BADRIKESHWAR CO OP HSG SOC. LTD, MUMBAI V. ITO WD 14(1)(3), MUMBAI

ITA 7594/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1822 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2015
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 26-12-2013
• Court: TRIBUNAL
• Department Lawyers: H M WANARE
• Keywords: Business income

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B , BENCH MUMBAI BEFORE SHRI R.C.SHARMA, AM & SHRI RAM LAL NEGI , JM ./ ITA NO. 7594 / MUM/20 1 3 ( / ASSESSMENT YEAR : 20 05 - 2006 ) BADRIKESH WAR CO - OP. HSG. SOC.82, BADRIKESHWAR, NETAJI SUBHASH ROAD, MUMBAI - 400002 VS. ITO, WARD - 14(1)(3), MUMBAI ./ ./ PAN/GIR NO. : A A AAB 0539 L ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : SHRI NISHIT GANDHI /REVENUE BY : SHRI H.M.WANARE / DATE OF HEARING : 1 6 / 1 2 /2015 / DATE OF PRONOUNCEMENT 16 / 12 /2015 / O R D E R PER R.C.SHARMA (A.M) : THIS IS AN APPEAL FILED BY THE ASSESSEE A GAINST THE ORDER OF CIT(A) - MUMBAI , DATED 4 - 10 - 2013 , FOR THE ASSESSMENT YEAR 2005 - 06 , IN THE MATTER OF IMPOSITION OF PENALTY U/S.271(1)(C) OF THE I.T.ACT. 2. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. THE ASSESSEE IS A HOUSING COOPERATIVE SOCIET Y. THE ASSESSEE HAS SHOWN THE RECEIPT FROM MOBILE COMPANY, IN INCOME AND EXPENDITURE ACCOUNT AND SURPLUS OF THIS ACCOUNT HAS NOT BEEN CONSIDERED/OFFERED AS INCOME ON THE PRINCIPAL OF MUTUALITY. THE AO AND ALSO CIT(A) HAS TREATED THE RECEIPTS FROM ALLOWING THE TERRACE TO BE USED OR INSTALLING TELECOMMUNICATIONS NETWORK AS BUSINESS INCOME. THE ASSESSEES CONTENTION IS REGARDING TREATING THE RECEIPT AS INCOME FROM PROPERTY AND ALLOWING THE ALLOWANCE ITA NO. 7594 /1 3 2 WAS DECLINED BY THE LOWER AUTHORITIES. FOR THE CHANGE IN HEA D OF INCOME, THE AO LEVIED PENALTY U/S.271(1)(C) OF THE ACT, WHICH WAS CONFIRMED BY THE CIT(A). 3. LD. AR PLACED ON RECORD ORDER OF THE COORDINATE BENCH OF THE TRIBUNAL, WHEREIN UNDER SIMILAR CIRCUMSTANCES, THE PENALTY SO LEVIED FOR CHANGE OF HEAD OF INCOM E WAS DELETED BY THE TRIBUNAL AFTER OBSERVING THAT ASSESSEE HAS FURNISHED ITS FULL PARTICULARS OF INCOME. THE PRECISE OBSERVATION OF THE TRIBUNAL IN CASE OF JOLLY HIGHRISE CO - OP HSG SOCIETY LTD., ITA NO.6521/MUM/2009, DATED 30 - 07 - 2010, WAS AS UNDER : - 5 . IN OUR OPINION, NOTHING HAS BEEN WITHHELD BY THE ASSESSEE IN RESPECT OF THE PARTICULARS. AT THE FIRST INSTANT, THE ASSESSEE TRIED TO MAKE OUT A CLAIM THAT THE ENTIRE RENTAL INCOME IS EXEMPT ON THE CONCEPT OF MUTUALITY. THEREAFTER, HE MADE OUT A CLAIM THAT THE ENTIRE INCOME IS TO BE ASSESSED AS INCOME FROM HOUSE PROPERTY. BUT BOTH THE CLAIMS OF THE ASSESSEE HAVE BEEN NEGATED. THE A.O BROUGHT TO TAX THE ENTIRE RENTAL INCOME/LICENSE FEE UNDER THE HEAD 'INCOME FROM OTHER SOURCES'. AS PER THE FACTS BEFORE US ONL Y CONTROVERSY WAS IN RESPECT OF THE HEAD OF INCOME UNDER WHICH THE INCOME IS TO BE ASSESSED. WE DO NOT FIND THAT ANY CONSCIOUS ACT ON THE PART OF THE ASSESSEE FOR CONCEALING THE PARTICULARS OF INCOME. IN OUR OPINION, THERE IS NO JUSTIFICATION TO SUPPORT TH E PENALTY ORDER PASSED BY THE A.O U/S 271(1)(C) OF THE ACT LEVYING PENALTY UPON THE ASSESSEE. ACCORDINGLY, THE PENALTY ORDER IS CANCELLED AND THE PENALTY IS DELETED. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. 4. AS THE FACTS AND CIRC UMSTANCES OF THE INSTANT CASE ARE SIMILAR TO THE FACTS CONSIDERED BY THE TRIBUNAL IN THE ABOVE CASE, RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL, WE DIRECT THE AO TO DELETE THE PENALTY SO IMPOSED. 5 . IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED. ITA NO. 7594 /1 3 3 O RD ER PRONOUNCED IN THE OPEN COURT ON THIS 1 6 /1 2 / 201 5 . SD/ - ( R AM LAL NEGI ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED 1 6 /1 2 /2015 . . /PKM , . / PS / COPY OF THE ORDER FORWARDED TO : / BY ORDER, / ( ASSTT. REGISTRAR) , / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A), MUMBAI. 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. //TRUE COPY//