SHRI PRAKASH CHAND VIJAY, Jaipur V. ACIT, Jaipur

ITA 817/JPR/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99307 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 22-10-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NEENA JEPH JCIT DHK
• Keywords: Capital asset; Additional evidence; Bonafide mistake
• Section: 143(3); 54F; 54

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; ,OA JH VH-VKJ-EHUK] YS[KK LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JM & SHRI T.R. MEENA, AM VK;DJ VIHY LA-@ ITA NO. 817/JP/2012 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2007-08 SHRI PRAKASH CHAND VIJAY M/S. SHREE PRAKASH GEMS 2019, PITALIYON KA CHOWK, JOHRI BAZAR, JAIPUR CUKE VS. THE ACIT CIRCLE- 1 JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: ABDPV 3015 E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI ANIL GOYAL, CA JKTLO DH VKSJ LS@ REVENUE BY :SMT. NEENA JEPH, JCIT LQUOKBZ DH RKJH[K@ DATE OF HEARING : 15/06/2015 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 07 /09/2015 VKNS'K@ ORDER PER R.P. TOLANI, JM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE LD. CIT(A) -1, JAIPUR DATED 22-08-2012 FOR THE ASSESSME NT YEAR 2007-08 RAISING THE FOLLOWING EFFECTIVE GROUNDS: 2. THAT THE LD. AO HAS ERRED IN IMPOSING HUGE PENA LTY OF RS. 2,28,340/- U/S 271(1)(C) AND THE LD. CIT(A) HAS ERR ED IN SUSTAINING THE PENALTY OF RS. 1,49,088/-. 3. THAT THE LD. CIT(A) HAS ERRED IN OBSERVING ON PA GE NO. 6 OF HER ORDER THAT THE PENALTY IS TO BE REDUCED PROPORT IONATELY ON THE DISALLOWANCE U/S 54F CONFIRMED BY THE LD. CIT(A) ON RS. 6,64,384/- WHEREAS THE AMOUNT OF THE SAME IS ONLY R S. 5,07,884/-. ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 2 4. THAT THE LD AO HAS ERRED IN IMPOSING PENALTY EVE N WHEN QUANTUM APPEAL WAS PENDING BEFORE THE LD. CIT(A). T HEREFORE, IMPOSITION OF PENALTY WAS IN VIOLATION OF PROVISION OF SECTION 275 OF THE I.T. ACT. 2.1 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE HAS NOT PRESSED THE GROUND NO. 4. THEREFORE, THE SAME IS DI SMISSED BEING NOT PRESSED. 3.1 NOW WE TAKE UP GROUND NO. 2 AND 3 OF THE ASSESS EE FOR ADJUDICATION. 3.2 THE FACTS IN BRIEF OF THE CASE ARE THAT THE ASS ESSEE FILED ITS RETURN OF INCOME ON 31-10-207 DECLARING AN INCOME OF RS. 18,9 5,470/- THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY AND ORDER U/ S 143(3) OF THE ACT WAS PASSED ON 25-1-2009 DETERMINING THE INCOME OF THE A SSESSEE AT RS. 30,87,790/-. DURING THE COURSE OF ASSESSMENT PROCE EDINGS, THE AO OBSERVED THAT THE ASSESSEE HAD SHOWN CAPITAL GAINS OF RS. 12,71,000/- AFTER GETTING BENEFIT OF INDEXATION BY SALE OF PLOT AT BAL VIHAR FOR RS. 13,01,000/-. THE ASSESSEE HAD CLAIMED DEDUCTION U/ S 54 OF THE ACT AFTER BUYING 03 PLOTS OF LAND TOTALING TO RS. 11,06,684/- AND PAID TAX ON BALANCE AMOUNT OF RS. 1,64,316/-. THE AO OBSERVED THAT THE ASSESSEE RE- INVESTED THE CAPITAL GAINS FOR BUYING THE NEW PLOTS OF LAND AND NOT IN A RESIDENTIAL HOUSE WHICH IS THE PRE-CONDITION FOR CL AIMING DEDUCTION U/S 54 ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 3 OF THE ACT. THE AO ASKED THE ASSESSEE TO EXPLAIN A S TO WHY THE AMOUNT SO INVESTED FOR BUYING THE NEW PLOTS OF LAND AMOUNT ING TO RS. 11,06,684/- BE NOT ADDED TO HIS TOTAL INCOME. IN RESPONSE TO TH E QUERY, THE ASSESSEE SUBMITTED HIS EXPLANATION DATED 22-10-2009 WHICH WA S CONSIDERED BY THE AO BUT THE AO DID NOT FIND THE REPLY OF THE ASSESSE E TENABLE FOR THE REASON THAT PLOT SITUATED AT 127, BAL VIHAR, JHOTWA RA, JAIPUR WAS NOT A RESIDENTIAL HOUSE AND THE INCOME FROM IT WAS NOT CH ARGEABLE UNDER THE HEAD INCOME FORM HOUSE PROPERTY. SECONDLY, THE NEW ASSETS PURCHASED WERE ALSO NOT RESIDENTIAL HOUSES BUT THEY WERE PLOTS OF LAND. SINCE THE ASSESSEE SOLD A PLOT OF LAND (NOT A RESID ENTIAL HOUSE) AND REINVESTED THE CAPITAL GAINS FOR BUYING THE NEW PLO TS OF LAND (AND NOT A RESIDENTIAL HOUSE), IT WAS HELD BY THE AO THAT HE W AS NOT COVERED BY THE PROVISIONS OF SECTION 54 OF THE ACT AND THE ENTIRE AMOUNT OF RS. 11,06,684/- WAS ADDED TO THE INCOME OF THE ASSESSEE WHILE PASSING THE ORDER U/S 143(3) OF THE ACT. 3.3 THE ASSESSEE WAS THEREAFTER GIVEN A SHOW CAUSE NOTICE BY THE AO TO EXPLAIN AS TO WHY PENALTY U/S 271(1)(C) BE NOT I MPOSED ON HIM. IN THE PENALTY ORDER, THE AO OBSERVED THAT THE CLAIM OF TH E ASSESSEE IN CLAIMING DEDUCTION U/S 54 OF THE ACT WAS NOT BONAFIDE ONE AN D THE ASSESSEE HAD INTENTIONALLY FILED INACCURATE PARTICULARS OF INCOM E IN ORDER TO EVADE TAX. ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 4 THE AO OBSERVED THAT THE ASSESSEE FURNISHED INACCUR ATE PARTICULARS OF INCOME LEADING TO CONCEALMENT OF THE SAME. THUS CON SIDERING ALL THESE FACTS MENTIONED ABOVE, THE AO VIDE HIS ORDER DATED 21-05-2010 IMPOSED A PENALTY OF RS. 2,48,340/-. 3.4 THE ASSESSEE PREFERRED AN APPEAL AGAINST THE O RDER OF THE AO UNDER SECTION 143(3) BEFORE THE LD. CIT(A) WHO HAS ALLOWE D PARTIAL RELIEF TO THE ASSESSEE. THE LD. CIT(A) IN HIS ORDER DATED 7-02-2 012 IN ITA NO. 870/09-10 HAS ALLOWED DEDUCTION UNDER SECTION 54F O F THE ACT TO THE EXTENT OF RS 5,98,800 BY OBSERVING AS UNDER (PARA 4 .4 AT PAGE 3 OF HIS ORDER):- THE CLAIM OF APPELLANT OF DEDUCTION UNDER SECTION 54F IS REQUIRED TO BE RESTRICTED TO THE VALUE OF LAND AT 4 2, SANTOSH VIHAR COLONY, JHOTWARA, JAIPUR, STAMP DUTY OF RS 4,42,300 AND CONSTRUCTION OF HOUSE OF RS 1,56,500. THEREFORE, T HE ASSESSEE IS ALLOWED THE CLAIM OF DEDUCTION UNDER SECTION 54F OF RS 5,98,000. DEDUCTION CLAIMED ON PURCHASE OF LAND AT B-10 AND B -1, RAGHUNANDAN VIHAR, JAIPUR AT RS 305,336 AND RS 359, 048 RESPECTIVELY CANNOT BE ALLOWED TO BE CLAIMED UNDER SECTION 54F AND IS TO BE WITHDRAWN WHILE COMPUTING CAPITAL GAIN S TAX LIABILITY. 3.5 AS AGAINST THE LEVY OF PENALTY, THE ASSESSEE PR EFERRED AN APPEAL BEFORE THE LD. CIT(A) WHO HAS PARTIALLY CONFIRMED T HE PENALTY U/S 271(1)(C) OF THE ACT. THE AO TAKING COGNIZANCE OF THE CIT(A) ORDER (ITA NO. 108/10-11) DATED 22.08.2012 HAS GIVEN A CO NSEQUENT EFFECT BY ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 5 HIS ORDER DATED 3.10.2012 WHEREBY THE ORIGINAL PENA LTY OF RS. 2,28,340/- U/S 271(1)(C) HAS BEEN REDUCED TO RS. 1,49,088/-. 3.6 IN LIGHT OF ABOVE FACTS, THE LIMITED ISSUE BEFO RE US IS WHETHER LEVY OF PENALTY OF RS 1,49,088 UNDER SECTION 271(1)(C) IS J USTIFIED OR NOT 3.7 FIRSTLY, IN RELATION TO GROUND NO. 3, DURING TH E COURSE OF HEARING, THE LD. AR OF THE ASSESSEE SUBMITTED THAT THE LD. CIT(A ) HAS ERRED IN DIRECTING THE AO TO COMPUTE THE PENALTY ON DISALLOWANCE RS. 6,64,384/- INSTEAD OF RS. 5,07,884/- U/S 54F OF THE ACT AND HAS SUBMITTED THE WORKING AS UNDER: DEDUCTION CLAIMED BY THE ASSESSEE U/S 54 RS 11,06 ,684 DEDUCTION ALLOWED BY THE CIT(A) U/S 54F RS 5,98, 800 BALANCE AMOUNT RS 5,07,884 3.8 IN CONTEXT OF QUANTUM PROCEEDINGS, IT IS OBSERV ED FROM THE ORDER OF THE CIT(A) THAT HE HAS ALLOWED DEDUCTION IN RESPECT OF THE VALUE OF LAND AT SANTOSH VIHAR COLONY, JHOTWARA, JAIPUR AND RELAT ED STAMP DUTY OF RS 4,42,300/- WHICH WAS CLAIMED EARLIER BEFORE THE AO, AND AN ADDITIONAL DEDUCTION TOWARDS CONSTRUCTION OF HOUSE OF RS 1,56, 500/- TOTALLING TO RS 5,98,000/-. AT THE SAME TIME, DEDUCTION IN RESP ECT OF PURCHASE OF LAND AT B-10 AND B-1, RAGHUNANDAN VIHAR, JAIPUR AT RS 3, 05,336/- AND RS 3,59,048/- RESPECTIVELY WERE WITHDRAWN. THE RES ULTANT POSITION THAT EMERGES IS AS UNDER: DEDUCTION CLAIMED BEFORE AO RS 11,06,68 4 ADD: ADDITIONAL DEDUCTION CLAIMED BEFORE CIT(A) R S 1,56,500 ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 6 TOTAL DEDUCTION CLAIMED RS 12,63,184 LESS: DEDUCTION ALLOWED BY THE CIT(A) RS 5,98,8 00 DEDUCTION DENIED TO THE APPELLANT RS 6,64,384 3.9 IN THE CONTEXT OF PENALTY PROCEEDINGS, LETS E XAMINE THE ORDER OF THE LD. CIT(A) WHO HAS PARTIALLY CONFIRMED THE PENALTY U/S 271(1)(C) OF THE ACT BY OBSERVING (PARA 4.3 (E) AT PAGE 6) OF HIS OR DER (ITA NO. 108/10- 11) DATED 22.08.2012:- (E) FROM THE FACTS OF THE CASE OF THE ASSESSEE AN D THE PROVISIONS OF SECTION 54F UNDER WHICH CLAIM HAS BEEN MADE, THE CLAIM IS CLEARLY INADMISSIBLE. THEREFORE, THE PENALTY U/S 271(1)(C) IS TO BE IMPOSED ON WRONG CLA IM U/S 54F MADE ON PURCHASE OF PLOTS AT B-10 AND B-1, RAGHUNANDAN VIHAR, JAIPUR FOR RS. 3,05,336/- AND RS . 