The ITO, Ward-5(3), Ahmedabad V. Radhe Infrastructure & Projects India Ltd., Ahmedabad

ITSSA 359/AHD/2013

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 2461 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s) 5 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 09-11-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 27-10-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 04-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 27

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER IT(SS)A NOS. 357, 358 & 359/AHD/2013 / ASSESSMENT YEAR: 2008-09, 2009-10 & 2010-11 INCOME TAX OFFICER, WARD 5 (3), AHMEDABAD VS. RADHE INFRASTRUCTURE & PROJECTS INDIA LIMITED, 1 ST FLOOR, CHINUBHAI CHAMBERS, B/H. CITY GOLD CINEMA, ASHRAM ROAD, AHMEDABAD-380009 PAN : AAACR 9178 F / (APPELLANT) / (RESPONDENT) CO NO. 44/AHD/2014 (IN IT(SS)A NO. 359/AHD/2013) / ASSESSMENT YEAR: 2010-11 RADHE INFRASTRUCTURE & PROJECTS INDIA LIMITED, PAN : AAACR 9178 F VS. INCOME TAX OFFICER, WARD 5 (3), AHMEDABAD (CROSS OBJECTOR) (RESPONDENT) REVENUE BY : SHRI MUDIT NAGPAL, SR DR ASSESSEE BY : SHRI P M MEHTA WITH SHRI G M THAKOR, ARS / DATE OF HEARING : 27/10/2016 / DATE OF PRONOUNCEMENT: 09/11/2016 / O R D E R PER N.K. BILLAIYA, ACCOUNTANT MEMBER: IT(SS)A NOS. 357, 358 & 359/AHD/2013 ARE THREE SEPA RATE APPEALS BY THE REVENUE PREFERRED AGAINST THREE DIFFERENT ORDER S OF THE CIT(A)-I, AHMEDABAD PERTAINING TO THREE ASSESSMENT YEARS, VIZ . AYS 2008-09, 2009- 10 AND 2010-11. ALL THESE APPEALS RELATE TO THE DE LETION OF THE PENALTY LEVIED BY THE AO U/S 271(1)(C) OF THE ACT. SINCE IN ALL TH ESE APPEALS THE LEVY OF PENALTY RELATES TO THE SAME SET OF FACTS THOUGH QUA NTUM MAY DIFFER, ALL THESE ITSSNOS. 357, 358 & 359/AHD/2013 & CO 44/AHD/2014 ITO VS. RADHE INFRASTRUCTURE & PROJECTS INDIA LTD 2008-09, 2009-10 AND 2010-11 2 APPEALS WERE THEREFORE HEARD TOGETHER AND ARE DISPO SED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. THE ASSESSEE HAS ALSO PREFERRED CROSS OBJECTION VIDE CO NO.44/AHD/2014 FOR AY 2010-11. 3. HAVING HEARD THE RIVAL CONTENTIONS, WE HAVE CARE FULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW. WE HAVE ALSO GONE THROUGH THE RESPECTIVE ASSESSMENT ORDERS. IN THIS CASE, THE ASSESSEE HAD CLAIMED DEDUCTION IN RESPECT OF CERTAIN BLOCKS OF LAND AT NASMED ON THE GROUND THAT THE IMPUGNED LANDS WERE UNDER DISPUTE AND THERE WAS LIT IGATION. DURING THE COURSE OF THE RESPECTIVE ASSESSMENT YEARS, THE ASSE SSEE WAS ASKED TO JUSTIFY ITS CLAIM OF DEDUCTIONS. THE ASSESSEE FILED DETAIL ED EXPLANATION. THE EXPLANATION OF THE ASSESSEE DID NOT FIND FAVOUR WIT H THE AO WHO WAS OF THE FIRM BELIEF THAT ONLY THE PROFIT ELEMENT IN THE IMP UGNED LANDS CAN BE ALLOWED AS DEDUCTION AND NOT THE ENTIRE SALE CONSID ERATION. THE ASSESSEE ACCEPTED THE PROPOSITION OF THE AO AND THE ASSESSME NTS WERE COMPLETED. 4. THE AO INITIATED PENALTY PROCEEDINGS FOR THE AMO UNT OF THE CLAIM DISALLOWED BY HIM DURING THE COURSE OF THE ASSESSME NT PROCEEDINGS. 