Deputy Commissioner of Income tax, V. Dr. Ranjana Ravindra Kadam, Pune

ITA 91/PUN/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5841 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 12-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJEEV GHEI
• Assessee Lawyers: DABHEDKHAR; SANTOSH JADHAV
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUN E . , , , ! BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AW ASTHY, JM . / ITA NO.91/PUN/2017 / ASSESSMENT YEAR : 2012-13 DCIT, CIRCLE-9, PUNE /APPELLANT VS. DR. RANJANA RAVINDRA KADAM, MANASI VACCINATION CENTRE, SANI BHOOMI HOUSING SOCIETY, BEHIND NIGDI BUS STOP, NIGDI, PUNE 411044 PAN : ABAPK8197K . / RESPONDENT / APPELLANT BY : SHRI SANJEEV GHEI / RESPONDENT BY : SHRI SANTOSH JADHAV & MS. DABHEDKHAR / DATE OF HEARING : 31.01.2019 / DATE OF PRONOUNCEMENT: 01.02.2019 / ORDER PER D. KARUNAKARA RAO, AM : THIS APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF CI T(A)-13, PUNE, DATED 25-10-2016 IN RELATION TO THE ASSESSMENT YEAR 201 2-13. 2. BRIEFLY STATED, RELEVANT FACTS INCLUDE, THAT THE ASSESSE E IS A DOCTOR BY PROFESSION. SHE FILED THE RETURN OF INCOME DECLARING TOTAL INC OME OF RS.1,37,46,603/-. A SURVEY U/S.133A WAS CARRIED OUT IN THE CASE OF THE ASSESSEE ON 12-01-2012. IN THE SAID SURVEY, ASSESSEE OFFERED RS.1.49 CRORE AS ADDITIONAL INCOME ON ACCOUNT OF UNACCOUNTED PROFESSION AL RECEIPTS. ASSESSEE FILED THE RETURN OF INCOME INCLUDING THE ADDITIONAL I NCOME OFFERED DURING THE SURVEY. ASSESSEE CLAIMED CERTAIN EXPENSES O N ACCOUNT OF SALARY, PETROL & VEHICLE EXPENSES AMOUNTING TO RS.4,14,396/- . HOWEVER, ITA NO.91/PUN/2017 DR. RANJANA R. KADAM 2 THE AO DISALLOWED 15% OF SUCH EXPENSES AND THUS DISALLOWED RS.62,160/- ON THE SAME. EVENTUALLY, AO DETERMINED THE INCOME AT R S.1,38,08,770/- AND LEVIED PENALTY OF RS.31,06,000/- U/S.271(1)(C) OF THE ACT O N THE GROUND THAT THE ASSESSEE CONCEALED THE PARTICULARS OF HER INCOME. 3. AGGRIEVED THE ORDER OF AO, THE ASSESSEE FILED AN APPEA L BEFORE THE CIT(A). THE CIT(A) DELETED THE PENALTY LEVIED BY THE AO. CONTENTS OF PARA NOS. 2.2 TO 2.6 OF THE ORDER OF CIT(A) ARE RELEVANT. AGGRIEV ED WITH THE ORDER OF CIT(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL WITH THE FOLLOWING GROUNDS : 1. WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE THE LD.CIT(A) WAS JUSTIFIED IN DELETING THE PENALTY LEVIED OF RS. 31,06 ,000/- WHEN THE ADDITION ON WHICH THE PENALTY WAS LEVIED WAS BASED ON SURVEY OPERATION ON ASSESSEE'S HOSPITAL & A LARGE DIFFERENCE WAS NOTICED BETWEEN ASSESSEE'S ACTUAL DAILY COLLECTION FROM HOSPITA L & MANUAL RECORDING IN THE BOOKS OF ACCOUNTS & DAILY ACCOUNTING PACKAGE. 2. WITHOUT PREJUDICE TO THE ABOVE , THE LD . CIT(A) ERRED IN NOT CONSIDERING THE HON'BLE SUPREME COURT'S DECISION IN T HE CASE OF MAK DATA P. LTD . V/S COMMISSIONER OF INCOME TAX-II (CIVIL APPEAL NO. 9772 OF 2013, ARISING OUT OF SPECIAL LEAVE PETITION (CI VIL) NO. 18389 OF 2013) IN WHICH HON ' BLE SUPREME COURT STATED THAT UNDER THE EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT , IT IS TRITE LAW THAT THE VOLUNTARY DISCLOSURE DOES NOT RELEASE THE ASSESSEE FRO M THE MISCHIEF OF PENAL PROCEEDINGS . THE LAW DOES NOT PROVIDE THAT WHEN AN ASSESSEE MAKES A VOLUNTARY DISCLOSURE OF HIS CONCEALED INCOME, H E HAD TO BE ABSOLVED FROM PENALTY. 3. THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER AN Y OF THE ABOVE GROUNDS OF APPEAL . 