AFTAB ABDUL REHMAN BADSHAH, MUMBAI V. ITO WD 13(1)(2), MUMBAI

ITA 7307/MUM/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0686 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-05-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 12-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AZGHAR ZAIN
• Keywords: Wrong claim
• Section: 143(3); 54F; 54

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI . , , BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 7307/MUM/2013 ( / ASSESSMENT YEAR : 2009 - 10 SHRI AFTAB ABDUL REHMAN BADSHAH, 286, BADSHAH STORES, ABDUL REHMAN STREET, MUMBAI - 400 003 / VS. THE ITO, WARD 13(1)(2), MUMBAI ./ ./ PAN/GIR NO. : ADDPA 6466C ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI VIMAL PUNMIYA / RESPONDENT BY : SHRI AZGHAR ZAIN / DATE OF HEARING : 13 . 0 5 .2015 / DATE OF PRONOUNCEMENT : 20 .0 5 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 2 4, MUMBAI DT. 6.9.2013 PERTAINING TO ASSESSMENT YEAR 2009 - 10. 2. THE SOLE GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN UPHOLDING THE LEVY OF PENALTY MADE U/S. 271(1)(C) OF THE ACT. ITA. NO. 7307/M/2013 2 3. THE ROOTS FOR THE LEVY OF PENALTY LIE IN THE ASSESSMENT ORDER DT. 21.12.2011 MADE U/S. 143(3) OF THE ACT WHEREIN THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS MADE LONG TERM CAPITAL GAIN FROM WHICH IT HAS CLAIMED EXEMPTION U/S. 54F OF THE ACT. AFTER CAR EFULLY PERUSING THE DETAILS, THE AO ALLOWED THE DEDUCTION U/S. 54F PARTLY AND IN RESPECT OF THE BALANCE CLAIM, PENALTY PROCEEDINGS WERE INITIATED U/S. 271(1) (C) OF THE ACT. 3.1. DURING THE COURSE OF PENALTY PROCEEDINGS, THE ASSESSEE WAS ALLOWED AN OPPOR TUNITY TO PRESENT HIS CASE AS TO WHY PENALTY SHOULD NOT BE LEVIED FOR FALSE CLAIM U/S. 54F OF THE ACT. THE ASSESSEE EXPLAINED THAT THERE IS NO FALSE CLAIM MADE ON THE CONTRARY ALL THE DETAILS RELATING TO THE CLAIM OF DEDUCTION U/S. 54F WAS FURNISHED DURI NG THE COURSE OF THE ASSESSMENT PROCEEDINGS ITSELF. IT WAS FURTHER POINTED OUT THAT THE CLAIM WAS WITHDRAWN PARTLY DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS ITSELF THEREFORE IT CANNOT BE SAID THAT THE ASSESSEE HAS WILLFULLY CONCEALED THE PARTICULARS OF INCOME OR FILED INACCURATE PARTICULARS OF INCOME. THE AO DID NOT ACCEPT THE SUBMISSIONS MADE BY THE ASSESSEE AND PROCEEDED BY LEVYING MINIMUM PENALTY OF RS. 2,55,535/ - U/S. 271(1)(C) OF THE ACT. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT( A) BUT WITHOUT ANY SUCCESS. 5. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE VEHEMENTLY STATED THAT U/S. 54F OF THE ACT THE STIPULATION IS IN RELATION TO THE PURCHASE OF PROPERTY BEFORE ONE YEAR OF THE SALE, THERE IS NO STIPULATION IN SO FAR AS THE PAYMENT FOR THE PROPERTY IS CONCERNED. THE LD. COUNSEL FURTHER POINTED ITA. NO. 7307/M/2013 3 OUT THAT NO DOUBT THE ASSESSEE HAS ADVANCED LOAN OF RS. 12.75 LAKHS MUCH EARLIER TO THE BUILDER BUT AT THE SAME TIME IN THE SALE DEED, THE SAID LOAN HAS BEEN CONVERTED INTO SALE CONSIDERATIO N THEREFORE THE ASSESSEE HAD MADE CLAIM U/S. 54F OF THE ACT WHICH CANNOT BE SAID TO BE A FALSE CLAIM. IN RESPECT OF THE ADDITIONS MADE TO THE PROPERTY, IT IS THE SAY OF THE LD. COUNSEL THAT ALL THE NECESSARY DETAILS WERE FURNISHED BEFORE THE AO. THE LD. COUNSEL CONCLUDED BY SAYING THAT MERELY BECAUSE THE ASSESSEE HAD WITHDRAWN THE CLAIM WOULD NOT AMOUNT TO FILING OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME. 6. PER CONTRA, THE LD. DR STRONGLY SUPPORTED THE ORDERS OF THE FIRST APPELLATE A UTHORITY. 7. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE ALSO GONE THROUGH THE ASSESSMENT ORDER. IT IS AN UNDISPUTED FACT THAT THE ASSESSEE HAS TENDERED LOAN TO THE BUILDER MUCH EARLIER TO THE DATE OF PURCHASE. IT IS ALSO AN UNDISPUTED FACT THAT THE LOAN AMOUNT OF RS. 12.75 LAKHS WAS CON VERTED INTO SALE CONSIDERATION WHICH IS ALSO EVIDENT FROM THE SALE DEED PLACED ON RECORD. WHETHER THE ASSESSEE IS ENTITLED FOR DEDUCTION U/S. 54 F OF THE ACT ON THIS CONVERSION OF LOAN INTO SALE CONSIDERATION IS DEFINITELY A HIGHLY DEBATABLE ISSUE , THEREFORE , IN OUR CONSIDERED OPINION, PENALTY CANNOT BE LEVIED U/S. 271(1)(C) OF THE ACT IN RESPECT OF THE CLAIM OF RS. 12.75 LAKHS. IN SO FAR AS THE CLAIM OF DEDUCTION IN RESPECT OF ADDITIONS/ALT ERATION OF RS. 0 8 LAKHS IS CONCERNED, WE FIND THAT THE ASSESSEE HAD FURNISHED ALL THE DETAILS ALTHOUGH HE FAILED TO SUCCEED IN CLAIMING THE DEDUCTION BUT THAT BY ITSELF WOULD NOT MAKE THE CLAIM A FALSE CLAIM. WE, THEREFORE, DO NOT FIND THIS A FIT CASE FOR THE LEVY OF PENALTY U/S. 271(1)(C) OF THE ACT. ITA. NO. 7307/M/2013 4 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. OR DER PRONOUNCED IN THE OPEN COURT ON 20TH MAY , 2015 SD/ - SD/ - ( D.MANMOHAN ) (N.K. BILLAIYA) /VICE PRESIDENT / ACCOUNTANT MEMBER MUMBAI ; DATED : 20 TH MAY , 2015 . . ./ RJ , 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 . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI