Sh. Paramjit Singh, Chandigarh V. ACIT, Chandigarh

ITA 332/CHANDI/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 8495 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 08-12-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 01-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: RICHA GUPTA
• Keywords: Bonafide mistake

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI H.L.KARWA, VICE PRESIDENT AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.332/CHD/2014 (ASSESSMENT YEAR : 2009-10) SH.PARAMJIT SINGH, VS. THE A.C.I.T., H.NO.558, SECTOR 36, CIRCLE 4(1), CHANDIGARH. CHANDIGARH. PAN: ABXPS6499P (APPELLANT) (RESPONDENT) APPELLANT BY : MS.RICHA GUPTA RESPONDENT BY : SHRI MANJIT SINGH, DR DATE OF HEARING : 08.12.2015 DATE OF PRONOUNCEMENT : 09.02.2016 O R D E R PER RANO JAIN, A.M . : THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCO ME TAX (APPEALS), CHANDIGARH DATED 27.1.2014 FOR ASSESSMEN T YEAR 2009-10. THE APPEAL BEFORE THE CIT (APPEALS) WAS AGAINST THE ORDER OF THE ASSESSING OFFICER MADE UND ER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN S HORT THE ACT). 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 24(A) OF T HE ACT 2 BEFORE REDUCING THE AMOUNT OF PROPERTY TAX FROM THE ALV, WHILE THE PROPERTY TAX SHOULD HAVE BEEN REDUCED FRO M THE ALV BEFORE CLAIMING DEDUCTION UNDER SECTION 24(A) O F THE ACT. FURTHER THE ASSESSEE COULD NOT PRODUCE COMPLE TE CHALLAN OF PROPERTY TAX. IN THIS VIEW, THE INCOME UNDER THE HEAD HOUSE PROPERTY WAS COMPUTED BY THE ASSES SING OFFICER AT RS.4,84,069/- INSTEAD OF RS.2,94,353/- S HOWN BY THE ASSESSEE, AN ADDITION OF RS.1,89, 716/- WAS MADE IN THIS MANNER. IN THE PENALTY PROCEEDINGS, IT WAS STATED BY THE ASSESSEE THAT IT WAS JUST A CLERICAL MISTAKE , WHICH MAY LEAD TO ADDITION BUT PENALTY IS NOT IMPOSABLE. RELIANCE WAS PLACED ON THE JUDGMENT OF THE HON'BLE APEX COURT IN THE CASE OF M/S PRICE WATERHOUSE COOPERS ( P) LTD., 348 ITR 306. 3. BEFORE THE LEARNED CIT (APPEALS) ALSO, THE SUBMISSIONS MADE ON THE LINES THAT THE MISTAKE WAS BONAFIDE AND PURELY TECHNICAL AND SO PENALTY SHOULD NOT BE LEVIED. THE LEARNED CIT (APPEALS) REJECTED THE CLAIM OF THE ASSESSEE PLACING RELIANCE ON THE JUDGMENT OF TH E HON'BLE DELHI HIGH COURT IN THE CASE OF ZOOM COMMUNICATION (P) LTD., 327 ITR 510. 4. BEFORE US, THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES. HER MAIN LINE OF ARGUMENT WAS THAT IT WAS A BONAFIDE CLERICAL MISTAKE, THERE WAS NO INTENTION M ALAFIDE ON THE PART OF THE ASSESSEE TO CONCEAL THE INCOME O R TO FURNISH INACCURATE PARTICULARS. THE SAME INCOME FR OM 3 SAME HOUSE PROPERTY IS BEING DECLARED BY THE ASSESS EE YEAR AFTER YEAR. OUR ATTENTION WAS INVITED TO THE COMPUTATION OF INCOME FOR ASSESSMENT YEAR 2007-08, WHEREBY THE INCOME FROM SAME PROPERTY IS BEING CALCULATED CORRECTLY. RELIANCE WAS AGAIN PLACED ON THE JUDGMENT OF THE HON'BLE APEX COURT IN THE CASE OF M /S PRICE WATERHOUSE COOPERS (P) LTD. (SUPRA) AND FURTH ER ON CIT VS. RELIANCE PETROPRODUCTS (P) LTD., 322 ITR 15 8 (SC). 