L/H of late Shri Tajuddin M. Somjee, Mrs. Shahnaz Ali Mohammad Somjee, Pune V. Deputy Commissioner of Income-tax, Circle - 2, Pune

ITA 860/PUN/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6355 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2003-2004
• Appeal Filed On: 14-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VITHAL BHOSALE
• Keywords: Sale consideration of property below Jantri Value; Capital Gains
• Section: 271(1)(c); 50C; 274; 54EC

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH, A PUNE VIRTUAL COURT BEFORE SHRI INTURI RAMA RAO , ACCOUNTANT MEMBER AND SHRI S.S. VISWANETHRA RAVI , J UDICIAL MEMBER . / ITA NO . 860 /PUN/201 8 / ASSESSMENT YEAR : 20 03 - 04 MRS. SHAHNAZ ALI MOHAMMAD SOMJEE L/H OF LATE SHRI TAJUDDIN M. SOMJEE FLAT NO.401 AND 402, THE IMPERIAL, KONDHWA KHURD, NIBM ROAD, PUNE 411048 PAN : A CQPS5642E ....... / APPELLANT / V/S. THE DY . COMMISSIONER INCOME TAX , CIRCLE - 2 , PUNE . / RESPONDENT ASSESSEE BY : NONE REVENUE BY : SHRI VITHAL BHOSALE / DATE OF HEARING : 0 9 - 0 9 - 20 2 1 / DATE OF PRONOUNCEMENT : 09 - 0 9 - 202 1 / ORDER PER INTURI RAMA RAO, AM: THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), PUNE - 5 , PUNE, DATED 27 . 1 1 .201 7 FOR THE ASSESSMENT YEAR 20 03 - 04 . 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE APPELLANT IS A N INDIVIDUAL . THE RET URN OF INCOME FOR THE ASSESSMENT YEAR 2003 - 04 WAS FILED ON 2 ITA NO.860/PUN/2018 MRS. SHAHNAZ ALI MOHAMMAD SOMJEE 22.03.2004 DECLARING A TOTAL INCOME OF RS.22,76,580/ - . AGAINST THE SAID RETURN OF INCOME, THE ASSESSMENT WAS COMPLETED BY THE ASSESSING OFFICER VIDE ORDER DATED 22.03.2006 AT A TOTAL INCOME OF RS. 3,01,80,370/ - . WHILE DOING SO, THE AO MADE ADDITION UNDER THE HEAD LONG TERM CAPITAL GAINS OF RS.2,78,83,000/ - BY ADOPTING THE DEEMED SALE CONSIDERATION AS STIPULATED UNDER THE PROVISIONS OF SECTION 50C OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) AND DENIED THE CLAIM FOR EXEMPTION UNDER THE PROVISIONS OF SECTION 54EC OF THE ACT. AGAINST THAT ORDER, AN APPEAL WAS PREFERRED BEFORE THE CIT(A), WHO HAD CONFIRMED THE ACTION OF AO AND EVEN ON FURTHER APPEAL BEFORE THE TRIBUNAL, THE ORDE RS OF THE LOWER AUTHORITIES WAS CONFIRMED. 3. WHILE THE MATTER STOOD THUS, A NOTICE U/S 274 R.W.S. 271(1)(C) OF THE ACT DATED 16.03.2012 WAS ISSUED REQUIRING THE APPELLANT TO SHOW CAUSE WHY THE PENALTY SHOULD NOT BE LEVIED. IN RESPONSE TO THE SHOW CAUSE NOTICE, THE ASSESSEE FILED AN EXPLANATION CONTESTING THAT THE ASSESSEE HAS NOT CONCEALED ANY PARTICULARS OF INCOME NOR FURNISHED ANY INACCURATE PARTICULARS OF INCOME AND MERE DISALLOWANCE OF CLAIM DOES NOT ENTAIL THE LEVY OF PENALTY AND RELIANCE ALSO PLACE D ON THE DECISIONS (A) CIT VS. RELIANCE PETROPRODUCT (P) LTD. (2010) 230 CTR (SC) 320; (B) ACIT VS. MAHINDRA SHUBHLAB SERVICES LTD. (2009) 31 SOT 361 (MUMBAI) AND (C) T.ASHOK PAI VS. CIT (2007) 210 CTR (SC) 259 . THE ABOVE EXPLANATION WAS REJECTED BY THE AO BY HOLDING THAT THE ASSESSEE HAD CONSCIOUSLY CONCEALED THE PARTICULARS OF INCOME AND LEVIED THE PENALTY OF RS.42,72,747/ - VIDE ORDER DATED 30.03.2012. BEING AGGRIEVED, AN APPEAL WAS FILED BEFORE THE CIT(A), WHO VIDE IMPUGNED ORDER HAS DISMISSED THE APP EAL FOR NON - 3 ITA NO.860/PUN/2018 MRS. SHAHNAZ ALI MOHAMMAD SOMJEE PROSECUTION WITHOUT GOING INTO THE MERITS OF THE ISSUE ON LEVY OF PENALTY. BEING AGGRIEVED BY THIS APPEAL, THE APPELLANT IS BEFORE US IN THE PRESENT APPEAL. WHEN THE MATTER WAS CALLED ON, NOBODY APPEARED ON BEHALF OF ASSESSEE DESPITE DUE SERV ICE OF SERVICE. 4 . WE HAVE HEARD SR. DR AND PERUSED THE MATERIAL ON RECORD. ON MERE READING THE IMPUGNED ORDER, IT IS CLEAR THAT THOUGH THE CIT(A) WAS JUSTIFIED IN THE CIRCUMSTANCES OF THE CASE TO DISPOSE OF THE APPEAL EX - PARTE , IT IS THE REQUIREMENT OF L AW THAT THE CIT(A) SHOULD GO INTO THE MERITS OF THE CASE IN APPEAL AND DECIDE THE MATTER ON MERITS. SINCE IN THE PRESENT CASE , THE CIT(A) HAD NOT PASSED THE ORDER IN CONFORMITY WITH THE REQUIREMENT OF LAW, WE REMIT THE ISSUE BACK TO THE FILE OF CIT(A) FOR DE NOVO ADJUDICATION OF THE ISSUE IN APPEAL ON MERITS. ACCORDINGLY, THE MATTER IS REMANDED TO THE FILE OF CIT(A). 5 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 9 TH SEPTEMBER , 20 2 1 . SD/ - SD/ - S.S.VISWANETHRA RAVI INTURI RAMA RAO JUDICIAL MEMBER ACCOUNTANT MEMBER / PUNE; / DATED : 9 TH SEPTEMBER , 20 2 1 GCVSR 4 ITA NO.860/PUN/2018 MRS. SHAHNAZ ALI MOHAMMAD SOMJEE / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A), PUNE - 5, PUNE ; 4. THE PR.CIT, PUNE - 4, PUNE ; 5. , , A / DR A , ITAT, PUNE; 6. / GUARD FILE. / BY ORDER, // // TRUE COPY// / SR. PRIVATE SECRETARY , / ITAT, PUNE