Income Tax Appellate Tribunal - Ahmedabad
Rajesh Dhirubhai Patel, , Ahmedabad vs Department Of Income Tax on 10 February, 2016
आयकर अपील
य अ धकरण, अहमदाबाद यायपीठ 'बी', अहमदाबाद ।
IN THE INCOME TAX APPELLATE TRIBUNAL
" B " BENCH, AHMEDABAD
सम ः- ी कुल भारत, या यक सद य एवं ी मनीष बोरड़, लेखा सद य ।
BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER And
SHRI MANISH BORAD, ACCOUNTANT MEMBER
आयकर अपील सं./I.T.A. No.2851/Ahd/2015
( नधा रण वष / Assessment Year : 2009-10)
The ACIT बनाम/ Shri Rajesh Dhirubhai Patel
Cir-7(2) Vs. D-43, Parimal Bungalows
Ahmedabad Nr.Sardar Chowk
Krishnanagar
Ahmedabad-382 345
थायी ले खा सं . /जीआइआर सं . / PAN/GIR No. : AGOPP 9136 E
(अपीलाथ' /Appellant) .. (()यथ' / Respondent)
अपीलाथ' ओर से /Appellant by : Shri B.Panda Sr.DR
()यथ' क+ ओर से/Respondent by : Ms.Arti N.Shah, AR
ु वाई क+ तार.ख /
सन Date of Hearing 09/02/2016
घोषणा क+ तार.ख /Date of Pronounce ment 10/02/2016
आदे श / O R D E R
PER SHRI KUL BHARAT, JUDICIAL MEMBER :
This appeal by the Assessee is directed against the order of the Ld.Commissioner of Income Tax(Appeals)-7, Ahmedabad ['CIT(A)' in short] dated 14/07/2015 pertaining to Assessment Year (AY) 2009-10. The Assessee has raised the following grounds of appeal:-
ITA No.2851 /Ahd/2015ACIT vs. Shri Rajesh Dhirubhai Patel Asst.Year - 2009-10 -2-
1. The Ld.CIT(A) has erred in law and on facts in deleting the penalty of Rs.13,65,434/- imposed u/s.271(1)(c) of the Act, ignoring the fact that the assessee did not offer the capital gain by taking sale consideration value as per Stamp Valuation Authority and the addition was correctly made by the A.O. taking the value as per 50C of the Act.
2. On fact and circumstances of the case, the Ld.CIT(A) has erred in law and on facts in deleting the penalty as above, overlooking the gravity of default committed by the assessee.
3. It is, therefore, prayed that the order of the CIT(A) be set aside and that of the A.O. be restored to the above extent.
2. Briefly stated facts are that the case of the assessee was picked up for scrutiny assessment and the assessment u/s.143(3) of the Income Tax Act,1961 (hereinafter referred to as "the Act") was framed vide order dated 23/12/2011, thereby the Assessing Officer (AO in short) made addition in respect of capital gain by invoking the provisions of section 50C of the Act. The AO also initiated penalty proceedings u/s.271(1)(c) of the Act and subsequently in quantum proceedings the ld.CIT(A) has confirmed the addition vide order dated 20/12/2012. The AO passed penalty u/s.271(1)(c) vide order dated 24/03/2014. The assessee being aggrieved by the said order, preferred an appeal before the ld.CIT(A), who after considering the submissions and the judicial pronouncements on the issue, vide order dated 14/07/2015, directed the AO to delete the penalty. Aggrieved by the order of the ld.CIT(A), now the Revenue is in appeal before us.
ITA No.2851 /Ahd/2015ACIT vs. Shri Rajesh Dhirubhai Patel Asst.Year - 2009-10 -3-
3. The only effective ground in this appeal is against the deletion of addition of Rs.13,65,434/-.
4. The ld.SR submitted that the ld.CIT(A) was not justified in deleting the addition. He relied upon the order of the AO. 4.1. On the contrary, ld.counsel for the assessee Ms.Arti N.Shah supported the order of the ld.CIT(A) and submitted that all evidences have been duly placed before the AO. There was no concealment of particulars of income or furnishing of inaccurate particulars of such income and the addition has been made merely on the basis of deeming fiction u/s.50C of the Act without carrying out any further enquiry. She submitted that the quantum proceedings and penalty proceedings are two different aspects.
