Income Tax Appellate Tribunal - Mumbai
Yashaswi Builders, Mumbai vs Department Of Income Tax on 23 December, 2011
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCHES "G", MUMBAI
Before Shri R.S.Syal, AM and Shri D.K.Agarwal, JM
ITA No.2527/Mum/2010 : Asst. Year 2005-2006
The Income tax Officer M/s.Yashaswi Builders
Ward 16(3)(3) 457 Phoenix Building
Mumbai. S.V.P.Road, Mumbai - 400 004.
Vs.
PAN : AAAFY0023F.
(Appellant) (Respondent)
Appellant by : Shri A.K.Nayak
Respondent by : Shri Tarun Ghia
Date of Hearing : 20.12.2011 Date of Pronouncement :23.12.2011
ORDER
Per R.S.Syal, AM :
This appeal by the Revenue arises out of the order passed by the Commissioner of Income-tax (Appeals) on 14.01.2010 deleting the penalty of `20 lakh imposed by the Assessing Officer u/s 271(1)(c) in relation to the assessment year 2005-2006.
2. This appeal is time barred by 16 days. The learned D.R. explained the reason for the delay. We are satisfied with such reasons leading to the delay in filing the appeal. No serious objection was taken by the learned AR. We, therefore, condone the delay and admit this appeal for hearing on merits.
3. Briefly stated the facts of the case are that the assessee filed return declaring total income of `8,67,470 and the assessment was completed at `33,40,070. The main addition on which concealment penalty has been imposed is about the rental income of `46.61 lakh which was claimed by the assessee as `Business income' instead of `Income from house property' assessed by the 2 ITA No.2527/Mum/2010. M/s.Yashaswi Builders.
Revenue. The Assessing Officer held that the assessee intentionally claimed rental income under the head `Profits and gains of business or profession' for claiming deduction towards various expenses. That is how the penalty of `20 lakh was imposed, which came to be deleted in the first appeal.
4. After considering the rival submissions and perusing the relevant material on record it is observed that the only basis for addition leading to the penalty is the transfer of rental income from the head `Profits and gains of business or profession' as declared by the assessee to the `Income from house property' as held by the Assessing Officer and the resultant disallowance of expenses claimed by the assessee under the head `Business income' and granting of eligible expenses under the head `Income from house property'. Apart from that there is nothing to indicate that there was any variation in the gross amount of rent received by the assessee and so declared. The assessee canvassed the view that the rental income was assessable under the head `Profits and gains of business or profession' as it was being done in the earlier years also, which position accepted by the Revenue albeit in assessments made u/s 143(1)(a). The mere fact that in the current year the Assessing Officer shifted the head under which the rental income was assessable, cannot be considered as a case for imposition of penalty u/s 271(1)(c). The Hon'ble Supreme Court in the case of CIT Vs. Reliance Petro Products Pvt. Ltd. [(2010) 322 ITR 158 (SC)] has held that simply for the reason that the Assessing Officer did not find the claim of the assessee to be sustainable in law up to a certain extent, it can not be a case for penalty u/s.271(1)(c) more so when the particulars furnished by the assessee were not inaccurate. The facts of our case are similar inasmuch as the assessee declared the rental income under the head `Business income' following the view taken by it in the earlier years and all the necessary particulars were duly disclosed. Respectfully following the same, we uphold the impugned order.
3 ITA No.2527/Mum/2010.M/s.Yashaswi Builders.
5. In the result, the appeal is dismissed.
Order pronounced on this 23rd day of December, 2011.
Sd/- Sd/-
(D.K.Agarwal) (R.S.Syal)
JUDICIAL MEMBER ACCOUNTANT MEMBER
Mumbai : 23rd December, 2011.
Devdas*
Sd/-
(R.K.Panda)
AM (Nominated)
Copy to :
1. The Appellant.
2. The Respondent.
3. The CIT concerned
4. The CIT(A)-XVII, Mumbai.
5. The DR/ITAT, Mumbai.
6. Guard File.
TRUE COPY.
By Order
Assistant Registrar, ITAT, Mumbai.