Smt. Ravindra Kaur Sethi, Lucknow V. ITO Rg. IV (2), Lucknow

ITA 623/LKW/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62161 (ITAT-LUCKNOW)
• Duration Of Justice: 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-07-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 21-06-2012
• Assessment Year: misc
• Appeal Filed On: 13-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Bonafide belief
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A : LUCKNOW BEFORE SHRI S. K. YADAV, JUDICIAL MEMBER AND SHRI B. R. JAIN, ACCOUNTANT MEMBER I.T.A. NO. 623 /LKW/1 1 ASSESSMENT YEAR: 2004 - 2005 SMT. RAVINDRA KAUR SETHI, VS. INCOME TAX OFFICER, 64 - B, SRINAGAR NAGAR, RANGE - IV(2), ALAMBAGH, LUCKNOW. LUCKNOW. PAN:AFSPS0778N (APPELLANT) (RESPONDENT) APPELLANT B Y : SHRI K. R. RASTOGI, C. A. RESPONDENT BY : MS. MANJU THAKUR, D.R. DATE OF HEARING : 21 / 06 /201 2 DATE OF PRONOUNCEMENT : 03/07/2012 ORDER PER S. K. YADAV, J.M,: THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A) CONFIRMING THE PENALTY OF ` 57,000/ - LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT WITHOUT APPRECIATING THE FACT THAT THE DETAILS OF THE PROPERTY WERE DULY DISCLOSED IN THE RETURN OF INCOME OF THE ASSESSEE AND THE ASSESSEE WAS UNDER THE BELIEF THAT SECTION 50C OF THE ACT IS NOT APPLICABLE IN CASE OF TRANSFER OF ASSET. 2. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND DOCUMENTS PLACED ON RECORD AND FIND THAT THE ASSESSEE HAS FILED THE RETURN OF INCOME SHOWING TOTAL INCOME OF ` 1,13,240/ - . THE 2 ASSESSMENT WAS COMPLETED BY THE ASSESSING OFFICER ON TRANSFER OF PROPERTY TO HUSBAND WITHOUT ADEQUATE CONSIDERATION. THE ASSESSEE TRANSFERRED PROPERTY WHOSE VALUE FOR STAMP DUTY PURPOSES WAS ` 14,55,789/ - FOR ` 2,00,000/ - AND THE ASSESS ING OFFICER ASSESSED THE CAPITAL GAIN AS PER REPORT OF THE D.V.O. VALUING THE PROPERTY AT ` 9,24,200/ - THEREBY MAKING AN ADDITION OF ` 6,83,833/ - , WHICH WAS CONFIRMED BY THE CIT(A) . ON APPEAL, THE TRIBUNAL HAS ALSO CONFIRMED THE ADDITION OF ` 5,88,000/ - ON T HE BASIS OF REPORT OF APPROVED VALUER SUBMITTED BY THE ASSESSEE. CONSEQUENTLY, PENALTY U/S 271(1)(C) WAS LEVIED AGAINST WHICH AN APPEAL WAS FILED BEFORE THE CIT(A) BUT THE ASSESSEE DID NOT FIND FAVOUR. 3. DURING THE COURSE OF HEARING OF THE APPEAL, THE L EARNED COUNSEL FOR THE ASSESSEE HAS INVITED OUR ATTENTION TO THE FACT THAT SHE HAS ALREADY DECLARED THE TRANSFER OF PROPERTY TO HER HUSBAND AND IN FACT SHE HAS NOT RECEIVED ANYTHING EXCEPT THE EXECUTION OF THE SALE DEED IN ORDER TO OBTAIN A LOAN FACILITY F ROM THE BANK BY HER HUSBAND. SINCE SHE HAS NOT RECEIVED ANYTHING FROM HER HUSBAND, THERE CANNOT BE ANY CONCEALMENT OF INCOME CHARGEABLE TO TAX. HOWEVER, SHE HAS DECLARED THE TRANSFER OF PROPERTY THROUGH HER RETURN OF INCOME. 4. THE LEARNED D.R. BESIDES PLACING RELIANCE ON THE ORDERS OF THE LOWER AUTHORITIES HAS CONTENDED THAT THE TRIBUNAL HAS ACCEPTED THE TRANSFER OF PROPERTY BY THE ASSESSEE IN FAVOUR OF HER HUSBAND AND ALSO ACCEPTED THE VALUERS REPORT ESTIMATING THE COST AT ` 5,88,000/ - LOOKING TO THE C ONDITION OF LAND BY ALLOWING DEDUCTION @59.73%. SINCE THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS IN 3 ITS RETURN OF INCOME, THE REVENUE HAS RIGHTLY LEVIED THE PENALTY U/S 271(1)(C) OF THE ACT. 5. HAVING GIVEN A THOUGHTFUL CONSIDERATION TO RIVAL SUBMISSIONS AND FROM A CAREFUL PERUSAL OF THE RECORD, WE FIND THAT THE ASSESSEE HAS MADE A DECLARATION IN COMPUTATION OF INCOME FILED ALONG WITH THE RETURN OF INCOME DECLARING THEREIN THROUGH ANNEXURE THAT S HE HAD SOLD ONE PLOT OF LAND FOR ` 2,00,000/ - TO HER HUSBAND ON WHICH NO CAPITAL GAIN ACCRUE D TO HER. THE REASONS FOR NOT OFFER ING THE CAPITAL GAIN WAS THAT THE PLOT WAS TRANSFERRED BY THE ASSESSEE TO HER HUSBAND ON WHICH NO SALE CONSIDERATION WAS PASSED O N BUT FOR REGISTERING THE SALE DEED SALE CONSIDERATION WAS REQUIRED TO BE SHOWN IN THE CONVEYANCE DEED. THE REVENUE HAS INVOKED THE PROVISIONS OF SECTION 50C OF THE ACT AND COMPUTED THE CAPITAL GAIN. IT HAS BEEN REPEATEDLY HELD THROUGH VARIOUS JUDICIAL P RONOUNCEMENTS THAT SECTION 50C IS DEEMING PROVISION ON THE BASIS OF WHICH CAPITAL GAIN CAN BE COMPUTED BUT FOR ESTIMATION OF THE SALE CONSIDERATION ON THE BASIS OF PROVISIONS OF SECTION 50C, PENALTY U/S 271(1)(C) SHOULD NOT BE LEVIED. MOREOVER, IN THE INS TANT CASE, THE ASSESSEE HAS SOLD THE PROPERTY TO HER HUSBAND FROM WHOM NO SALE CONSIDERATION WAS PASSED ON BUT FOR EXECUTING THE SALE DEED, SALE CONSIDERATION WAS SHOWN. SINCE THE ASSESSEE HAS DECLARED ALL THESE FACTS IN HER COMPUTATION OF INCOME FILED AL ONG WITH THE RETURN OF INCOME, IT CANNOT BE SAID THAT THE ASSESSEE HAS EITHER CONCEALED THE INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. IN FACT, IT IS A CASE OF BONAFIDE BELIEF UNDER WHICH CAPITAL GAIN WAS NOT OFFERED. WE, THEREFORE, ARE OF THE VIEW THAT UNDER THESE 4 CIRCUMSTANCES, PENALTY U/S 271(1)(C) SHOULD NOT BE LEVIED. WE, ACCORDINGLY, DELETE THE PENALTY OF ` 56,000/ - LEVIED U/S 271(1)(C) OF THE ACT. 6. IN THE RESULT, THE APPEAL IS ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 03/07/2012 ) SD/. SD/. ( B. R. JAIN ) ( S. K. YADAV ) ACC OUNTANT MEMBER JUDICIAL MEMBER DATED: 03/07/2012 *SINGH COPY FORWARDED TO THE: 1. APPELLANT. 2. RESPONDENT. 3. CIT (A) 4. CIT 5. DR. ASSISTANT REGISTRAR