5. DURING THE COURSE OF PENAL PROCEEDINGS, THE ASSE SSEE STRONGLY SUBMITTED THAT IT HAS AGREED FOR THE PROPOSED DISAL LOWANCE OF THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS THOUGH THE CLAIM WAS GENUINE AND JUSTIFIABLE. THEREFORE, THERE IS NO QUESTION O F LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THE CONTENTIONS OF THE ASSES SEE WERE DISMISSED BY THE AO WHO PROCEEDED BY LEVYING THE PENALTY U/S 271(1)( C) OF THE ACT FOR FURNISHING INACCURATE PARTICULARS OF INCOME. 6. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A ) AND REITERATED ITS CONTENTIONS. THE FIRST APPELLATE AUTHORITY WAS CON VINCED WITH THE ITSSNOS. 357, 358 & 359/AHD/2013 & CO 44/AHD/2014 ITO VS. RADHE INFRASTRUCTURE & PROJECTS INDIA LTD 2008-09, 2009-10 AND 2010-11 3 CONTENTIONS OF THE ASSESSEE. THE CIT(A) WAS OF THE OPINION THAT IN THE RETURNS OF INCOME ITSELF THE ASSESSEE HAS GIVEN A N OTE REGARDING THE DEDUCTION CLAIMED BY IT IN RESPECT OF THE VALUE OF CERTAIN LANDS SOLD AND VALUATION OF THE CLOSING STOCK OF THE LAND. THE C IT(A) FURTHER FOUND THAT THE SALE CONSIDERATION CREDITED BY THE ASSESSEE COU LD NOT BE REALIZED DUE TO VARIOUS REASONS MENTIONED IN THE NOTE FILED WITH TH E RETURNS OF INCOME. THE CIT(A) FOUND THAT DURING THE COURSE OF THE ASSESSME NT PROCEEDINGS, THE AO ADOPTED A DIFFERENT VIEW HOLDING THAT ONLY THE DIFF ERENCE BETWEEN THE COST AND SALE CONSIDERATION COULD BE ALLOWED AS DEDUCTIO N. THE ASSESSEE AGREED TO THE PROPOSITION OF THE AO. 7. THE CIT(A) FOUND THAT THE FACTS OF THE CASE DO N OT JUSTIFY THE LEVY OF PENALTY BECAUSE THERE IS NO CASE FOR FILING OF INAC CURATE PARTICULARS OF INCOME. THE FIRST APPELLATE AUTHORITY DELETED THE IMPUGNED PENALTY. 8. AGGRIEVED BY THIS, THE REVENUE IS BEFORE US. 9. THE CLAIM OF THE ASSESSEE CAN BE UNDERSTOOD BY T HE FOLLOWING CHART:- AY AMOUNT CLAIMED BY APPELLANT WHILE COMPUTING ITS RETURN OF INCOME (I) CORRESPONDING ELEMENT OF COST (II) BALANCE BEING THE PROFIT ELEMENT FOR WHICH THE APPELLANTS CLAIM WAS ACCEPTED (III) 2008-09 94,11,600 47,73,957 46,37,643 2009-10 2,06,99,100 66,85,800 1,40,13,300 2010-11 3,43,07,110 61,46,029 2,81,61,081 2,00,57,961 2,00,57,961 - TOTAL 8,44,75,771 8,76,63,747 4,68,12,024 10. IN THE RECEPTIVE RETURNS OF INCOME, THE ASSESS EE HAD EXPLAINED ITS CLAIM BY WAY OF NOTE AND THE SAME READS AS UNDER:- ITSSNOS. 357, 358 & 359/AHD/2013 & CO 44/AHD/2014 ITO VS. RADHE INFRASTRUCTURE & PROJECTS INDIA LTD 2008-09, 2009-10 AND 2010-11 4 4. THE APPELLANT-COMPANY IS ENGAGED IN THE BUSINES S OF PURCHASES AND SALES OF LAND AND THE RETURNS OF INCOME FOR THE THREE ASS ESSMENT YEARS WERE ACCOMPANIED BY THE FOLLOWING NOTES: (A) THAT NOTE NO.6 FOR AY 2008-09 CONTAINED THE FOLLOWI NG CLAIM: 6. THE ASSESSEE WHILE FILING THE PRESENT RETURN OF INC OME HAS CLAIMED AN AMOUNT OF RS.94,11,600/- IN RESPECT OF DISPUTE/LIAB ILITY IN RESPECT OF SALE OF LAND AT NASMED. THE DETAILS OF WHICH WILL BE PROVIDED BY A SEPARATE LETTER AND THE REASONS FOR CLAIMING IT IN THE CURRENT YEAR WILL ALSO BE PROVIDED. (B) THAT NOTE NO.6 FOR AY 2009-10 CONTAINED THE FOLLOWI NG CLAIMS:- 6. THE ASSESSEE WHILE FILING THE PRESENT RETURN OF INC OME HAS CLAIMED AN AMOUNT OF RS.2,06,99,100/- IN RESPECT OF DISPUTE/LI ABILITY IN RESPECT OF SALE OF LAND AT NASMED. THE DETAILS OF WHICH WILL BE PR OVIDED BY A SEPARATE LETTER AND THE REASONS FOR CLAIMING IT IN THE CURRE NT YEAR WILL ALSO BE PROVIDED. (C) THAT NOTE NO.3 FOR AY 2010-11 CONTAINED THE FOLLOWI NG CLAIMS:- 3. THE ASSESSEE WHILE FILING THE PRESENT RETURN OF INCOME HAS CLAIMED AN AMOUNT OF RS.5,43,64,971/- IN RESPECT OF DISPUTE/LI ABILITY IN RESPECT OF SALE OF LAND AT NASMED. THE DETAILS OF WHICH WILL BE PR OVIDED BY A SEPARATE LETTER AND THE REASONS FOR CLAIMING IT IN THE CURRE NT YEAR WILL ALSO BE PROVIDED. THE CLAIM FOR RS.5,43,64,971/- REFERRED TO IN THE A BOVE NOTE CONSISTED OF RS.3,43,07,110/- IN RESPECT OF SALE OF LAND AND RS. 2,00,57,961/- IN RESPECT OF CLOSING STOCK OF LAND. 11. CONSIDERING THE AFOREMENTIONED FACTUAL DETAILS FURNISHED AT THE TIME OF RETURNS OF INCOME ITSELF AND THE CORRESPONDING A CCEPTANCE OF THE PROPOSITION MADE BY THE AO DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS SHOW THAT THE ASSESSEE NEVER FILED ANY INACCURATE PARTICULARS OF INCOME. MERELY BECAUSE A CLAIM OF DEDUCTION MADE B Y THE ASSESSEE DID NOT ITSSNOS. 357, 358 & 359/AHD/2013 & CO 44/AHD/2014 ITO VS. RADHE INFRASTRUCTURE & PROJECTS INDIA LTD 2008-09, 2009-10 AND 2010-11 5 FIND FAVOUR WITH THE AO, THE LEVY OF PENALTY U/S 27 1(1)(C) OF THE ACT CANNOT BE JUSTIFIED. FOR THIS PROPOSITION, WE DRAW SUPPOR T FROM THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. RELIAN CE PETROPRODUCTS PVT. LTD., REPORTED IN 322 ITR 158 (SC). 12. IN THE LIGHT OF THE AFORE STATED FACTUAL MATR IX, WE DO NOT FIND ANY ERROR OR INFIRMITY IN THE FINDINGS OF THE CIT(A). ALL TH E APPEALS BY THE REVENUE ARE DISMISSED. 13. THE COUNSEL FOR THE ASSESSEE DID NOT PRESS THE CROSS-OBJECTION OF THE ASSESSEE AND THE SAME IS DISMISSED AS NOT PRESSED. 14. BEFORE PARTING, THE DR HAD RELIED UPON THE DECI SION OF THE HONBLE SUPREME COURT IN THE CASE OF MAK DATA PVT LTD VS. C IT, REPORTED IN (2013) 358 ITR 593 (SC). WE FIND THAT THE SAID DECI SION OF THE HONBLE SUPREME COURT IS MISPLACED BECAUSE THE SAID DECISIO N RELATES TO THE VOLUNTARY DISCLOSURES; HOWEVER, IN THE CASE IN HAND THERE IS NO ISSUE OF VOLUNTARY DISCLOSURE. 15. IN THE RESULT, ALL THE APPEALS FILED BY THE REV ENUE ARE DISMISSED AND THE CROSS-OBJECTION FILED BY THE ASSESSEE IS ALSO D ISMISSED. ORDER PRONOUNCED IN THE COURT ON 9 TH NOVEMBER, 2016 AT AHMEDABAD. SD/- SD/- (MAHAVIR PRASAD) JUDICIAL MEMBER (N.K. BILLAIYA) ACCOUNTANT MEMBER AHMEDABAD; DATED 09/11/2016 BIJU T., SR.PS ITSSNOS. 357, 358 & 359/AHD/2013 & CO 44/AHD/2014 ITO VS. RADHE INFRASTRUCTURE & PROJECTS INDIA LTD 2008-09, 2009-10 AND 2010-11 6 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! # / CONCERNED CIT 4. # ( ) / THE CIT(A) , AHMEDABAD 5. & ! , ! , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) ' #, / ITAT, AHMEDABAD