The Income Tax Officer, Ward-1, Gandhidham-Kutch V. Shri Manoj Ramjivan Poddar, Gandhidham-Kutch

MA 55/RJT/2019

AI Insights

The case involves the Income Tax Officer, Ward-1, Gandhidham, Kutch as the appellant and Shri Manoj Ramjivan Poddar as the respondent. The revenue sought to recall the ITAT order dismissing its appeal due to the low quantum of penalty, arguing that the case falls under exceptions specified in CBDT circular 03/2018. The ITAT had previously dismissed the appeal as the penalty amount was below the threshold limit set by the circular. The revenue contended that the constitutional validity of the defective notice under section 274 r.w.s. 292B of the Act was challenged, which should have led to a decision on merits. However, the court found that the revenue did not adequately challenge the CIT-A's findings, which were crucial to the case.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 135798 (ITAT-RAJKOT)
• Duration Of Justice: 4 year(s) 5 month(s) 17 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 09-11-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 17-08-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 22-05-2019
• Other Referred Cases: Fortune Hotels and Estate P Ltd, Madan Theaters Ltd
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHRIASHISHKUMARPANDEY; WAYOFTHISMISCELLANEOUSAPPLICATIONISSEEKINGRECALLOF
• Assessee Lawyers: SHRIMEULRANPURA
• Keywords: Sale consideration of property below Jantri Value

Judgement Text

आयकरअपीलीयअधिकरण , अहमदाबादनयायपीी INTHEINCOMETAXAPPELLATETRIBUNAL, (CONDUCTEDTHROUGHE-COURTATAHMEDABAD) BEFOREMsSUCHITRAKAMBLE,JUDICIALMEMBER, And SHRIWASEEMAHMED,ACCOUNTANTMEMBER, M.ANo.55/Rjt/2019 in आयकरअपीलसं./ITANo.136/Rjt/2017 धििाधरणवरध/Asstt.Years:2010-2011 IncomeTaxOfficer, Ward-1, Gandhidham, Kutch. Vs. ShriManojRamjivanPoddar, PlotNo.62-63, SectorNo.1, Gandhidham-370201. PAN:ACMPP9787D Revenueby:ShriAshishKumarPandey,Sr.D.R Assesseeby:ShriMeulRanpura,A.R सुिवाईकीतारीख /DateofHearing:18/08/2023 घोरणाकीतारीख/DateofPronouncement:10/11/2023 आदेश /ORDER PERWASEEMAHMED,ACCOUNTANTMEMBER: TheRevenuebywayofthismiscellaneousapplicationisseekingrecallof theorderpassedbytheITATonthereasoningthatthereisamistakeapparent fromrecordwithinthemeaningoftheprovisionsofsection254(2)oftheAct. 2.TherevenueinthemiscellaneousapplicationsubmittedthattheITAThas dismissedtheappealfiledbytherevenueonaccountoflowtax/penaltyamountin M.ANo.55/Rjt/2019 in ITANo.136/Rjt/2017 A.Y.2010-11 2 pursuancetotheCBDTcircularbearingnumber03/2018dated11-07-2018.As pertherevenue,thequantumofthepenaltyisbelowthethresholdlimit,butits casefallsunderexceptionslaiddowninclause10ofthesaidcircular.Therelevant extractofthecircularisreproducedasunder: [10.Adversejudgmentsrelatingtothefollowingissuesshouldbecontestedon meritsnotwithstandingthatthetaxentailedislessthanthemonetarylimitsspecifiedin para3aboveorthereisnotaxeffect: 3.Aspertherevenue,theconstitutionalvaliditywithrespecttothedefective noticeissuedundersection274r.w.s.292BoftheActhasbeenchallengedand thereforetheappealfiledbytherevenueshouldbedecidedonmerit. 4.Inviewoftheabove,thelearnedDRsubmittedthatthereisamistakein theorderoftheITATwhichneedstoberectifiedwithinthemeaningofthe provisionsofsection254(2)oftheAct. 5.Ontheotherhand,thelearnedARvehementlysupportedtheorderofthe ITAT. 6.Heardtherivalcontentionsofboththepartiesandperusedthematerials availableonrecord.Withoutgoingintothemeritofthecaseasmadeoutbythe revenuinthemiscellaneousapplication,itisimportanttonotethatthelearned CIT-AhasdeletedthepenaltyimposedbytheAOonaccountof2reasons,firstly, thenoticeissuedforinitiatingthepenaltywasdefectiveandsecondlytheaddition inthesearchproceedingswasmadebasedontheprovisionsofsection50Cofthe Actandnotonthebasisofanydocumentseizedduringthesearch.Therelevant findingofthelearnedCIT-Areadsasunder: 8.Inthecaseunderconsideration,asdiscussedabove,theassesseesoldproperty forRs.25lakhsandtheconveyancedeedwasregisteredonthisconsideration.No documentortransactionorayentryinanybooksofaccountswasfoundduringthecourse ofsearchu/s132whichcouldsuggestanyincome.Itwasonlybyvirtueofthedeeming (a)WheretheConstitutionalvalidityoftheprovisionsofanActorRuleisunderchallenge,or M.ANo.55/Rjt/2019 in ITANo.136/Rjt/2017 A.Y.2010-11 3 provisionsofsection50Cthattheassesseehadtoworkoutlongtermcapitalgainsonthe saleofthesaidproperty.ThefactsofthecasesofFortuneHotelsandEstatePLtd(supra) andMadanTheatersLtd(supra)arequitesimilartothefactsofthepresentappellant. Therefore,theappellantcannotbesaidtohavefileinaccurateparticularsofincomeorto haveconcealedanyincome.Inviewoftheabovefactsandcircumstancesofthecaseand positionoflawontheissue,itismyconsideredopinion,theprovisionsofexplanation5A ofsection271(1)(c)arenotapplicable.Accordingly,thegroundofappealisallowed. 6.1TheabovefindingofthelearnedCIT-Awasalsochallengedbytherevenue intheappealfiledbeforetheITATbutthesamewasn’tadjudicatedbytheITAT asthequantumofpenaltywasbelowthethresholdlimit.Therevenuehasnot broughtoutanythingonrecordsuggestingthattheabovefindingofthelearned CIT-Awasunderthechallengeinclause“a”ofpara10ofthecircular.i.e.“Where theConstitutionalvalidityoftheprovisionsofanActorRuleisunderchallenge”. Inotherwords,therevenueinthemiscellaneousapplicationhasnotpointedout anydefectintheorderoftheITATquathefindingofthelearnedCIT-A reproducedhereinabove.Thus,theappealfiledbytherevenueisliabletobe dismissedonaccountoflessquantumofthepenaltyaspertheCBDTcircular 03/2018.Accordingly,wedonotfindanyinfirmityintheorderoftheITATwhich requiresanycorrectionorrecalloftheorder.Hence,themiscellaneousapplication filedbytherevenueisherebydismissed. 7.Intheresult,themiscellaneousapplicationfiledbytherevenueis dismissed. OrderpronouncedintheCourton10/11/2023atAhmedabad. Sd/-Sd/- (SUCHITRAKAMBLE)(WASEEMAHMED) JUDICIALMEMBERACCOUNTANTMEMBER (TrueCopy) Ahmedabad;Dated10/11/2023 Manish