Sh. Preet Inder Singh, Mohali V. DCIT, Mohali

ITA 560/CHANDI/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90146 (ITAT-CHANDIGARH)
• Duration Of Justice: 11 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-05-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 28-04-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 02-06-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: JYOTI KUMARI

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES A CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R. SOOD, ACCOUNTANT MEMBER ITA NO.560/CHD/2014 ASSESSMENT YEAR: 2006-07 SH. PREET INDER SINGH VS. THE DCIT HM 548,PHASE 7 CIRCLE 6(1) MOHALI MOHALI PAN NO. AGXPS3838H (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT BY : SMT JYOTI KUMARI DATE OF HEARING : 28/04/2015 DATE OF PRONOUNCEMENT : 21/05/2015 ORDER PER T.R.SOOD, A.M. THE APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 28/03/2014 PASSED BY THE CIT(A) CHANDIGARH. 2. IN THIS APPEAL VARIOUS GROUNDS HAVE BEEN RAISED BUT THE ONLY ISSUE INVOLVED IS CONFIRMATION OF LEVY OF PENALTY UNDER S ECTION 271(1)(C). 3. AFTER HEARING BOTH THE PARTIES WE FIND THAT ASSE SSEE HAD FILED A RETURN DECLARING TOTAL INCOME OF RS. 42,09,742/- INCLUDING CAPITAL GAIN OF RS. 39,46,000/-. CERTAIN ENQUIRIES WERE CONDUCTED FROM M/S EMAAR MGF LAND LTD. BY DCIT, CENTRAL CIRCLE 6(1) AND IT WAS POINTED OUT THAT THE HUGE PAYMENT WERE MADE TO CERTAIN PERSONS IN MOHALI, PUNJAB FOR PURCHASE OF L AND AND ALSO FOR SETTLEMENT FOR CANCELLATION OF CERTAIN AGREEMENTS. THE DETAILS OF THESE PAYMENTS ARE AS UNDER: SR.NO. NAME AMOUNT PAID AS PER CANCELLATION AGREEMENT* DATED 15.2.2006(RS.) AMOUNT PAID AS PER SALE AGREEMENT DATED 15.2.2006(RS. TOTAL 1 SH. RAVINDER GOYAL 63906249 36093750 99999999 2 SH. PRAVEEN KAUSHAL 38945834 11054166 50000000 3 SH. MOHIT GAWRI 38945834 11054166 50000000 2 4 SH. JATINDER SINGH VIRK 20571875 79428125 100000000 5 SH. F.J.S BAJWA 88945834 11054167 100000001 6 SH. H.P. SINGH 37250000 30734375 67984375 7 SH. PREET INDER SINGH 5000000 27015625 32015625 GRAND TOTAL 293565626 206434374 500000000 ON THE BASIS OF ABOVE INFORMATION A SURVEY OPERATIO N WAS CONDUCTED IN THE CASE OF ASSESSEE. DURING THE SURVEY AND SUBSEQUENT ENQUIRIES IT EMERGED THAT THE ASSESSEE ALONGWITH SH. PARVEEN KAUSHAL AND SH. MOHIT GAWRI AND SH. F J S BAJWA HAVE NOT SHOWN CERTAIN INCOME ON ACCOUNT OF A MOUNT RECEIVED FROM M/S MGF LTD. AFTER DETAILED INVESTIGATION AND ENQUI RIES ULTIMATELY THE ADDITION OF RS. 3,70,75,625 RECEIVED FROM M/S MGF DEVELOPMENT L TD. AND M/S COLUMBIA HOLDINGS PVT. LTD. WAS ADDED TO THE INCOME OF THE A SSESSEE AND PENALTY PROCEEDING UNDER SECTION 271(1)(C) WERE ALSO INITIA TED. HOWEVER ON APPEAL THIS ADDITION WAS REDUCED TO RS. 84,45,625/-. 4. IN RESPONSE TO THE SHOW CAUSE NOTICE FOR LEVY OF PENALTY IT WAS MAINLY SUBMITTED THAT SINCE APPEAL IS STILL PENDING BEFORE THE ITAT THEREFORE PENALTY PROCEEDING SHOULD BE KEPT IN ABEYANCE. HOWEVER AO D ID NOT AGREE AND LEVIED THE MINIMUM PENALTY @ 100% AMOUNTING TO RS. 1,28,64 ,831/-. 5. ON APPEAL THE PENALTY WAS CONFIRMED HOWEVER THE LD. CIT(A) DIRECTED AO TO CONFIRM THE PENALTY TO THE EXTENT OF ADDITION SUSTAINED IN APPEAL. 6. BEFORE US LD. COUNSEL FOR THE ASSESSEE DID NOT S ERIOUSLY ARGUE ON THE ISSUE OF LEVY OF PENALTY BECAUSE PENALTY HAS BEEN CONFIRM ED BY THE TRIBUNAL IN SIMILAR GROUP OF CASES. HOWEVER, HE POINTED OUT THAT SINCE PENALTY HAS BEEN LEVIED BY THE AO ON THE BASIS OF TOTAL ADDITION WHICH HAVE BE EN REDUCED BY THE APPELLATE ORDER THEREFORE AT LEAST PENALTY SHOULD B E REDUCED TO THE EXTENT OF INCOME DECLARED BY THE ASSESSEE ON ACCOUNT OF CAPIT AL GAIN. IN THIS REGARD HE ALSO FILED THE COPY OF COMPUTATION OF INCOME. 7. ON THE OTHER HAND LD. DR STRONGLY SUPPORTED THE ORDER OF AO. 8. AFTER CONSIDERING THE RIVAL SUBMISSIONS CAREFULL Y WE FIND THAT IN THE COMPUTATION OF INCOME ASSESSEE HAS ALREADY DECLARED INCOME FROM CAPITAL GAIN IN RESPECT OF THE DISPUTED PROPERTY FOR WHICH ADDITION WERE MADE AT RS. 3 33,05,000/- WHERE AS INCOME FROM CAPITAL GAIN HAVE BEEN COMPUTED AT RS. RS. 84,45,625/- . THE PENALTY HAS BEEN LEVIED ON THE BA SIS OF THE ADDITION OF RS. 84,45,625/-. SINCE ASSESSEE HAS ALREADY DECLARED IN COME FROM CAPITAL GAIN AT RS. 33,05,000/- THEREFORE, CONCEALMENT IS ONLY TO T HE EXTENT OF EXTRA AMOUNT DETERMINED AT RS. 84,45,625.00 33,05,000.00. THE PENALTY CAN BE LEVIED ON SUCH CONCEAL INCOME. THEREFORE WE SET ASIDE THE ORDER O F LD. CIT(A) AND DIRECT AO TO LEVY THE PENALTY ONLY ON THE AMOUNT WHICH WAS NO T DISCLOSED AFTER VERIFYING THE DECLARED AMOUNT IN THE RETURN WHICH IS STATED B EFORE US AT RS. 33,05,000/-. 9. IN THE RESULT APPEAL OF THE ASSESSEE IS PARTLY A LLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 21/05/2015 SD/- SD/- (BHAVNESH SAINI) (T.R. SOOD) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 21/05/2015 AG COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT, TH E CIT(A), THE DR