ITO, New Delhi V. Shri Navneet Gupta, Delhi

ITA 445/DEL/2013

• Counselvise Citation: 44520114 RSA 2013
• Duration Of Justice: 2 year(s) 10 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 23-11-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 24-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

ITA NO.445/DEL/2013 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO. 4 45 /DEL/2013 A.Y. 200 8 - 0 9 INCOME TAX OFFICER, WARD 29(3), ROOM NO. 103, DRUM SHAPE BUILDING, I.P. ESTATE, NEW DELHI 110 002 VS. SHRI NAVNEET GUPTA, 1824-25, BHAGIRATH PALACE, CHANDNI CHOWK, DELHI 110 006 (PAN:AAIPG5172H) (APPELLANT) (APPELLANT) (APPELLANT) (APPELLANT) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) DEPARTMENT BY : SH. P. DAM KANUNJNA, SR. DR ASSESSEE BY : NONE PRESENT DATE OF HEARING : DATE OF HEARING : DATE OF HEARING : DATE OF HEARING : 23 2323 23- -- -11 1111 11- -- -201 201 201 2015 55 5 DATE OF ORDER : DATE OF ORDER : DATE OF ORDER : DATE OF ORDER : 2 22 24 44 4- -- -11 1111 11- -- -201 201 201 2015 55 5 ORDER ORDER ORDER ORDER PER PER PER PER H.S. SIDHU H.S. SIDHU H.S. SIDHU H.S. SIDHU : : : : J JJ JM MM M THE REVENUE HAS FILED THIS AGAINST THE ORDER DATED 6.11.2012 PASSED BY THE LD. CIT(A)-XXV, NEW DELHI ON THE FOLLOWING GROU NDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) ERRED IN LAW AND IN FACTS IN DELETING THE PENALTY OF RS. 6,3 1,113/-. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) ERRED IN DELETING THE PENALTY U/S. 271(1)(C) BY IGNORING THE FACT THAT THE ASSESSEE SHOULD HAVE OFFERED THE INCOME UNDER THE PROVISIONS OF SECTION 50C OF THE I.T. ACT, 1961. ITA NO.445/DEL/2013 2 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE L D. CIT(A) ERRED IN OBSERVING IN PARA 3.4 OF HIS ORDER THAT NO PENALTY IS LEVIABLE IN THE CASE OF ADDITIONS WHICH ARE MADE ON ESTIMATED INCOME BY IGN ORING THE DECISION IN THE CASE OF ADDL. CIT VS. CHANDRAKANTHA AND ANOTHER (MP) 205 ITR 607; ADDL. CIT VS. LAKSHMI INDUSTRIES AND COLD STORAGE C O. LTD. (ALL) 146 ITR 492; CIT VS. MD. WARASAT HUSSAIN (PATNA) 171 ITR 40 5; AM SHAH & CO. VS. CIT (GUJ) 238 ITR 415. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE HAS FILED THE RETURN INCOME OF RS. 28,28,749/- WHICH INCLUDED THE SHORT TERM CA PITAL GAIN OF RS. 2,33,000/- THE CASE WAS TAKEN UP FOR SCRUTINY AND IT WAS FOUND THAT THE ASSESSEE HAS SOLD A PROPERTY AT C-96, CHANDER NAGAR, GHAZAIABAD UP FOR A SALE CONSIDERATION OF RS. 33,50,000/-. THE SALE CONSIDERATION AS PER THE STAMP VALUATION AUTHORITY WAS RS. 43,40,000/-. THE ASSESSEE WAS CONFRONTED ABOUT THE COST OF THE PROPERTY AND ABOUT THE SALE CONSIDERATION AS PER T HE STAMP VALUATION AUTHORITY U/S. 50C. SUBSEQUENTLY, THE ASSESSEE HAS REVISED TH E COST OF PROPERTY AT RS. 22,40,000/- AND HAS OFFERED THE SHORT TERM CAPITAL GAIN OF RS. 21,00,000/- (RS. 43,40,000 (-) RS. 22,40,000) IN PLACE OF RS. 2 ,33,000/- DECLARED BY THE ASSESSEE. SO, THE SHORT TERM CAPITAL GAIN AS PER T HE AI WAS RS. 21,00,000/- AND THE AO HAS MADE THE ADDITION OF RS. 18,67,000/- (RS . 21,00,000/- (-) RS. 2,33,000) AND THE AO HAD ALSO INITIATED THE PENALTY PROCEEDINGS U/S. 271(1) AND HAS LEVIED THE PENALTY OF RS. 6,31,113/- ON 28. 6.2011. 3. AGGRIEVED BY THE AFORESAID PENALTY ORDER, ASSESS EE APPEALED BEFORE THE LD. CIT(A), WHO VIDE IMPUGNED ORDER DATED 6.11.201 2 HAS CANCELLED THE PENALTY IN DISPUTE. 4. NOW THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST THE ORDER DATED 6.11.2012 PASSED BY THE LD. CIT(A). ITA NO.445/DEL/2013 3 5. IN THIS CASE, NOTICE OF HEARING TO THE ASSESSEE WAS SENT BY THE REGISTERED AD POST, IN SPITE OF THE SAME, ASSESSEE, NOR HIS A UTHORIZED REPRESENTATIVE APPEARED TO PROSECUTE THE MATTER IN DISPUTE, NOR FI LED ANY APPLICATION FOR ADJOURNMENT. KEEPING IN VIEW THE FACTS AND CIRCUM STANCES OF THE PRESENT CASE AND THE ISSUE INVOLVED IN THE PRESENT APPEAL, I AM OF THE VIEW THAT NO USEFUL PURPOSE WOULD BE SERVED TO ISSUE NOTICE AGAIN AND A GAIN TO THE ASSESSEE, THEREFORE, I AM DECIDING THE PRESENT APPEAL EXPART E QUA ASSESSEE, AFTER HEARING THE LD. DR AND PERUSING THE RECORDS 6. LD. DEPARTMENTAL REPRESENTATIVE RELIED UPON THE ORDER OF THE AO AND REITERATED THE CONTENTION RAISED IN THE GROUNDS OF APPEAL FILED BY THEM. 7. WE HAVE HEARD THE LD. DR AND PERUSED THE RECO RDS ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES. WE FIND THAT ASSESSEE SUBMITTED BEFORE THE LD. CIT(A) THAT AO WAS NOT JUSTIFIED TO LEVY THE PENALTY AS TH ERE WAS NO CONCEALMENT OF INCOME AND THERE WAS NO FURNISHING OF INACCURATE PA RTICULARS OF INCOME. WE FIND THAT IN THIS CASE THE ASSESSEE HAS SOLD THE PROPERT Y FOR RS. 33,50,000/- AND THE ASSESSEE HAS DECLARED THE STCG OF RS 2,33,000/-. TH E AO HAS TAKEN THE CIRCLE RATE OF THE PROPERTY WHICH IS RS 43,40,000/- AND AC CORDINGLY HAS WORKED OUT THE CAPITAL GAIN OF RS 21,00,000/- ULS 5OC. IT WAS FURTHER SUBMITTED BEFORE THE LD. CIT(A) THAT THE ADDITION MADE BY THE AO IS A NO TIONAL ADDITION AND NO PENALTY CAN BE LEVIED ON NOTIONAL ADDITION OR ON NO TIONAL INCOME. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAS ACCEPTED THE ADDITI ON WITH A VIEW TO BUY PEACE WITH THE DEPARTMENT AND ALSO TO AVOID THE LITIGATIO N AND THE ASSESSEE ALSO RELIED ON THE VARIOUS CASE LAWS TO SUPPORT HIS CLAIM THAT NO PENALTY CAN BE LEVIED ON SURRENDERED INCOME AND THE CASE LAWS ARE AS UNDER : - (I) CIT V S HARSHVARDHAN CHEMICALS & MINERALS LTD, 259 ITR 212 [2003] (RAJ) ITA NO.445/DEL/2013 4 (II) CIT VS ADAMKHAN, 223 ITR 264 [1997] (MAD) (III) AKSHAY BHANDER VS CIT, 220 ITR 325 [1996] ( GAU) 7.1 FROM THE ABOVE, WE FIND AO HAS NOT DETECTED ANY CONCEALMENT OF INCOME EITHER IN THE RETURN OF INCOME OR IN THE BOOKS OF A CCOUNTS OF THE ASSESSEE. IN OUR CONSIDERED OPINION, THE CASE OF THE ASSESSEE IS ALS O SUPPORTED BY THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD (2010) 322 ITR 158 (SC) IN WHICH IT HAS BEEN HELD THAT MERE MAKING OF A CLAIM WHICH IS UNSUSTAIN ABLE LAW CANNOT BE TREATED AS FURNISHING OF INACCURATE PARTICULARS OF INCOME A ND AS SUCH WILL NOT ATTRACT THE PENALTY PROCEEDINGS ULS 271(1)(C). 7.2 WE ALSO FIND THAT IN THE CASE OF CIT VS HARS HVARDHAN CHEMICALS & MINERALS LTD, 259 ITR 212 [2:9~3] (RAJ), THAT NO PE NALTY IS LEVIABLE FOR ANY ADDITION WHICH IS DEBATABLE, ARGUABLE AND A CONTROV ERSIAL ADDITION. IN THE CASE OF CIT VS ADAMKHAN, 223 ITR 264 [1997] (MAD), IT HA S BEEN HELD THAT NO PENALTY IS LEVIABLE IN THE CASE OF ADDITIONS WHICH ARE MADE ON ESTIMATED INCOME OR A CONDITIONAL SURRENDER IS MADE BY THE ASSESSEE TO AV OID THE PENALTY AND TO BUY PEACE WITH THE DEPARTMENT. IN THE CASE OF AKSHAY BH ANDER VS CIT, 220 ITR 325 [1996] (GAU), IT HAS BEEN HELD THAT THE PENALTY IS A QUASI-CRIMINAL IN NATURE AND NO PENALTY CAN BE LEVIED UNLESS THERE IS EVIDENCE O F CONCEALMENT OR THE ASSESSEE IS HELD GUILTY OF CONCEALMENT. 7.3 KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCE S OF THE CASE AND THE PRECEDENTS RELIED UPON BY THE LD. CIT(A) IN HIS I MPUGNED ORDER, WE ARE OF THE CONSIDERED VIEW THAT THE AO HAS NOT DETECTED OR FOU ND ANY CONCEALMENT OF INCOME IN THE CASE OF THE ASSESSEE AND AS SUCH THE AO IS NOT JUSTIFIED TO LEVY THE PENALTY WITHIN THE MEANING OF SECTION 271(1)(C) AND ACCORDINGLY, THE PENALTY LEVIED BY THE AO WAS RIGHTLY CANCELLED BY THE LD. C IT(A). THEREFORE, WE DO NOT ITA NO.445/DEL/2013 5 SEE ANY INFIRMITY IN THE WELL REASONED ORDER PASSE D BY THE LD. CIT(A), HENCE, WE UPHOLD THE SAME AND DISMISS THE APPEAL FILED BY THE REVENUE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/11/2015. S SS SD DD D/ // /- -- - S SS SD DD D/ // /- -- - [ [[ [PRASHANT MAHARISHI PRASHANT MAHARISHI PRASHANT MAHARISHI PRASHANT MAHARISHI] ]] ] [ [[ [H.S. SIDHU H.S. SIDHU H.S. SIDHU H.S. SIDHU] ]] ] ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER ACCOUNTANT MEMBER JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER DATE: 24-11-2015 SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR SRBHATNAGAR COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: COPY FORWARDED TO: - -- - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES