RUBY MILLS LTD., MUMBAI V. A.C.I.T. CIR.7(2), MUMBAI

ITA 8429/MUM/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 3309 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-07-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 12-03-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 12-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Business income

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D, MUMBAI .. , , , BEFORE SHRI R.S.SYAL, AM AND SHRI AMIT SHUKLA, JM ITA NO.8429/MUM/2011 : ASST.YEAR 2005-2006 RUBY MILLS LTD., RUBY HOUSE, J.K. SAWANT MARG, DADAR (W), MUMBAI-400 028 PAN :AAACT 0220 G / VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX CIRCLE 7(2) MUMBAI. ( !' / APPELLANT) ( #$ !' / RESPONDENT) !' / APPELLANT BY : MRS. KRUPA R GANDHI #$ !' / RESPONDENT BY : MRS. R.M. MADHAVI % & ' ( / DATE OF HEARING : 01.07.2013 )*+, ' ( / DATE OF PRONOUNCEMENT : 03 .07.2013 ! ' / O R D E R PER R.S.SYAL ( AM) : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) ON 22.0 7.2011 UPHOLDING PENALTY OF ` 53,85,000/- IMPOSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT IN RELATION TO THE ASSESS MENT YEAR 2005-2006. 2. BRIEFLY STATED THE FACTS OF THE CASE LEADING TO THE IMPOSITION OF PENALTY ARE THAT THE ASSESSEE SOLD CERTAIN PROPERTY AND OFFERED THE AMOUNT OF PROFIT FOR TAXATION UNDER THE HEAD `CAPIT AL GAINS. THE ASSESSING OFFICER TOOK THE VIEW THAT IT WAS IN THE NATURE OF BUSINESS INCOME ARISING OUT OF ADVENTURE IN THE NATURE OF T RADE. ACCORDINGLY HE ENHANCED THE TOTAL INCOME ON THIS ISSUE. THE LD. CIT(A) UPHELD THE ASSESSMENT ORDER ON THIS SCORE. IT IS ON THE BASIS OF THIS ADDITION THAT ITA NO.8429/MUM/2011. RUBY MILLS LTD. MUMBAI. 2 THE PRESENT PENALTY CAME TO BE IMPOSED AND APPROVED IN THE FIRST APPEAL. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE RELEVANT MATERIAL ON RECORD. AT THE VERY OUTSET, THE LD. COU NSEL FOR THE ASSESSEE SUBMITTED THAT THE ACTION OF THE ASSESSING OFFICER IN TREATING THE INCOME FROM THE SALE OF PROPERTY AS `BUSINESS INCOM E AS AGAINST THE ASSESSEES CLAIM OF `CAPITAL GAINS CAME UP FOR CON SIDERATION BEFORE THE TRIBUNAL IN QUANTUM APPEAL. HE STATED THAT THE TRIBUNAL IN ITA NO. 2694/M/2009, VIDE ITS ORDER DATED 26.04.2014, HAS UPHELD THE STAND OF THE ASSESSEE. A COPY OF THE SAID ORDER WAS PLACED ON RECORD. IN VIEW OF THESE FACTS, IT WAS STATED THAT NO PENA LTY COULD BE IMPOSED. THE LD. DR FAIRLY CONCEDED THAT THE FOUNDATION FOR THE IMPOSITION OF PENALTY DOES NOT EXIST BY VIRTUE OF THE AFORESAID O RDER PASSED BY THE TRIBUNAL. 4. IN VIEW OF THE RIVAL BUT COMMON SUBMISSIO NS IT IS FOUND THAT THE VERY BEDROCK, ON WHICH THE PRESENT PENALTY HAS BEEN IMPOSED AND CONFIRMED, CEASES TO EXIST BECAUSE OF THE ORDER PAS SED BY THE TRIBUNAL IN QUANTUM PROCEEDINGS ACCEPTING THE ASSESSEES POI NT OF VIEW AND CONSEQUENTLY DELETING THE ADDITION. WE, THEREFORE, S ET-ASIDE THE IMPUGNED ORDER AND CANCEL THE INSTANT PENALTY. 5. -, . / 0 ' 1 23 IN THE RESULT, THE APPEAL IS ALLOWED. ITA NO.8429/MUM/2011. RUBY MILLS LTD. MUMBAI. 3 ORDER PRONOUNCED ON THIS 3 RD DAY OF JULY, 2013. ' )*+, 4% 5. 03-07-2013 * ' <& SD/- SD/- (AMIT SHUKLA) (R.S.SYAL) # !$ / JUDICIAL MEMBER % !$ / ACCOUNTANT MEMBER 5=& MUMBAI ; 4% 5 DATED : 3 RD JULY, 2013. ASHISH ! ' &#'() * )+' / COPY OF THE ORDER FORWARDED TO : 1. !' / THE APPELLANT 2. #$ !' / THE RESPONDENT. 3. ( ) / THE CIT-7, MUMBAI. 4. / CIT(A)-13 , MUMBAI 5. @A < #%BC , ( BC, , 5=& / DR, ITAT, MUMBAI 6. < D E & / GUARD FILE. ! ' / BY ORDER, $ @ # //TRUE COPY// ,/- . ( DY./ASSTT. REGISTRAR) , 5=& / ITAT, MUMBAI