5. We have heard the rival submissions, perused the material available on record and gone through the orders of the authorities below. There is no dispute with regard to the fact that the addition was made on the basis of invoking the provisions of section 50C of the Act. The Revenue has also not placed any material evidence on record to prove that the AO has made enquiry and consequence of such enquiry some material was gathered which was not disclosed by the assessee. The ld.CIT(A) after considering the submissions has decided the issue by observing as under:-
"3.4. I have considered the penalty order, assessment order and the submissions made by the appellant. A perusal of the order u/s.143(3) shows that the addition of Rs.42,28,700/- was made by the AO on ITA No.2851 /Ahd/2015 ACIT vs. Shri Rajesh Dhirubhai Patel Asst.Year - 2009-10 -4- account of the deeming provisions of Section 50C of the I.T.Act. All the details regarding sale of land had been produced by the appellant before the AO during the course of assessment proceedings. The addition on account f capital gains was made only on account of provision of section 50C whereby the AO took the value of the property at Rs.1,07,78,700/- instead of Rs.65,50,000/- as per the sale deed submitted by the appellant. Section 271(1)(c) of the I T Act states as under:-
"If the Assessing Officer or the Commissioner (Appeals) or the Commissioner in the course of any proceedings under this Act, is satisfied that any person:
(a) Omitted
(b) ....; or
(c) has concealed the particulars of his income or furnished inaccurate particulars of such income; or
(d) .....
he may direct that such person shall pay by way of penalty....".
3.5. In the present case it cannot be said that the appellant concealed particulars of his income or furnished inaccurate particulars of such income. All the documents and facts were before the AO at the time of assessment proceedings. The addition was made only on account of a different view taken by the A.O. The Hon'ble Supreme Court in the case of CIT Vs. Reliance Petroproducts Pvt.Ltd. (322 ITR 158) has held as under:-
"A glance at the provisions of section 271(1)(c) of the Income Tax Act, 1961, suggests that in order to b covered by it, there has to be concealment of the particulars of the income of the Appellant. Secondly, the Appellant must have furnished inaccurate particulars of his income. The meaning of the word "particulars" used in section 271(1)(c) would embrace the details of the claim made. Where no information given in the return is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars. In order to expose the assessee to penalty, unless the case is strictly ITA No.2851 /Ahd/2015 ACIT vs. Shri Rajesh Dhirubhai Patel Asst.Year - 2009-10 -5- covered by the provision, the penalty provision cannot be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate particulars. There can be no dispute that everything would depend upon the return filed by the assessee, because that is the only document where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate, the liability would arise. To attract penalty, the details supplied in the return must not be accurate, not exact or correct, not according to the truth or erroneous.
Where there is no finding that any details supplied by the assessee in its return are found to be incorrect or erroneous or false there is no question of inviting the penalty under section 271(1)(c). A mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such a claim made in the return cannot amount to furnishing inaccurate particulars".
In view of the discussion above and the ruling of Hon'ble Supreme Court, I am of the view that this is not a case where the appellant has furnished inaccurate particulars of income.
3.6 As regards the addition of Rs.1,05,000/- on account of long term capital gain on sale of shop, the appellant had declared the same in his return of income. The AO could also have had independent enquiries conducted, if he was not satisfied with the explanation offered by the appellant. Further, it is settled law that penalty proceedings are separate from assessment proceedings. Even during penalty proceedings, no steps have been taken by the AO to establish that the appellant furnished inaccurate particulars of income. In view of the above discussion, the appellant's case does not attract provisions of Section 271(1)(c) and penalty of Rs.13,65,434/- is deleted."
5.1. The above finding of the ld.CIT(A) remains uncontroverted as the Revenue has not placed any material on record suggesting that there was concealment of particulars of income or furnishing inaccurate particulars of such income by the assessee. Therefore, we are of the considered ITA No.2851 /Ahd/2015 ACIT vs. Shri Rajesh Dhirubhai Patel Asst.Year - 2009-10 -6- view that the ratio laid down by the Hon'ble Apex Court rendered in the case of CIT vs. Reliance Petroproducts Pvt.Ltd. reported at (2010) 322 ITR 0158 (SC) is rightly applied by the ld.CIT(A). Under these facts, we do not see any reason to interfere with the order of the ld.CIT(A), same is hereby upheld. Thus, the ground raised in the Revenue's appeal is rejected.
6. In the result, Revenue's appeal stands dismissed.
Order pronounced in the Court on Wednesday, the 10th day of February, 2016 at Ahmedabad.
Sd/- Sd/-
(मनीष बोरड़) (कुल भारत)
लेखा सद य या यक सद य
( MANISH BORAD ) ( KUL BHARAT )
ACCOUNTANT MEMBER JUDICIAL MEMBER
Ahmedabad; Dated 10/ 02 /2016
ट..सी.नायर, व. न.स./T.C. NAIR, Sr. PS
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)-7, Ahmedabad
5. 8वभागीय ( त न5ध, आयकर अपील.य अ5धकरण, अहमदाबाद / DR, ITAT, Ahmedabad
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, अहमदाबाद / ITAT, Ahmedabad