Sh. Sanjay Kumar Dang, Saharanpur V. ITO, Saharanpur

ITA 2967/DEL/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 8368 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 2
• Next Hearing Date: 08-03-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DK MISHR A
• Keywords: Business income
• Section: 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI H. S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO. 2967/DEL/2014 ASSESSMENT YEAR: 2009-10 SANJAY KUMAR DANG, VS. ITO, WARD-2 S/O SH. JAGDISH LAL, SAHARANPUR R/O GALI NO. 1, NEAR NATIONAL PUBLIC SCHOOL, JWALA NAGAR, SAHARANPUR-247001 (PAN: CCCPK3649H) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI D.K. MISHRA, CIT(DR) DATE OF HEARING ON : 10/03/2016 ORDER PRONOUNCED ON : 04/04/20 16 ORDER PER H.S. SIDHU, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 31.12.2013 PASSED BY THE LD. CIT(A), MUZAFFARNAGAR RELATING TO ASSESSMENT YEAR 2009-10 ON THE FOLLOWING GROUNDS:- 1. LEARNED COMMISSIONER OF INCOME TAX (APPEAL) IS WRO NG AND UNJUSTIFIED IN CONFIRMING THE PENALTY U/S 271 ( 1) (C) IMPOSED BY THE ASSESSING OFFICER WITHOUT GOING THRO UGH THE FULL FACTS OF THE CASE AND CASES RELIED UPON BY THE APPELLANT. 2. THAT THE OBSERVATION OF LD CIT (A) ON PAGE 6 OF THE APPELLATE ORDER TO THE EFFECT. 'HOWEVER SUCH CONTEN TIONS RAISED BY THE APPELLANT HAVE NO FORCE IS AS MUCH AS NO SUPPORTING DETAILS AND EVIDENCES HAVE BEEN FURNISHE D' IS ITA NO. 2967/DEL/2014 (AY 2009-10) 2 AGAINST THE FACTS AND ALSO CONTRARY TO THE EVIDENCE FILED. THE APPELLANT HAD FILED COPY OF ORDERS OF STATE GOV T. PRESCRIBING CIRCLE RATE AT THE TIME OF PURCHASE AND ALSO AT THE TIME OF SALE TO PROVE THAT THE INCREASE IN VALU ES PROPERTY WAS NOTIONAL AND WAS DUE TO RENTAL VALUE INCREASED BY THE STATE GOVT. 3. THAT LEARNED CIT (A) HAS RELIED UPON BY THE DECI SIONS WHICH ARE MAINLY ON THE POINT OF EXPLANATION AND HA S DIVERTED THE ISSUE TO OTHER LINE. THE CASE RELIED U PON BY THE APPELLANT ARE OF HIGHEST COURT OF LAND I.E. HON'BLE SUPREME COURT WHILE LEARNED CIT(A) WANTS TO TAKE SHELTER FR OM THE DECISION OF HIGH COURT AND ITAT. NO WHERE THE CASE LAWS RELIED UPON BY THE APPELLANT HAVE BEEN CONSIDERED A ND DISTINGUISHED AT ALL. 4. THAT NO DECISION HAS BEEN GIVEN ON GROUND NO 2 W HICH IS ON ACCOUNT OF INSUFFICIENT OPPORTUNITY OF BEING HEA RD. 5. THAT LEARNED CIT(A) HAS PASSED THE ORDER ON THE ISSUE WHICH WAS NOT RAISED IN THE APPEAL. NO FINDING REGA RDING SATISFACTION OF THE ASSESSING OFFICER IN THE ASSESS MENT HAS BEEN RECORDED NOR HAS CASE LAWS RELIED UPON BEEN DISTINGUISHED. 6. THAT APPELLATE ORDER AS PASSED IN THE CASE IS AG AINST THE LAW AND FACTS OF THE CASE. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE PROCEE DINGS U/S. 147 OF THE I.T. ACT, 1961 WERE STARTED BY ISSUE OF NOTICE U/S. 148 DATED 14.6.2011. IN RESPONSE TO THIS NOTICE THE ASSESSEE FILED THE RETURN OF INCOME ON 21.12.2011 SHOWING NET TOTAL INCOME OF RS . 