5. THE LEARNED D.R. RELIED ON THE ORDER OF THE LEARNED CIT (APPEALS), SPECIFICALLY ON THE JUDGMENT OF THE HON'BLE DELHI HIGH COURT IN THE CASE OF ZOOM COMMUNICATION (P) LTD. (SUPRA). 6. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. WE OBSERVE THAT THE ASSESSEE HAS BEEN DECLARING THE INCOME FROM THE SAID PROPERTY FROM THE LAST YEAR. THE CORRECT COMPUTATION OF INCOME PLACED ON THE PAPER B OOK STRENGTHENS THE CASE OF THE ASSESSEE THAT THIS YEAR THE WRONG CALCULATION HAS BEEN MADE AS A MISTAKE. THE CONTENTION OF THE ASSESSEE HAS ALL ALONG BEEN THAT IT IS A CLERICAL MISTAKE. IT IS NOT A CASE OF CONCEALMENT OF INCOME. WE FIND THAT THIS IS A BONAFIDE MISTAKE DO NE BY THE ASSESSEE WITHOUT ANY MALAFIDE INTENTION. THE R ELIANCE PLACED BY THE COUNSEL OF THE ASSESSEE ON THE JUDGME NT OF HON'BLE SUPREME COURT IN THE CASE OF M/S PRICE 4 WATERHOUSE COOPERS (P) LTD. (SUPRA) IS NOT OUT OF P LACE, WHEREBY IT HAS BEEN HELD AS UNDER : 18. THE FACT THAT THE TAX AUDIT REPORT WAS FILED ALONG WITH THE RETURN AND THAT IT UNEQUIVOCALLY STATED THAT THE PROVISION FOR PAYMENT WAS NOT ALLOWABLE UNDER SECTION 40A(7) OF T HE ACT INDICATES THAT THE ASSESSEE MADE A COMPUTATION ERRO R IN ITS RETURN OF INCOME. APART FROM THE FACT THAT THE ASSES SEE DID NOT NOTICE THE ERROR, IT WAS NOT EVEN NOTICED EVEN BY TH E ASSESSING OFFICER WHO FRAMED THE ASSESSMENT ORDER. IN THAT SEN SE, EVEN THE ASSESSING OFFICER SEEMS TO HAVE MADE A MISTAKE IN OVERLOOKING THE CONTENTS OF THE TAX AUDIT REPORT. 19. THE CONTENTS OF THE TAX AUDIT REPORT SUGGEST THAT THERE IS NO QUESTION OF THE ASSESSEE CONCEALING ITS INCOME. T HERE IS ALSO NO QUESTION OF THE ASSESSEE FURNISHING ANY INAC CURATE PARTICULARS. IT APPEARS TO US THAT ALL THAT HAS HAPPENE D IN THE PRESENT CASE IS THAT THROUGH A BONA FIDE AND INADVE RTENT ERROR, THE ASSESSEE WHILE SUBMITTING ITS RETURN, FAILED TO ADD THE PROVISION FOR GRATUITY TO ITS TOTAL INCOME. THIS CAN ON LY BE DESCRIBED AS A HUMAN ERROR WHICH WE ARE ALL PRONE TO MAKE. THE CALIBRE AND EXPERTISE OF THE ASSESSEE HAS LITTLE OR NOTHING TO DO WITH THE INADVERTENT ERROR. THAT THE ASSESSEE S HOULD HAVE BEEN CAREFUL CANNOT BE DOUBTED, BUT THE ABSENCE OF DUE CARE, IN A CASE SUCH AS THE PRESENT DOES NOT MEAN TH AT THE ASSESSED IS GUILTY OF EITHER FURNISHING INACCURATE PA RTICULARS OR ATTEMPTING TO CONCEAL ITS INCOME. 20. WE ARE OF THE OPINION, GIVEN THE PECULIAR FACTS OF THIS CASE, THAT THE IMPOSITION OF PENALTY ON THE ASSESSEE IS NOT JUSTIFIED. WE ARE SATISFIED THAT THE ASSESSEE HAD COMMITTED AN INADVERTENT AND BONA FIDE ERROR AND HAD NOT INTENDE D TO OR ATTEMPTED TO EITHER CONCEAL ITS INCOME OR FURNISH INAC CURATE PARTICULARS. 5 7. IN VIEW OF THE ABOVE, WE DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 9 TH DAY OF FEBRUARY, 2016. SD/- SD/- (H.L. KARWA) (RANO JAIN) VICE PRESIDENT ACCOUNTANT MEMBER DATED : 9 TH FEBRUARY, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH