Shri Rajeshkumar Kanjibhai Patel, Mehsana V. The Income Tax Officer, Patan Ward-3, Mehsana

ITA 3014/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9485 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-02-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 28-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B
• Assessee Lawyers: M J SHAH

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD , , BEFORE SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER ./ I.T.A. NO.3014/AHD/2015 ( / ASSESSMENT YEAR : 2011-12) RAJESHKUMAR KANJIBHAI PATEL 5, RAJHANS SOCIETY DHAROI COLONY ROAD AT & TAL: VISNAGAR, DIST.MEHSANA-384 315 / VS. THE INCOME TAX OFFICER WARD-3 MEHSANA ./ ./ PAN/GIR NO. : ABNPP 8566 G ( ' / APPELLANT ) .. ( #' / RESPONDENT ) ' $ / APPELLANT BY : SHRI M.J. SHAH, AR #' % $ / RESPONDENT BY : SHRI B.PANDA, SR.DR &'( % ) / DATE OF HEARING 11/02/2016 *+, % ) / DATE OF PRONOUNCEMENT 24/02/2016 / 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)-GANDHINAGAR [CIT(A) IN SHORT] DATED 29/07/2015 PERTAINING TO ASSESSMENT Y EAR (AY) 2011-12. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- ITA NO.3014/AHD /2015 RAJESHKUMAR KANJIBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 2 - 1. THE CIT(APPEALS) ERRED IN UPHOLDING PENALTY OF RS. 3,40,401/- U/S.271(1)(C) OF THE I.T. ACT, 1961. 2. THE CIT(APPEALS) FAILED TO APPRECIATE THE SUBMISSIO NS MADE BY THE ASSESSEE AND IN THE PROCESS ERRED IN UPHOLDING THE PENALTY LEVIED U/S.271(1)(C). 2.1. THE ONLY EFFECTIVE GROUND IN THIS APPEAL IS AGAINST CONFIRMATION OF PENALTY OF RS.3,40,401/- LEVIED U/S.271(1)(C) OF TH E INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS THE ACT). BRIEFLY S TATED FACTS ARE THAT THE CASE OF THE ASSESSEE WAS PICKED UP FOR SCRUTINY ASS ESSMENT AND THE ASSESSMENT U/S.143(3) OF THE ACT WAS FRAMED VIDE O RDER DATED 19/02/2014, THEREBY THE ASSESSING OFFICER (AO IN SHORT) MADE ADDITION(S) OF RS.10,79,207/- ON ACCOUNT OF UNACCOU NTED INVESTMENT IN GOLD JEWELLERY, RS.3,616/- ON ACCOUNT OF NON-DISCLO SURE OF INTEREST RECEIVED FROM INCOME-TAX REFUND AND RS.77,093/- ON ACCOUNT OF DISALLOWANCE OF AGRICULTURAL EXPENSES. THE AO ALSO INITIATED PENALTY PROCEEDINGS U/S.271(1)(C) OF THE ACT. THE PENALTY OF RS.3,40,410/- ON TOTAL ALLEGED CONCEALED INCOME OF RS.11,56,300/-. THE ASSESSEE BEING AGGRIEVED BY THE PENALTY ORDER, PREFERRED AN APPEAL BEFORE THE LD.CIT(A), WHO AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESS EE DISMISSED THE APPEAL. AGGRIEVED BY THE ORDER OF THE LD.CIT(A), THE ASSESSEE IS FURTHER IN APPEAL BEFORE US. 3. THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE AUTHORITIES BELOW WERE NOT JUSTIFIED IN LEVYING THE PENALTY. HE SUBM ITTED THAT THE ITA NO.3014/AHD /2015 RAJESHKUMAR KANJIBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 3 - LD.CIT(A) FAILED TO APPRECIATE THE FACT THAT DUE TO OVERSIGHT THE ASSESSEE DID NOT INCLUDE THE ENTIRE SUM AND OUT OF TOTAL INC OME DISCLOSED, A SMALL PORTION WAS LEFT OUT DUE TO OVER SIGHT, BUT IT WAS DULY INCLUDED IN THE RETURN OF INCOME AND ADVANCE-TAX WAS PAID THEREON. HE SUBMITTED THAT HAD THE INTENTION WAS TO CONCEAL THE INCOME, THE AS SESSEE COULD HAVE DONE IT FOR A BIGGER AMOUNT. HE HAS TAKEN THROUGH THE ASSESSMENT ORDER AND THE PENALTY ORDER AS WELL. HE RELIED ON THE JU DGEMENT OF HONBLE APEX COURT RENDERED IN THE CASE OF PRICE WATERHOUSE COOPERS PVT.LTD. VS. CIT REPORTED AT (2012) 348 ITR 306 (SC). 