3,59,048/- RESPECTIVELY. THE A.R. HIMSELF HAS ADMIT TED ON PAGE 2 OF HIS SUBMISSION THAT THE PENALTY MAY BE R EDUCED PROPORTIONATELY AS PER THE ORDER OF THE LD. CIT(A) DATED 7- 02-2012 IN ITA NO. 870/09-10. THUS THE AO IS DIRECT ED TO REDUCE THE PENALTY U/S 271(1) (C) PROPORTIONATELY O N THE TAX EVADED ON THE DISALLOWANCE U/S 54F CONFIRMED BY THE LD. CIT(A) OF RS. 6,64,384/-. TO THAT EXTENT, THE PENAL TY IS CONFIRMED U/S 271(1)( C) FOR FILING INACCURATE PART ICULARS OF INCOME. 3.10 AS IS CLEAR FROM THE ABOVE, THE DIRECTIONS OF THE LD. CIT(A) IN THE PENALTY ORDER ARE IN CONSONANCE WITH THE DIRECTIONS OF THE LD. CIT(A) IN THE QUANTUM PROCEEDINGS IN RELATION TO DISALLOWANCE OF DEDUCTION OF RS 664,384 CLAIMED BY THE ASSESSEE. WHAT THE ASSES SEE HAS FAILED TO CONSIDER IS THAT HE HAS RAISED AN ADDITIONAL CLAIM BEFORE THE LD. CIT(A) TOWARDS THE COST OF CONSTRUCTION OF THE HOUSE WHICH HAS BEEN ALLOWED TO ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 7 HIM BY THE LD. CIT(A) BY EXERCISING HIS JURISDICTIO N AS HE HAS COTERMINOUS POWER UNDER THE I.T. ACT. IN OTHER WORDS, THE ORDER OF THE AO MERGES WITH THE ORDER OF THE LD. CIT(A). SO, WHAT NEEDS T O BE EXAMINED IS WHAT HAS BEEN CLAIMED AS A DEDUCTION BEFORE THE AO AS WE LL AS BEFORE LD. CIT(A) AND WHAT HAS BEEN FINALLY ALLOWED TO HIM. T HE AMOUNT WHICH IS FINALLY DISALLOWED WOULD ,THEREFORE, SUFFER THE CON SEQUENT PENALTY PROVISIONS UNDER SECTION 271(1)(C) OF THE ACT. WE THEREFORE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LD. CIT(A) AND TH E SAME IS UPHELD ON THIS GROUND. IN THE RESULT, GROUND NO. 3 RAISED BY THE ASSESSEE IS DISMISSED. 3.11 NOW COMING TO GROUND NO. 2, THE LD. AR OF THE ASSESSEE HAS RAISED TWO BROAD CONTENTIONS BEFORE US. FIRSTLY, HE HAS S UBMITTED THAT THERE WAS NO CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHI NG INACCURATE PARTICULARS OF INCOME FOR THE REASON THAT WHATEVER INCOME WAS TO BE DISCLOSED WAS DISCLOSED AND THE DEDUCTION CLAIMED B Y THE ASSESSEE WAS IN THE COMPUTATION OF INCOME OF THE ASSESSEE. HOWEVER, THE DEDUCTION CLAIMED BY THE ASSESSEE WAS NOT ACCEPTABLE TO THE D EPARTMENT AND THE SAME HAS BEEN DISALLOWED. THE LD. AR FURTHER SUBMIT TED THAT MERE ERRONEOUS CLAIM MADE IN THE RETURN WILL NOT BE A GR OUND FOR LEVYING THE PENALTY. SECONDLY, HE HAS SUBMITTED THAT THE RETURN OF THE ASSESSEE WAS FILED IN A HURRIED MANNER BY THE LD. AR OF THE ASSE SSEE ON THE LAST DATE OF ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 8 FILING OF APPEAL ON 31-10-2007 AND IF THE RETURN HA D NOT BEEN FILED BY THE ASSESSEE THEN THE ASSESSEE HAD TO FACE PENALTY U/S 271B OF THE ACT. THEREFORE, THE LD. AR OF THE ASSESSEE SHRI SUSHIL V ARMA FILED THE RETURN OF INCOME OF THE ASSESSEE AFTER CLAIMING DEDUCTION OF RS. 11,06,684/- U/S 54 OF THE ACT WITHOUT FULLY VERIFYING THE FACTS OF THE CASE. THUS THERE WAS NO FAULT OF THE ASSESSEE IN CLAIMING MORE DEDUCTION U/ S 54 OF THE ACT AND TO THIS EFFECT THE AN AFFIDAVIT OF SHRI SUSHIL VARMA W AS FILED BEFORE THE LD. CIT(A). 