Sh. Hardeep Sachdeva, New Delhi V. ACIT, New Delhi

ITA 5948/DEL/2014

• Counselvise Citation: [2018] 118 COUNSELVISE.COM (IT) 8869 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2010-2011
• Appeal Filed On: 03-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VIKAS GOEL
• Keywords: Depreciation
• Section: 271(1)(c); 143(3); 14A

Judgement Text

1 ITA NO. 5948/DEL/2014 IN THE INCOME TAX APPELLAT E TRIBUNAL DELHI BENCH: C NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBE R AND MS SUCHITRA KAMBLE, JUDIC IAL MEMBER ITA NO. 5948/DEL/2014 ( A .Y 2010-11) HARDEEP SACHDEVA B-236, SECOND FLOOR, GREATER KAILASH-I NEW DELHI AALFA6462H (APPELLANT) VS ACIT CIRCLE-37(1) NEW DELHI (RESPONDENT) APPELLANT BY SH. VIKAS GOEL, ADV RESPONDENT BY SH. AMIT KATOCH, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 18/09/2014 PASSED BY CIT(A)-XXVIII, NEW DELHI FOR ASSESSMENT YEAR 2010-11. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. THAT THE LD. COMMISSIONER (APPEALS) HAS ERRED IN LAW AS WELL AS IN FACTS BY SUSTAINING THE PENALTY ORDER U/S 271(1) (C) OF T HE ASSESSING OFFICER . 3. ASSESSMENT IN THIS CASE WAS COMPLETED U/S 143(3) OF THE INCOME TAX ACT, 1961 ON 26/3/2013 AT AN INCOME OF RS. 1,92,93, 079/- AGAINST THE RETURN INCOME OF RS. 1,04,46,937/-. DURING THE ASSESSMENT PROCEEDINGS THE FOLLOWING ADDITIONS/DISALLOWANCES WAS MADE BY THE ASSESSING O FFICER:- (I) DEPRECIATION ON PROPERTY OF RS. 5,67,000/- DATE OF HEARING 19.12.2018 DATE OF PRONOUNCEMENT 26.12.2018 2 ITA NO. 5948/DEL/2014 (II) EXCESS DEPRECIATION CLAIMED ON BOOKS OF RS. 5, 20,800/- (III) DISALLOWANCE OF PROFESSIONAL FEES OF RS. 69,3 7,275/- (IV) DISALLOWANCE TOWARDS 14A OF RS. 1,13,542/- (V) DISALLOWANCE TOWARDS FOREIGN TRAVELLING EXPENSE S OF RS. 5,08,967/- (VI) DISALLOWANCE TOWARDS PERSONAL OF RS.1,98,558/- PENALTY PROCEEDINGS U/S 271(1)(C) WAS INITIATED ON THE POINT NO. (I) (II) (III) ( IV) &(V) BY THE ASSESSING OFFICER. THE ASSESSEE PREFER RED AN APPEAL BEFORE THE CIT(A) ON POINT NO. (II), (III) & (V) AND DID NOT F ILE ANY APPEAL FOR ADDITION ON ACCOUNT OF DEPRECIATION OF PROPERTY I.E. POINT NO. 1. THEREFORE, THE ASSESSING OFFICER ISSUED THE PENALTY NOTICE U/S 271(1)(C) FO R CONCEALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS. THE ASSESSEE MADE SUBMISSIONS BEFORE THE ASSESSING OFFICER. AFTER CONSIDERING THE SUBMI SSIONS OF THE ASSESSEE, THE ASSESSING OFFICER IMPOSED PENALTY OF RS. 1,75,200/- . 4. BEING AGGRIEVED BY THE PENALTY ORDER, THE ASSESS EE FILED APPEAL BEFORE THE CIT (A). THE CIT(A) DISMISSED THE APPEAL OF THE AS SESSEE. 5. THE LD. AR SUBMITTED THAT DURING THE YEAR, THE A SSESSEE CLAIMED DEPRECIATION OF RS. 11,34,000/- ON THE PROPERTY SIT UATED AT GREATER KAILASH, NEW DELHI. THE ASSESSEE ALSO CLAIMED DEPRECIATION ON THE VALUE OF LAND AS WELL. THE ASSESSEE CLAIMED THESE DEPRECIATIONS AS PER THE VARIOUS DECISIONS OF THE TRIBUNALS WHEREIN THE DEPRECIATION ON LAND AND BUILDING HAS BEEN ALLOWED IN SIMILAR CIRCUMSTANCES. THUS, THE LD. AR SUBMITT ED THAT THIS ISSUE IS A DEBATABLE ISSUE, AND THEREFORE, THE ASSESSING OFFIC ER WAS NOT JUSTIFIED IN INITIATING THE PENALTY PROCEEDINGS U/S 271(1)(C) A S THERE IS NO ELEMENT OF CONCEALMENT OF INCOME OR INACCURATE FURNISHING OF D OCUMENTS. THE LD. AR RELIED UPON THE DECISIONS OF THE DELHI TRIBUNAL IN CASE OF NAMASTE VOYAGES PVT. LTD. VS. ITO (2010) 5 ITR 19, WHEREIN IT IS HELD TH AT THE VALUE OF LAND AND BUILDING SHOWN AS COMPOSITE FIGURE AND DEPRECIATION IN THAT REGARD WAS INADVERTENTLY CLAIMED WHICH WAS ALLOWED FOR THE PAS T YEARS WITHOUT REDUCING VALUE OF LAND DOES NOT AMOUNT TO CONCEALMENT OF IN COME. THE LD. AR FURTHER 3 ITA NO. 5948/DEL/2014 SUBMITTED THAT IN SIMILAR CIRCUMSTANCES IN EARLIER ASSESSMENT YEAR, THE REVENUE HAS ALLOWED THIS DEPRECIATION. 6. THE LD. DR RELIED UPON THE ORDER OF THE ASSESSIN G OFFICER PASSED U/S 271(1)(C) AND ALSO RELIED UPON THE ORDER OF THE HO N'BLE DELHI HIGH COURT IN CASE OF MD. RAZA VS. CIT(A) 2016-TIOL-2026-SC-DEL-I T. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. IT IS PERTINENT TO NOTE THAT IN EARLIER AS SESSMENT YEARS SIMILAR CLAIM OF THE DEPRECIATION HAS BEEN ALLOWED BY THE REVENUE AU THORITIES. THE ISSUE IS DEBATABLE ISSUE AND SOME OF THE DECISIONS DECIDED I N FAVOUR OF THE ASSESSEE ON THE ISSUE OF DEPRECIATION. THUS, THERE WAS NO CONC EALMENT OF INCOME OR INACCURATE FURNISHING OF PARTICULARS ON PART OF THE ASSESSEE. THE CASE LAW RELIED UPON BY THE LD. DR IS NOT APPLICABLE IN THE PRESENT CASE AS IN THAT CASE THE ASSESSEE DID NOT DISCLOSE THE DETAILS OF THE CR EDITORS NOR THEIR LIST BUT MERELY CLAIMED IN THE RETURN. IN THE PRESENT ASSESS EES CASE THE ASSESSEE CLAIMED THE DEPRECIATION AFTER FILING THE DETAILS A ND THERE WAS NO CONCEALMENT OR INACCURATE FURNISHING OF DOCUMENTS AS THE ISSUE IS ALLOWED IN RESPECT OF DEPRECIATION CLAIMED FOR LAND AND BUILDING. THEREFO RE, SECTION 271(1)(C) WILL NOT BE ATTRACTED IN THE PRESENT CASE. THE ORDER OF THE CIT(A) IS SET ASIDE AND APPEAL OF THE ASSESSEE IS ALLOWED. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH DECEMBER, 2018 . SD/- SD/- (R. K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 26/12/2018 R. NAHEED 4 ITA NO. 5948/DEL/2014 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 19.12.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 20.12.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 2 6 .12.2018 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 2 6 .12.2018 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 2 6 .12.2018 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER