MUSTANG PROPERTIES P. LTD, MUMBAI V. ITO 9(2)(3), MUMBAI

ITA 3561/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3359 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 11-02-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 06-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D P REDDY
• Assessee Lawyers: V C SHAH
• Keywords: Difference of opinion

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B , MUMBAI BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH , JUDICIAL MEMBER ITA NO. 3561/MUM/2013 : (A.Y : 20 06 - 07 ) M/S. MUSTANG PROPERTIES PVT. LTD. 501, KRYSTAL, 206, WATERFIELD ROAD, BANDRA (W), MUMBAI 400 050. PAN : AAACM9440M VS. ITO - 9(2)(3), MUMBAI (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI V.C. SHAH REVENUE BY : SHRI D.P. REDDY (DR) DATE OF HEARING : 17 / 03 /201 6 DATE OF PRONOUNCEMENT : 30 / 03 /201 6 O R D E R PER R.C. SHARMA, AM : THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A), MUMBAI FOR A.Y 2006 - 07, IN THE MATTER OF IMPOSITION OF PENALTY U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. THE AO HAS LEVIED PENALTY WITH RESPECT TO INCOME OFFERED IN THE RETURN AS INCOME FROM BUSINESS WHICH WAS TREATED BY THE AO AS INCOME FROM OTHER SOURCES. BY CHANGING HEAD OF INCOME AO DISALLOWED SOME OF THE 2 M/S. MUSTANG PROPERTIES PVT. LTD. ITA NO. 3561/MUM/2013 EXPENSES UNDER THE HEAD ADMINISTRATIVE EXPENSES, AUDITORS REMUNERATION AND INTEREST ON CAR LOAN. THE AO HAS ALSO DISALLOWED SET - OFF OF CARRY FORWARD BUSINESS LOSS AMOUNTING TO RS.2,62,183/ - BECAUSE OF CHANGE OF HEAD OF INCOME . THUS, WE FOUND THAT PENALTY HAS NOT BEEN LE VIED FOR CONCEALMENT OF INCOME OR FURNISHING OF INA CCURATE PARTICULARS OF INCOME BUT MERELY ON THE PLEA OF CHANGE OF HEAD FROM INCOME FROM BUSINESS TO INCOME FROM OTHER SOURCES. WE DO NOT FIND ANY JUSTIFICATION FOR THE PENALTY SO LEVIED INSOFAR AS THE RE IS NEITHER FURNISHING OF INACCURATE PARTICULARS OF INCOME NOR CONCEALMENT OF ANY PARTICULARS. 3. FROM THE RECORD WE FOUND THAT IN COMPUTING INCOME FROM PROPERTY , ASSESSEE HAD ARRIVED AT ANNUAL LETTING VALUE AFTER DEDUCTING THE EXPENDITURE ON AMENITIES PROVIDED TO THE OCCUPANT BEING DEDUCTIBLE IN DETERMINING THE ANNUAL LETTING VALUE. THE AO OPINED THAT THE SAME WAS NOT DEDUCTIBLE. HE, THEREFORE, DISALLOWED THE CLAIM FOR DEDUCTION PARTIALLY. SUCH DISALLOWANCE OF EXPENDITURE CLAIMED UNDER NO CIRCUMSTANC ES CAN BE SAID TO BE CONCEALMENT OF INCOME. SIMILARLY, IN RESPECT OF FINANCING ACTIVITY CARRIED OUT BY THE ASSESSEE, OFFERED UNDER THE HEAD INCOME FROM BUSINESS, THE AO DIFFERED WITH THE SAME AND ASSESSED THE INCOME AS INCOME FROM OTHER SOURCES RESUL TING INTO DISALLOWANCE OF SOME OF EXPENSES . THIS WAS PURELY A DIFFERENCE OF OPINION AND UNDER NO CIRCUMSTANCES, IT CAN BE SAID THAT THERE WAS CONCEALMENT. THE ASSESSEE HAD NOT CONCEALED ANY INCOME AND HENCE NO PENALTY IS LEVIABLE. 3 M/S. MUSTANG PROPERTIES PVT. LTD. ITA NO. 3561/MUM/2013 4. IN VIEW OF THE AB OVE, WE DO NOT FIND ANY JUSTIFICATION FOR PENALTY SO CONFIRMED BY CIT(A) U/S. 271(1)(C). 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 3 0 T H MARCH, 201 6 . SD/ - SD/ - ( PAWAN SINGH ) JUDICIAL MEMBER (R.C. SHARMA) ACCOUNTANT MEMBER MUMBAI, DATE : 3 0 T H MARCH, 2016 *SSL* COPY TO : 1) THE APPLICANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, B BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR I.T.A.T, MUMBAI