Gujarat State Police Housing Corporation Ltd., Gandhinagar V. The Dy. CIT, GNR Circle, Gandhinagar

ITA 2933/AHD/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7910 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 1 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 07-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S N DIVATIA

Judgement Text

ITA NO. 2 933 / AHD/20 1 4 A.Y. 20 1 0 - 11 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI N.K. BILLAIYA , ACCOUNTANT MEMBER I TA NO. 2 933 /AHD /201 4 ASSESSMENT YEAR: 20 1 0 - 11 GUJARAT STATE POLICE HOUSING VS. DY. COMMISSION ER OF INCOME TAX, CORPORATION LIMITED, GNR CIRCLE, GANDHINAGAR. CIVIL SUPPLIES CORPORATION BUILDING, CH ROAD, SECTOR 10A, GANDHINAGAR 382 010. [PAN A A A C G 55 32 C ] (APPELLANT ) (RESPONDENT) APPELLANT BY : SHRI S.N. DIVATIA, A.R. RESPONDENT BY : SHRI MUDIT NAGPAL, SR. D.R. DATE OF HEARING : 05.12 . 20 17 DATE OF PRONOUNCEMENT : 18 . 12 .2017 O R D E R PER N.K. BILLAIYA, A CCOUNTANT MEMBER THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF CIT(A) , G ANDHINAGAR DATED 18.09.2014 PERTAINING TO ASSESSMENT YEAR 2010 - 11. 2. THE ONLY GRIEVANCE OF THE ASSESSE E RELATES TO LEVY OF PENALTY UNDER SECTION 271 B OF THE INCOME TAX ACT, 1961 ( THE ACT HEREINAFTER) WHICH WAS CONFIRMED BY THE CIT(A). 3. BRIEFLY STATE D FACTS OF THE CASE ARE THAT THE ASSESSEE IS A WHOLLY OWNED GOVERNMENT C OMPANY OF GUJARAT AND NODAL AGENCY ENGAGED IN VARIOUS TYPES OF CONSTRUCTION AND MAINTENANCE ACTIVITIES FOR AND ON BEHALF OF HOME DEPARTMENT , GOVERNMENT OF GUJARAT. WHILE SCRUTINIZING THE RETURN OF INCOME, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS SHOWN TURNOVER OF RS.21.30 CRORES AND, THEREFORE, FORMED BELIEF THAT THE ASSESSEE HAS VIOLATED THE PROVISIONS OF SECTION 44AB OF THE ACT AND HENCE LIABLE FOR PENALTY UNDER SECTION 2 71B OF THE ACT . THE ASSESSING OFFICER, THEREFORE, LEVIED PENALTY OF RS.1 ,00,000/ - . THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) BUT WITHOUT ANY SUCCESS. ITA NO. 2 933 / AHD/20 1 4 A.Y. 20 1 0 - 11 PAGE 2 OF 3 4. BEFORE US THE LEANED COUNSEL FOR THE ASSESSE E VEHEMENTLY STATED THAT THE ASSESSEE IS NOT EN GAGED IN ANY BUSINESS AND THE ONLY INCOME OF THE ASSESSEE IS INTEREST INCOME AND, THEREFORE, THE ASSESSE E IS NOT LIABLE TO COMPLY WITH THE PROVISIONS OF SECTION 44AB OF THE ACT. IT IS THE SAY OF THE LEARNED COUNSEL THAT SINCE THE ASSESSEE IS NOT LIABLE FO R COMPLYING WITH THE PROVISIONS OF SECTION 44AB OF THE ACT, NO PENALTY SHOULD BE LEVIED UNDER SECTION 271B OF THE ACT. 5. PER CONTRA, LEARNED DEPARTMENTAL REPRESENTATIVE STRONGLY SUPPORTED THE FINDINGS OF THE ASSESSING OFFICER. 6. WE HAVE CAREFULLY CON SIDERED THE ORDERS OF THE AUTHORITIES BELOW. A PERUSAL OF THE INCOME AND EXPENDITURE ACCOUNT OF THE ASSESSE E EXHIBITED AT PAGE 23 OF THE PAPER BOOK SHOWS THAT THE ONLY SOURCE OF INCOME OF THE ASSESS E E IS BANK INTEREST AND INTEREST ON ICD. MOREOVER, INTER EST ON ICD IS RS.20.42 CRORES . I T IS TRUE THAT THE ASSESSEE IS NOT ENGAGED IN ANY TYPE OF BUSINESS AND EVEN THE INTEREST INCOME OF THE ASSESSEE HAS BEEN HELD TO BE NOT TAXABLE BY THE HON BLE JURISDICTIONAL HIGH COURT OF GUJARAT IN ASSESSEE S OWN CASE IN T AX APPEAL N O.63 OF 2015, ORDER DATED 06.04.2015. 7. IN OUR CONSIDERED OPINION, SINCE THE ASSESSE E IS NOT ENGAGED IN ANY BUSINESS AND THE ONLY INCOME OF THE ASSESSEE IS FROM INTEREST WHICH IS ALSO EXEMPT FROM TAX AS PER THE ORDER OF HON BLE HIGH COURT OF G UJARAT (SUPRA), WE DO NOT FIND THIS TO BE A FIT CASE FOR LEVY OF PENALTY UNDER SECTION 271B OF THE ACT. WE ACCORDINGLY SET ASIDE THE FINDINGS OF THE CIT(A) AND DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY OF RS.1,00,000/ - . 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ACCORDINGLY ALLOWED. ( OR DER PRONOUNCED IN THE OPEN COURT ON THIS 18 TH DAY OF DECEMBER , 2017 ) SD/ - SD/ - RAJPAL YADAV N.K. BILLAIYA ( JUDICIAL MEMBER) ( ACCOUNTANT MEMBER ) AHMEDABAD, THE 18 TH DAY OF DECEMBER , 201 7 PBN/* ITA NO. 2 933 / AHD/20 1 4 A.Y. 20 1 0 - 11 PAGE 3 OF 3 COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER E COPY ASSISTANT REGISTRAR INCOME TAX A PPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD