED BY THE ASSESSEE BEFORE TH E LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) WE FIND THAT THE LEVY PERTA INED TO CONCEALMENT OF INCOME OF RS. 1,02,744/- AND THE PENALTY LEVIED WAS RS. 22 ,248/-. THEREFORE IN VIEW OF CBDT CIRCULAR F.NO. 279/MISC.142/2007-IT DATED 15 TH MAY, 2008 THE APPEAL IS NOT MAINTAINABLE, TAX EFFECT BEING LESS THAN RS. 2 LAKH S. VIDE PARA 4 OF THIS CIRCULAR IT IS CLEARLY MENTIONED THAT THE TAX EFFECT IN ASCERTA INING MONETARY LIMITS FOR FILING OF APPEALS, IN THE CASE OF PENALTY ORDERS, WOULD MEAN QUANTUM OF PENALTY DELETED OR REDUCED. 3. THEREFORE, APPEAL OF THE REVENUE IS DISMISSED AS NOT MAINTAINABLE. ORDER PRONOUNCED ON THIS _______ DAY OF MAY, 2009 . (G.C. GUPTA) (ABRAHAM P. GEORGE) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED THE ______MAY, 2009. KN COPY TO: 6. THE ASSESSEE 7. THE ITO-26(1)(2), MUMBAI. 8. THE CIT, CITY-XXVI, MUMBAI 9. THE CIT(A)-XXVIII, MUMBAI 10. THE DR, G BENCH, MUMBAI BY ORDER /TRUE COPY/ ASST. REGISTRAR, ITAT, MUMBAI S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 18.05.09 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 18.05.09 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 5 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER 6