Sh. Sajal Gupta, New Delhi V. DCIT, New Delhi

ITA 5722/DEL/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7147 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 18-07-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 22-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-I : NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER ITA NO.5722/DEL/2014 ASSESSMENT YEAR : 2010-11 SAJAL GUPTA, B-102, NEETI BAGH, NEW DELHI. PAN: AAJPG3990N VS. DCIT, CIRCLE-14(1), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SATYAJIT GOEL, CA DEPARTMENT BY : NONE DATE OF HEARING : 18.07.2016 DATE OF PRONOUNCEMENT : 18.07.2016 ORDER PER R.S. SYAL, AM: THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER PASSED BY THE CIT(A) ON 18.7.2014 CONFIRMING THE PENALTY OF R S.1,35,960/- IMPOSED BY THE AO U/S 271(1)(C) OF THE INCOME-TAX A CT, 1961, IN RELATION TO THE ASSESSMENT YEAR 2010-11. ITA NO.5722/DEL/2014 2 2. THE DEPARTMENT HAS REQUESTED FOR ADJOURNMENT IN ALL THE CASES, INCLUDING THE PRESENT CASE, FIXED TODAY FOR HEARING BEFORE THE BENCH BY GIVING THE REASON THAT: SR. DR IS NOT AVAILABLE. THERE IS NEITHER ANY ONE FROM THE SIDE OF THE REVENUE TO REPRESENT THE R EVENUE NOR TO EXPLAIN THE REASONS AS TO WHY THE BENCH BE ALLOWED TO CRASH . THE LD. AR STRONGLY OPPOSED TO THE GRANTING OF ADJOURNMENT. I AM SATISFIED THAT THE REVENUES PRAYER FOR ADJOURNMENT CANNOT BE ACCEPTED . THE SAME IS, THEREFORE, REJECTED AND THE APPEAL IS BEING TAKEN U P FOR DISPOSAL ON MERITS EX PARTE QUA THE REVENUE. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGAGED IN SHARE TRADING BUSINESS. A SUM OF RS.10,50,000/- WAS CLAIMED AS DEDUCTION ON ACCOUNT OF PROFESSIONAL AND MANAGEMENT CHARGES. THESE CHARGES WERE PAID TO THREE PERSONS AS COMMISSION FO R GIVING TIPS TO THE ASSESSEE FOR THE SHARES TO BE PURCHASED. ONE OF TH E RECIPIENTS INCLUDED SMT. SHANTI DIVI TO WHOM A SUM OF RS.4,40,000/- WAS PAID. THE AO REQUIRED THE ASSESSEE TO PRODUCE SMT. SHANTI DEVI. IT WAS SUBMITTED THAT SHE HAD EXPIRED. FOR VERIFICATION OF THE SAME, THE AO ISSUED SUMMONS ITA NO.5722/DEL/2014 3 U/S 131 TO ONE SHRI BIRBAL SINGH, S/O SMT. SHANTI D EVI. SHRI BIRBAL SINGH APPEARED AND GOT HIS STATEMENT RECORDED. HE D ID NOT DENY THAT SMT. SHANTI DEVI WAS 80 YEARS OF AGE BEFORE HER DEA TH. HE SHOWED IGNORANCE AS TO WHETHER SHE WAS ACTIVELY ENGAGED IN ANY SHARE MARKET. FROM THIS, THE AO DREW INFERENCE THAT THE TRANSACTI ON OF PAYMENT OF COMMISSION TO SMT. SHANTI DEVI WAS A PLOY TO REDUCE THE TAXABLE INCOME. HE, THEREFORE, MADE A DISALLOWANCE OF RS.4 ,40,000/-, AGAINST WHICH THE INSTANT PENALTY WAS IMPOSED. THE LD. CIT (A) CONFIRMED THE PENALTY. THE ASSESSEE IS AGGRIEVED AGAINST THE CONF IRMATION OF THE INSTANT PENALTY. 4. I HAVE HEARD THE LD. AR AND PERUSED THE RELEVANT MATERIAL ON RECORD. IT IS OBSERVED THAT THE ASSESSEE CLAIMED T O HAVE PAID A COMMISSION OF RS.4,40,000/- TO SMT. SHANTI DEVI, WH O EXPIRED AT THE TIME WHEN THE AO TOOK UP THE ASSESSMENT PROCEEDINGS . THIS FACT WAS CONFIRMED BY SHRI BIRBAL SINGH, S/O SMT. SHANTI DEV I THAT THE OLD LADY WAS NO MORE. THIS SHOWS THAT THE ASSESSEES CLAIM FOR PAYMENT OF COMMISSION REMAINED UNSUBSTANTIATED BECAUSE OF THE DEATH OF THE ITA NO.5722/DEL/2014 4 RECIPIENT. IT IS NOTICED THAT APART FROM THIS PAYM ENT, THE ASSESSEE ALSO PAID SIMILAR COMMISSION TO TWO OTHER PARTIES AMOUNT ING TO RS.6,10,000/- WHICH HAS BEEN ALLOWED BY THE AO. UNDER SUCH CIRCU MSTANCES, IT IS DIFFICULT TO HOLD THAT THE ASSESSEE CONCEALED INCOM E OR FURNISHED INACCURATE PARTICULARS OF INCOME QUA THE PAYMENT OF RS.4,40,000/- TO SMT. SHANTI DEVI ATTRACTING PENALTY U/S 271(1)(C) O F THE ACT. I, THEREFORE, ORDER TO DELETE THE PENALTY. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 18.07.20 16. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED, 18 TH JULY, 2016. DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.