SURESH PRODUCTIONS ,HYDERABAD V. DCIT., CENTRAL CIRCLE-1(2), HYDERABAD

MA 30/HYD/2024

AI Insights

The case involves Suresh Productions, which sought to recall an order confirming a penalty under Section 271(1)(c) of the Income Tax Act. The penalty was initially levied following an assessment under Sections 153C and 143(3), where the assessee had declared additional income from house property, which was inadvertently not included in the original return. The Tribunal had previously confirmed the penalty, citing Explanation 5A of Section 271(1), which was argued to be inapplicable as the assessee was not a searched person. However, the Tribunal found that the provisions applied as the assessee was covered under Section 153C. The assessee's application for recalling the order was based on the non-consideration of certain judgments, which the Tribunal found did not constitute a mistake apparent from the record.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 706930 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 11 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-07-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-B
• Assessment Year: 2015-2016
• Appeal Filed On: 26-07-2024
• Other Referred Cases: Saksham Commodities Ltd vs. ITO, Karti P. Chidambaram v. PDIT, Vrundavan Ginning & Oil Mill vs. Astt. Registrar/President, CIT vs. Sical Logistics Ltd, Vijay Channabasav Suttatti vs. ACIT, CIT vs. Reliance Telecom Ltd, Suresh Prasad J.V vs. ACIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: A SRINIVAS
• Section: 143(3); 271(1)(c); 132

Judgement Text

" MA No 30 of 2024 Suresh Productions Page 1 of 6 आयकर अपीलȣय अͬधकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘ DB-B ‘ Bench, Hyderabad Before Shri Vijay Pal Rao, Vice-President A N D Shri Madhusudan Sawdia, Accountant Member MA No.30/Hyd/2024 (आ.अपी.सं /ITA No.641/Hyd/2023) (िनधाŊरण वषŊ/Assessment Year: 2015-16) M/s. Suresh Productions Hyderabad PAN:AAJFS7306J Vs. Dy. C. I. T Central Circle 1(2) Hyderabad (Appellant) (Respondent) िनधाŊįरती Ȫारा/Assessee by: Shri A Srinivas, CA राज̾ व Ȫारा/Revenue by:: Dr. Sachin Kumar, Sr. AR सुनवाई की तारीख/Date of hearing: 20/06/2025 घोषणा की तारीख/Pronouncement: 07/07/2025 आदेश/ORDER Per Vijay Pal Rao, Vice President By way of this application, the assessee is seeking recalling of the order dated 29/02/2024 whereby the Tribunal has confirmed the penalty levied u/s 271(1)(c) of the Act. 2. The learned AR of the assessee has submitted that the assessment in the case of the assessee was completed u/s 153C r.w.s 143(3) of the Act wherein the AO has made no addition to MA No 30 of 2024 Suresh Productions Page 2 of 6 the total income declared by the assessee in the return of income filed in response to the notice u/s 153C of the Act. The assessee Suo motto declared an income of Rs.3,50,000/- as income from house property before the deduction u/s 24 of the Act over and above the original assessment. The ld AR has further submitted that the rental income was inadvertently not taken into account while filing the return of income. The same was offered to tax in response to the notice u/s 153C of the Act. Therefore, when the assessee has declared the said income in the return of income and no addition was made by the AO, then the penalty levied u/s 271(1)(c) of the Act is not justified. The ld AR has further submitted that the Tribunal has confirmed the penalty by invoking the Explanation 5A of Section 271 (1) of the Act which is not applicable in the case of the assessee as this is not an assessment of a searched person. In support of his contention, he relied upon the following decisions: i) Hon’ble Delhi High Court in the case of Saksham Commodities Ltd vs. ITO (2024) 464 ITR 1 (Del.) ii) Hon’ble Madras High Court in the case of Karti P. Chidambaram v. PDIT (Inv.) (2021) 436 ITR 340 3. The ld AR has submitted that the non-consideration of these judgments while passing the impugned order crept an apparent mistake from record and consequently, the impugned order of the Tribunal be recalled for deciding the same after considering the decisions as referred above. MA No 30 of 2024 Suresh Productions Page 3 of 6 4. On the other hand, the ld DR has submitted that the Tribunal has decided the appeal of the assessee on merits and also considered the contention of the assessee on the applicability of the Exp.5A of Sec 271(1) of the Act which cannot be reviewed in the proceedings u/s 254(2) of the Act. Thus, the ld DR has submitted that the assessee is seeking the review of the order of the Tribunal passed on merits in the garb of rectification of the mistake which is beyond the provisions of Section 254(2) of the Act. In support of his contention, he has relied upon the following judgments: i) Hon’ble Gujarat High Court in the case of Vrundavan Ginning & Oil Mill vs. Astt. Registrar/President (2021) 126 Taxmann.com 227 (Guj.) ii) Hon’ble Madras High Court in the case of CIT vs. Sical Logistics Ltd (2021) 128 Taxmann.com 370 (Mad.) iii) Hon’ble Bombay High Court in the case of Vijay Channabasav Suttatti vs. ACIT (2024) 166 Taxmann.com 384 (Bom.) iv) Hon’ble Supreme Court in the case of CIT vs. Reliance Telecom Ltd (2021) 133 Taxmann.com 41 (S.C) v) ITAT Hyderabad Bench in the case of Suresh Prasad J.V vs. ACIT in M.A. No.13/.Hyd/2024 dated 2/9/2024 5. We have considered the rival submissions and carefully perused the order of the Tribunal. The Tribunal has considered the submissions of the assessee as well as the decisions relied upon by the ld AR mentioned in Para 5 of the impugned order: MA No 30 of 2024 Suresh Productions Page 4 of 6 “5. By placing reliance on the decision reported in the cases of CIT vs. Suresh Chand Bansal (2010) 329 ITR 330 (Calcutta) and CIT vs. Suraj Bhan (2007) 159 Taxman 26, he argued that assessee had offered additional income following search and such income had been accepted in entirety without any attempt to obtain explanation of the assessee, no penalty is leviable u/s 271(1)(c) of the Act”. 6. The Tribunal has given the findings in Para 7 & 8 of the impugned order as under: 7. We further note that at the time of levying of penalty u/s 271(1)(c), the AO has also applied the Explanation 5A to Section 271(1) of the I.T. Act. Therefore, it is not the case of the MA No 30 of 2024 Suresh Productions Page 5 of 6 applying Explanation 5A to section 271(1) first time by the Tribunal while passing the impugned order but the AO as well as the CIT (A) has also applied the Explanation 5A to Section 271(1) of the I.T. Act. The decisions relied upon by the assessee are not on the point that the provisions of Explanation 5A to Section 271(1) are not applicable in case of the assessee other than the searched person or the assessee covered u/s 153C of the Act. The language of Explanation 5A is very much clear and unambiguous that in course of a search initiated u/s 132 of the Act on or after 1/6/2007, the assessee is found to be the owner of any money, bullion, jewellery or other valuable article or thing or income and such income has not been declared on Return of Income furnished before the date of search, then not withstanding that such income is declared in the Return of Income furnished after the date of search, he shall be deemed to have concealed the particulars of income. Therefore, it is not restricted to the assessee who is searched but it is clearly stated that in the course of search, the assessee is found to be the owner of asset or income which certainly covers the assessee falling u/s 153C of the Act. Even otherwise, the impugned order passed by the Tribunal is a decision on the point and not a mistake apparent from record as there is no direct binding precedent brought before us on the point that the Explanation 5A to Section 271(1) is not applicable in case of the assessee covered u/s 153C of the Act. Hence, we find that the assessee has failed to make out a case of mistake apparent from record within the scope of the provisions of Section MA No 30 of 2024 Suresh Productions Page 6 of 6 254(2) of the Act. Accordingly, we do not find any merit or substance in the M.A of the assessee which is liable to be dismissed. We order accordingly. 8. In the result, Miscellaneous Application filed by the assessee is dismissed. Order pronounced in the Open Court on 7th July, 2025. Sd/- Sd/- (MADHUSUDAN SAWDIA) ACCOUNTANT MEMBER (VIJAY PAL RAO) VICE-PRESIDENT Hyderabad, dated 7th July, 2025 Vinodan/sps Copy to: S.No Addresses 1 Suresh Productions, 8-2-293/82/JIII/6 Ramanaidu Studio, Jubilee Hills, Film Nagar, Hyderabad 500033 2 Dy. CIT (Central Circle) 1(2) Aayakar Bhavan, Basheerbagh, Opp: LB Stadium, Hyderabad 500004 3 Pr. CIT – Central, Hyderabad 4 DR, ITAT Hyderabad Benches 5 Guard File By Order "