The ITO, Ward 2(4), RAJKOT-GUJARAT V. Smt Mrudulaben Bhaichand Mehta, RAJKOT-GUJARAT

ITA 84/RJT/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56686 (ITAT-RAJKOT)
• Duration Of Justice: 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 26-08-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 07-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MK SINGH SHRI BAKUL V GANATRA
• Keywords: Charitable institution
• Section: 80G

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT BEFORE SHRI A.L. GEHLOT (AM) AND SHRI N.R.S. GANESA N (JM) I.T.A. NO.84/RJT/2011 (ASSESSMENT YEAR 2007-08) ITO, WD.2(4) VS SMT. MRUDULABEN BHAICHAND MEHTA, HUMMING BIRD PROP. SCHOOL & HOBBY CENTRE 9, BRINDAVAN, KALAWAD ROAD RAJKOT PAN : AALXPM6234A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MK SINGH RESPONDENT BY: SHRI BAKUL V GANATRA DATE OF HEARING : 26-08-2011 DATE OF PRONOUNCEMENT : 30-08-2011 O R D E R PER N.R.S. GANESAN, JM THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A)-III, RAJKOT DATED 22-12-2010 DELETING THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT FOR THE ASSESSMENT YEAR 2007-0 8. 2. SHRI MK SINGH, THE LD.DR SUBMITTED THAT THE ASSE SSING OFFICER, DURING THE COURSE OF ASSESSMENT PROCEEDINGS, FOUND THAT THE AS SESSEE HAS MADE DONATION OF RS.75 LAKHS TO BHAICHAND PREMCHAND VADHAR (MEHTA ) CHARITABLE TRUST, RAJKOT. WHILE CLAIMING DEDUCTION U/S 80G, THE ASSE SSEE WORKED OUT THE QUALIFYING DEDUCTION U/S 80G AT RS.37,50,000 AND CL AIMED RS.13,89,903 AS DEDUCTION U/S 80G IN THE RETURN OF INCOME. THE ASS ESSING OFFICER FOUND THAT THE ASSESSEE WAS ENTITLED TO THE DEDUCTION U/S 80G ONLY TO THE EXTENT OF RS.69,495 ITA NO.84/RJT/2011 2 AS AGAINST THE CLAIM OF THE ASSESSEE AT RS.13,89,90 3. ACCORDINGLY THE ASSESSING OFFICER DISALLOWED THE EXCESS CLAIM TO THE EXTENT O F RS.13,20,408. ACCORDING TO THE LD.DR, CLAIMING EXCESS DEDUCTION U/S 80G AMOUNT S TO FURNISHING OF INACCURATE PARTICULARS, THEREFORE, THE ASSESSING OF FICER HAS RIGHTLY LEVIED PENALTY U/S 271(1)(C) OF THE ACT. 3. ON THE CONTRARY, SHRI BAKUL V GANATRA, THE LD.RE PRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE DONATION MADE BY THE AS SESSEE WAS NOT IN DISPUTE. THE AMOUNT OF DEDUCTION CLAIMED IN THE RETURN OF IN COME WAS DUE TO SOME ERROR IN THE COMPUTATION OF INCOME. AS SOON AS IT WAS PO INTED OUT, THE ASSESSEE ACCEPTED THE ERROR AND OFFERED THE INCOME FOR TAXAT ION. SINCE IT WAS DUE TO COMPUTATION ERROR, ACCORDING TO THE LD.REPRESENTATI VE, THE CIT(A) HAS RIGHTLY DELETED THE PENALTY.OF RS.3,74,887. ACCORDING TO T HE LD.REPRESENTATIVE DUE TO WRONG COMPUTATION THE ASSESSEE HAS MADE THE CLAIM A ND WHEN IT WAS POINTED OUT THE ASSESSEE HAS ACCEPTED THE MISTAKE AND OFFER ED THE SAME FOR TAXATION. THE FACT REMAINS IS THAT DONATION MADE TO THE EXTEN T OF RS.75 LAKHS IS ON RECORD. SO WHAT REMAINS IS COMPUTATION OF THE ELIGIBLE DEDU CTION. THEREFORE, IT IS UP TO THE ASSESSING OFFICER TO COMPUTE THE DEDUCTION UNDE R THE PROVISIONS OF SECTION 80G OF THE ACT. SO MERELY BECAUSE THE ASSESSEE COM PUTED THE DEDUCTION WRONGLY WITHOUT ANY MALA FIDE INTENTION IT MAY NOT AMOUNT TO FURNISHING OF INACCURATE PARTICULARS OF INCOME. FURNISHING OF IN ACCURATE PARTICULARS OF INCOME IS ONE THING AND ERROR IN THE COMPUTATION OF ELIGIB LE DEDUCTION IS TOTALLY ANOTHER THING. THEREFORE, IN OUR OPINION, THIS IS NOT A FI T CASE FOR LEVY OF PENALTY. ITA NO.84/RJT/2011 3 ACCORDINGLY, WE HOLD THAT THE CIT(A) HAS RIGHTLY DE LETED THE PENALTY LEVIED BY THE ASSESSING OFFICER, AFTER FOLLOWING THE JUDGMENT OF THE APEX COURT IN THE CASE OF CIT VS RELIANCE PETROPRODUCTS 222 ITR 518 (SC). W E DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY THE SAME IS CONFIRMED. 4. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 30-08-2011. SD/- SD/- (A.L. GEHLOT) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT, DT : 30 TH AUGUST, 2011 PK/- COPY TO: 1. ASSESSEE 2. REVENUE 3. THE CIT(A)-III, RAJKOT 4. THE CIT-II, RAJKOT 5. THE DR, I.T.A.T., RAJKOT (TRUE COPY) BY ORDER ASSTT.REGISTRAR, ITAT, RAJKOT