Asst. Commissioner of Income Tax, Circle-2(1), Kondapur V. Hyma Developers Private Limited (Formerly known as DLF Homes Kokapet Pvt. Ltd.), Madhapur

ITA 543/Hyd/2023

• Counselvise Citation: [2024] 101 COUNSELVISE.COM (IT) 5761 (ITAT-HYDERABAD)
• Duration Of Justice: 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-07-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-B
• Next Hearing Date: 03-07-2024
• Assessment Year: 2012-2013
• Appeal Filed On: 07-11-2023
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CH RAJESWARA REDDY
• Keywords: Wrong claim; Revenue expenditure
• Section: 271(1)(c); 143(3)

Judgement Text

आयकर अपीलीय अिधकरण, हैदराबाद पीठ मŐ IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES “B”, HYDERABAD BEFORE SHRI MANJUNATHA G., ACCOUNTANT MEMBER & SHRI K.NARASIMHA CHARY, JUDICIAL MEMBER आ.अपी.सं / ITA No. 543/Hyd/2023 (िनधाŊरण वषŊ / Assessment Year: 2012-13) Asstt. Commissioner of Income Tax Circle 2(1), Kondapur Hyderabad Vs. HYMA Developers (P) Ltd (formerly known as DLF Homes Kokapet Pvt Ltd) Kondapur, Hyderabad [PAN : AACCK9921H] अपीलाथŎ / Appellant Ů̝ यथŎ / Respondent िनधाŊįरती Ȫारा/Assessee by: Advocate A.V. Raghuram राज̾ व Ȫारा/Revenue by: Shri CH Rajeswara Reddy, DR सुनवाई की तारीख/Date of hearing: 03/07/2024 घोषणा की तारीख/Pronouncement on: 19/07/2024 आदेश / ORDER PER K. NARASIMHA CHARY, J.M: 2. Aggrieved by the order dated 08/09/2023 passed by the learned Commissioner of Income Tax (Appeals)-NaƟonal Faceless Appeal Centre (NFAC), Delhi (“Ld. CIT(A)”), in the case of HYMA Developers (P) Ltd (“the Page 2 of 5 assessee”) for the assessment year 2012-13, the Revenue preferred this appeal. 3. Assessee is a company. It filed its Return of Income for the AY 2012- 13, declaring a loss of Rs. 5,42,39,733/- inclusive of interest claimed as revenue expenditure Rs. 4,63,68,948/-. Assessment u/s 143(3) of the Income Tax Act, 1961 (for short “the Act”) was completed on 25.02.2015 at a loss of Rs.(-) 5,11,506/- as against the returned loss of Rs.(-) 5,42,39,733/- thereby making disallowance on account of interest expenses to the tune of Rs.4,63,35,631/- and commission and brokerage expenses to the tune of Rs.73,59,279/-. Aggrieved by the order of the learned Assessing Officer, the assessee preferred appeal before the learned CIT(A), who by his order in Appeal No. 45/2015-16 dated 03.02.2017, inter alia, sustained said addiƟons which were subjected to iniƟaƟon of penalty proceedings u/s 271(1)(c) of the Act for furnishing inaccurate parƟculars of income and concealment of income. Learned Assessing Officer, accordingly, levied penalty of Rs.1,50,44,405/- u/s 271(1)(c) of the Act @ 100% of the tax evaded for concealment of its true income and for furnishing inaccurate parƟculars of income as the assessee failed to substanƟate its claim at the Ɵme of assessment proceedings as well as at the Ɵme of penalty proceedings. 4. Aggrieved, assessee preferred appeal before the learned CIT(A) challenging the levy of penalty staƟng that all the parƟculars were furnished before the learned Assessing Officer and it is only on verifying those parƟculars learned Assessing Officer made certain disallowances and therefore, the case does not fall in the category of either concealment of income or furnishing of inaccurate parƟculars. Assessee also pleaded that for the assessment year 2011-12 a similar penalty was levied and it was deleted by the learned CIT(A) in appeal holding that the case does not fall in either of the categories. Page 3 of 5 5. Learned CIT(A), based on the order passed by the Assessing Officer for the assessment year 2011-12 in assessee’s own case levying penalty, and held that it is not a fit case for levy of penalty as it could not be said that the assessee had furnished inaccurate parƟculars of income or had concealed the parƟculars of income and accordingly, penalty levied by the AO is liable to be deleted. 6. According to the learned DR, making a wrong claim also amounts to furnishing of inaccurate parƟculars and thereby concealment of income and on that score he jusƟfied the orders of the authoriƟes. 7. We have gone through the record in the light of the submissions made on either side. It is an admiƩed fact that as against the loss of ₹ 5, 42,39,733/-claimed by the assessee in the return of income, learned Assessing Officer completed the assessment at a loss of ₹ 5, 11, 406/- and in that process may disallowance on account of interest of expenses to the tune of ₹ 4, 63, 35, 631/-and commission and brokerage expenses to the tune of ₹ 73, 59, 279/-. It’s not the case of the Revenue that the assessee failed to show these expenses while compuƟng the income are that it is only during the assessment proceedings such a fact is unearthed for the 1 st Ɵme by the learned Assessing Officer. Assessee furnished in fact all these figures and it is only aŌer considering them the learned Assessing Officer disallowed certain expenses claimed by the assessee. 8. In this context we would like to refer to the decision of the Delhi High Court in CIT vs. DCM Limited(2013) 359 ITR 0101 (Delhi), wherein the Hon’ble High Court of Delhi held that law does not bar or prohibit an assessee for making a claim, which he believes may be accepted or is plausible; that when such a claim is made during the course of regular or scruƟny assessment, liberal view is required to be taken as necessarily the claim is bound to be carefully scruƟnized both on facts and in law; that full probe and appraisal is natural and normal; that threat of penalty cannot become a gag and/or haunt an assessee for making a claim which may be Page 4 of 5 erroneous or wrong, when it is made during the course of the assessment proceedings; that normally, penalty proceedings in such cases should not be iniƟated unless there are valid or good grounds to show that factual concealment has been made or inaccurate parƟculars on facts were provided in the computaƟon. Law does not bar or prohibit a person from making a claim, when he knows the maƩer is going to be examined by the Learned Assessing Officer. 9. Apart from this a similar quesƟon had arisen in assessee’s own case in the earlier assessment year 2011-12 and considering the facts and circumstances of the case, the 1 st appellate authority held that such sort of incidences do not fall within the ambit of either concealment of income or furnishing of inaccurate parƟculars and it would not be a fit case to levy penalty. Learned CIT(A) followed the same for this year also. We find it difficult to hold such a finding as is illegal or irregular. Having regard to the facts and circumstances as a whole, we are of the considered opinion that the learned CIT(A) reached the correct conclusion in deleƟng the penalty and no interference is needed with such a finding. We therefore, dismiss the grounds of appeal. 10. In the result, appeal of the Revenue is dismissed. Order pronounced in the open court on this the 19 th July, 2024. Sd/- Sd/- (MANJUNATHA G.) (K. NARASIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER Hyderabad, Dated: 19/07/2024 Pvv/SPS Copy forwarded to: 1. ACIT, Circle 2(1) Room No.513, 5 th Floor, Signature Towers, Kondapur, Page 5 of 5 Hyderabad 500084 2. Hyma Developers (P) Ltd, 8 th Floor, 3 rd Block, My Home Hub, Madhapur, Hyderabad 500081 3. Pr.CIT , Hyderabad. 4. DR, ITAT, Hyderabad. 5. GUARD FILE TRUE COPY ASSISTANT REGISTRAR ITAT, HYDERABAD