RATANDEVI S. JAIN, MUMBAI V. ITO 21(1)(4), MUMBAI

ITA 6297/MUM/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 71974 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-12-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2005-2006
• Appeal Filed On: 12-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value
• Section: 50C

Judgement Text

D IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER ./I.T.A. NO.6297/M/2012 (AY: 2005 - 2006) RATANDEVI S. JAIN, JAIN GANGWAL & ASSOCIATES, 103, VTM BLDG NO.2, MHERA COMPOUND, A.K. ROAD, SAKINAKA, MUMBAI 400 072. / VS. ITO - 21(1)(4), MUMBAI. ./ PAN : ADNPJ 5468 K ( / APPELLANT) .. ( / RESPONDENT ) / APPELLANT BY : SHRI HARIDAS BHAT / REVENUE BY : SHRI MANVENDRA GOYAL , DR / DATE OF HEARING : 12.12.2013 / DATE OF PRONOUNCEMENT : 18 .12.2013 / O R D E R PER D. KARUNAKARA RAO, AM: THIS APPEAL FILED BY THE ASSESSEE ON 12.10.2012 IS AGAINST THE ORDER OF CIT (A) - MUMBAI DATED 19.6.2012 FOR THE ASSESSMENT YEAR 2005 - 2006. 2. IN THIS APPEAL, ASSESSEE RAISED THE FOLLOWING EFFECT GROUND WHICH READS AS UNDER: THE APPELLATE LEARNED AUTHORITY / ITO ERRED IN LEVYING PENALTY U/S 271(1)(C) OF THE ACT OF RS.3,00,000/ - AND APPELLANT PRAYS FOR ALLOWING THE SAME. 3. AT THE OUTSET, SHRI HARIDAS BHAT, LD COUNSEL FOR THE ASSESSEE DEMONSTRATED WITH FACTS AND FIGURES THAT T HE ADDITIONS MADE ARE RELATING TO THE DIFFERENCE BETWEEN THE SALE CONSIDERATION AS PER THE STAM P DUTY AUTHORITIES AND THE FIGURES MENTIONED IN THE AGREEMENT. AO INVOKED THE PROVISIONS OF SECTION 50C AND THE PENALTY LEVIED IN THIS CASE RELATED TO THE AFORE MENTIONED ADDITIONS. IN THIS REGARD, LD COUNSEL BROUGHT OUR ATTENTION TO THE PENALTIES U/S 271(1)(C) OF THE ACT AND MENTIONED THAT THE PENALTIES MADE U/S 50C ARE NOT SUSTAINABLE AND IN SUPPORT OF THIS PROPOSITION, LD COUNSEL FILED A COPY OF THE JUDGMENT OF THE HONBLE HIGH COURT OF KOLKATA IN THE 2 CASE OF CIT VS. MADAN TEATRES LTD VIDE ITA NO.62 OF 2013 & GA NO.684 OF 2013 AND THE DECISION OF THE COORDINATE BENCH IN THE CASE OF RENU HINGORANI VS. ACIT VIDE ITA NO.2210/MUM/2010 (AY 2006 - 2007) DATED 22.12.20 10, WHEREIN THE PENALTY LEVIED U/S 271(1)(C) WAS HELD NOT SUSTAINABLE IN RESPECT OF THE ADDITIONS MADE U/S 50C OF THE ACT. IN THIS REGARD, LD COUNSEL READ OUT PARA 8 OF THE SAID ORDER OF THE TRIBUNAL (SUPRA) AND THE RELEVANT PORTIONS FROM THE SAID PARA 8 READ AS UNDER: 8..........UNDER THESE FACTS AND CIRCUMSTANCES, IT CANNOT BE SAID THAT THE ASSESSEE HAS NOT FURNISHED CORRECT PARTICULARS OF INCOME. MERELY BECAUSE THE ASSESSEE AGREED FOR ADDITION ON THE BASIS OF VALUATION MADE BY THE STAMP VALUATIO N AUTHORITY WOULD NOT BE A CONCLUSIVE PROOF THAT THE SALE CONSIDERATION AS PER THIS AGREEMENT WAS INCORRECT AND WRONG. ACCORDINGLY, THE ADDITION BECAUSE OF THE DEEMING PROVISIONS DOES NOT IPSO FACTO ATT R ACT THE PENALTY U/S 271(1)(C). HENCE, IN VIEW OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD (SUPRA), THE PENALTY LEVIED U/S 271(1)(C) IS NOT SUSTAINABLE. THE SAME IS DELETED. 4. FURTHER, LD COUNSEL ALSO RELIED ON ANOTHER DECISION OF THE ITAT, MUMBAI IN THE CASE OF LOTUS LEARNING (P) LTD. VS. DCIT VIDE ITA NO.464/M/1998 [2006] 7 SOT 540 (MUMBAI) FOR THE IDENTICAL PROPOSITION. 5. ON THE OTHER HAND, LD DR RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE ORD ERS OF THE REVENUE AUTHORITIES AS WELL AS THE CITED DECISIONS. ON PERUSAL OF THE SAID JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT LTD; THE JUDGMENT OF THE HONBLE KOLKATA HIGH COURT IN THE CASE OF MADAN TEATRES LTD (SUPRA) AS WELL AS THE DECISIONS OF THE TRIBUNAL AND CONSIDERING THE SETTLED NATURE OF THE ISSUE, WE ARE OF THE OPINION THAT THE IMPUGNED PENALTY LEVIED U/S 271(1)(C) IS NOT SUSTAINABLE. ACCORDINGLY, WE DELETE THE PENALTY AND GROUNDS RAIS ED BY THE ASS ESSEE ARE ALLOWED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONO UNCED IN THE OP EN COURT ON 1 8 T H DECEMBER, 2013. S D / - S D / - (VIVEK VARMA) (D. KARUNAKARA RAO) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 1 8 .12.2013 3 . . ./ OKK , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI