Navin Kumar Chaudhary, Rewari V. ITO, Gurgaon

ITA 594/DEL/2010

• Counselvise Citation: 59420114 RSA 2010
• Duration Of Justice: 2 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-03-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 06-03-2012
• Assessment Year: 1999-2000
• Appeal Filed On: 08-02-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MAMTA KOCHAR
• Assessee Lawyers: GAUTAM JAIN F
• Keywords: Revised return
• Section: 148; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F NEW DELHI) BEFORE SHRI RAJPAL YADAV JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER I.T.A. NO.594/DEL/2010 ASSESSMENT YEAR : 1999-2000 SHRI NAVEEN KUMAR CHAUDHARY, ITO, C/O ML GULATI, ADVOCATE, WARD-1, 5189-TOPCHIWARA, REWARI V. UDYOG VIHAR, HSIDC B LDG., PHASE-5, GURGAON. (APPELLANT) (RESPONDENT) PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO. PAN /GIR/NO.AEPPC AEPPC AEPPC AEPPC- -- -5072 5072 5072 5072- -- -F FF F APPELLANT BY : SHRI GAUTAM JAIN, F.C.A. RESPONDENT BY : SMT. MAMTA KOCHAR, SR. DR. ORDER PER KAPOOR, AM: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF LD CIT(A), PANCHKULLA DATED 16.12.2009 FOR ASSESSMENT YEA R 1999-2000. THE GROUNDS OF APPEALS ARE AS UNDER:- 1. THAT HAVING REGARDS TO THE FACTS AND CIRCUMSTANCES OF T HE CASE, THE LD CIT(A) HAS ERRED IN LAW AND FACTS IN CONFIRMI NG THE PENALTY ACTION U/S 271(1) (C ) OF THE LD ASSESSING OFFICER WARD -1, GURGAON WHERE HE HAD IMPOSED THE PENALTY OF `. 2,24, 375/-. 2. THAT THE LD CIT(A) HAS FURTHER ERRED IN IGNORING THE FACTS THAT THE SAME WAS A REFUND CASE AND NO ANY INTENTION TO HOODWIN KED THE ITA NO594/DEL/10 2 REVENUE AT ANY STAGE NOR IN ANY MANNER AS ALLEGED AND HELD BY THE LD APPELLATE AUTHORITY. 3. THAT THE LD CIT(A) HAS GROSSLY HELD THAT THE APPELLANT CONCEALED THE PARTICULARS OF HIS INCOME. HE HAS IGNORED ALL THE FACTS, CIRCUMSTANCES AND THE QUANTUM ORDER OF THE LD CIT(A) DATED 3.9.2007. 4. THAT THE LD CIT(A) HAS ALSO IGNORED ALL THE FACTS AN D CIRCUMSTANCES FOR FILING THE RETURNS U/S 148, ITS RESULTS AND FINDINGS OF THE LD CIT(A) IN THE QUANTUM CASE. 2. BRIEF FACTS OF THE CASE ARE THAT THE PROCEEDINGS U/ .S 147 WERE INITIATED IN THE CASE ON THE BASIS OF INFORMATION RECE IVED BY THE ASSESSING OFFICER FROM ADDL. CIT, CENTRAL RANGE-III, NE W DELHI THAT LAND MEASURING 7 KANLAS 3 MARLAS WAS PURCHASED IN THE JOINT NAMES OF SHRI KIRAN KUMAR, DILBAGH SINGH AND THE ASSESSEE SHRI NAVEEN KUMAR, ALL SONS OF SHRI AZAD SINGH CHOPRA DURING PREVIOUS YEAR RE LEVANT TO ASSESSMENT YEAR 1999-2000FROM SMT. PADMINI GALGOTIA. IT WAS SUBMITTED THAT ANOTHER LAND MEASURING 4 KANALS 10 MA RLAS WAS PURCHASED FROM SHRI SUNIL GALGOTIA FOR `.8,82,200/- IN