SULTAN HAJIAHMEDBUX QUARESHI, MUMBAI V. ACIT 17(3), MUMBAI

ITA 3662/MUM/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 2256 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 1 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 15-06-2015
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: M P SHARMA

Judgement Text

IN THE INC OME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI R.C . SHARMA, A M AND SHRI SANDEEP GOSAIN, JM ./ I.T.A. NO. 3662 /MUM/2015 ( / ASSESSMENT YEAR: 2010 - 11 ) SHRI SULTAN HAJIAHMEDBUX QURESHI 114, SHAIKH BURHAN K AMRUDDIN STREET, TELI MOHALLA, M UMBAI - 400 008 . / VS. ACIT - 17(3), MUMBAI . ./ ./ PAN/GIR NO. AABPQ 0774G ( / APPELLANT ) : ( / RESPONDENT ) / APPELLANT BY : SHRI M.P. SHARMA / RESPONDENT BY : SHRI NEIL PHILIP / DATE OF HEARING : 20 /07 /2016 / DATE OF PRONOUNCEMENT : 27/07/2016 / O R D E R PER R.C. SHARMA , A. M.: THIS IS AN A PPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDER BY THE COMMISSI ONER OF INCOME TAX (APPEALS) - 32 , MU MB AI (CIT(A) FOR SHORT) DATED 07.05 . 2015 FOR THE ASSESSMENT YEAR (A.Y.) 2010 - 11 , IN THE MATTER OF IMPOSITION OF PENALTY U/S 271(1)(C) OF THE ACT. 2. IN THIS APPEAL ASSESSEE IS AGGRIEVED FOR IMPOSITION OF PENALTY OF R S.64,100/ - U/S 271(1)(C) . 2 ITA NO. 366 2 / M UM/2015 (A.Y. 2010 - 11 ) SHRI SULTAN HAJIAHMEDBUX QURESHI VS. ACIT 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT THE ASSESSEE IS A BUILDER OF RESIDENTIAL COMPLEX. DURING THE ASSESSMENT PROCEEDINGS FOR THE ASSESSMENT YEAR 2010 - 11 THERE AROSE DIFFERENCE IN OPINIO N BETWEEN THE ASSESSEE AND THE ASSESSING OFFICER WITH REGARDS TO VALUATION OF THE CLOSING STOCK. THE ASSESSING OFFICER INSISTED THAT THE CLOSING STOCK SHOULD ALSO BE VALUED FOR THE AREA OF FLAT NO.1102 HAVING AREA OF 771 SQ.FT., HOWEVER ON FURTHER EXPLANAT ION SUBMITTED BY THE ASSESSEE IT WAS AGREED THAT THE VALUATION WILL BE RESTRICTED TO THE EXTENT OF 30% OF THE VALUE AS ONLY FLOOR AREA IS COMPLETED. THUS ON THE REVISE D CALCULATIONS THE SOCK WAS INCREASED BY RS.207424/ - IN RESPECT OF THE ABOVE DISPUTE. FO R T HE ADDITION SO MADE THE AO ALSO LEVIED PENALTY U/S 271(1)(C) , WHICH WAS CONFIRMED BY LD. CIT(A) AND ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4 . WE HAVE CONSIDERED RIVAL CONTENTIONS AND FOUND THAT THE ASSESSEE HAS SUBMITTED ALL NECESSARY DETAILS INCLUD ING THE LETTER OF OBJECTION FROM THE MUNICIPAL AUTHORITIES AND THUS THE ASSESSEE HAS GIVEN BONAFIDE EXPLANATION FOR NOT INCLUDING THE VALUATION FOR 771SQ.FT. IN CLOSING STOCK. UNDER THESE CIRCUMSTANCES THERE IS NO JUSTIFICATION FOR LEVYING OF PENALTY U/S 2 71(1)(C) . IN VIEW OF THE DECISION IN CASE OF CIT V/S SADHU SINGH AND SONS (2012) 344 ITR 316 (P&H) HIGH COURT WHEREIN IT WAS HELD THAT FINDING THE DIFFERENCE IN VALUATION OF SOCK DOES NOT AMOUNT TO CONCEALMENT OF INCOME AND THUS PENALTY U/S 271(1)(C) CANN OT BE LEVIED. 3 ITA NO. 366 2 / M UM/2015 (A.Y. 2010 - 11 ) SHRI SULTAN HAJIAHMEDBUX QURESHI VS. ACIT 5. IN VIEW OF THE ABOVE THERE IS NO JU STIFICATION OF LEVY OF PENALTY U/S 271(1)(C) MERELY BECAUSE OF DIFFERENCE IN VALUATION. 6 . IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOU NCED IN THE OPEN COURT ON 27 JULY , 201 6 SD/ - SD/ - ( SANDEEP GOSAIN ) ( R.C. SHARMA) / JUD I C I AL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 27 . 0 7 .201 6 PS. ASHWINI / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F ILE / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBA I.