59,730/- BESIDES LONG TERM CAPITAL GAIN OF RS. 2,44,210/-. THE ASSESSEE DERIVES INCOME FROM PURCHASE AND SALE OF CLOTH AND ALSO FRO M CAPITAL GAIN ON SALE OF SHOP. IN THIS CASE ASSESSMENT WAS COMPLETED U/S. 147/143(3) VIDE ORDER DATED 29.2.2012 ON NET TOTAL INCOME OF R S. 3,13,940/- INCLUDING LONG TERM CAPITAL GAIN RS. 2,44,210/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS FOUND THAT THE ASSES SEE HAD CONCEALED THE PARTICULARS OF HIS INCOME AND FURNISHED INACCU RATE PARTICULARS OF HIS INCOME. ACCORDINGLY, A NOTICE U/S. 274 READ W ITH SECTION 271(1)(C) WAS ISSUED. IN RESPONSE TO THE SAME, ASS ESSEE FILED ITA NO. 2967/DEL/2014 (AY 2009-10) 3 THE WRITTEN EXPLANATION DATED 13.8.2012. THEREAFT ER, THE AO LEVIED A PENALTY OF RS. 31,800/- U/S. 271(1)(C) OF THE I.T. ACT, 1961 VIDE ORDER 29.8.2012. 3. AGAINST THE ABOVE PENALTY ORDER DATED 29.8.2012 PASSED BY THE ASSESSING OFFICER, ASSESSEE APPEALED BEFORE THE LD. FIRST APPELLATE AUTHORITY, WHO VIDE IMPUGNED ORDER DATED 31.12.2013 DISMISSED THE APPEAL OF THE ASSESSEE. 4. AGAINST THE ABOVE ORDER OF THE LD. CIT(A) DATED 31.12.2013, ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. IN THIS CASE, NOTICE OF HEARING TO THE ASSESSEE WAS SENT BY THE REGISTERED AD POST, IN SPITE OF THE SAME, ASSESSEE, NOR HIS AUTHORIZED REPRESENTATIVE APPEARED TO PROSECUTE THE MATTER IN DISPUTE, NOR FILED ANY APPLICATION FOR ADJOURNMENT. HOWEVER, THE ASSE SSEE HAS FILED THE WRITTEN SUBMISSIONS IN ORDER TO SUPPORT HIS CASE. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AN D THE ISSUE INVOLVED IN THE PRESENT APPEAL, WE ARE OF THE VIEW THAT NO USEFUL PURPOSE WOULD BE SERVED TO ISSUE NOTICE AGAIN AND A GAIN TO THE ASSESSEE, THEREFORE, WE ARE DECIDING THE PRESENT AP PEAL EXPARTE QUA ASSESSEE, AFTER HEARING THE LD. DR AND PERUSING THE RECORDS. 6. AS PER THE ASSESSEES WRITTEN SUBMISSIONS, HE ST ATED THAT NO SATISFACTION FOR CONCEALMENT WAS RECORDED BY THE AO AND THE CASE LAWS CITED BY THE ASSESSEE IN THE REPLY HAS NOT BEEN DIS CUSSED AT ALL. THEREFORE, THE AMOUNT OF RS. 31,800/- DOES NOT ATTR ACT ANY PENALTY. IN SUPPORT OF HIS CONTENTION, HE RELIED UPON THE DE CISION OF THE HONBLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PETRO PR ODUCTS (2010) TAXMAN 322. 7. ON THE OTHER HAND, LD. DR RELIED UPON THE ORDER OF THE AUTHORITIES BELOW AND REQUESTED THAT THE APPEAL OF THE ASSESSEE MAY BE DISMISSED. ITA NO. 2967/DEL/2014 (AY 2009-10) 4 8. WE HAVE HEARD LD. DR AND PERUSED THE RECORDS, E SPECIALLY THE ORDERS OF THE AUTHORITIES BELOW, THE WRITTEN SUBMIS SIONS BY THE ASSESSEE. WE FIND THAT DURING THE PENALTY PROCEEDIN GS, THE AO HELD AS UNDER:- I HAVE CAREFULLY CONSIDERED THE EXPLANATION FURNIS HED BY THE ASSESSEE AND I AM OF THE OPINION THAT SAME HAS GOT NO FORCE. THE ASSESSEE HAS FILED HIS RETURN OF INCOME SHOWING NET TOTAL INCOME AT RS. 3,03,940/- INCLUDING LONG T ERM CAPITAL GAIN AT RS. 2,44,210/-, WHICH BEING ABOVE THE TAXAB LE LIMIT, THE ASESSEE WAS CLEARLY LIABLE TO FILE HIS RETURN O F INCOME ULS 139(1) OF THE I.T. ACT, 1961 WHICH HE FAILED TO DO. IN THIS CASE IT WAS NOTICED THAT THE ASSESSEE HAD SOLD SHOP FOR RS. 34,56,000/- ALONGWITH 8 OTHER CO-OWNERS. THE SHARE OF THE ASSESSEE WAS 1/1/6 ON WHICH LONG TERM CAPITAL GAIN WAS NOT SHOWN. ACCORDINGLY A NOTICE U/S 148 OF THE 1. T .ACT, 1961 DATED 14-6-2011 WAS ISSUED. IN COMPLIANCE. THE ASSESSEE FILED RETURN SHOWING LONG TERM CAPITAL GAI N AND BUSINESS INCOME. CONSIDERING ALL THE FACTS OF THE C ASE, I AM OF THE OPINION THAT THE ASSESSEE HAD DELIBERATELY C ONCEALED THE PARTICULARS OF HIS INCOME AND FURNISHED INACCUR ATE PARTICULARS OF HIS INCOME AND ACCORDINGLY THIS IS A FIT CASE FOR LEVY OF PENALTY ULS 271(1)( C ) OF THE I.T. ACT, 19 61. 8.1 WE FURTHER FIND THAT LD. CIT(A) BY PLACING RELI ANCE OF THE DECISION IN THE CASE OF RAM SEWAK CHANDRA 151 CTR 294 (ALL) AND GURBACHAN LAL 250 ITR 157 (DEL.) HAS HELD THAT IN A CASE OF LONG TERM CAPITAL GAIN ONLY DECLARED IN RESPONSE TO NOTICE U/S. 148 OF THE ACT, BURDEN IS ON THE ASSESSEE TO PROVE THAT THERE WAS NO CONCEALMENT OF INCOME OR OF TRUE PARTICULARS. HENCE, FURTHER HELD THAT ANGLE O F CONCEALMENT IS MORE THAN ESTABLISHED AND THEREFORE, UPHELD THE PE NALTY OF RS. 31,800/-. ITA NO. 2967/DEL/2014 (AY 2009-10) 5 8.2 WE FURTHER NOTE THAT IN THIS CASE NO SATISFACT ION FOR CONCEALMENT WAS RECORDED FOR PENALTY OF RS.31,800/-. WE FURTHER NOTE THE AO OBSERVED THAT ASSESSEE FURNISHED INACCURATE PARTIC ULARS OF ITS INCOME AND IS LIABLE FOR PENALTY U/S 271(1)(C), WHICH DID NOT ESTABLISH FROM THE ABOVE FACTS AND CIRCUMSTANCES THAT HOW THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF ITS INCOME. SECTION 271(1 )(C) POSTULATES IMPOSITION OF PENALTY FOR FURNISHING OF INACCURATE PARTICULARS AND CONCEALMENT OF INCOME. IN THIS REGARD, WE DRAW OUR SUPPORT FROM THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF C IT VS. RELIANCE PETROPRODUCTS PVT. LTD. (2010) 322 ITR-158 (SC) WHE REIN THE HON'BLE SUPREME COURT HAS HELD THAT 'WHERE THERE IS NO FINDINGS THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE, THERE IS NO QUESTION OF INVITIN G THE PENALTY U/SEC. 271(1)(C) OF THE ACT. A MERE MAKING A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT OF FURNISHING INACC URATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. SUCH CLAIM MA DE IN THE RETURN CANNOT AMOUNT TO FURNISHING A INACCURATE PARTICULAR S OF INCOME. AS THE ASSESSEE HAS FURNISHED ALL THE DETAILS OF ITS EXPEN DITURE AS WELL AS INCOME IN ITS RETURN, WHICH DETAILS, IN THEMSELVES, WERE NOT FOUND TO BE INACCURATE NOR COULD BE VIEWED AS THE CONCEALMENT O F INCOME ON ITS PART. IT WAS UP TO THE AUTHORITIES TO ACCEPT ITS CLAIM IN THE RETURN OR NOT. MERELY, BECAUSE THE ASSESSEE HAD CLAIMED THE EXPEND ITURE, WHICH CLAIM WAS NOT ACCEPTED OR WAS NOT ACCEPTABLE TO THE REVEN UE, THAT BY ITSELF WOULD NOT, IN OUR OPINION, ATTRACT THE PENALTY U/SE C. 271(1)(C). IF WE ACCEPT THE CONTENTION OF THE REVENUE THEN IN CASE O F EVERY RETURN WHERE THE CLAIM MADE IS NOT ACCEPTED BY THE ASSESSING OFF ICER FOR ANY REASON, THE ASSESSEE WILL INVITE PENALTY U/SEC. 271(1)(C). THAT IS CLEARLY NOT THE INTENDMENT OF THE LEGISLATURE'. 7.4 IN THE BACKGROUND OF THE AFORESAID DISCUSSIONS AND PRECEDENT, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE HA S NOT FURNISHED ITA NO. 2967/DEL/2014 (AY 2009-10) 6 INACCURATE PARTICULARS OF INCOME AND THERE ARE NO F INDINGS OF THE ASSESSING OFFICER AND THE CIT (APPEALS) THAT THE DE TAILS FURNISHED BY THE ASSESSEE IN HIS RETURN ARE FOUND TO BE INACCURA TE OR ERRONEOUS OR FALSE. UNDER THESE CIRCUMSTANCES, IN OUR VIEW THE P ENALTY IN DISPUTE IS TOTALLY UNWARRANTED AND DESERVE TO BE DELETED. ACC ORDINGLY, WE DELETE THE PENALTY OF RS. 31,800/- MADE U/S. 271(1)(C) OF THE I.T. ACT AND CANCEL THE ORDERS OF THE AUTHORITIES BELOW ON THE I SSUE IN DISPUTE. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 04/04/2016 . SD/- SD/- [PRASHANT MAHARISHI] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 04/4/2016 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES