The DCIT, Circle-5, Baroda V. M/s. Om Developers, Baroda

ITA 353/AHD/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8352 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 12-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAURABH SINGH
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH BEFORE: SHR I RAJPAL YADAV , JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER THE DCIT, CIRCLE - 3(1), BARODA - 390007 (APPELLANT) VS M/S. OM DEVELOPERS, 6, SARVODAY SOCIETY, NR. DELUXE SOCIETY, NIZAMPURA, BARODA - 02 PAN: AABFO4011A (RESPONDENT) REVENUE BY : S H RI SAUR ABH SINGH , SR. D . R. ASSESSEE BY: MS. KINJAL SHAH , A.R. DATE OF HEARING : 11 - 04 - 2 018 DATE OF PRONOUNCEMENT : 16 - 05 - 2 018 / ORDER P ER : AMARJIT SINGH, ACCOUNT ANT MEMBER : - THIS REVENUE S APPEAL FOR A.Y. 2008 - 09 , ARIS ES FROM ORDER OF THE CIT(A) - 4, VADODARA DATED 15 - 10 - 2015 , IN PROCEEDINGS UNDER SECTION 271(1 ) (C) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF AP PEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (APPEALS) ERRED IN DELETING THE PENALTY OF RS.28,25,782/ - LEVIED FOR FURNISHING INACCURATE PARTICULARS OF INCOME BY HOLDING THAT THE AO WAS NOT CORRECT IN LEVYING THE PENA LTY THOUGH THE QUANTUM ADDITION WAS CONFIRMED BY LD. CIT(A). 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (APPEALS) ERRED IN IGNORING THE FACT THAT THE PENALTY IS NATURAL CONSEQUENCE ONCE THE QUANTUM ADDITION HAS BEEN UPHELD BY THE CIT(A) AND A.O. IS BOUND TO LEVY PENALTY WITHIN ONE YEAR FROM THE END OF THE YEAR IN WHICH APPELLATE ORDER WAS RECEIVED. I T A NO . 35 3 / A HD/20 16 A SSESSMENT YEAR 200 8 - 09 I.T.A NO. 353 /AHD/20 16 A.Y. 2008 - 09 PAGE NO DCIT VS. M/S. OM DEVELOPERS 2 3. THE BRIEF FACT OF THE CASE IS THAT ASSESSEE HAS FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS. NIL ON 29 TH SEPTEMBER , 2008. SUBSEQUENTLY, THE CASE WAS SELECTED UNDER SCRUTINY BY ISSUING OF NOTICE U/S. 143(2) OF THE ACT ON 23 RD AUGUST, 2009. DURING THE COURSE OF SCRUTINY ASSESSMENT, THE ASSESSING OFFICER NOTICED THAT ASSSESSEE HAS CLAIMED DEDUCTION U/S. 80IB (10) OF THE ACT TO THE AMOUNT OF RS. 83 , 13 , 570/ - ON ACCOUNT OF HOUSING PROJECT. T HE ASSESSING OFFICER HAS DISALLOWED THE CLAIM OF DEDUCTION U/S. 80IB OF THE ACT ON THE GROUND THAT ASSESSEE FIRM HAS NOT FULFILLED ALL THE CONDI TIONS STIPULATED IN SECTION 80IB OF TH E ACT. THE ASSESSING OFFICER HAS ALSO INITIATED PENALTY PROCEEDINGS FOR FURNISHING INACCURATE PARTICULARS OF INCOME U/S. 271(1) (C) OF THE ACT ON THE DISALLOWANCE MADE U/S 80IB OF THE ACT. T HE LD. CIT(A) HAS CONFIRMED THE DISALLOWANCE OF CLAIM OF DEDUCTI ON U/S. 80IB(10) OF THE ACT. 3.1 DURING THE PENALTY PROCEEDINGS , THE ASSESSING OFFICER HAS STATED THAT IT IS CRYSTAL CLEAR THAT ASSESSEE HAS NOT FULFILLED THE BASIC CONDITION I.E. OWNERSHIP OF LAND ON WHI CH HOUSING PROJECT WAS CONSTRUCTED AND THE APPROV AL OF THE LOCAL AUTHORITY WAS NOT IN THE NAME OF THE ASSESSEE FIRM, THEREFORE , THE ASSESSING OFFICER HAS CONCLUD ED THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME LEADING TO CONCEALMENT OF INCOME AND LEVIED A PENALTY OF RS. 28 , 25 , 78 2 / - U/S. 2 71(1)(C) OF THE ACT. 4. AGGRIEVED ASSESSEE FILED APPEAL BEFORE THE LD. CIT(A) AGAINST THE LEVYING OF PENALTY BY THE ASSESSING OFFICER. THE LD. CIT(A) HAS DELETED THE PENALTY LEVIED BY THE ASSESSING OFFICER ON THE GROUND THAT THE ISSUES ON WHICH DEDUCTION 80IB(10) WAS DISALLOWED BY THE ASSESSING OFFICER WAS HIGHLY DEBATABLE AND UNDER THESE CIRCUMSTANCES PENALTY U/S. 271(1)(C) OF THE ACT CANNOT BE SUSTAINED. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFORE US, LD. DEPARTMENTAL REPRESENTATIVE HAS SUPPORTED THE ORDER OF ASSESSING OFFICER. ON THE OTHER HAND, LD. COUNSEL HAS BROUGHT TO OUR NOTICE THAT THE CO - ORDINATE BENCH OF THE ITAT, AHMEDABAD OF THE ITAT VIDE ITS DECISION IN ITA NO. 642/AHD/2013 DATED I.T.A NO. 353 /AHD/20 16 A.Y. 2008 - 09 PAGE NO DCIT VS. M/S. OM DEVELOPERS 3 15/03/2018 IN THE CASE OF ASSESSEE ITSELF HAS DELETED T HE QUANTUM ADDITION MADE IN THE CASE OF THE ASSESSEE AND CONTENDED THAT LEVYING OF PENALTY IN THE CASE OF THE ASSESSEE HAS BECOME INFRUCTUOUS. 5. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE MATERIAL ON RECORD CAREFULLY. WE HAVE NOTICED THAT CO - OR DIN ATE BENCH OF ITAT VIDE ITA NO. 642/AHD/2013 DATED 15/03/2018 D HAS DE LETED THE ADDITION AND ALLOW ED THE CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT . SINCE THE QUANTUM ADDITION HAS BEEN QUASHED BY THE DECISION OF THE CO - ORDINATE BENCH OF THE TRIBUNAL, THE REFORE WE CONSIDER THAT THE IMPUGNED PENALTY IN THE CASE OF THE ASSESSEE HAS BECOME INFRUCTUOUS . ACCORDINGLY , THE APPEAL OF THE REVENUE IS DISMISSED. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PR ONOUNCED IN TH E OPEN C OURT ON 16 - 05 - 201 8 SD/ - SD/ - ( RAJPAL YADAV ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 16 /05 /2018 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,