Prem Chand Gupta, New Delhi V. ITO, New Delhi

ITA 6744/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2955 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-12-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2011-2012
• Appeal Filed On: 22-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVIKANT GUPTA
• Section: 145

Judgement Text

ITA NO. 6744/DEL/2015 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: H NEW DELHI BEFORE SHRI G.D. AGRAWAL, HONBLE PRESIDEN T & SHRI K.N. CHARY, JUDICIAL MEMBER ITA NO.-6744/DEL/2015 ( ASSESSMENT YEAR: 2011-12) PREM CHAND GUPTA 2116, D-11, VASANT KUNJ, NEW DELHI. AAEPG5955G VS ITO WARD 62(4) NEW DELHI. ASSESSEE BY SH. GAUTAM JAIN, ADV. SH. PIYUSH KUMAR KAMAL, ADV. REVENUE BY SH. RAVI KANT GUPTA, SR. DR ORDER PER K. NARSIMHA CHARY, J.M. AGGRIEVED BY THE ORDER DATED 23.10.2015 IN APPEAL N O. 244/2014-15 PASSED BY THE LD. COMMISSIONER OF INCOM E TAX (APPEALS)-20, NEW DELHI (FOR SHORT CALLED AS THE L D. CIT(A)), ASSESSEE PREFERRED THIS APPEAL. 2. FACTS STATED IN BRIEF ARE THAT THE ASSESSEE IS A CONTRACTOR AND DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR THE AY 2011-12, IT WAS FOUND THAT THE ASSESSEE SOLD THE FL AT THAT WAS PURCHASED ON 18.05.2010 FOR RS. 40,28,000/- WAS SOL D ON 25.03.2011 FOR A SUM OF RS. 45 LACS RESULTING IN CA PITAL GAIN OF RS. 4,72,000/- WHICH THE ASSESSEE HAS NOT DECLARED THE SAID INCOME IN THE RETURN. HOWEVER, BY LETTER DATED 12. 03.2014 ASSESSEE DECLARED THE SAME AND OFFERED THE TAX THER EON. LD. AO DATE OF HEARING 26.12.2017 DATE OF PRONOUNCEMENT 26.12.2017 ITA NO. 6744/DEL/2015 2 MADE AN ADDITION OF RS. 6,24,350/- BY DISALLOWING 1 % OF THE TOTAL WORKS COST U/S 145 OF THE ACT ON THE GROUND T HAT THE BILLS AND VOUCHERS WERE NOT PROPERLY MAINTAINED AND ARE N OT SUBJECT TO VERIFICATION. ASSESSING OFFICER INITIATED PENALT Y PROCEEDINGS U/S 271 (1)(C) OF THE INCOME TAX ACT, 1961 (FOR SHO RT CALLED AS THE ACT) IN RESPECT OF THE CAPITAL GAINS AND ALSO THE AD-HOC ADDITION AT 1% OF CONTRACT RECEIPTS AND LEVIED A PE NALTY OF RS. 3,38,769/-. LD. CIT (A) CONFIRMED THE ADDITION MAD E ON ACCOUNT OF THE CAPITAL GAINS BUT DELETED THE AD HOC ADDITION AT 1% OF THE CONTRACT RECEIPTS. 3. IT IS THE ARGUMENT OF THE LD. AR THAT IT IS ONLY BY INADVERTENCE, THE RECEIPT ON ACCOUNT OF CAPITAL GAI N ESCAPED THEIR ATTENTION WHILE FILING THE RETURN OF INCOME B UT WHEN IT WAS REALIZED, BY WAY OF LETTER DATED 12.03.2014, THE FA CT WAS BROUGHT TO THE NOTICE OF THE AUTHORITIES AND DUE TA XES WERE PAID. LD. DR ARGUED THAT IT IS ONLY WHEN CONFRONTE D DURING THE SCRUTINY THE ASSESSEE OFFERED THE TAX ON THIS SHORT TERM CAPITAL GAIN, AS SUCH, PENALTY IS SUSTAINABLE. 4. ON AN EXAMINATION OF THE ASSESSMENT ORDER, WE FI ND THAT THERE IS NO ALLEGATION AS TO THE ASSESSING OFFICER DETECTING THE ESCAPEMENT OF THIS PARTICULAR INCOME BEFORE THE ASS ESSEE REALIZING AND OFFERING IT TO THE TAX. ASSESSMENT O RDER READS THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASS ESSEE DISCLOSED VIDE LETTER DATED 12.03.2014 THAT HE HAD SOLD THE PROPERTY AGAINST WHICH THE CAPITAL GAIN WAS WORKED OUT. WHAT IS NOT TO BE FOUND FROM THE ASSESSMENT ORDER, CANNOT B E SUPPLEMENTED BY THE LD. DR DURING ARGUMENTS. IN THE CIRCUMSTANCES, WE ARE OF THE OPINION THAT IT IS A C ASE OF THE ITA NO. 6744/DEL/2015 3 ASSESSEE NON-DECLARING THE SHORT TERM CAPITAL GAINS BY INADVERTENCE AND SINCE THE ASSESSEE REALIZED THE SA ME AND OFFERED FOR TAX THE PENALTY CANNOT BE SUSTAINED. W E, THEREFORE, WHILE ALLOWING THE APPEAL DIRECT THE AO TO DELETE T HE PENALTY. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON 26.12.2017 SD/- SD/- (G.D. AGRAWAL) (K. NARSIM HA CHARY) PRESIDENT JUDICIAL MEMBER DATED: 26.12.2017 *KAVITA ARORA COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI DRAFT DICTATED ON 26.12.2017 DRAFT PLACED BEFORE AUTHOR 26.12.2017 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. APPROVED DRAFT COMES TO THE SR.PS/PS 26.12.17 KEPT FOR PRONOUNCEMENT ON 26.12.17 FILE SENT TO THE BENCH CLERK 27.12.17 DATE ON WHICH FILE GOES TO THE AR DATE ON WHICH FILE GOES TO THE HEAD CLERK. DATE OF DISPATCH OF ORDER.