Shri Ramdas Arjun Hagawane, Pune V. ITO,(CIB)-2, Pune, Pune

ITA 361/PUN/2011

• Counselvise Citation: 36124514 RSA 2011
• Duration Of Justice: 2 year(s) 2 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 17-10-2012
• Assessment Year: 2004-2005
• Appeal Filed On: 31-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANN KAPTHUAMA
• Keywords: Rule of consistency; Cost of acquisition; Fair market value
• Section: 143(3); 54B; 147; 27; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES A, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.361/PN/2011 (ASSESSMENT YEAR : 2004-05) RAMDAS ARJUN HAGAWANE A/P KIRKATWADI GAON, TAL HAVELI, DIST.- PUNE PAN : ABPPH6238K . APPELLANT VS. INCOME TAX OFFICER WARD 1 (3), PUNE . RESPONDENT APPELLANT BY : MS. DEEPA KHARE RESPONDENT BY : MS. ANN KAPTHUAMA DATE OF HEARING : 07-06-2013 DATE OF PRONOUNCEMENT : 25-06-2013 ORDER PER G. S. PANNU, AM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-I, PUNE DATED 22.10.2010 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 05.06.2008 PAS SED BY THE ASSESSING OFFICER, UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2004-05. 2. IN BRIEF, THE RELEVANT FACTS ARE THAT THE ASSESS EE IS A CO-OWNER OF THE LAND SITUATED AT SURVEY NO. 100, 102, 104 & 106 AT KIRKATWADI, PUNE. THE ASSESSEE, ALONG WITH OTHER CO-OWNERS EXECUTED A DEV ELOPMENT AGREEMENT IN RESPECT OF THE SAID LAND WITH ONE M/S D.S. KULKARNI & COMPANY ON 03.10.2003 FOR A TOTAL CONSIDERATION OF RS.1,70,00,000/-, OUT OF WHICH ASSESSEES SHARE WAS 1/4 TH WHICH CAME TO RS.29,25,000/-. IN THE CASE OF ONE C O-OWNER, SHRI BALASAHEB HAGAWANE, BROTHER OF THE ASSESSEE, ASSESS MENT UNDER SECTION 143(3) OF THE ACT FOR ASSESSMENT YEAR 2004-05 WAS C OMPLETED ON 15.12.2006 ITA NO.361/PN/2011 RAMDAS ARJUN HAGAWANE A.Y. 2004-05 WHEREIN THE CAPITAL GAIN ON SALE OF LAND WAS HELD T O BE LIABLE FOR TAXATION AND THE CAPITAL GAIN WAS WORKED OUT AT RS.26,80,629/-. THE ASSESSING OFFICER NOTICED THAT ASSESSEE BEING A CO-OWNER OF THE PROPE RTY WAS ALSO LIABLE FOR ASSESSMENT OF CAPITAL GAIN AND AS THE ASSESSEE HAD NOT FILED THE RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, A NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED TO THE ASSESSEE IN ORDER TO TAX THE INCOME BY WAY OF CAPITAL GAIN OF RS.26,80,629/-, WHICH HAD ESCAPED A SSESSMENT. IN RESPONSE TO THE NOTICE ISSUED UNDER SECTION 148 OF THE ACT, ASS ESSEE FILED A RETURN OF INCOME DECLARING CAPITAL GAINS AT NIL AND AGRICULTU RE INCOME OF RS.1,45,200/-. THE ASSESSEE HAD DECLARED THE CAPITAL GAIN AT RS.23 ,24,675/- BUT THE TAXABLE CAPITAL GAIN WAS COMPUTED AT NIL AFTER CLAIMING E XEMPTION UNDER SECTION 54B OF THE ACT. THE ASSESSING OFFICER DIFFERED WITH THE ASSESSEE WITH RESPECT TO THE ADOPTION OF THE FAIR MARKET VALUE AS ON 01.04.1981 FOR THE PURPOSE OF DETERMINING THE COST OF ACQUISITION IN ORDER TO COM PUTE THE CAPITAL GAINS. IN THE ASSESSMENT FINALIZED UNDER SECTION 143(3) READ WITH SECTION 147 OF THE ACT DATED 26.12.2007 THE ASSESSING OFFICER ASSESSED THE CAPITAL GAIN AT RS.26,80,629/-, AS ASSESSED IN THE ASSESSMENT OF OT HER CO-OWNER, SHRI BALASAHEB HAGAWANE AND AFTER ALLOWING THE EXEMPTION UNDER SECTION 54B OF THE ACT OF RS.4,20,000/-, THE NET CAPITAL GAIN OF R S.22,60,630/- WAS ASSESSED. 