THE JOINT NAMES OF THESE PERSONS. ON THE BASIS OF THIS INFORMATION, THE ASSESSING OFFICER INITIATED PROCEEDINGS U/S 147 AND ISSUED NOTICE U/S 148 OF THE ACT IN RESPONSE TO WHICH THE ASSESSEE FILED RETURN DECLARING INC OME OF `.13,09,517/- RECEIVED AS INTEREST FROM HUDA FOR ACQU ISITION OF AGRICULTURAL LAND. THE SOURCE OF INVESTMENT IN AGRICU LTURAL LAND WAS STATED TO BE OUT OF COMPENSATION RECEIVED FROM HUDA O N ACQUISITION OF THEIR AGRICULTURAL LAND. THE ASSESSEE FILED REVISED RE TURN DURING ASSESSMENT PROCEEDINGS SHOWING INCOME OF `.7,95,677/-. A SUM OF `.5,13,840/- WAS RECOVERED BACK AS PER ORDERS OF THE H IGH COURT. THE ASSESSING OFFICER DID NOT ACCEPT THE REVISED RETURN AND BROUGHT TO TAX THE ENTIRE INTEREST ON THE GROUND THAT THE ASSESSEE IS FO LLOWING THE ITA NO594/DEL/10 3 CASH SYSTEM OF ACCOUNTING AND HAS RECEIVED COMPENSATION IN THE YEAR UNDER ASSESSMENT AND THE COURT ORDER WAS NOT PRONOUNCED DURING THE YEAR UNDER ASSESSMENT. 3. HOWEVER THE APPEAL WAS DECIDED IN FAVOUR OF THE A SSESSEE AND THE ASSESSED INCOME WAS REDUCED BY `.5,13,840/- THE AMOU NT WHICH WAS RECOVERED FROM THE ASSESSEE BY VIRTUE OF THE COURT O RDER. THE ASSESSING OFFICER INITIATED THE PENALTY PROCEEDINGS FOR CONCEALMENT OF INTEREST INCOME AMOUNTING TO `.7,95,677/- AND ALSO AG RICULTURAL INCOME OF `.60,000/-. BEFORE THE ASSESSING OFFICER THE ASSESSEE STA TED THAT THE PENALTY PROCEEDINGS HAVE BEEN INITIATED ON THE GROUN D THAT RETURN WAS NOT FILED U/S 139 WHICH IS NOT CORRECT SINCE HIS CASE IS A REFUND CASE ON ACCOUNT OF TDS DEDUCTED BY HUDA. THE ASSESSING OFFICER DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE AND HELD THAT THE ASSESSEE HAD NOT FILED HIS RETURN U/S 139 OF THE ACT AND AS PER CLA USE (A) OF EXPLANATION 2 BELOW SECTION 147, IT IS A CASE OF DEEM ED ESCAPEMENT OF INCOME. THE ASSESSING OFFICER HELD THAT THE ASSESSEE FAILE D TO FURNISH THE TRUE AND CORRECT PARTICULARS OF HIS INCOME AND IT WAS A WILFULL ATTEMPT ON THE PART OF THE ASSESSEE TO AVOID THE PAYMEN T OF LEGITIMATE TAX. THE ASSESSING OFFICER, THEREFORE, LEVIED PENALTY O F `.2,24,375/- U/S 271(1)( C) OF THE ACT. 4. BEFORE THE CIT(A), THE LD AR FOR THE ASSESSEE PLACED RELIANCE ON THE CASE OF CIT V. AM GOPALAN VIDE SLP NO.6439 OF 20 09 (SC) IN WHICH IT HAS BEEN HELD THAT THROUGH THE ASSESSEE MAY HAVE FIL ED THE RETURN LATE THE INCOME COULD NOT BE TREATED AS UNDISCLOSED FO R THE YEAR IN WHICH TAX HAS BEEN DEDUCTED AT SOURCE OR ADVANCE TAX HAS BEEN PAID. THERE WAS NO MENS REA ON THE PART OF THE ASSESSEE TO CONC EAL THE INCOME. ITA NO594/DEL/10 4 5. LD CIT(A) DID NOT AGREE WITH THE PLEA OF THE LD AR FOR THE ASSESSEE AND UPHELD THE ORDER OF THE ASSESSING OFFICER. TH