4. BEFORE US, AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THIS IS A CASE OF SURVEY ACTION U/S.133A OF THE ACT HELD ON 12-01-2012 AND THE DATE FALLS WITHIN THE PREVIOUS YEAR. THE ADDITIONAL INCOM E OFFERED DURING SURVEY ACTION WAS INCORPORATED IN THE BOOKS OF A CCOUNT AND FILED THE RETURN OF INCOME WITHIN THE DUE DATE SPECIFIED UNDER THE A CT. ON SUCH FACTS, THE PENALTY U/S.271(1)(C) IS NOT LEVIABLE SINCE NO INCOME IS FOUND ITA NO.91/PUN/2017 DR. RANJANA R. KADAM 3 CONCEALED AS PER THE RETURN OF INCOME SO FILED BY THE ASS ESSEE. IN THIS REGARD, HE RELIED ON THE FOLLOWING DECISIONS : 1. ACIT VS. M/S. D.J. BUILDERS AND DEVELOPERS ITA NO.1731/MUM/2012, DATED 25-07-2014 2. CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. 3. MAK DATA P. LTD. VS. CIT - CIVIL APPEAL NO.9772 OF 2013, DATED 30-10-2013 5. ON THE OTHER HAND, LD. DR HEAVILY RELIED ON THE ORDER OF THE AO. 6. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE ORDE RS OF THE AUTHORITIES BELOW. WE FIND, THE ASSESSEE IN THE PRESENT CA SE, FILED THE RETURN OF INCOME U/S.139(1) OFFERING THE ADDITIONAL INCOME DISCLO SED DURING THE SURVEY ACTION U/S.133A OF THE ACT AND THE AO ACCEP TED THE SAME U/S.143(3) OF THE ACT. AO DID NOT MAKE ANY ADDITION. UNDE R SUCH CIRCUMSTANCES, IT IS AMPLY CLEAR THAT THERE IS NO CONCEA LMENT OF FURNISHING OF INACCURATE PARTICULARS WHICH WARRANTS IMPOSITION OF PENALT Y. WE, THEREFORE, CONCUR WITH THE ARGUMENTS OF LD. AR ON THIS V ERY ISSUE. FURTHER, WE PERUSED THE DECISIONS RELIED ON BY THE LD. AR. WE FIND THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. D.J. BUILDERS AND DEVELOPERS (SUPRA) RELYING ON THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. SAS PHARMACEUTICALS 335 ITR 259 HAS HELD AS UNDER : 18. THUS, IN VIEW OF THE HONBLE DELHI HIGH COURT, THE PROVISIONS OF SEC.271(1)(C) SHOULD BE INTERPRETED STRICTLY. IF THE RA TIO OF THE DECISION RENDERED BY THE DELHI HIGH COURT IS APPLIED TO THE F ACTS OF THE PRESENT CASE, THE ASSESSEE CANNOT BE IMPOSED PENALTY U/S.271(1)(C), S INCE IT HAS ALREADY DISCLOSED THE SURRENDERED AMOUNT AS ITS INCOME IN THE RETURN OF INCOME. THE DECISION RENDERED BY LD.CIT(A) IS IN ACCORDANCE WITH THE RATION LAID DOWN BY HONBLE DELHI H IGH COURT. ACCORDINGLY, WE DO NOT FIND ANY INFIRMITY IN THE DECI SION TAKEN BY LD. CIT(A). ITA NO.91/PUN/2017 DR. RANJANA R. KADAM 4 6.1 SIMILAR VIEW HAS BEEN TAKEN BY THE BANGALORE BENCH OF THE TRIBUNAL IN THE CASE OF SHRI MUNINAGA REDDY VS. ACIT IN ITA NO.148 8/BANG/2012, DECIDED ON 14-08-2013. RELEVANT PARAS FROM THE SAID DE CISION ARE EXTRACTED BELOW : 10. THERE CAN BE NO CONCEALMENT OR NON-DISCLOSURE, AS TH E ASSESSEE HAD MADE A COMPLETE DISCLOSURE IN THE IT R ETURN AND OFFERED THE SURRENDERED AMOUNT FOR THE PURPOSES OF TAX AND THEREFORE NO PENALTY UNDER S. 271(1)(C) COULD BE LE VIED. THE WORDS IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT IN SEC. 271 (1)(C) OF THE ACT ARE PREFACED BY THE SATISFACTION OF THE AO OR TH E CIT(A). WHEN A SURVEY IS CONDUCTED BY A SURVEY TEAM, THE QUESTION OF SATISFACTION OF AO OR THE CIT(A) OR THE CIT DOES NOT ARISE. ONE HAS TO KEEP IN MIND THAT IT IS THE AO WHO INITIATES PENALTY PROCEEDINGS AND DIRECTS THE PAYMENT OF PENALTY. HE CANNOT RECORD ANY SATISFACTION DURING THE COURSE OF SURVEY. DECISION TO INITIATE PENALTY PROCEEDI NGS