Income Tax Appellate Tribunal - Pune
Dilip P.Sonigara, vs Department Of Income Tax on 17 July, 2006
IN THE INCOME TAX APPELLATE TRIBUNAL
PUNE BENCH, ''B'' PUNE
Before Shri I.C. Sudhir, JM and Shri D. Karunakara Rao, AM
I.T.A. No. 266/PN/2009: A.Y. 2003-04
Asstt. CIT Cir. 9, Pune Appellant
Vs.
Dilip P. Sonigara
Vishal Arcade
Station Road
Chinchwadgaon,
Pune-411 033.
PAN ACNPS 6825 M Respondent
Appellant by : Shri G.S. Gulati
Respondent by: Shri Sunil Ganoo
ORDER
Per I.C. Sudhir, JM
The revenue has questioned first appellate order on the ground that the learned CIT(A) has erred in:
(i) not treating the revised return as non est as the same was barred by time as per the provisions of section 139(5) of the Act;
(ii) holding that the assessee had disclosed a true and correct income when the time barred revised return has no validity as per the Income-tax Act 1961;
(iii) deleting the penalty of Rs. 12,95,747/- levied u/s 271(1)(c) of the Act.2 ITA No.266/PN/2009
Dilip P. sonigara A.Y. 2003-04 ,
2. We have heard and considered arguments advanced by both the parties in view of the orders of lower authorities and the decisions relied upon.
3. The relevant facts are that in its original return of income filed on 22-9-2003, the assessee declared income of Rs.45,29,811/- consisting long term capital gain on sales of shares of Database Finance Ltd., of Rs. 39,84,588/-. On this gain tax was paid at concessional rate of 10%. Subsequently, revised return of income was filed by the assessee on 12-6- 2006 declaring total income at Rs. 45,85,740/-. In this revised return of income, tax on the entire income including long term capital gain was paid at the maximum marginal rate. Vide letter dated 17-7-2006, the A.O received information from Investigation Wing of the Income-tax Department that the assessee had booked non-genuine capital gain for the relevant year on account of sale of shares of Database Finance Ltd. The A.O accordingly issued notice u/s 148 on 28-2-2007 in response to which the assessee submitted that the revised return filed on 12-6-2006 could be treated as return filed in compliance of notice u/s 148. The assessment u/s 143(3) read with section 147 was completed on 30-11-2007 assessing the total income of the assessee at Rs. 46,26,150/-. The A.O also ordered for initiation of penalty proceedings u/s 271(1)(c). During the penalty proceedings, 3 ITA No.266/PN/2009 Dilip P. sonigara A.Y. 2003-04 , the assessee tried to explain that penalty u/s 271(1)(c) was not attracted in the case of assessee as the assessee had filed the revised return of income prior to any receipt of notice from the A.O. The A.O did not agree with such explanation with this observation that revised return was filed by the assessee only in pursuance of initiation of inquiry by the Investigation Wing of the Income-tax Department for ascertaining the genuineness of claim of long term capital gain furnished by the assessee on sale of shares of Database Finance Ltd. The A.O thus levied penalty of Rs. 12,95,747/- being 150% of the tax sought to be evaded. The learned CIT(A) has however, deleted the penalty. The same has been questioned by the revenue before us.
4. The learned DR tried to justify the penalty orders. He submitted that the return was revised by the assessee when it is realized that on similar other cases department was making inquiries. In its revised return, the assessee changed the head of income from capital gain to marginal income. Under these circumstances, it cannot be inferred that the declaration was made by the assessee voluntarily. The learned DR submitted further that revised return was filed beyond time and hence it is non est. 4 ITA No.266/PN/2009 Dilip P. sonigara A.Y. 2003-04 ,
5. While reiterating the submissions made before the lower authorities, the learned AR on the other hand placed reliance on the following decisions:
(a) CIT Vs. Rajiv Garg and others (2009) 313 ITR 256 (P&H)
(b) CIT vs. Sureshchandra Mittal (2000) 241 ITR 124 (MP)
(c) CIT vs. Suresh Chandra Mittal (2001) 251 ITR 9(Sc)
(d) Addl. CIT Vs. Prem Chand Garg (2009) 119 ITD 97 (Del) (TM)
6. The learned AR submitted that the A.O has accepted the revised return, hence the same cannot be disputed now by the Department, that it was beyond prescribed time limit, hence non est. In this regard, the learned AR placed reliance on the decision of Bombay High court in the case of Laxman Vs. CIT (1988) 174 ITR 465 (Bom).
7. Having gone through the orders of the lower authorities we find that certain important facts of the case have not been disputed. These facts are that the assessee had correctly discussed his income and paid taxes due thereon before issuance of notice u/s 148 of the Act by the assessee or prior to the date 17-7-2006 on which a letter was written by the Investigation Wing of the Income-tax Department to the A.O., that the assessee had booked non-genuine long term capital gain for the relevant year on account of sale of shares of Database Finance Ltd. IN view of these admitted material facts, we are of the opinion that there is no reason to interfere with the finding of the learned CIT(A) while deleting the penalty that there was no concealment of particulars of 5 ITA No.266/PN/2009 Dilip P. sonigara A.Y. 2003-04 , income or furnishing of inaccurate particulars thereof on the part of the assessee towards the addition to levy penalty u/s 271(1)(c) thereupon. This material fact has also not been rebutted by the Department as noted by the learned CIT(A) that the A.O has dropped penalty proceedings initiated u/s 271(1)(c) of the Act for A.Y. 2004-05 on similar facts. The first appellate order in question is thus upheld. The grounds are accordingly rejected.
8. Consequently, the appeal is dismissed.
Order is pronounced in the open court on 31st August 2010.
Sd/- sd/-
(D. Karunakara Rao) (I.C. Sudhir )
Accountant Member Judicial Member
Pune,dated the 31st August 2010
Ankam
Copy forwarded to:
(1) Assessee
(2) Department
(3) CIT- (A) III Pune
(4) CIT - IV Pune
(5) The D.R. ITAT 'B' Bench, Pune
True copy By order,
Assistant Registrar
Income-tax Appellate Tribunal,
Pune Benches, Pune