Income Tax Appellate Tribunal - Ahmedabad
Smt.Anilaben Navinchandra Thakkar,, ... vs Income Tax Officer,Ward-5(3)(1),, ... on 19 April, 2018
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IN THE INCOME TAX APPELLATE TRIBUNAL
" SMC " BENCH, AHMEDABAD
सव ी द प कुमार के डया, लेखा सद य एवं महावीर साद, या यक सद य के सम ।
BEFORE SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER &
SHRI MAHAVIR PRASAD, JUDICIAL MEMBER
ITA No. 3442/Ahd/2015
( नधा रण वष / Assessment Year: 2011-12)
Smt. Anilaben Navinchandra बनाम/ The ITO,
Thakkar, Vs. Ward - 5(3)(1),
Prop. Aakruti Packaging, Narayan Chambers,
12, Harikrishana Soc. Ashram Road,
Pritamnagar, Ellisbridge, Ahmedabad.
Ahmedabad - 380 006
थायी ले खा सं . /जीआइआर सं . / PAN/GIR No. : AAWPT 4447 L
(अपीलाथ& /Appellant) .. ( 'यथ& / Respondent)
अपीलाथ& ओर से / Appellant by : Shri S. N. Divatia, A.R.
'यथ& क) ओर से/Respondent by : Shri Prajna Paramita, Sr. D.R.
ु वाई क) तार ख /
सन Date of Hearing 09/03/2018
घोषणा क) तार ख /Date of Pronounce ment 19/04/2018
आदे श / O R D E R
PER MAHAVIR PRASAD, JUDICIAL MEMBER :
The captioned appeal has been filed at the instance of the Assessee against the appellate order of the Commissioner of Income Tax(Appeals)-5, Ahmedabad [CIT(A) in short] vide appeal no.CIT(A)-5/ITO.Wd.5(3)(1)/94/2014-15 dated 05/10/2015 arising in the penalty order passed under s.271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as "the Act") dated 19/02/2015 relevant to Assessment Year (AY) 2011-12.
ITA No.3442/Ahd/15Smt. Anilaben Navinchandra Thakkar Vs. ITO Asst.Year -2011-12 -2-
2. The substantive grievance of the assessee reads as under:-
"1.1 The order passed u/s.250 on 05/10/2015 for A.Y. 2011-12 by CIT(A)-5 Abad upholding the penalty of Rs.6,65,680/- imposed u/s.271(1)(c) by AO is wholly illegal, unlawful and against the principles of natural justice.
1.2 The Ld. CIT(A) has grievously erred in law and or on facts in not considering fully and properly the submissions made and evidence produced by the appellant with regard to the impugned penalty.
2.1 The Ld.CIT(A) has grievously erred in law and on facts in confirming that the appellant had furnished inaccurate particulars of income by not including LTCG on sale of house property claimed exempt in A.Y.2008-09 though the conditions precedent for it were not fulfilled.
2.2 That in the facts and circumstances of the case as well as in law, the Ld.CIT(A) ought not to have upheld the penalty of Rs.6,65,680 levied u/s 271(1)(c).
3.1 Without prejudice to the above and in the alternative, the penalty of Rs.6,65,680/- imposed by AO and confirmed by CIT(A) is excessive and erroneous so that the same should be reduced."
3. The brief facts of the case are that for Asst. Year 2011-12 in reassessment proceedings was Long Term Capital Gain arose as a result of sale of residential house property. As per records, assessee has sold RHP for total sale consideration of Rs.70,00,000/- during the previous year. The Long Term Capital Gain was worked out by the assessee at Rs.36,54,330/- for asst. year 2008-09 and assessee has invested Rs.15,00,000/- in REC Bond u/s.54EC of the Act. The assessee is also invested Rs.22,50,000/- for Capital Gain Account scheme in form of FD with Bank of Baroda. As per provisions of Section 54(1) of the Act, Rs.22,50,000/- was to be utilized for new RHP within time limit prescribed. Later on it was noticed that the assessee has not utilized R.22,50,000/- for new RHP within time ITA No.3442/Ahd/15 Smt. Anilaben Navinchandra Thakkar Vs. ITO Asst.Year -2011-12 -3- limit prescribed u/s.54(1) of the Act, as such amount not so utilized shall be charged u/s.45 of the Act. Assessee has furnished a return of income for assessment year 2009-10, 2010-11 and 2011-12 as under:
A.Y. Date of filing
2009-10 02/03/2010
2010-11 14/03/2011
2011-12 17/03/2012
4. The period of three years from the date of transfer/sale of original asset expires on 01/06/010. The date falls during the previous year relevant to A.Y.2011-12. As per proviso to provisions of Section 54(2) of the Act, the amount of capital gain not so utilized.
5. With the above background the assessment proceedings were taken up for A.Y. 2011-12 by invoking the provision of section 147/148 of the Act.
6. During the course of reassessment proceedings, assessee admitted that "we agree that we are liable to the capital gain tax". After this admission, ld. AO held that assessee has committed the default and as such amount Rs.22,50,000/- not so utilized was charged u/s.45 of the Act, as the income of previous year 01/04/2010 to 31/03/2011 relevant to A.Y.2011-12. Accordingly, Rs.22,50,000/- was taxed under the head Long Term Capital Gain for A.Y. 2010-11 and penalty proceedings were also initiated for furnishing of inaccurate particulars of income or concealed the income vide order u/s.143(3) r.w.s.147 of the Act. Thereafter, penalty proceedings were also initiated. During the penalty proceedings, assessee stated that though she has admitted that the assessee was liable to Long Term Capital Gain and accordingly ITA No.3442/Ahd/15 Smt. Anilaben Navinchandra Thakkar Vs. ITO Asst.Year -2011-12 -4- assessee has accepted the assessment order and tax has been paid as per assessment order. It is seen from the record that assessee as not preferred appeal against the order u/s.143(3) of the Act.
7. But in penalty proceedings, ld. AO held that assessee has furnished inaccurate particulars of her income under the head Long Term Capital Gain or has concealed the income within the meaning of provisions of Section 271(1)(c) of the Act. Hence, assessee has committed the default which attracts the penalty u/s.271(1)(c) and levied the penalty of Rs.6,65,680/-.
8. Against the said order assessee preferred first statutory appeal before the ld. CIT(A) but to no avail. Now appeal is before us.
9. We have gone through the relevant record and impugned order. Ld. AR stated that appellant has invested a part of amount of Capital Gain in buying residential house. But due to sudden increase in property price and other dispute, the builder has revised the price of houses, which was not as per the understanding of assessee hence the same could not materialize. However, later on assessee could not invest the same money due to tremendous increase in the price of residential house property. Therefore, under compelling circumstances, the assessee agreed to pay tax and already assessee has paid capital gain tax.
10. In support of its contention, appellant filed a copy of Bank Pass Book where the amount was deposited and in support of its contention assessee also cited a judgment of Apex Court in the matter of Union of India vs. Rajasthan Spg. & Wvg. Mills (2009) wherein it has been held that "mere nonpayment or short-payment of tax would not inevitably lead to imposition of penalty".
ITA No.3442/Ahd/15Smt. Anilaben Navinchandra Thakkar Vs. ITO Asst.Year -2011-12 -5-
11. In the case of CIT vs. Reliance Petro Products (2010), Delip N. Shroff vs. CIT (2007) it has been held that "merely because an addition is made to the income declare by assessee, penalty under section 271(1)(c) cannot be imposed".
12. In this case, Long Term Capital Gain was worked out and claimed that Rs.15,00,000/- has been invested in REC. Bond and Rs.22,25,000/- was deposited in Bank of Baroda. As per certificate dated 30/09/2007 issued by the Bank of Baroda.
13. Because of hike in the price of the house, assessee could not purchase the property and assessee has also paid tax after going through the aforesaid judgment and facts of the case are considered. We are of the considered opinion that appellant should be given benefit of section 273(B) of the Act as there was a reasonable cause for not invested the money in the property. Therefore, we delete the penalty confirmed by the CIT(A).
14. In the result, appeal filed by the assessee is allowed.
This Order pronounced in Open Court on 19/04/2018
Sd/- Sd/-
( द प कुमार के डया) (महावीर साद)
लेखा सद य या यक सद य
( PRADIP KUMAR KEDIA ) ( MAHAVIR PRASAD
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated 19/ 04/2018
Priti Yadav, Sr. PS
ITA No.3442/Ahd/15
Smt. Anilaben Navinchandra Thakkar Vs. ITO Asst.Year -2011-12 -6- आदे श क त"ल#प अ$े#षत/Copy of the Order forwarded to :
1. अपीलाथ& / The Appellant
2. 'यथ& / The Respondent.
3. संबं5धत आयकर आयु7त / Concerned CIT
4. आयकर आय7 ु त(अपील) / The CIT(A)-5, Ahmedabad.
5. 8वभागीय त न5ध, आयकर अपील य अ5धकरण,राजोकट/DR,ITAT, Rajkot
6. गाड फाईल / Guard file.
आदे शानुसार/ BY ORDER, स'या8पत त //True Copy// उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील य अ धकरण, राजोकट / ITAT, Rajkot