3.1. ON THE CONTRARY, LD.SR.DR OPPOSED THE SUBMISSI ONS AND SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. HE RELIED ON THE JUDGMENT OF HONBLE APEX COURT RENDERED IN THE CASE OF MAK DATA P.LTD. VS. CIT IN CIVIL APPEAL NO.9772 OF 2013, DATED 30 TH OCTOBER-2013 :: 38 TAXMANN.COM 448 (SC). 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AS WELL AS THE JUDGEMENT RELIED UPON BY THE RESPECT IVE PARTIES. THERE IS NO DISPUTE WITH REGARD TO THE FACT THAT THE QUANTUM PROCEEDINGS AND THE PENALTY PROCEEDINGS ARE DIFFERENT AND DISTINCT PROC EEDINGS. MERELY BECAUSE THE ASSESSEE HAS DISCLOSED IN SURVEY PROCEE DINGS AND DID NOT INCLUDE THE SUM IN THE RETURN OF INCOME WOULD NOT IPSO FACTO MAKE THE ITA NO.3014/AHD /2015 RAJESHKUMAR KANJIBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 4 - ASSESSEE LIABLE FOR PENALTY FOR NON-INCLUSION OF TH E ENTIRE SUM IN THE RETURN OF INCOME. IF THE ASSESSEE HAS A BONAFIDE EXPLANATION, UNDER SUCH CIRCUMSTANCES, THE PENALTY WOULD NOT BE LEVIABLE. BEFORE LEVYING THE PENALTY, THE AO HAS TO SATISFY THAT THE GROUND OF L EVY OF PENALTY EXISTS AS CONTEMPLATED UNDER THE RELEVANT PROVISIONS OF THE A CT. IN THE INSTANT CASE, THE ADDITION WAS MADE ON THE BASIS OF DISCLOS URE OF THE ASSESSEE DURING THE SURVEY PROCEEDINGS. IT WAS STATED DURIN G THE COURSE OF ASSESSMENT PROCEEDINGS, THAT DUE TO OVERSIGHT THE A MOUNT ON WHICH THE PENALTY WAS PROPOSED TO BE LEVIED WAS LEFT OUT. IT WAS SUBMITTED THAT THE MISTAKE WAS BONAFIDE. WE FIND THAT THE AO HAS RECO RDED THAT THE ASSESSEE HAD DEPOSITED THE TAX PAYABLE ON THE AMOUN T LEFT OUT BY WAY OF SELF ASSESSMENT TAX BEFORE COMPLETION OF ASSESSMENT . UNDER THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, THE EXPLANATION OF THE ASSESSEE APPEARS TO BE BONAFIDE, NO DOUBT CAN BE CASTED WHEN THE MAJ OR SUM WAS DULY DISCLOSED BY THE ASSESSEE AND TAX WAS PAID THEREON. THEREFORE, IN VIEW OF THE JUDGMENT OF THE HONBLE APEX COURT RENDERED IN THE CASE OF PRICE WATERHOUSE COOPERS PVT.LTD. VS. CIT (SUPRA), WE HER EBY DIRECT THE AO TO DELETE THE PENALTY. THE JUDGEMENT RELIED UPON BY T HE LD.SR.DR IN THE CASE OF MAK DATA P.LTD. VS. CIT(SUPRA) WOULD NOT BE APPLICABLE TO THE PRESENT CASE AS THE FACTS OF THE PRESENT CASE ARE D ISTINGUISHABLE. THE REVENUE HAS NOT DISPUTED THE FACT THAT OUT OF TOTAL INCOME DISCLOSED BY THE ASSESSEE, THE ADDITIONAL INCOME DID NOT INCLUDE RS.10,79,207/- WHICH IS A VERY SMALL AMOUNT IN COMPARISON TO THE ADDITIO NAL INCOME OF ITA NO.3014/AHD /2015 RAJESHKUMAR KANJIBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 5 - RS.1,45,79,207/- OFFERED TO TAX. THUS, THIS GROUND OF ASSESSEES APPEAL IS ALLOWED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE COURT ON WEDNESDAY, THE 24 TH DAY OF FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( PRAMOD KUMAR ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 24/ 02 /2016 0)..& , '.&../ T.C. NAIR, SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. ' / THE APPELLANT 2. #' / THE RESPONDENT. 3. 123 4 / CONCERNED CIT 4. 4 ( ) / THE CIT(A)-GANDHINAGAR 5. 5'6 &23 , ) 23 , , 1 / DR, ITAT, AHMEDABAD 6. 689 :( / GUARD FILE. / BY ORDER, #5 //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 23.2.16 (DICTATION-PAD 11+ PAGES ATTACHED AT THE END OF THIS FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER .. 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.24.2.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 24/2/16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER