THE ACIT, Visakhapatnam V. KVS Sujatha, Visakhapatnam

ITA 624/VIZ/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1045 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 7 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 01-06-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 08-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M N MURTHY NAIKDR
• Assessee Lawyers: C V S MURTHY
• Section: 143(3); 142(1); 148

Judgement Text

ITA NO.624/VIZAG/2014 SMT. K.V.S. SUJATHA, VISAKHAPATNAM 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.624/VIZAG/2014 ( / ASSESSMENT YEAR: 2008-09) ACIT, CIRCLE - 4(1), VISAKHAPATNAM VS. SMT. K.V.S. SUJATHA, VISAKHAPATNAM [P AN: AEQPK9001H ] ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SHRI M.N. MURTHY NAIK,DR / RESPONDENT BY : SHRI C.V.S. MURTHY, AR / DATE OF HEARING : 27.07.2016 / DATE OF PRONOUNCEMENT : 29.07.2016 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF CIT(A), VISAKHAPATNAM DATED 26.9.2014 FOR THE ASSES SMENT YEAR 2008-09. ITA NO.624/VIZAG/2014 SMT. K.V.S. SUJATHA, VISAKHAPATNAM 2 2. FACTS ARE IN BRIEF THAT THE ASSESSEE IS AN INDIV IDUAL FILED A RETURN OF INCOME ON 8.12.2010 BY DECLARING TOTAL INCOME OF ` 74,35,980/- WHICH INCLUDES THE INCOME DERIVED FROM CAPITAL GAINS AND INCOME FROM OTHER SOURCES. THEREAFTER, THE A.O. AFTER RECEIVING THE INFORMATION FROM ADIT(INV), UNIT-III(2) ON 14.11.11, ABOUT SALE OF A RESIDENTIAL FLAT BY THE ASSESSEE TO M/S. BOTHRA SHIPPING SERVICES ON WHOSE CASE SEARCH OPERATION WAS CONDUCTED BY THE DEPARTMENT, ISSUED A NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED AS 'TH E ACT') AND ASSESSMENT WAS COMPLETED ACCEPTING THE RETURN FILED BY THE ASSESSEE. 3. THEREAFTER, THE A.O. HAS INITIATED THE PENALTY P ROCEEDINGS U/S 271(1)(C) OF THE ACT ON THE GROUND THAT THE ASSESSE E FILED THE RETURN OF INCOME BY DISCLOSING THE CAPITAL GAINS ONLY BECAUSE A SEARCH WAS CONDUCTED IN THE GROUP OF M/S. BOTHRA SHIPPING SERV ICES AND THEREFORE, THE ASSESSEE HAD CONCEALED THE RETURN OF TRUE PARTI CULARS OF INCOME AND CALLED EXPLANATIONS FROM THE ASSESSEE. THE ASSESSE E HAS SUBMITTED BEFORE THE A.O. THAT I HAVE NOT CONCEALED ANY INCOM E OR PARTICULARS AND THE RETURN FILED BY ME WAS ACCEPTED BY THE A.O. U/S 143(3) OF THE ACT WITHOUT MAKING ANY ADDITIONS. THEREFORE, NO PENALT Y CAN BE LEVIED. HOWEVER, THE A.O. HAS NOT ACCEPTED THE EXPLANATION GIVEN BY THE ASSESSEE AND IMPOSED A PENALTY U/S 271(1)(C) OF THE ACT ON THE GROUND ITA NO.624/VIZAG/2014 SMT. K.V.S. SUJATHA, VISAKHAPATNAM 3 THAT DUE TO SEARCH IN THE CASE OF M/S. BOTHRA SHIPP ING SERVICES, THE ASSESSEE HAD DISCLOSED THE CAPITAL GAINS AND THIS I S AMOUNTING TO CONCEALMENT OF TRUE PARTICULARS OF INCOME. ACCORDI NGLY, PENALTY IS LEVIED. 4. ASSESSEE CARRIED MATTER IN APPEAL BEFORE THE CIT (A). IT WAS SUBMITTED BEFORE THE LD. CIT(A) THAT THE ASSESSEE F ILED A RETURN OF INCOME ON 8.12.2010 AND THE INVESTIGATION WING RECO RDED THE SWORN STATEMENT FROM THE ASSESSEE ON 31.12.2010 AND SUBMI TTED THAT THE ASSESSEE HAD FILED A RETURN OF INCOME MUCH PRIOR TO RECORDING HER STATEMENT BY THE INVESTIGATION WING. IT WAS ALSO C ONTENDED BEFORE THE LD. CIT(A) THAT THE A.O. HAS ISSUED A NOTICE U/S 14 8 OF THE ACT DATED 14.11.2011, BEFORE THAT ASSESSEE HAD ALREADY FILED HER RETURN OF INCOME ON 8.12.2010, THEREFORE, SUBMITTED THAT SEARCH IN T HE CASE OF M/S. BOTHRA SHIPPING COMPANY IS NOTHING TO DO WITH THE A SSESSEE. IT WAS ALSO CONTENDED BEFORE THE LD. CIT(A) THAT ASSESSEE IS FILING BELATED RETURN IN THE YEAR UNDER CONSIDERATION EVEN IN EARL IER YEARS ALSO AND SUBMITTED THAT PENALTY MAY BE DELETED. THE LD. CIT (A) AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE, HE GAV E A FINDING THAT THE ASSESSEE HAD FILED A RETURN OF INCOME ON 8.12.2010. THE ENQUIRY CONDUCTED BY THE INVESTIGATION WING OF THE DEPARTME NT ON 