3.12 THE LD. DR RELIED ON THE ORDER OF THE LD. CIT( A). 3.13 WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSE D THE MATERIAL AVAILABLE ON RECORD. IN THIS CASE, IT IS SEEN THAT DURING ASSESSMENT PROCEEDINGS, THE ASSESSEE HAD SHOWN CAPITAL GAINS O F RS. 12.71 LACS AFTER GETTING BENEFIT OF INDEXATION BY SALE OF A PLOT OF LAND AT BAL VIHAR FOR DEDUCTION U/S 54 OF THE ACT TOWARDS COST OF PURCHAS E OF 03 PLOTS OF LAND TOTALING TO RS. 11,06,684/- AND PAID TAX ON BALANCE AMOUNT OF RS. 1,64,316/-. THE QUESTION WHICH ARISES FOR CONSI DERATION IS WHETHER THE APPELLANT HAS A REASONABLE BASIS FOR CLAIM OF DEDUC TION UNDER SECTION 54 OF THE ACT IRRESPECTIVE OF TREATMENT THEREOF IN QUA NTUM PROCEEDINGS. FIRSTLY, IT IS AN UNDISPUTED FACT THAT WHAT THE ASS ESSEE HAS SOLD IS A PLOT OF LAND AND NOT A RESIDENTIAL HOUSE. SECTION 54 OF THE ACT PROVIDES FOR ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 9 DEDUCTION WHERE THE ASSESSEE SOLD A RESIDENTIAL HOU SE AND SECTION 54F OF THE ACT PROVIDES FOR DEDUCTION WHERE THE ASSESSEE S OLD ANY CAPITAL ASSET OTHER THAN A RESIDENTIAL HOUSE. ON THIS PLAIN READ ING OF THESE TWO SECTIONS AND NOTWITHSTANDING THE SATISFACTION OR OTHERWISE O F THE OTHER ELIGIBILITY CONDITIONS UNDER THE SAID PROVISIONS, IT IS CLEAR T HAT THE ASSESSEES CLAIM FOR DEDUCTION UNDER SECTION 54 IS NOT ADMISSIBLE AT FIRST PLACE. HAVING SAID THAT, WE HAVE ALSO OBSERVED THAT LD. CIT(A) HA S TAKEN COGNIZANCE OF THE ADDITIONAL EVIDENCE TOWARDS COST OF CONSTRUCTIO N OF RESIDENTIAL HOUSE ON ONE OF THE 3 PLOTS OF LAND AND ALLOWED DEDUCTION UNDER SECTION 54F. TO THIS EXTENT, THE CLAIM OF THE ASSESSEE HAS BEEN ACCEPTED AND PENALTY HAS ALREADY BEEN PROPORTIONATELY REDUCED BY THE LD . CIT(A) . NOW, THE QUESTION IS EVEN IF WE ACCEPT THAT THE CLAIM OF THE ASSESSEE IS UNDER SECTION 54F AND NOT SECTION 54, DOES THE ASSESSEE HAS A REASONABLE AND BONAFIDE BASIS FOR MAKING SUCH CLAIM UNDER SECTION 54F OF THE ACT IN RESPECT OF OTHER 2 PLOTS OF THE LAND AT B- 10 AND B -1, RAGHUNANDAN VIHAR, JAIPUR AS WELL. 3.14 IN THIS REGARD, THE ASSESSEE HAS SUBMITTED THA T THE RETURN OF THE ASSESSEE WAS FILED IN A HURRIED MANNER BY THE LD. A R OF THE ASSESSEE ON THE LAST DATE OF FILING OF APPEAL ON 31-10-2007 AFT ER CLAIMING DEDUCTION OF RS. 11,06,684/- U/S 54 OF THE ACT WITHOUT FULLY