VIKAS AMRIT RAJPUT, PUNE V. DCIT 26(2), MUMBAI

ITA 3755/MUM/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 55144 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 29-08-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 10-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHANTAM BOSE
• Keywords: Bonafide belief

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F, MUMBAI BEFORE SHRI J. SUDHAKAR REDDY, A.M. AND SHRI V. DUR GA RAO, J.M. ITA NO. 3755/MUM/2010 ASSESSMENT YEAR : 2002-03 VIKAS AMRIT RAJPUT, APPELLANT C/O MR. D.Y. PANDIT ADV 1187/10, KRUPA, SHIVAJINAGAR, PUNE 411 055 VS. DY. COMMISSIONER OF INCOME-TAX-26(2), R ESPONDENT MUMBAI 400 002. APPELLANT BY : NONE RESPONDENT BY : MR. SHANTAM BOSE DATE OF HEARING : 29/09/2011 DATE OF PRONOUNCEMENT : 14/09 /2011 ORDER PER V. DURGA RAO, J.M.: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGA INST THE ORDER OF CIT(A)-XXVI, MUMBAI, PASSED ON 26/03/2009 FOR TH E ASSESSMENT YEAR 2002-03. 2. THE GROUND RAISED IN THIS APPEAL IS PERTAINING T O PENALTY OF RS. 12,528/- U/S 271(1)(C) OF THE ACT. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE AT THE T IME OF HEARING BEFORE US. HOWEVER, WE PROCEED TO DECIDE THE APPEAL AFTER HEARING THE LEARNED DR AND ON MERIT. 4. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SEE IS AN EMPLOYEE OF M/S BPCL. THE AO NOTICED THAT THE ASSESSEE HAS R ECEIVED LEASE RENT OF RS. 28,800/- DURING THE PREVIOUS YEAR, WHICH WAS ADDED TO THE ITA NO. 3755/MUM/2010 VIKAS AMRIT RAJPUT 2 TOTAL INCOME OF THE ASSESSEE TREATING THE SAME AS INCOME FROM HOUSE PROPERTY. THE ASSESSEE HAS ALSO RECEIVED MAINTENAN CE EXPENSES OF RS. 12,960/- WHICH WAS NOT SHOWN IN THE ORIGINAL RETURN FILED FOR THE YEAR. SINCE THE ASSESSEE HAD NOT SHOWN THE SAID RE CEIPTS IN HIS ORIGINAL RETURN OF INCOME AND THE SAME IS BROUGHT T O THE TAXATION AFTER THE DETECTION BY THE DEPARTMENT U/S 48 OF THE ACT, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND IMPOSED PENALTY ON CONCEALED INCOME AT RS. 12,528/-. ON APP EAL, THE CIT(A) CONFIRMED THE PENALTY LEVIED BY THE AO. AGGRIEVED B Y THE ORDER OF THE CIT(A), THE ASSESSEE CARRIED THE MATTER IN APPEAL B EFORE THE ITAT. 5. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF THE PARTIES AND PERUSED THE RECORD. THE SUBMISSIONS OF THE ASSESSE E BEFORE THE CIT(A) WAS THAT THE AO HAS NOT CONSIDERED THE AMOUN T OF PERQUISITE VALUE ADDED IN FORM 16 AND OFFERED TO TAX WHILE CAL CULATING INCOME FROM HOUSE PROPERTY, WHICH RESULTED INTO DOUBLE TAX ATION OF THE SAME INCOME. THE SUM OF RS. 28,80/- IS ALREADY FORMING P ART OF THE TOTAL INCOME AND THE AO ERRED IN CONSIDERING THIS SUM AS CONCEALED. IT WAS SUBMITTED BEFORE THE CIT(A) THAT THE AO ERRED IN LE VYING PENALTY ON REIMBURSEMENT OF EXPENSES AS THE SAME HAS BEEN RECE IVED BY THE ASESSSEE AS LESSOR ON ACCOUNT OF EXPENSES FOR MAINT ENANCE AND PAYMENT TAXES ETC. AS PER THE TERMS AND CONDITIONS OF LEASE AGREEMENT AND, THEREFORE, THE SAME IS NOT INCOME OF THE ASESS SEE. THE CIT(A) HAS NOT CONSIDERED THE SUBMISSIONS OF THE ASSESSEE AND CONFIRMED THE PENALTY LEVIED BY THE AO. WE FIND THAT THE AO NOTIC ED IN HIS ORDER THAT IN ORIGINAL RETURN OF INCOME, THE ASSESSEE HAD NOT DISCLOSED THE LEASE RENT AND MAINTENANCE CHARGES, WHICH RESULTED INTO T HE DIFFERENCE IN INCOME BETWEEN ASSESSED INCOME AND RETURNED INCOME. SINCE THE LEASE RENT WAS TAXED ONLY AFTER ITS DETECTION BY TH E DEPARTMENT, THE AO INITIATED PENALTY PROCEEDINGS AND LEVIED PENALTY ON THE INCOME, ON WHICH TAX IS SOUGHT TO BE EVADED, AT RS. 12,528/-. FOR THIS DIFFERENCE, THE EXPLANATION OF THE ASSESSEE IS THAT HE WAS UNDE R BONAFIDE BELIEF THAT WHATEVER INCOME EARNED FROM THE EMPLOYER REFLE CTED IN FORM NO. ITA NO. 3755/MUM/2010 VIKAS AMRIT RAJPUT 3 16. WE ARE OF THE VIEW THAT THE ASESSSEE HAD NOT WI LLFUL INTENTION TO CONCEAL THE INCOME OR ANY DELIBERATE INTENTION TO D EFRAUD THE REVENUE AS THE ASSESSEE WAS UNDER THE BONAFIDE BELIEF THAT WHATEVER INCOME EARNED FROM THE EMPLOYER WAS REFLECTED IN FORM NO. 16. THE ASSESSEE IS A REGULAR AND TIMELY IN MEETING ALL HIS TAX OBL IGATIONS. THE CIT(A) HAS NOT CONSIDERED THE SUBMISSIONS OF THE ASSESSEE. THEREFORE, IN OUR CONSIDERED OPINION, THE EXPLANATION OFFERED BY THE ASSESSEE IS BONAFIDE, WHICH OUGHT TO HAVE BEEN ACCEPTED BY THE REVENUE AUTHORITIES. HENCE, THIS IS NOT A FIT CASE FOR LEVY OF PENALTY U/S 271(1)(C). THEREFORE, WE HEREBY CANCEL PENALTY OF R S. 12,528/- LEVIED BY THE AO AND CONFIRMED BY THE CIT(A). 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . PRONOUNCED IN THE OPEN COURT ON THIS 14 TH DAY OF SEPTEMBER, 2011. SD/- SD/- (J. SUDHAKAR REDDY) (V. DURGA RAO) ACCOUNTANT MEMBER JUDI CIAL MEMBER MUMBAI, DATED: 14 TH SEPTEMBER, 2011 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A) CONCERNED. 4) THE CIT CONCERNED. 5) THE DEPARTMENTAL REPRESENTATIVE, F BENCH, I.T .A.T., MUMBAI. BY ORDER //TRUE COPY// ASST. REGISTRAR, I.T.A.T., MUMBAI.