D.C.I.T. 9(1), MUMBAI V. EVERGREEN INVESTMENT & SERVICES PVT. LTD., MUMBAI

ITA 4313/MUM/2012

• Counselvise Citation: 431319914 RSA 2012
• Duration Of Justice: 1 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 15-01-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 22-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Keywords: Business income
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER AND DR. S.T.M. PAVALAN, JUDICIAL MEMBER ITA NO. 4313/MUM/2012 ASSESSMENT YEAR: 2008-09 D.C.I.T 9(1),ROOM NO. 223, AAYAKAR BHAWAN, M.K.MARG, MUMBAI-400 020. VS. EVERGREEN INVESTMENT & SERVICES PVT.LTD, 601, MOKSH UPPER GOVIND NAGAR, MALAD(E), MUMBAI-400 097 (APPELLANT) (RESPONDENT) PERMANENT ACCOUNT NO. :- AAACE 8589 K APPELLANT BY : MS.SONIA KUMAR RESPONDENT BY : NONE DATE OF HEARING : 15.01.2014 DATE OF PRONOUNCEMENT : 22.01.2014 O R D E R PER DR. S.T.M. PAVALAN, JM: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF THE LD.CIT(A)-19, MUMBAI DATED 19.04.2012 DELETING THE PENALTY OF RS. 12,62,088/- LEVIED BY THE AO U/S 271(1)(C) FOR THE ASSESSMENT YEAR 2008-09. 2. BRIEFLY STATED, THE ASSESSEE, A COMPANY, IN ITS RETURN OF INCOME HAD DECLARED A TOTAL INCOME AT RS.52,70,480/-. THIS INCLUDED AN INCOME O F RS.51,08,094/- ON ACCOUNT OF SALE OF SHARES WHICH HAD BEEN DISCLOSED AS SHORT TERM CAPIT AL GAIN. IN THE ASSESSMENT FRAMED U/S 143(3) OF THE INCOME TAX ACT, THE AO TREATED THE SA ID INCOME UNDER THE HEAD BUSINESS INCOME. THE ASSESSEE HAD NOT PREFERRED ANY APPEAL AGAINST THE ASSESSMENT ORDER. CONSEQUENTLY, IN THE PENALTY PROCEEDINGS, THE AO LE VIED A PENALTY @ 100% TAX SOUGHT TO BE EVADED WAS RS.12,62,088/- BY INVOKING SECTION 271(1 )(C) OF THE ACT. ON APPEAL, THE LD.CIT(A) DELETED THE PENALTY LEVIED BY THE AO AS T HE LD.CIT(A) IN THE QUANTUM PROCEEDINGS FOR THE EARLIER ASSESSMENT YEAR (2007-08) HAS DECID ED A SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE AND SINCE IDENTICAL FACTS ARE INVOLVED IN THE ASSESSMENT YEAR UNDER CONSIDERATION, TWO VIEWS ARE POSSIBLE ON THE SAID ISSUE. THEREFORE , ACCORDING TO THE LD.CIT(A), THE CASE OF ITA NO. 4313/MUM/2012 M/S. EVERGREEN INVESTMENT & SERVICES PVT.LTD ASSESSMENT YEAR: 2008-09 2 THE ASSESSEE DOES NOT ATTRACT THE PROVISIONS OF SEC TION 271(1)(C) OF THE ACT. AGGRIEVED BY THE IMPUGNED ORDER, THE REVENUE IS IN APPEAL BEFORE US. 3. NO ONE HAS APPEARED ON BEHALF OF THE ASSESSEE DE SPITE THE NOTICE HAVING BEEN SENT TO THE ASSESSEE WELL IN ADVANCE. WE, THEREFORE, PROCEE D TO DECIDE THE APPEAL OF THE REVENUE EX PARTE AFTER CONSIDERING THE SUBMISSIONS OF THE L D.DR AND ALSO PERUSING THE ORDERS OF LOWER AUTHORITIES. IT IS PERTINENT TO MENTION THAT THE DISPUTE IN THE ASSESSMENT PROCEEDINGS IS ONLY WITH REGARD TO THE LEGAL CONTENTION WHETHER TH E PROFITS ARE TO BE TAXED UNDER THE HEAD BUSINESS INCOME OR CAPITAL GAINS. IN THIS CONNE CTION, THE AO HAS TREATED THE IMPUGNED RECEIPTS UNDER THE HEAD BUSINESS INCOME AS AGAINS T THE ASSESSEE DECLARING THE SAME AS SHORT TERM CAPITAL GAIN. THE DELHI HIGH COURT, IN T HE CASES OF CIT VS. AURIC INVESTMENT AND SECURITIES LTD. 310 ITR 121 AND CIT VS. BHARTESH JAIN 323 ITR 358 HAS HELD THAT IF THE ADDITION IS MADE BY CHANGE OF HEAD OF INCOME, IT DO ES NOT AMOUNT TO CONCEALMENT OF INCOME OR PROVIDING INACCURATE PARTICULARS. THESE RATIOS O F THE DELHI HIGH COURT HAVE ALSO BEEN FOLLOWED BY THE TRIBUNAL IN THE CASE OF BENNETT COLEMAN COMPANY LTD. VS. CIT IN ITA NO. 3710/MUM/2011. THE CASE OF THE ASSESSEE IS SQUARELY COVERED BY THE DECISIONS OF THE DELHI HIGH COURT WHICH HAVE BEEN FOLLOWED IN BENNETT COLEMANS CASE (SUPRA). ALSO, WE CONCUR WITH THE FINDINGS OF THE LD.CIT(A) THAT TWO VIEWS A RE POSSIBLE ON THE SAID ISSUE AS IN THE QUANTUM PROCEEDINGS FOR THE EARLIER ASSESSMENT YEAR (2007-08), THE LD.CIT(A) HAS DECIDED A SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE AND IDENT ICAL FACTS ARE INVOLVED IN THE ASSESSMENT YEAR UNDER CONSIDERATION. THEREFORE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD.CIT(A) IN DELETING THE PENALTY LEVIED BY THE AO AND THE SAME IS UPHELD. 4. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY OF JANUARY, 2014. SD/- SD/- (R.C.SHARMA) (DR. S.T.M. PAVALAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 22.01.2014. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT(A) CONCERNED, MUMBAI THE DR E BENCH //TRUE COPY// BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.