VER IFYING THE FACTS OF THE ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 10 CASE. THUS THERE WAS NO FAULT OF THE ASSESSEE IN CL AIMING MORE DEDUCTION U/S 54 OF THE ACT AND TO THIS EFFECT, AN AFFIDAVIT OF SHRI SUSHIL VARMA WAS FILED BEFORE THE LD. CIT(A). IT WOULD BE INTERESTIN G TO OBSERVE THAT DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSES SEE HAS NOT CORRECTED SO CALLED MISTAKE AND HAS CONTINUED WITH THE POSITI ON THAT CLAIM UNDER SECTION 54 IS MAINTAINABLE. IT WOULD BE ALSO RELEV ANT TO NOTE THAT THE LD. AR SHRI SUSHIL VARMA WHO HAS FILED THE RETURN HAS A LSO REPRESENTED THE ASSESSEE DURING THE COURSE OF THE ASSESSMENT PROCE EDINGS WHICH SHOWS THAT THE LD AR HAS BEEN DULY AUTHORIZED TO REPRESEN T THE ASSESSEE. IF IT WAS A CASE OF A BONAFIDE MISTAKE AND MAKING A CLAIM IN A HURRIEDLY MANNER, THE ASSESSEE THROUGH ITS AR HAS GOT AMPLE OPPORTUNITY TO WITHDRAW SUCH CLAIM DURING THE ASSESSMENT PROCEEDIN GS SPECIALLY WHEN A SPECIFIC SHOW CAUSE MADE BY THE AO ON THIS SPECIFI C MATTER OF DEDUCTION UNDER SECTION 54 AND EVEN SUBSEQUENTLY DURING THE A PPELLATE PROCEEDINGS WHICH HE HAS FAILED MISERABLY TO UTILIZE. IN LIGHT OF THESE FACTS, IT IS DIFFICULT FOR US TO RELY ON THE AFFIDAVIT FILED BY THE LD AR TO THE EFFECT THAT THE ASSESSEE CANNOT BE PENALIZED FOR THE ACTS OF T HE LD AR AND TO THIS EXTENT, WE DONT FIND ANY INFIRMITY IN THE ORDER OF THE LD CIT(A). 3.15 NOW COMING TO THE ASSESSEES CONTENTION THAT MERE ERRONEOUS CLAIM MADE IN THE RETURN WILL NOT BE A GROUND FOR L EVYING THE PENALTY. IN ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 11 THE RETURN OF INCOME AND MORE SPECIFICALLY IN THE C OMPUTATION OF INCOME, THE ASSESSEE HAS MENTIONED THAT IT HAS MADE AN IN VESTMENT IN HOUSE PROPERTY U/S 54 FOR RS 11,06,684 WHICH HAS BEEN CL AIMED AS DEDUCTION AGAINST THE CAPITAL GAINS ACCRUING ON SALE OF PLOT OF LAND AT BAL VIHAR. FURTHER, REFERENCE CAN BE DRAWN TO THE ASSESSEE'S SUBMISSION DATED 22.10.2009 DURING THE COURSE OF ASSESSMENT PROCEEDI NGS WHEREIN IT IS STATED THAT REGARDING INVESTMENT OF LONG TERM CAPI TAL GAINS OF RS 12,71,000/- ON SALE OF RESIDENTIAL HOUSE AT BAL VIHAR, WE SUBMIT THAT ASSESSEE HAS PURCHASED RESIDENTIAL PLOTS FOR RS 11, 06,684/- IN ACCORDANCE WITH THE PROVISIONS OF SECTION 54 WHEREBY EXEMPTION OF EQUIVALENT AMOUNT HAS BEEN CLAIMED IN THE RETURN OF INCOME, SE CTION 54 DOESNT DENY FOR EXEMPTION IN CASE MORE THAN ONE RESIDENTIAL HOU SE ARE PURCHASED BY THE ASSESSEE OUT OF CAPITAL GAINS ON SALE OF RESIDE NTIAL HOUSE. IN THIS REGARD, THE HONBLE KARNATAKA HIGH COURT IN CASE OF CIT VS ANANDA BASAPPA (2009) 223 CTR 186 (KAR) HAS HELD THAT THE EXPRESSION A RESIDENTIAL HOUSE USED IN SECTION 54 MAKES IT CLEA R THAT IT WAS NOT THE INTENTION OF THE LEGISLATURE TO CONVEY THE MEANING THAT IT REFERS TO A SINGLE RESIDENTIAL HOUSE. AFTER ANALYZING THE PROVISIONS OF SECTION 54, THE HONBLE HIGH COURT HAS HELD THAT THE SAID EXPRESSIO N A RESIDENTIAL HOUSE SHOULD BE READ IN CONSONANCE WITH OTHER WORDS BUIL DINGS AND LANDS AND ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 12 THEREFORE, THE SINGULAR ALSO PERMITS THE USE OF PLU RAL. THIS VIEW WAS REITERATED IN THE CASE OF CIT VS SMT K.G.RUKMINIAMM A (2011) 239 CTR 435 WHEREIN IT WAS HELD THAT FOUR RESIDENTIAL FLATS CONSTITUTE A RESIDENTIAL HOUSE FOR THE PURPOSES OF SECTION 54. IN CASE OF I TO VS MS SUSHILA M. JHAVERI (2007) 109 TTJ 299 (MUM)(SB), THE SPECIAL B ENCH OF THIS TRIBUNAL HAS HELD THAT THE EXEMPTION U/S 54F IS AVA ILABLE IN RESPECT OF INVESTMENTS IN TWO ADJACENT HOUSES WHICH CONSTITUTE ONE RESIDENTIAL UNIT. IN THE CASE OF THE ASSESSEE, IT HAS INVESTED THE CO NSIDERATION RECEIVED ON SALE OF PLOT OF LAND IN 03 DIFFERENT PLOTS OF LANDS WHICH WERE GEOGRAPHICALLY LOCATED AT 03 DIFFERENT LOCATIONS I. E, AT SANTOSH VIHAR, AT B-10 RAGHUNANDAN VIHAR AND AT B-1, RAGHUNANDAN VIHA R. FURTHER, A RESIDENTIAL HOUSE HAS BEEN CONSTRUCTED ONLY ON THE PLOT OF LAND AT SANTOSH VIHAR. IT IS THUS CLEAR THAT IN THE FACTS OF THE P RESENT CASE, THE ASSESSEE DOESNT HAVE ANY LEGAL AND TENABLE BASIS FOR CLAIM OF DEDUCTION IN RESPECT OF 03 SEPARATE PLOTS OF LAND WHICH ARE PHYSICALLY A T DIFFERENT LOCATIONS AS BY NO STRETCH OF IMAGINATION, THEY WOULD COLLECTIVE LY SATISFY THE DEFINITION OF A RESIDENTIAL HOUSE. THEREFORE, IT IS CLEARLY A CASE OF STRIKING IN THE DARK WHICH THE ASSESSEE HAS BEEN UNSUCCESSFUL AS R IGHTLY HELD BY THE LOWER AUTHORITIES. IT IS CLEARLY A CASE WHERE THE FACTUAL POSITION DOESNT SUPPORT THE CLAIM OF THE ASSESSEE AND THERE CANNOT BE ANY DISPUTE OR ITA NO. 817/JP/2012 SHRI PRAKASH CHAND VIJAY VS. ACIT, CIRCLE- 13 DEBATE THAT THE ASSESSEE WAS ELIGIBLE FOR CLAIM AT FIRST PLACE. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE CONSIDERED VIEW THAT CLAIM OF THE ASSESSEE UNDER S ECTION 54 WAS NOT A BONAFIDE CLAIM AND LEVY OF PENALTY U/S 271(1)(C) WA S JUSTIFIED AND HENCE CONFIRMED. 4.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07 /09/2 015. SD/- SD/- VH-VKJ-EHUK VKJ-IH-RKSYKUH (T.R. MEENA) (R.P.TOLANI) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 7 TH SEPT 2015 *MISHRA VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI PRAKASH CHAND VIJAY, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- THE ACIT, CIRCLE- 1, JAIPUR 3. VK;DJ VK;QDRVIHY ) @ CIT(A), JAIPUR 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO.817/JP/2014) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR