Income Tax Appellate Tribunal - Ahmedabad
Mohanlal Kuberdas Joshi., Surat vs Dcit, Circle-9,, Surat on 17 January, 2017
IN THE INCOME TAX APPELLATE TRIBUNAL "SMC" BENCH, AHMEDABAD BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER आयकर अपील सं./ ITA No. 2254/Ahd/2013 िनधा रण वष / Assessment Year : 2006-2007 Mohanlal Kuberdas Joshi, DCIT, 42, Vishalnagar Co-op. Housing Vs Circle-9, Society Ltd., Bhatar Road, Surat Surat PAN : ABEPJ 5812 G अपीलाथ / अपीलाथ (Appellant) यथ यथ / थ (Respondent) Assessee by : Written Submissions (None) Revenue by : Shri G C Daxini, Sr DR Date of Hearing : 07/12/2016 Date of Pronouncement in Court : 17/01/2017 आदेश/O R D E R This appeal by the assessee is directed against the order of the Learned Commissioner of Income-Tax (Appeals)-V, Surat dated 27.06.2013 for Assessment Year 2006-2007.
2. The solitary ground raised is as under:-
The learned Commissioner of Income-tax (Appeals) erred in partially confirming penalty on the basis of addition made u/s 50C of the Act which is a deeming provision.
3. At the time of hearing, none appeared for the assessee; however, written submissions were filed on 04.07.2016 with the request to consider the same. Consequently, this appeal is decided ex-parte qua the assessee after considering the submissions, case laws and hearing the ld. Departmental Representative. In the written submissions, the ld. Counsel for the assessee has contended that:-
(i) It is submitted that u/s 50C, addition to the income of the assessee is made on the basis of a deeming provision. While there would be one figure as per Stamp Valuation Authority and another figure SMC-ITA No. 2254/Ahd/2013 Mohanlal Kuberdas Joshi vs. DCIT AY : 2006-2007 2 can be different as per value determined by DVO u/s. 50C(2) of the Act. In the background of the above, no penalty can be levied on such figure.
(ii) Reliance is placed on the following judgemnets:-
(a) Chimanlal Manilal Patel ITA No.508/Ahd/2010 Ahmedabad Bench
(b) Haresh P. Shah ITA No.2154/Ahd/2010 Ahmedabad Bench
(c) Renu Hingorani ITA No.2210/Mum/2010 Mumbai Tribunal
(d) Jagdish Daswni ITA No.4181/Mum/2011 Mumbai Tribunal
(e) C. Basker ITA No.997/Mds/2012 Chennai Tribunal
(f) Madan Theatres Ltd. (260-CTR-75) Calcutta High Court
(g) Kerman F. Lakdawala ITA No.l810/Ahd/2011 Ahmedabad Bench
(iii) The Assessing Officer has not brought any evidence to show that assessee has received additional amount as per valuation done by Stamp Valuation Authority just because Assessing Officer has accepted valuation as per Stamp Valuation Authority it cannot be said that assessee has received such amount and therefore there cannot be concealment of income. The department appeal is required to be dismissed.
(iv) In this case, the assessee did not file appeal against the order passed making the above addition but as held in case of order of Mumbai Tribunal in case of Renu Hingorani "merely because the assessee agreed for addition on the basis of valuation made by the Stamp Valuation Authority that by itself would not be conclusive proof that the sale consideration as per this agreement was incorrect and wrong." Accordingly, the addition because of the deeming provision does not attract penalty u/s. 271(l)(c) of the Act.
4. Ld. Departmental Representative supported the orders of the authorities below and contends that the provisions of Section 50C were very clear and the assessee ought to have offered the capital gains in terms of Section 50C.
SMC-ITA No. 2254/Ahd/2013 Mohanlal Kuberdas Joshi vs. DCIT AY : 2006-2007 3
5. I have heard the rival contentions, perused the material available on record and gone through the orders of the authorities below. The Ahmedabad Bench of ITAT in order dated 22.06.2012 in the case of Chimanlal Manilal Patel vs. ACIT, (2012) 33 CCH 647 AhdTrib, (ITA No.508/Ahd/2010) has held as under:-
"5. We have heard the rival contentions and perused the material on record. It is a fact that the addition has been made by the AO in the revisionary proceedings. The addition has been made on the basis of provisions of section 50C. It is not the case of the AO that the assessee has received consideration over and above than that declared in the sales deed. The AO has not disputed the consideration received by the assessee. The addition has been made on the basis of deeming provisions of section 50C. The assessee has furnished all the facts of sale, documents/ material before the AO. The AO has not doubted the genuineness of the documents/details furnished by the assessee. Only because the assessee agreed to the additions because of the deeming provisions it cannot be construed to be filing of inaccurate particulars on the part of the assessee. The assessee agreed to addition on the basis of valuation made by the stamp valuation authority cannot be a conclusive proof that the sale consideration as per the sale agreement is seemed to be incorrect and wrong. In view of these facts we are of the considered view that penalty cannot be levied on the basis of deeming provision. We accordingly delete the same."
In the case of Renu Hingorani vs. ACIT in ITA No.2210/Mum/2010, another Co-ordinate Bench of this Tribunal has held as under:-
"8. We have considered the rival contentions and relevant record. We find that the AO had made addition of Rs.9,00,824/- being difference between the sale consideration as per sale agreement and the valuation made by the Stamp Valuation Authority. Thus, the addition has been made by the AO by applying the provisions of section 50C of the Act. It is evident from the assessment order that the AO has not questioned the actual consideration received by the assessee but the addition is made purely on the basis of deeming provisions of the Income Tax Act, 1961. The AO has not given any finding that the actual sale consideration is more than the sale consideration admitted and mentioned in the sale agreement. Thus it does not amount to concealment of income or furnishing inaccurate particulars of income. It is also not the case of the revenue that the assessee has failed to furnish the relevant record as called by the AO to disclose the primary facts. The assessee has furnished all the relevant facts, documents/material including the sale agreement and the AO has not doubted the genuineness and validity of the documents produced before him and the sale consideration received by the assessee. Under these facts and circumstances, it cannot be said that the SMC-ITA No. 2254/Ahd/2013 Mohanlal Kuberdas Joshi vs. DCIT AY : 2006-2007 4 assessee has not furnished correct particulars of income. Merely because the assessee agreed for addition on the basis of valuation made by the Stamp Valuation Authority would not be a conclusive proof that the sale consideration as per this agreement was incorrect and wrong. Accordingly the addition because of the deeming provisions does not ipso facto attract the penalty u/s 271(1)(c ). Hence in view of the decision of the Hon'ble Supreme Court in the case of CIT V/s Reliance Petroproducts Pvt.Ltd (supra), the penalty levied u/s 271(1)( c ) is not sustainable. The same is deleted.
Similar view has been adopted in the case of Shri Jagdish Daswni vs. ITO in ITA No.4181/Mum/2011 and in other cases mentioned by the assessee. All these judgments have specifically dealt with the provisions of Section 50C of the Income-tax Act; besides, all the details concerning the transactions were duly mentioned in the return of income to which the judgment of Hon'ble Supreme Court in the case of CIT Vs Reliance Petroproducts Pvt. Ltd, reported in 322 ITR 158(SC), as considered by the ITAT in the case of Renu Hingorani (supra), is squarely applicable. In view of the above observations and judicial precedents, this is not a fit case for levying penalty u/s 271(1)(c) of the Act, which is deleted and the assessee's appeal is accordingly allowed.
6. In the result, the appeal filed by the assessee is allowed.
Sd/-
R.P. TOLANI
(JUDICIAL MEMBER)
Ahmedabad; Dated 17/01/2017
*Biju T., Sr. PS
आदेश क ितिलिप अ ेिषत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2.
यथ / The Respondent.
3. संबंिधत आयकर आयु / Concerned CIT
4. आयकर आयु (अपील) / The CIT(A)
5. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, अहमदाबाद / DR, ITAT, Ahmedabad
6. गाड फाईल / Guard file.
आदेशानुसार/ BY ORDER, TRUE COPY उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपीलीय अिधकरण, अहमदाबाद / ITAT, Ahmedabad