SMT. KRISHNA DEVI SAIWAL,ALWAR vs. INCOME TAX OFFICER, WARD-1-3, ALWAR

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ITA 1259/JPR/2018Status: DisposedITAT Jaipur06 June 2019AY 2007-084 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that penalty under Section 271(1)(c) is not leviable when income is assessed on the basis of deemed consideration under Section 50C, especially when the revenue fails to produce evidence of the assessee receiving more than the declared amount. The Tribunal followed previous decisions to delete the penalty.

What were the facts?

The Assessing Officer (AO) levied penalty under Section 271(1)(c) based on an addition made under Section 50C, by adopting the stamp duty valuation rate as sale consideration instead of the actual sale consideration mentioned in the sale deed. The CIT(A) confirmed the AO's action.

What were the issues?

Whether penalty under Section 271(1)(c) can be levied on additions made under Section 50C when no evidence of actual receipt of higher consideration is produced by the revenue.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 50C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, JAIPUR BENCHES (SMC

Before: SHRI RAMESH C SHARMAvk;dj vihy la-@ITA No. 1259/JP/2018

For Appellant: Shri P.C. Parwal (CA) jktLo dh vksj ls@
Hearing: 02/05/2019Pronounced: 06/06/2019

ORDER PER: R.C. SHARMA, A.M. This is an appeal filed by the assessee against the order of ld.CIT(A), Alwar dated 12/09/2018 for the A.Y. 2007-08 in the matter of imposition of penalty U/s 271(1)(c) of the Income Tax Act, 1961 (in short, the Act).

2.

In this case, the A.O. has levied penalty with reference to addition made on account of capital gain income by determining sale consideration U/s 50C of the Act and disregarding the actual sale

1.

2 ITA 1259/JP/2018 Smt. Krishna Devi Saiwal Vs ITO consideration mentioned in the sale deed. By the impugned order, the ld. CIT(A) confirmed the action of the A.O., against which the assessee is in further appeal before the ITAT

3.

Rival contentions have been heard and record perused. The A.O. has levied penalty U/s 271(1)(c) of the Act with respect to addition made U/s 50C of the Act under the head capital gains.

4.

On merit it was submitted by the ld AR that penalty u/s 271(1)(c) is not leviable where income is assessed on the basis of deemed consideration uls 50C as revenue has failed to produce any evidence that assessee actually received more than the amount shown to have been received by the assessee. Reliance in this regard was placed on the following decisions:

Shri Jhabar Singh Vs. ITO order dated 17.04.2017 (Jaipur) (Trib.) From the record I found that during course of assessment proceedings, the A.O. noticed that the assessee had sold immovable property for Rs. 13,00,000/-. The AO, however, adopted the sale consideration at Rs.63,09,000/- on the basis of DLC rate determined by the Collector, Stamps, by invoking the provision of section 50C and thereafter initiated penalty proceedings u/s 271(1)(c) on the ground 3 ITA 1259/JP/2018 Smt. Krishna Devi Saiwal Vs ITO of concealment. Thus, the AO levied penalty u/s 271(1)(c) on the difference between the stated sale consideration and the DLC rate adopted by the Collector, Stamps.

5. The ITAT, Jaipur Bench after relying on the decision of Co- ordinate Bench in case of Anita Beniwal vs. ITO in and also on the judgement of Hon'ble Calcutta High Court rendered in case CIT vs. Madan Theaters Ltd. 263 CTR 7 had deleted similar penalty by holding as under:-

In the present case also, the facts are identical as in the case of Anita Beniwal. In this case also the penalty has been levied on the basis that the actual sale consideration was lesser than the value adopted by the Stamp Valuation Authority. The Revenue has not brought any material on record suggesting that the assessee had received actual consideration as adopted by the Stamp Valuation Authority. Therefore, we do not see any reason for taking a different view as adopted by the Co-ordinate Benches of this Hon'ble Tribunal, at the Hon'ble Calcutta High Court in the case of CIT vs. Madan Theatres Ltd. We therefore direct the Assessing Officer to delete the penalty.

5.

The issue is also covered by the decision of the ITAT Delhi Benches in the case of Ashwani Jaipaty Vs DCIT (2018) 53 CCH 0340 (Del. Trib). However, no contrary decision was placed by the ld AR in spite of Bench asking for the same.

6.

In view of the above facts and circumstances and respectfully following the decision of Coordinate Bench of Delhi ITAT, I do not find any merit in the penalty so imposed by the A.O. U/s 271(1)(c) of the 4 ITA 1259/JP/2018 Smt. Krishna Devi Saiwal Vs ITO Act with respect to addition made under deeming provisions of Section 50C of the Act. Hence, I direct the A.O. to delete the penalty.

7.

In the result, appeal of the assessee is allowed.

Order pronounced in the open court on 06th June, 2019

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सहायक पंजीकार@Aेेज. त्महपेजतंत

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