IS TAKEN WHILE MAKING ASSESSMENT ORDER. IT IS, THUS, OBVIOUS THA T THE EXPRESSION IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT CAN NOT HAVE THE REFERENCE TO SURVEY PROCEEDINGS. IT NECESSARILY FOLLOWS THAT CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING O F INACCURATE PARTICULAR OF INCOME BY THE ASSESSEE HAS TO BE IN T HE IT RETURN FILED BY IT. THE ASSESSEE CAN FURNISH THE PARTICULARS OF INCOM E IN HIS RETURN AND EVERYTHING WOULD DEPEND UPON THE IT RETURN FILED BY THE ASSESSEE. THIS VIEW GETS SUPPORTED BY EXPLANATIONS 4 AS WELL AS 5 AND 5A OF S. 271. OBVIOUSLY, NO PENALTY CAN BE IMPOSED UNLESS THE CONDITIO NS STIPULATED IN THE SAID PROVISIONS ARE DULY AND UNAMBIGUOUSLY SA TISFIED. SINCE THE ASSESSEE WAS EXPOSED DURING SURVEY, MAY BE, IT WOULD HA VE NOT DISCLOSED THE INCOME BUT FOR THE SAID SURVEY. HOWEVER , THERE CANNOT BE ANY PENALTY ONLY ON SURMISES, CONJECTURES AND POSSIBIL ITIES. SEC. 271(1)(C) HAS TO BE CONSTRUED STRICTLY. UNLESS IT IS FO UND THAT THERE IS ACTUALLY A CONCEALMENT OR NON-DISCLOSURE OF THE PARTIC ULARS OF INCOME, PENALTY CANNOT BE IMPOSED. THERE IS NO SUCH CONCEALMENT OR NONDISCLOSURE AS THE ASSESSEE HAD MADE A COMPLETE DISC LOSURE IN THE IT RETURN AND OFFERED THE SURRENDERED AMOUNT FOR THE PUR POSES OF TAX. 11. EXPLN.5 AND 5A ARE ALSO AN EXCEPTION TO THE RULE THAT WHEN AN INCOME WHICH IS ULTIMATELY BROUGHT TO TAX IS DECLARE D IN A RETURN OF INCOME, THERE CAN BE NO QUESTION OF TREATING THE ASS ESSEE AS HAVING CONCEALED PARTICULARS OF INCOME OR FURNISHED INACCU RATE PARTICULARS OF INCOME. THOSE EXPLANATIONS WILL ALSO NOT APPLY IN THE PRE SENT CASE BECAUSE THOSE EXPLANATIONS ARE APPLICABLE ONLY WHEN TH ERE IS A SEARCH U/S.132 OF THE ACT AND TO A CASE OF SURVEY U/S.133A OF THE ACT . 12. FOR THE REASONS GIVEN ABOVE WE HOLD THAT THERE CAN BE NO JUSTIFICATION FOR IMPOSITION OF PENALTY ON THE INCO ME OFFERED IN THE RETURN OF INCOME BY THE ASSESSEE, BECAUSE THERE CANNOT BE ANY PENALTY ON INCOME WHICH IS DECLARED IN A RETURN OF INCOME, ON THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. 13. THE HONBLE DELHI HIGH COURT IN THE CASE OF SAS PHARMACEUTICALS (SUPRA) AND THIS TRIBUNAL IN THE CA SE OF VASAVI SHELTERS (SUPRA) HAVE ALSO TAKEN THE VIEW AS STATED ABOVE. ITA NO.91/PUN/2017 DR. RANJANA R. KADAM 5 FROM THE ABOVE, IT IS EVIDENT THAT THE FACTS OF THE PRESE NT CASE ARE IDENTICAL TO THE FACTS DECIDED IN THE ABOVE DISCUSSED CASES. THUS , WE HOLD THAT THE ORDER OF THE CIT(A) IN DELETING THE PENALTY CANNOT BE FAULTE D WITH. THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON THIS 01 ST DAY OF FEBRUARY, 2019. SD/- SD/- ( /VIKAS AWASTHY) ( . /D. KARUNAKARA RAO) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / PUNE; / DATED : 01 ST FEBRUARY, 2019 SATISH / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A)-13, PUNE 4. / THE PR.CIT-5, PUNE 5. , , / DR A, ITAT, PUNE; 6. / GUARD FILE. / BY ORDER, // TRUE COPY // SENIOR PRIVATE SECRETARY , / ITAT, PUNE. ITA NO.91/PUN/2017 DR. RANJANA R. KADAM 6 DATE 1. DRAFT DICTATED ON 31-01-2019 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 01-02-2019 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS 7. DATE OF UPLOADING ORDER SR.PS 8. FILE SENT TO THE BENCH CLERK SR.PS 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK 10. DATE ON WHICH FILE GOES TO THE A.R. 11. DATE OF DISPATCH OF ORDER.