31.12.2010. ITA NO.624/VIZAG/2014 SMT. K.V.S. SUJATHA, VISAKHAPATNAM 4 THEREFORE, THE RETURN FILED BY THE ASSESSEE CONSEQU ENT TO THE SEARCH OPERATION IN THE CASE OF M/S. BOTHRA SHIPPING LIMIT ED IS NOT CORRECT AND PENALTY LEVIED BY THE A.O. WAS CANCELLED. THE RELE VANT PORTION OF THE ORDER IS EXTRACTED AS UNDER: I HAVE CONSIDERED THE SUBMISSIONS MADE. FROM THE P ERUSAL OF THE ASSESSMENT ORDER AND THE IMPUGNED PENALTY ORDER , IT IS EVIDENT THAT THE ASSESSEE HAS FILED THE RETURN OF INCOME ON 8.12 .2010, PRIOR TO ISSUE OF ANY NOTICE U/S 142(1) OR U/S 148 OF THE I.T. ACT BY THE ASSESSING OFFICER. THE RETURN OF INCOME WAS FILED BEFORE ANY INQUIRY BY THE INVESTIGATION WING OF THE DEPARTMENT WHICH WAS ON 3 1.12.2010. THEREFORE, I DO NOT FIND ANY MATERIAL BASIS TO TAKE THE VIEW THAT THE RETURN WAS FILED ONLY CONSEQUENT TO SEARCH OPERATIO N IN THE CASE OF BOTHRA SHIPPING SERVICES LTD. FURTHER, THERE IS NO VARIATION TO THE RETURNED INCOME IN THE ASSESSMENT MADE U/S 143(3) R .W.S. 147 ON 28.12.2012. THEREFORE, IT HAS TO BE TAKEN THAT THE ASSESSEE HAS VOLUNTARILY FURNISHED THE INFORMATION RELATING TO H ER CAPITAL GAINS IN THE RETURN FILED BY HER, THOUGH IT WAS BELATED. I ALSO FIND MERIT IN THE ASSESSEES CONTENTION THAT THE ASSESSEE HAD FILED B ELATED RETURNS ON EARLIER OCCASIONS ALSO AND THEREFORE NO MALAFIDE IN TENTION COULD BE INFERRED. IN VIEW OF THESE FACTUAL POSITION, I FIND THAT THERE IS NO BASIS TO TAKE THE VIEW THAT THE ASSESSEE HAS CONCEALED PARTI CULARS OF HER INCOME. THEREFORE, THE AO IS DIRECTED TO CANCEL THE IMPUGNE D PENALTY LEIVED. 5. THE LD. D.R. STRONGLY SUPPORTED THE ORDER PASSED BY THE A.O. 6. THE LD. COUNSEL FOR THE ASSESSEE STRONGLY SUPPOR TED THE ORDER PASSED BY THE LD. CIT(A). 7. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. ITA NO.624/VIZAG/2014 SMT. K.V.S. SUJATHA, VISAKHAPATNAM 5 THE ASSESSEE HAD FILED A RETURN OF INCOME FOR THE A SSESSMENT YEAR 2008-09 BELATEDLY ON 8.12.2010 BY DECLARING TOTAL I NCOME OF ` 74,35,980/- WHICH INCLUDES INCOME DERIVED FROM CAP ITAL GAINS & INCOME FROM OTHER SOURCES. THERE IS A SEARCH CONDU CTED BY THE DEPARTMENT IN THE CASE OF M/S. BOTHRA SHIPPING SERV ICES TO WHOM ASSESSEE HAS SOLD THE RESIDENTIAL FLAT AND THEREAFT ER ASSESSEE WAS ASKED TO APPEAR BEFORE THE INVESTIGATION WING OF THE DEPA RTMENT ON 31.12.2010. THE ASSESSEE HAS ALREADY FILED A RETUR N OF INCOME ON 8.12.2010 AND THEREAFTER A NOTICE U/S 148 OF THE AC T WAS ISSUED TO THE ASSESSEE AND RETURN FILED BY THE ASSESSEE WAS ACCEP TED U/S 143(3) R.W.S. 147 OF THE ACT ON 28.12.2012. THEREFORE, TH E RETURN FILED BY THE ASSESSEE CANNOT BE TREATED CONSEQUENT TO THE ENQUIR Y CONDUCTED BY THE INVESTIGATION WING OF THE DEPARTMENT. SO FAR AS FI LING OF THE BELATED RETURN IS CONCERNED, THE LD. CIT(A) GAVE A FINDING THAT THE ASSESSEE HAD FILED BELATED RETURN ON EARLIER OCCASIONS ALSO AND HELD THAT THERE IS NO BASIS TO TAKE A VIEW THAT ASSESSEE HAS CONCEALED TH E PARTICULARS OF HER INCOME. WE FIND THAT THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INACCURATE PARTICULARS. IN VIEW OF THE ABOVE , THERE IS NO REASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A). THIS APPEAL FILED BY THE REVENUE IS DISMISSED. ITA NO.624/VIZAG/2014 SMT. K.V.S. SUJATHA, VISAKHAPATNAM 6 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 29 TH JUL16. SD/- SD/- ( . ) ( . ) (G. MANJUNATHA) (V. DURGA RAO) /ACCOUNTANT MEMBER /JUDICIAL MEMBER ! /VISAKHAPATNAM: % /DATED : 29.07.2016 VG/SPS '! (! /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE ACIT, CIRCLE-4(1), VISAKHAPA TNAM 2. / THE RESPONDENT SMT. K.V.S. SUJATHA, 58-21-50, BUTCHIRAJUPALEM, VISAKHAPATNAM 3. ) / THE CIT, VISAKHAPATNAM 4. ) ( ) / THE CIT(A), VISAKHAPATNAM 5. ! , , , , ! / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // /0 , (SR.PRIVATE SECRETARY) , , ! / ITA 9 T, VISAKHAPATNAM