ITO, UDAIPUR V. Shri Deepak Kumar Godha, UDAIPUR

ITA 71/JODH/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78277 (ITAT-JODHPUR)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-07-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 24-07-2014
• Assessment Year: 2001-2002
• Appeal Filed On: 07-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value
• Section: 143(3); 50C; 153A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL JODHPUR BENCH, JODHPUR BEFORE SHRI HARI OM MARATHA , JUDICIAL MEMBER AND SHRI N.K.SAINI, ACCOUNTANT MEMBER ITA NO. 71 / JU/ 20 1 4 ASSESSMENT YEAR: 200 1 - 0 2 T HE I.T .O VS. SHRI DEEPAK KUMAR GODHA WARD 2(1) S/O SHRI K.L. GODHA UDAIPUR 222, ASHOK NAGAR MAIN UDAIPUR PAN NO. AAQPC 8365 G (APPELLANT) (RESPONDENT) A SSESSEE B Y : SHRI HITESH BHADADA DEPARTMENT B Y : SHRI N.A. JOSHI , DR DATE OF H EARING : 24 . 0 7 .201 4 DATE OF PRONOUNCEMENT : 30 . 0 7 . 201 4 ORDER PER HARI OM MARATHA , J .M. TH IS APPEAL BY THE REVENUE PERTAINING TO A.Y 200 1 - 200 2, DIRECTED A GAINST THE ORDER OF THE CIT (A) , UDAIPUR , DATED 2 7 . 11 .20 1 3 EMANATES FROM THE PENALTY ORDER DATED 12.03.2010 PASSED /S 2 71(1)(C) OF THE INCOME - TAX ACT, 1961. 2 2. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT ASSESSEE DERIVES INCOME FROM TRADING IN DIAMOND TOOLS AND SEGMENTS APART FROM DERIVING SHARE INCOME FROM PARTNERSHIP FIRM AND INCOME FROM OTHER SOURCES. HE IS REGULARL Y FILING RETURN OF INCOME [ROI] AND FOR A.Y. 200 1 - 02 HE FILED ROI DECLARING TOTAL INCOME OF RS. 1 , 92 , 311 / - . A SEARCH WAS CARRIED OUT AT THE RESIDENCE OF SHRI NARESH GODHA ON 11.3.2005. DURING THE COURSE OF SEARCH, DIARIES ETC WERE FOUND WHICH WERE IMPOUN DED VIDE ANNEXURE A - 1 TO A - 14 WHICH WERE SEIZED. HIS STATEMENT U/S 132(4) WAS ALSO RECORDED. IN HIS STATEMENT HE STATED THAT THESE INCRIMINATING PAPERS BELONGED TO SHRI DEEPAK GODHA. THEREAFTER, ON 3.5.2005, WHEN HIS STATEMENT WAS RECORDED, HE ACCEPTE D THAT THESE PAPERS BELONGED TO HIM AND PERTAINED TO BUSINESS TRANSACTIONS. SO HE SURRENDERED THIS INCOME FOR TAX BY OFFERING INCOME OF RS. 7,16,200/ - WHILE FILING RETURN U/S 153C OF THE ACT OUT OF RS. 9,08,511/ - . ASSESSMENT WAS COMPLETED ON 20.12.2006 U /S 153C/143(3) OF THE ACT AT A TOTAL INCOME OF RS. 24,40,360/ - WHICH WAS FINALLY ASSESSED AFTER THE ORDER OF THE ITAT AT RS. 14,39,660/ - . CONSEQUENTLY , THE AO INITIATED PENALTY PROCEEDINGS BY SPECIFICALLY MENTIONING THAT THE SAME IS INITIATED WITH 3 REFEREN CE TO ADDITIONS MADE BY HIM OF THE INCOME OFFERED BY THE ASSESSEE IN THE RETURN FILED U/S 153C OF THE ACT. AS PER THE AO, THE INCOME OF RS. 7,16,200/ - DISCLOSED BY THE ASSESSEE IN THE RETURN FILED IN RESPONSE TO NOTICE U/S 153C WAS NOT VOLUNTARILY SURREND ERED, IN RESPECT OF BALANCE AMOUNT OF RS. 5,31,150/ - , THE AO HAS OBSERVED THAT IN THE ASSESSMENT ORDER ITSELF, SATISFACTION FOR INITIATION OF PENA L TY PROCEEDINGS ON THIS ISSUE WAS HIGHLIGHTED. THE ASSESSEE AGREED TO THIS ADDITION AND DID NOT FILE ANY APPE AL. ACCO R DINGLY, THE AO HA S IMPOS E D