3. SUBSEQUENTLY, THE ASSESSING OFFICER VIDE HIS ORD ER DATED 05.06.2008 HELD THE ASSESSEE GUILTY OF CONCEALING THE PARTICUL ARS OF INCOME QUA THE AMOUNT OF CAPITAL GAIN OF RS.22,60,630/- AND LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT AMOUNTING TO RS.5,25,000/-. TH E SAID LEVY OF PENALTY HAS BEEN UPHELD BY THE CIT(A), AGAINST WHICH THE ASSESS EE IS IN FURTHER APPEAL BEFORE US. 4. AT THE TIME OF HEARING, THE LEARNED COUNSEL FOR ASSESSEE MADE A PRELIMINARY SUBMISSION TO THE EFFECT THAT THE IMPUG NED LEVY OF PENALTY IS UNTENABLE ON THE PRINCIPLE OF CONSISTENCY. THE LEAR NED COUNSEL HAS POINTED ITA NO.361/PN/2011 RAMDAS ARJUN HAGAWANE A.Y. 2004-05 OUT THAT IN THE CASE OF TWO OTHER CO-OWNERS OF THE PROPERTY NAMELY, SHRI LAXMAN ARJUN HAGAWANE AND SMT. LAXMIBAI ARJUN HAGAW ANE, IDENTICAL AMOUNTS OF CAPITAL GAIN ON SALE OF KIRKATWADI LAND HAS BEEN ASSESSED IN THEIR HANDS UNDER SIMILAR CIRCUMSTANCES AND IN BOTH THE C ASES, THE ASSESSING OFFICER HAS FOUND IT EXPEDIENT TO DROP THE PENALTY PROCEEDINGS INITIATED UNDER SECTION 271(1)(C) OF THE ACT AND IN THIS REGARD, TH E ORDERS PASSED BY THE ASSESSING OFFICER IN THE ABOVE TWO CASES DATED 29.0 9.2010 HAVE BEEN REFERRED TO, COPIES OF WHICH HAVE BEEN PLACED IN TH E PAPER BOOK AT PAGES 146 AND 147 RESPECTIVELY. IN THE COURSE OF HEARING, THE LEARNED COUNSEL ALSO FURNISHED ASSESSMENT ORDERS IN THE CASES OF TWO CO- OWNERS NAMELY, SHRI LAXMAN ARJUN HAGAWANE AND SMT. LAXMIBAI ARJUN HAGAW ANE PASSED BY THE SAME ASSESSING OFFICER UNDER SECTION 143(3) READ WI TH SECTION 147 DATED 26.12.2007 WHEREIN THE CAPITAL GAINS OF SAME AMOUNT HAVE BEEN ASSESSED AND IN IDENTICAL CIRCUMSTANCES. ON THIS BASIS, IT I S SOUGHT TO BE MADE OUT THAT REVENUE CANNOT TAKE DIFFERENT POSITIONS IN THE CASE OF TWO ASSESSEES, WHO ARE OTHERWISE SIMILARLY PLACED. 5. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPR ESENTATIVE HAS NOT CONTROVERTED THE FACTUAL MATRIX BROUGHT OUT BY THE ASSESSEE HOWEVER ACCORDING TO HER EACH CASE IS INDEPENDENT AND THERE FORE THE PLEA OF CONSISTENCY MADE OUT BY THE ASSESSEE WAS NOT JUSTIF IED. 6. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS. FACTUALLY SPEAKING, IT IS QUITE EVIDENT THAT THE FACTS AND CIRCUMSTANCE S UNDER WHICH THE ASSESSEE HAS BEEN HELD TO BE GUILTY OF DEFAULT UNDER SECTION 271(1)(C) OF THE ACT IS SIMILAR TO THE CASES OF OTHER CO-OWNERS OF THE PROP ERTY NAMELY, SHRI LAXMAN ARJUN HAGAWANE AND SMT. LAXMIBAI ARJUN HAGAWANE, AN D ALL THE ASSESSEES BELONG TO THE SAME FAMILY. IT IS ALSO NOTABLE THAT ASSESSMENTS IN THE CASE OF OTHER TWO ASSESSEES NAMELY, SHRI LAXMAN ARJUN HAGAW ANE AND SMT. LAXMIBAI ARJUN HAGAWANE HAVE BEEN COMPLETED BY THE SAME ASSESSING ITA NO.361/PN/2011 RAMDAS ARJUN HAGAWANE A.Y. 2004-05 OFFICER AS IN THE CASE OF THE ASSESSEE NAMELY INCOM E TAX OFFICER, WARD 1 (3), PUNE. IN THE CASE OF THE ASSESSEE PENALTY HAS ALSO BEEN LEVIED BY INCOME TAX OFFICER, WARD 1 (3), PUNE, WHEREAS IN THE OTHER TWO CASES THE PENALTY PROCEEDINGS INITIATED IN THE COURSE OF ASSESSMENT P ROCEEDINGS HAVE BEEN DROPPED BY THE SAME OFFICE. IN OUR CONSIDERED OPINI ON, WITHOUT GOING INTO MITTY-GRITTY OF THE PENALTY LEVIED UNDER SECTION 27 1(1)(C) OF THE ACT IN THE PRESENT CASE, IT IS SUFFICIENT TO OBSERVE THAT FOLL OWING THE PRINCIPLE OF CONSISTENCY THE DEPARTMENT IS PRECLUDED FROM TAKING DIVERGENT VIEWS ON THE SAME ISSUE IN THE HANDS OF DIFFERENT ASSESSEES, WHO ARE OTHERWISE SIMILARLY PLACED. ON THIS ASPECT ITSELF, WE FIND NO REASON TO UPHOLD THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT AMOUNTING TO RS. 5,25,000/- IN THE PRESENT CASE. ACCORDINGLY, THE ORDER OF THE CIT(A) IS SET-A SIDE AND THE ASSESSING OFFICER IS DIRECTED TO DELETE THE PENALTY LEVIED UN DER SECTION 271(1)(C) OF THE ACT AMOUNTING TO RS.5,25,000/-. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED AS ABOVE. ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH JUNE, 2013. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 25 TH JUNE, 2013 SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-I, PUNE; 4) THE CIT-I, PUNE; 5) THE DR, A BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY I.T.A.T., PUNE