ASPANDIAR R. IRANI, THANE V. ACIT CIR 1, THANE

ITA 7098/MUM/2014

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8762 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 11 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 26-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR YADAV

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH A MUMBAI BEFORE SHRI D.T. GARASIA (JUDICIAL MEMBER) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 7098/MUM/2014 ASSESSMENT YEAR: 2006 - 07 ASPANDIAR R. IRANI IRANI WADI, 1 ST POKHARAN ROAD, J.K. GRAM, THANE - 400606 VS. ACIT - 1 THANE PAN NO. AAAPI0977L APPELLANT RESPONDENT ASSESSEE BY : NONE REVENUE BY : SHRI RAJESH KUMAR YADAV , DR DATE OF HEARING : 03/10 /2017 DATE OF PRONOUNCEMENT : 31/10/2017 ORDER PER N.K. PRADHAN, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE . THE REL EVANT ASSESSMENT YEAR IS 2006 - 07 . THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMIS SIONER OF INCOME TAX (APPEALS) - II , THANE AND ARIS ES OUT OF PENALTY U/S 271(1)(C) OF THE INCOME TAX ACT 1961, (THE ACT). ASPANDIAR R. IRANI ITA NO. 7098/MUM/2014 2 2. THE G ROUND OF APPEAL FILED BY THE ASSESSEE READ S AS UNDER: ON FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN CONFIRMING THE PENALTY LEVIED BY THE LD. AO U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 TO THE EXTENT OF RS.10,00,000/ - IN RESPECT OF DENIAL OF EXEMPTION U/S 54EC. 3. BRIEFLY STA TED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE ALONG WITH ONE SHRI G. IRANI SOLD PLOT NO. 347 AND 338 AT PANCHPAKHADI, THANE FOR A TOTAL CONSIDERATION OF RS.4,84,00,000/ - AND CALCULATED HIM LONG TERM CAPITAL GAINS (LTCG) AT RS.1,53,42,890/ - BEING 50% OF HIS SHARE. THE ASSESSEE FURTHER CLAIMED A DEDUCTION OF RS.1,00,00,000/ - U/S 54EC OUT OF THE ABOVE CAPITAL GAINS. THUS HE OFFERED THE BALANCE OF RS.53,42,890/ - FOR TAXATION AS CAPITAL GAINS. ACCORDING TO THE ASSESSING OFFICER (AO) THE SALE CONSIDERATION OF THE ABOVE PLOTS SHOWN WAS LESS THAN THE MARKET VALUE AS PER STAMP DUTY RECKONER. THEREFORE, ON THE BASIS OF THE MARKET VALUE DETERMINED BY THE DVO AT RS.3,91,77,903/ - , THE AO CALCULATED THE CAPITAL GAINS AT RS.1,77,55,325/ - . THEN THE AO IMPOSED THE PENALTY OF RS.28,62,295/ - U/S 271(1)(C) OF THE ACT. 4. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE FILED AN APPEAL BEFORE THE LD. CIT(A). WE FIND THAT THE LD. CIT(A) OBSERVED THAT THE ASSESSEE HAD DISCLOSED LTCG OF RS.53,42,890/ - IN THE RETURN OF INCOME REVIS ED ON 23.03.2007. THEREFORE, HE DIRECTED THE AO TO EXCLUDE THE LTCG OF RS.53,42,890/ - FROM THE INCOME TO BE CONSIDERED FOR PENALTY U/S 271(1)(C). HOWEVER, THE LD. CIT(A) OBSERVED THAT THE ASSESSEE HA D ACTUALLY INVESTED RS.50,00,000/ - IN THE ELIGIBLE BOND S WHEREAS IT CLAIMED ASPANDIAR R. IRANI ITA NO. 7098/MUM/2014 3 DEDUCTION OF RS.1,00,00,000/ - U/S 54EC. BY NOTIFICATION DATED 22.12.2006, THE AMOUNT OF INVESTMENT WAS RESTRICTED TO RS.50,00,000/ - BECAUSE OF THE ABOVE FACTS THE LD. CIT(A) DIRECTED THE AO TO IMPOSE PENALTY U/S 271(1)(C) IN RESPECT OF RS.50,00,000/ - . 5. WE FIND THAT THOUGH THE CASE WAS FIXED FOR HEARING ON 03.10.2017 NEITHER THE ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE APPEARED BEFORE THE TRIBUNAL. 6. BEFORE US, THE LD. DR SUPPORTS THE ORDER PASSED BY THE LD. CIT(A). 7. WE HAVE HEARD THE LD. DR AND PERUSED THE RELEVANT MATERIALS ON RECORD. WE FIND THAT THE ASSESSEE HA D ACTUALLY INVESTED RS.50,00,000/ - IN THE ELIGIBLE BONDS THOUGH IT CLAIMED DEDUCTION OF RS.1,00,00,000/ - U/S 54EC. THEREFORE, THE LD. CIT(A) HAS RIGHTLY HELD THAT TH E ASSESSEE IS LIABLE TO PENALTY ONLY IN RESPECT OF RS.50,00,000/ - U/S 271(1)(C). THUS WE UPHOLD THE ORDER OF THE LD. CIT(A). 8. IN THE RESULT, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31/10/2017. SD/ - SD/ - ( D.T. GARASIA ) (N.K. PRADHAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED: 31/10/2017 RAHUL SHARMA, SR. P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - ASPANDIAR R. IRANI ITA NO. 7098/MUM/2014 4 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI