LATE SMT. JANABAI ANANDJI MATANI, MUMBAI V. ITO 19(2)(3), MUMBAI

ITA 3052/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 49144 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-06-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 06-06-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 19-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGH
• Assessee Lawyers: VIJAY KUMAR BIYANI
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, I, MUMBAI BEFORE S/SHRI D.K.AGARWAL (JM) AND T.R.SOOD(A.M ) ITA NO.3052/MUM/2010 (ASSESSMENT YEAR: 2002-03) LATE SMT.JAMNAB AI ANANDJI MATANI, 20, SUSHILABAUG, 53, S.V.ROAD, SANTACRUZ(W), MUMBAI-400054 PAN: AAMPM3480E INCOME TAX OFFICER WARD 19(2)(3), PIRAMAL CHAMBERS, LALBAUG, MUMBAI. APPELLANT V/S RESPONDENT APPELLANT BY : SHRI VIJAY KUMAR BIYANI RESPONDENT BY : SHRI S.K.SIN GH. O R D E R PER D.K.AGARWAL (JM) THIS APPEAL PREFERRED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 24.2.2010 PASSED BY THE LEA RNED COMMISSIONER OF INCOME TAX (A) CONFIRMING THE PENAL TY OF RS.2,55,063/- IMPOSED BY THE AO UNDER SECTION 271 (1)( C ) OF THE INCOME TAX ACT, 1961 (THE ACT). 2. BRIEFLY STATED FACTS OF THE CASE ARE THAT THE AS SESSEE AN INDIVIDUAL DERIVES INCOME FROM PROPERTY AND LON G TERM CAPITAL GAIN ON SALE OF SHARES. THE RETURN WAS FILE D DECLARING TOTAL INCOME OF RS.36,690/-. DURING THE COURSE OF A SSESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR 2003-04 THE AO FROM ITA NO.3052/MUM/2010 (ASSESSMENT YEAR: 2002-03) 2 THE AGREEMENT DATED 31.1.2002 NOTED THAT THE ASSES SEE WHO WAS A MEMBER OF M/S SUSHILA BAUG CO-OPERATIV E HSG.SOC.LTD HAS ENTERED INTO AN AGREEMENT ON 31. 1.2002 FOR DEVELOPMENT OF PROPERTY FOR CONSIDERATION OF RS.13,17,750/- AND THE PART PERFORMANCE WAS COMPLE TED BY RECEIVING AN AMOUNT OF RS.25,000/- ON 1.2.2002. THE AO HOLDING THAT BOTH THE PARTIES HAVE PERFORMED THEIR PART, THE TRANSFER IS COMPLETED WITHIN THE MEANING OF SECTION 2(47) OF THE ACT, TAXED THE RESULTANT LONG TERM CAPITAL GAIN OF RS.12,62,619/- VIDE ORDER DATED 26.12.2006 PASSED U NDER SECTION 143(3) R.W.S.147 OF THE ACT. ON APPEAL, THE LEARNED COMMISSIONER OF INCOME TAX (A) DISMISSED THE ASSESS EES APPEAL VIDE ORDER DATED 7.1.2008. SINCE DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO ALSO INITIATED PENAL TY PROCEEDINGS UNDER SECTION 271(1) (C) OF THE ACT, T HE AO ISSUED NOTICE TO SHOW CAUSE AS TO WHY PENALTY UNDER SECTION 271(1)(C) SHOULD NOT BE IMPOSED. IN REPLY, THE A SSESSEE VIDE LETTER DATED 29.1.2007 HAS STATED THAT THE ADD ITION OF LONG TERM CAPITAL GAINS MADE BY THE AO IN ASSESSME NT YEAR 2002-03 CANNOT BE SAID THAT THE ASSESSEE HAS CONCEA LED THE INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOM E SINCE THESE PARTICULARS WERE FILED BY THE ASSESSEE IN THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2003-04. HOWEVER, T HE AO DID NOT ACCEPT THE ASSESSEES EXPLANATION. ACCORDI NG TO THE AO SINCE THE LEARNED COMMISSIONER OF INCOME TAX (A ) HAS ITA NO.3052/MUM/2010 (ASSESSMENT YEAR: 2002-03) 3 ALREADY DISMISSED THE ASSESSEES APPEAL, THEREFORE, THE ARGUMENTS ADVANCED BY THE ASSESSEE REGARDING THE TA XABILITY ON CAPITAL GAIN ON DEVELOPMENT RIGHTS IS NOT ACCEPT ABLE AS THE ASSESSEE HAS TRANSFERRED HER RIGHTS IN THE SOCI ETY ONLY WHEN SHE ENTERED INTO AN AGREEMENT WITH THE DEVELOP ER AND NOT BEFORE THAT. THE ASSESSEE HAS ALSO NOT OFFERE D CAPITAL GAIN EVEN AFTER RECEIPT OF THE ENTIRE MONEY FROM TH E DEVELOPER. UNDER THESE CIRCUMSTANCES, THE ASSESSE E HAS TRIED TO CONCEAL THE AMOUNT RECEIVED FROM THE DEVE LOPER IN LIEU OF SURRENDER OF HER RIGHTS IN THE SOCIETY AN D HENCE THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HER INCOM E OR FILED INACCURATE PARTICULARS OF HER INCOME WHICH WAS OTHE RWISE TAXABLE AND ACCORDINGLY THE AO HAS IMPOSED THE PENA LTY OF RS.2,55,063/- VIDE ORDER DATED 25.3.2009 PASSED UN DER SECTION 271(1)(C ) OF THE ACT. ON APPEAL, THE LEA RNED COMMISSIONER OF INCOME TAX (A) FOR THE SAME REASONS DISMISSED THE ASSESSEES APPEAL. 3. BEING AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (A), THE ASSESSEE IS IN APPEAL BEFORE US CHALLENGING IN THE GROUND OF APPEAL THE S USTENANCE OF PENALTY OF RS.2,55,063/-IMPOSED BY THE AO UNDER SECTION 271(1)( C ) OF THE ACT. ITA NO.3052/MUM/2010 (ASSESSMENT YEAR: 2002-03) 4 4. AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITS THAT SINCE THE TRIBUNAL IN ASSESS EES OWN CASE IN LATE SMT. JAMNABAI ANANDJI MATANI, L/H SHRI BHUPENDRA MATANI V/S INCOME TAX OFFICER, WARD 19(2) (3) IN ITA NO.1909/MUM./2008 (AY: 2002-03) ORDER DATED 30. 4.2010 HAS DELETED THE ENTIRE ADDITION OF RS.12,62,619/-, THEREFORE, THE PENALTY IMPOSED BY THE AO AND SUSTAINED BY THE LEARNED COMMISSIONER OF INCOME TAX (A) BE DELETED. 5. ON THE OTHER HAND, THE LEARNED D.R. SUPPORTS THE ORDER OF THE AO AND LEARNED COMMISSIONER OF INCOME TAX ( A). 6. HAVING CAREFULLY HEARD THE SUBMISSIONS OF THE RIVAL PARTIES AND PERUSING THE MATERIAL AVAILABLE ON REC ORD, WE FIND MERITS IN THE PLEA OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE TRIBUNAL IN THE QUANTUM APPEAL F ILED BY THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAS D ELETED THE ENTIRE ADDITION OF RS.12,62,619/- ON WHICH THE AO HAS IMPOSED IMPUGNED PENALTY, VIRTUALLY, THE BASIS FOR IMPOSITION AND LEVY OF PENALTY UNDER SECTION 271(1)(C) IS NO T AVAILABLE. WHEN SUCH IS THE POSITION, THE IMPOSITION OF PENALT Y IS NOT IN ACCORDANCE WITH LAW AND ACCORDINGLY, THE PENALTY OF RS.2,55,063/- IMPOSED BY THE AO UNDER SECTION 271 (1)(C ) AND SUSTAINED BY THE LEARNED COMMISSIONER OF INCOME TAX ITA NO.3052/MUM/2010 (ASSESSMENT YEAR: 2002-03) 5 (A) IS DELETED. THE GROUND TAKEN BY THE ASSESSEE I S THEREFORE ALLOWED. 7. IN THE RESULT, THE ASSESSEES APPEAL STANDS ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH JUNE,2011. SD SD (T.R.SOOD) (D.K.AGARWAL) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 10TH JUNE,2011 SRL COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. DR CONCERNED BENCH 6. GUARD FILE. BY ORDER TRUE COPY ASSTT. REGISTRAR, ITAT, MUMBAI