Samir Pravinbhai Patel, Ahmedabad V. Income Tax Officer, Ward-1(3), Ahmedabad

ITA 3443/AHD/2015

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5828 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-03-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 10-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANTONY PARIATH
• Assessee Lawyers: S N DIVATIA

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD , , BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER ./ I.T.A. NO.3443/AHD/2015 ( / ASSESSMENT YEAR : 2011-12) SAMIR PRAVINBHAI PATEL 1005-06, 10 TH FLOOR ADITYA BLDG SHRIMALI SOC CROSS-ROADS NAVRANGPURA, AHMEDABAD / VS. THE ITO WARD-1(3) 303, 3 RD FLOOR PRATYAKSH KAR BHAVAN AMBAWADI, AHMEDABAD # ./ ./ PAN/GIR NO. : ALUPP 5562 F ( #& / APPELLANT ) .. ( '#& / RESPONDENT ) #&( / APPELLANT BY : SHRI S.N. DIVATIA, AR '#&)( / RESPONDENT BY : SHRI ANTONY PARIATH, SR.DR *+), / DATE OF HEARING 06/03/2018 -./0), / DATE OF PRONOUNCEMENT 20/ 03 /2018 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTAN CE OF THE ASSESSEE AGAINST THE APPELLATE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-1, AHMEDABAD [CIT(A) IN SHORT] DATED 26/10/2015 CONFIRMING THE IMPOSITION OF PENALTY LEVIED BY THE ASSESSING OFFICER ITA NO.3443/AHD /2015 SAMIR PRAVINBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 2 - (AO) UNDER S.271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT') DATED 14/07/2014. 2. THE LIMITED ISSUE IN THE CAPTIONED APPEAL IS COR RECTNESS OF THE IMPOSITION OF PENALTY OF RS.1,15,937/- UNDER S.271( 1)(C) FOR CLAIMING WRONGFUL DEDUCTION OF A STAMP DUTY EXPENSES AMOUNTI NG RS.3,75,200/- UNDER S.24(B) OF THE ACT AGAINST THE RENTAL INCOME DERIVED FROM THE PROPERTY AND OFFERED TO TAXATION UNDER THE HEAD IN COME FROM HOUSE PROPERTY. 3. WE HAVE HEARD THE RIVAL SUBMISSION ON THE ISSUE. ON PERUSAL OF THE ORDERS OF THE AUTHORITIES BELOW, WE NOTE FEW FACTS CONCERNING THE ISSUE TO DETERMINE THE CORRECTNESS OF IMPOSITION OF PENALTY. IN THE COURSE OF THE SCRUTINY ASSESSMENT OF THE RETURN FILED BY THE ASSE SSEE RELEVANT TO AY 2011-12, THE ASSESSING OFFICER (AO) NOTICED THAT TH E ASSESSEE HAS DISCLOSED RENTAL INCOME FROM LEASE OF THE PROPERTY. WHILE DOING SO, DEDUCTION TOWARDS STAMP DUTY EXPENSES OF RS.3,75,20 0/- INCURRED AT THE TIME OF EXECUTION OF LEASE AGREEMENT WAS ALSO CLAI MED AS DEDUCTION UNDER S.24(B) OF THE ACT WHICH WAS FOUND TO BE INA DMISSIBLE IN LAW. THE AO ACCORDINGLY IMPOSED PENALTY OF RS.1,15,937/- AS A CONSEQUENCE OF DISALLOWANCE OF THE AFORESAID EXPENSE. THE CIT(A) HAS BROADLY ENDORSED THE ACTION OF THE AO. TO ADJUDICATE THE ISSUE, WE NEED TO ASCERTAIN THE BONAFIDES OF THE ACTION OF THE ASSESSEE. IT IS SEE N FROM THE LEASE ITA NO.3443/AHD /2015 SAMIR PRAVINBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 3 - AGREEMENT REFERRED TO IN THE COURSE OF HEARING BEFO RE US THAT STAMP DUTY CHARGES OF RS.3,75,175/- WAS INCURRED INDEED TO BRI NG LEASE RENT AGREEMENT INTO MOTION. THE ASSESSEE HAS TAKEN THAT AS PART OF CALCULATION OF LEASE RENTAL WHILE DETERMINING THE TERMS OF LEAS E. THEREFORE, THE BONAFIDES OF THE ASSESSEE WHILE COMMITTING INADVERT ENT ERROR IN CLAIMING DEDUCTION OF SUCH EXPENSES CANNOT BE TOTALLY RULED OUT. WE ALSO SEE FROM THE ASSESSMENT ORDER THAT WHEN CONFRONTED ON THE WR ONG CLAIM TOWARDS STAMP DUTY EXPENSES IN TERMS OF SECTION 24(B) OF TH E ACT, THE ASSESSEE READILY ACCEPTED THE ERROR WITHOUT ANY PROTEST AND ACQUIESCED HIMSELF WITH THE DISALLOWANCE IN THIS REGARD. THIS ALSO IN DICATES BONAFIDE ON THE PART OF THE ASSESSEE IN ITS CONDUCT. THEREFORE, W E ARE OF THE VIEW THAT CIRCUMSTANCES EXIST TO GRANT BENEFIT OF DOUBT TO TH E ASSESSEE AND EXONERATE THE IGNORANT ASSESSEE FROM CLUTCHES OF PE NALTY PROCEEDINGS. WE ACCORDINGLY DIRECT THE AO TO DELETE THE PENALTY UNDER S.271(1)(C) OF THE ACT IN THIS REGARD. 4. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . THIS ORDER PRONOUNCED IN OPEN COURT ON 20 / 0 3 /201 8 SD/- SD/- ( ) ( ) ( MAHAVIR PRASAD ) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 20/ 03 /2018 4 ..*,.*../ T.C. NAIR, SR. PS ITA NO.3443/AHD /2015 SAMIR PRAVINBHAI PATEL VS. ITO ASST.YEAR 2011-12 - 4 - !'#' / COPY OF THE ORDER FORWARDED TO : 1. #& / THE APPELLANT 2. '#& / THE RESPONDENT. 3. 567, 8, / CONCERNED CIT 4. 8, ( ) / THE CIT(A)-1, AHMEDABAD 5. 9:;,*67 , 670 , 5 / DR, ITAT, AHMEDABAD 6. ;<+ / GUARD FILE. / BY ORDER, '9 ,, //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 7.3.18 (DICTATION-PAD 7- PA GES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 7.3.18 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.20.3.18 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 20.3.18 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