E RELEVANT PORTION OF THE ORDER OF LD CIT(A) IS AS UNDER:- THE ASSESSING OFFICER HAS RIGHTLY HELD THAT THE APPELLA NT CONCEALED THE INCOME AND IN CASE NOTICE U/S 148 OF TH E IT ACT HAD NOT BEEN ISSUED TO THE APPELLANT, THE INCOME WOUL D HAVE ESCAPED ASSESSMENT. THE ARGUMENT OF THE COUNSEL THAT THE RETURN OF INCOMES WAS FILED DECLARING THE INTEREST INC OME AND IT DOES NOT AMOUNT TO CONCEALMENT OF INCOME IS DEVOID O F ANY MERIT AND THE SAME IS REJECTED. THE RETURN WAS FILED B Y THE APPELLANT ONLY AFTER NOTICE U/S 148 WAS ISSUED TO THE A PPELLANT AND THE RETURN WAS NEVER FILED VOLUNTARILY U/S 139 OF THE INCOME TAX ACT, 1961. THE CASE NOW RELIED UPON BY THE COUNS EL IS OF NO HELP TO HIM SINCE THE RETURN IN THE PRESENT CASE WAS NO T FILED AT ALL AND IT IS NOT A CASE OF LATE FILING OF THE RETUR N. THE ASSESSING OFFICER HAS RIGHTLY HELD THAT THE APPELLANT CONCEALE D THE PARTICULARS OF HIS INCOME AND HAS RIGHTLY LEVIED PENAL TY AMOUNTING TO `.2,24,375/- U/S 271(1)( C) OF THE IT A CT. THE ORDER OF THE ASSESSING OFFICER LEVYING PENALTY IS UPHELD. 6. WE HAVE CONSIDERED THE SUBMISSIONS OF RIVAL PARTIES AN D ARE OF THE OPINION THAT PENALTY U/S 271(1)( C) CANNOT BE SUST AINED BECAUSE THE ASSESSEE HAD NOT FURNISHED INACCURATE PARTICULARS IN THE RETURN OF INCOME WHICH IS A PRE REQUISITE FOR IMPOSITION OF PENA LTY U/S 271(1) ( C) OF THE ACT. MOREOVER, THE PENALTY IMPOSABLE U/S 271( 1)( C) IS TO BE QUANTIFIED IN ACCORDANCE WITH CLAUSE (III) OF SECTION 271(1)( C) WHICH READS AS FOLLOWS:- ITA NO594/DEL/10 5 IN THE CASES REFERRED TO IN CLAUSE ( C ) A SUM WHICH SH ALL NOT BE LESS THAN BUT WHICH SHALL NOT EXCEED THREE TIMES THE T AX SOUGHT TO BE EVADED BY REASON OF CONCEALMENT OF PARTICULARS OF HIS INCOME THE FURNISHING OF INACCURATE PARTICULARS OF SU CH INCOME. THE EXPRESSION THE AMOUNT OF TAX SOUGHT TO BE EVADED M EANS TAX ON TOTAL INCOME ASSESSED (AS REDUCED BY ADVANCE TAX, TDS, TAX COLLECTED AT SOURCE & SELF ASSESSMENT TAX PAID BEFORE THE DUE DATE OF FILING THE RETURN. HERE IN THE PRESENT CASE, THERE WAS NO TAX LIA BILITY BEFORE THE ISSUE OF NOTICE U/S 148, RATHER THERE WAS REFUND SO THE RE WAS NO TAX SOUGHT TO BE EVADED. THEREFORE, LD REVENUE AUTHORITI ES HAVE ERRED IN VISITING ASSESSEE WITH PENALTY. IT IS DELETED. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALL OWED. 8. ORDER PRONOUNCED IN THE OPEN COURT ON THE 16TH D AY OF MARCH, 2012. SD/- SD/- (RAJPAL YADAV) (T.S. KAPOOR ) JUDICIAL MEMBER ACCOUNTANT MEMBER DT.16.3.2012. HMS COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). ITA NO594/DEL/10 6 ITA NO594/DEL/10 7 POINT TO BE DISCUSSED WITH THE MINISTRY FOR FUTURE REF ERENCE FOR WRITING A LETTER TO THE MINISTRY. 1.