SARALA M. MAHESHWARI, MUMBAI V. ITO 16(2)(1), MUMBAI

ITA 7978/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92446 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 4 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 20-04-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 25-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: LOVE KUMAR
• Assessee Lawyers: HARESH G BUCH
• Keywords: Capital asset

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE S/SHRI B.R.BASKARAN (AM) AND AMIT SHUKLA, (JM) . . , , ./ I.T.A. NO. 797 8 / MUM/20 1 1 ( / ASSESSMENT YEAR : 20 0 4 - 05 ) SMT.SARALA M MAHESHWARI, 36, L JAGMAHANDAS MARG, MUMBAI - 400036 / VS. INCOME TAX OFFICER 16(2)(1), MATRU MANDIR, 2 ND FLOOR, TARDEO ROAD, MUMBAI - 400007 ( / APPELLANT ) .. ( / RESPONDENT ) ./ ./PAN/GIR NO. : AALPM2716Q / A SSESSEES BY SHRI HARESH G BUCH / RE VENUE BY SHRI LOVE KUMAR / DATE OF HEARING : 20.4. 20 1 5 / DATE OF PRONOUNCEMENT : 24. 4 . 201 5 / O R D E R PER B.R. BASKARAN (AM) THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 19.9.2011 PASSED BY LD CIT(A) - 27 , MUMBAI CONFIRMING THE PENALTY O F RS.15,48,555/ - LEVIED BY THE AO U/S 271(1)(C) OF THE INCOME TAX ACT, 1961. 2. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. THE FACTS RELATING TO THE ISSUE ARE THAT THE ASSESSEE HAD INVESTED IN UNIT SCHEME 1964 OF UNIT TRUST OF INDIA (UTI) IN THE YEAR 1999, WHICH WAS A SPECIFIED CAPITAL ASSET PRESCRIBED IN 54EA OF THE ACT. HENCE T HE SAID INVESTMENT HAD LOCKING PERIOD OF THREE YEARS. SUBSEQUENTLY, THE UTI UNDERWENT A RESTRUCTURING AND AS A RESULT OF WHICH UNIT SCHEME, 1964 WAS TERMINATED ITA NO.7978 / MUM/201 1 2 WITH EFF ECT FROM 1.6.2003. ACCORDINGLY , THE ASSESSEES RIGHT IN THE AFORESAID UNITS EXTINGUISHED W.E.F. 1.6.2003 AND IN LIEU OF THE SAME , THE ASSESSEE WAS ALLOT T ED 6.75% TAX FREE US 64 BONDS. IN VIEW OF THE SW APPING OF THE INVESTMENT, THE ASSESSEE INCURRED A LO SS AND THE ASSESSEE CLAIMED THE SAME AS LONG TERM CAPITAL LOSS ARISING ON TRANSFER UNITS OF UNIT 64 SCHEME. IN THE ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT THE INCOME ARISING OF TRANSFER OF UNITS OF UNIT 1964 SCHEME IS EXEMPT FROM TAX U/S 10(33) OF T HE ACT AND ACCORDINGLY, THE AO HELD THAT LOSS INCURRED BY ASSESSEE ON TRANSFER OF U NIT 64 UNITS CANNOT BE SET OFF OR ALLOWED TO BE CARRIED FORWARD. ACCORDINGL Y, HE DISALLOWED THE SAID CLAIM FOR SET OFF AND CARRY FORWARD OF THE LOSS ARISING ON TRANSFER OF UNIT 64 UNITS. THE AO ALSO LEVIED PENALTY U/S 271(1)(C) OF THE ACT ON THE ABOVE SAID DISALLOWANCE AND THE SAME WAS ALSO CONFIRMED BY THE LD. CIT(A). AGGRIEVED, THE ASSESSEE HAS FILED THIS APPEAL BEFORE US. 3. BEFORE US, THE ASSESSEE PLACED RELIANC E ON THE DECISION RENDERED BY HONBLE JURISDICTIONAL HIGH COURT OF BOMBAY IN THE CASE OF CIT VS. NALIN P SHAH (2013)(40 TAXMANN.COM 86), WHEREIN THE PENALTY LEVIED UNDER IDENTICAL DISALLOWANCE MADE WAS DELETED BY THE HIGH COURT ON THE REASONING THAT THE AS SESSEE HAD FURNISHED ALL THE DETAILS RELATING TO THE CLAIM AND THERE WAS NO FURNISHING OF INACCURATE PARTICULARS OR CONCEALMENT OF INCOME. IN THE INSTANT CASE ALSO, THE ASSESSEE HAS FURNISHED ALL THE DETAILS RELATING TO THE CLAIM OF LOSS ARISING FROM SALE OF UNIT 64 SCHEME UNITS. THOUGH THE ASSESSING OFFICER HAS LEVIED THE PENALTY ON THE GROUND THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME, YET HE DID NOT SUBSTANTIATE HIS VIEW WITH MATERIAL. HENCE, IN OUR VIEW, IT IS NOT A CASE OF FURN ISHING OF INACCURATE PARTICULARS OF INCOME. ACCORDINGLY, WE ARE OF THE VIEW THAT THE DECISION RENDERED BY THE HONBLE JURISDICTIONAL BOMBAY HIGH COURT IN THE CASE OF NALIN P SHAH (SUPRA) IS APPLICABLE TO THE ITA NO.7978 / MUM/201 1 3 FACTS PREVAILING IN THE INSTANT CASE. BY FOLLO WING THE SAME, WE SET ASIDE THE ORDER OF LD CIT(A) AND DIRECT THE AO TO DELETE THE IMPUGNED PENALTY. 4. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. THE AB OVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 24TH APR , 2015 . 24TH APR , 2015 SD SD ( / AMIT SHUKLA ) ( . . / B.R. BASKARAN) / JUDICI AL MEMBER / ACCOUNTANT MEMBER MUMBAI: 24TH APR ,2015 . . . ./ SRL , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - CONCERNED 4. / CIT CONCERNED 5. , , / DR, ITAT, MUMBAI CONCERNED 6. / GUARD FILE. / BY ORDER, TRUE COPY (ASSTT. REGISTRAR) , /ITAT, MUMBAI