PENALTY U/S 271(1) (C) OF THE ACT ON INCOME OF RS. 7,16,200/ - DECLARED IN THE RETURN FILED IN RESPONSE TO NOTICE U/S 153C OF THE ACT. THE ASSESSEE MADE ASSERTIONS AGAINST THE IMPOSITION OF PENALTY WITH THE HELP OF VARIO US JUDGMENTS/DECISIONS AND AFTER CONSIDERING THE SAME, THE CIT(A) HAS DELETED THIS PENALTY. NOW THE REVENUE IS AGGRIEVED AND HAS FILED THIS APPEAL. THE CIT(A) HAS INVOKED EXPLANATION 5 TO SECTION 271(1)(C) OF THE ACT. 3. WE HAVE HEARD THE RIVAL SUBMISSI ONS AND HAVE PERUSED THE ENTIRE MATERIAL ON RECORD. BOTH THE RIVAL REPRESENTATIVES REITERATED THEIR EARLIER SUBMISSIONS. AFTER CONSIDERING THE 4 RIVAL SUBMISSIONS WE FIND THAT THE ISSUE INVOLVED IN THIS APPEAL IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE B Y THE ORDER OF THIS BENCH IN THE CASE OF DEVIDAS SUKHANI VS. DCIT, JODHPUR, WHEREIN UNDER IDENTICAL CIRCUMSTANCES, IT HAS BEEN HELD AS UNDER: 8. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON R ECORD. IN THE PRESENT CASE, IT IS AN ADMITTED FACT THAT ASSESSMENT WAS FRAMED BY THE ASSESSING OFFICER ON THE BASIS OF RETURN OF INCOME FILED UNDER SECTION 153A OF THE ACT AND THE ASSESSED INCOME WAS THE SAME AS WAS DECLARED BY THE ASSESSEE. HOWEVER, PENAL TY UNDER SECTION 271 (1)(C) OF THE ACT WAS LEVIED BY THE ASSESSING OFFICER SINCE THERE WAS DIFFERENCE IN THE INCOME DECLARED IN THE RETURN OF INCOME FILED UNDER SECTION 139(1) AND DISCLOSED UNDER SECTION 153A OF THE ACT. THE DIFFERENCE IN THOSE TWO INCOMES WAS MAINLY ON ACCOUNT OF CASH, WHICH WAS SHOWN BY THE ASSESSEE AS AN INCOME ON ACCOUNT OF UNEXPLAINED CASH IN CIRCULATION OUT OF THE BOOKS OF ACCOUNTS, IN THIS REGARD, IT IS NOTICED FROM THE ASSESSMENT ORDER FOR THE A.Y. 2007 - 08 (COPY OF WHICH IS PLACED O N RECORD) THAT THE ASSESSING OFFICER ACCEPTED THE CASH AVAILABLE WITH THE ASSESSEE BY OBSERVING AT PAGE 4 OF THE SAID ORDER AS UNDER: - AFTER CONSIDERING THE REPLY FILED BY THE ASSESSEE AND THE FACT THAT RS. 16,80,000/ - (RS. 19,00,000/ - - RS. 5 2,20,000/ - ) WAS CASH AVAILABLE WITH HIM ON ACCOUNT OF SURRENDER MADE IN THE A.Y. 2005 - 06 AND RS. 5,00,000/ - WAS FURTHER AVAILABLE WITH HIM FOR ON MONEY RECEIVED FROM SHRI JAGDISH RANGWANI AGAINST SALE OF PROPERTY AND RS. 5,40,376/ - IS THE CASH AVAILABLE IN THE BOOKS A S SUCH NO INTERFERENCE IS REQUIRED ON THE ISSUE. THEREFORE THE EARLIER CASH AVAILABLE WITH THE ASSESSEE IN CIRCULATION CANT BE TREATED AS UNDISCLOSED INCOME FOR THE PURPOSES OF LEVY OF PENALTY UNDER SECTION 271 (1 )(C) OF THE ACT. THE OTHER DIFFERENCE WA S ON ACCOUNT OF SHORT TERM CAPITAL GAIN. THE SAID DIFFERENCE WAS OF RS. 2,20,175/ - WHICH WAS ON ACCOUNT OF DIFFERENCE BETWEEN THE SALE VALUE AND THE VALUE AS ADOPTED BY SUB - REGISTRAR CONSIDERING THE PROVISIONS OF SECTION 50C OF THE ACT. THE ASSESSEE DISCLO SED ALL THE RELEVANT FACTS IN HIS RETURN OF INCOME RELATING TO THE SHORT TERM CAPITAL GAIN, SO IT WAS NOT A CONCEALED INCOME. IN THE PRESENT CASE, WHAT WAS OFFERED BY THE ASSESSEE IN HIS RETURN OF INCOME UNDER SECTION 153A OF THE ACT HAD BEEN ACCEPTED BY T HE ASSESSING OFFICER WHILE FRAMING THE ASSESSMENT UNDER SECTION 153B R.W.S. 143(3) OF THE ACT. THERE IS NO OBSERVATION OF THE ASSESSING OFFICER THAT THE AMOUNTS, ON WHICH PENALTY UNDER SECTION 271 (1 )(C) OF THE ACT WAS LEVIED WERE NOT DISCLOSED IN THE RET URN FILED BY THE ASSESSEE UNDER SECTION 153A OF THE ACT. THE ASSESSING OFFICER SIMPLY STATED THAT THE ASSESSEE HAD NOT DISCLOSED THOSE INCOME IN THE ORIGINAL RETURN OF INCOME. THE ASSESSMENT IN THIS CASE WAS FRAMED ON 11/11/2008 AND BEFORE COMPLETION OF TH E SAID ASSESSMENT, THE ASSESSEE VIDE LETTER DATED 22/01/2007 I.E. JUST AFTER THE SEARCH OPERATION ON 18/01/2007 STATED THAT HE WAS PREPARED TO PAY TAX 6 ON LEGITIMATE AND CORRECT AMOUNT OF INCOME AS MAY BE MUTUALLY DETERMINED ON AGREED BASIS. THE ASSESSEE AL SO STATED THAT THE SAID LETTER BE TREATED AS STATEMENT UNDER SECTION 132(4) OF THE ACT, THEREBY ENTITLING THE ASSESSEE TO THE BENEFITS OF EXPLANATION 5 TO SECTION 271 (1 )(C) OF THE ACT. THE ASSESSING OFFICER NOWHERE STATED THAT THE CONTENTS OF THE SAID LE TTER WERE WRONG AND NO T ACCEPTED. IN OTHER WORDS, HE HAD NOT STATED ANYTHING TO DISPROVE THE CONTENTS OF THE SAID LETTER IN THE ASSESSMENT ORDER DATED 11/11/2008. MOREOVER, WHATEVER WAS OFFERED BY THE ASSESSEE IN HIS RETURN OF INCOME HAS BEEN ACCEPTED BY T HE ASSESSING OFFICER WHILE FRAMING ASSESSMENT UNDER SECTION 143(3) R.W.S. 153B OF THE ACT. THEREFORE, THE PENALTY 271 (1 )(C) OF THE ACT WAS NOT LEVIABLE IN THIS CASE. FOR THE AFORESAID VIEW, WE ARE FORTIFIED BY THE JUDGMENT OF THE HON'BLE JURISDICTIONAL H IGH COURT IN THE CASE OF CIT VS. KANHAIYALAL (2008) 299 ITR 19 (RAJ), WHEREIN IT HAS BEEN HELD AS UNDER: - '... THAT, THE ASSESSING OFFICER HAD FOUND THE INCOME TO RELATE TO DIFFERENT ASSESSMENT YEARS, IN DIFFERENT VOLUMES, AS CONTRA DISTINGUISHED TO THE ON E SUBMITTED BY THE ASSESSEE, AND HAD ACCORDINGLY MADE THE ASSESSMENTS, WHICH ASSESSMENTS HAD BECOME FINAL, AND WERE NOT THE SUBJECT - MATTER OF CHALLENGE. HENCE, THE ASSESSEE WAS ENTITLED TO THE IMMUNITY UNDER EXPLANATION 5 TO SECTION 2 71(1)(C). PENALTY COUL D NOT BE IMPOSED. 7 8. IN THE PRESENT CASE ALSO THE INCOME WHICH WAS DECLARED BY THE ASSESSEE IN RETURN OF INCOME FILED UNDER SECTION 153A OF THE ACT. THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT LEARNED CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE ACTION OF TH E ASSESSING OFFICER FOR IMPOSING THE PENALTY AMOUNTING TO RS. 7,26,159/ - UNDER SECTION 271 (1 )(C) OF THE ACT. ACCORDINGLY, THE SAME IS DELETED. RESPECTFULLY FOLLOWING OUR OWN ORDER DATED 18.9.2013 IN THE CASE OF DEVIDAS SUKHANI IN ITA NO. 122/JODH/2013 F OR A.Y. 2005 - 06, WE CANNOT ALLOW THE GROU ND OF APPEAL RAISED THE REVENUE . 4 . IN THE RESULT, T HE APPEAL OF THE REVENUE STANDS DISMISSED . ORDER PRON OUNCED IN THE COURT ON 30 TH JULY , 2014. (N.K.SAINI) [HARI OM MARATHA] ACC OUNTANT MEMBER JUDICIAL MEM B ER DATED : JULY , 201 4 VL/ - COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT BY ORDER 4. THE CIT(A) 5. THE DR SENIOR PRIVATE SECRETARY ITAT, J ODHPUR