M/s. Sagar Developers, Baroda V. The Income Tax Officer, Ward-2(3), Baroda

ITA 505/AHD/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 8526 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 1 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 02-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH (BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER & SHRI S.S. GODARA, JUDICIAL MEMBER) ITA. NO: 505/AHD/2016 (ASSESSMENT YEAR: 2011-12) M/S. SAGAR DEVELOPERS DEEP PROVISION STORE, NEAR ATMAJYOTI ASHRAM,ELLORA PARK BARODA-390007 V/S INCOME TAX OFFICER, WARD- 2 (3), BARODA (APPELLANT) (RESPONDENT) PAN: ABNFS5321G APPELLANT BY : SHRI MUKUND BAKSHI, AR RESPONDENT BY : SHRI SUMIT KUMAR VERMA, SR. D.R. ( )/ ORDER DATE OF HEARING : 04 -04-201 8 DATE OF PRONOUNCEMENT : 06 -04-2018 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-5, VADODARA DATED 26.11.2015 PERTAINING TO A.Y. 2011-1 2. ITA NO. 505/ AHD/2016 . A.Y. 2011-1 2 2 2. THE ONLY GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN CONFIRMING THE PENALTY LEVIED U/S. 271(1)(C) OF THE ACT. 3. THE ROOTS FOR THE LEVY OF PENALTY LIE IN THE ASSESS MENT ORDER DATED 27.03.2014 FRAMED U/S. 143(3) OF THE ACT. 4. BRIEFLY STATED THE FACTS OF THE CASE ARE DURING THE COURSE OF THE SEARCH OPERATION CONDUCTED AT THE GROUP CONCERNS OF DARSHNAM GROUP. THE ASSESSEE ADMITTED ON MONEY RECEIPTS IN CASH TO THE TUNE OF RS. 69.79 LACS AND SUPPRESSION OF PROFIT TO THE TUNE OF RS. 59 LACS. THE ADMITTED AMO UNT WAS DISCLOSED IN THE RETURN OF INCOME FILED ON 24.09.2011. THE RETURNED INCOME WAS ACCEPTED AS SUCH AFTER MAKING PETTY ADDITION ON ACCOUNT OF DONA TION OF RS. 11,000/- AND INTEREST ON TDS AT RS. 2137/-. PENALTY PROCEEDINGS WERE SEPARATELY INITIATED FOR THE AMOUNT ADMITTED. 5. DURING THE COURSE OF THE PENALTY PROCEEDINGS, THE A .O. SHOW CAUSED THE ASSESSEE TO EXPLAIN WHY PENALTY SHOULD NOT BE LEVIE D U/S. 271(1)(C) OF THE ACT FOR THE AMOUNT ADMITTED AS UNDISCLOSED INCOME. THE ASSESSEE STRONGLY CONTENDED THAT SINCE THE RETURNED INCOME HAS BEEN A CCEPTED AS SUCH, THERE IS NO CASE FOR THE LEVY OF PENALTY. THE CONTENTION OF THE ASSESSEE DID NOT FIND ANY FAVOUR WITH THE A.O. WHO LEVIED PENALTY AT RS. 43.7 7 LACS. 6. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) B UT WITHOUT ANY SUCCESS. 7. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE REITERA TED WHAT HAS BEEN STATED BEFORE THE LOWER AUTHORITIES AND THE LD. D.R. STRON GLY SUPPORTED THE FINDINGS OF THE A.O. ITA NO. 505/ AHD/2016 . A.Y. 2011-1 2 3 8. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORD ERS OF THE AUTHORITIES BELOW. IT IS TRUE THAT THE ASSESSEE WAS EXPOSED DUR ING THE SEARCH PROCEEDINGS AND WOULD NOT HAVE DISCLOSED THE INCOME BUT FOR THE SAID OPERATION. HOWEVER, THERE CANNOT BE ANY PENALTY ONLY ON SURMISES, CONJE CTURES AND POSSIBILITIES. SECTION 271(1)(C) HAS TO BE CONSTRUED STRICTLY. UNL ESS IT IS FOUND THAT THERE IS ACTUALLY A CONCEALMENT OR NON-DISCLOSURE OF THE PAR TICULARS OF INCOME, PENALTY CANNOT BE IMPOSED. IN THE CASE IN HAND, THERE WAS N O SUCH CONCEALMENT OR NON-DISCLOSURE AS THE ASSESSEE HAD MADE A COMPLETE DISCLOSURE IN THE INCOME TAX RETURN AND OFFERED THE SURRENDERED AMOUNT FOR T HE PURPOSES OF TAX AND THE RETURNED INCOME HAS BEEN ACCEPTED AS SUCH. 9. THE HONBLE HIGH COURT OF DELHI IN THE CASE OF SAS PHARMACEUTICALS 335 ITR 259 HAS HELD THAT WHERE INCOME SURRENDERED BY ASSES SEE HAD BEEN SHOWN BY IT IN ITS REGULAR INCOME-TAX RETURN, PENALTY CANNOT BE IMPOSED U/S. 271(1)(C) OF THE ACT. 10. CONSIDERING THE FACTS IN TOTALITY IN THE LIGHT OF T HE JUDGMENT OF THE HONBLE HIGH COURT OF DELHI (SUPRA), WE SET ASIDE THE FINDI NGS OF THE LD. CIT(A) AND DIRECT THE A.O. TO DELETE THE PENALTY SO LEVIED. AP PEAL FILED BY THE ASSESSEE IS ACCORDINGLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 06 - 04- 20 18 SD/- SD/- (S. S. GODARA) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 06/04/2018 RAJESH COPY OF THE ORDER FORWARDED TO: -