CIT vs. GREENLINE DEVELOPERS PVT LTD

{' s-22 *IN CTT TIIII ilIGII COURT OX' DITILIII AT NIIW DITLIU I'fA 859/2011 ..... Appcllant 'l'hlough: Mr. Kamal Sawhucy, Sr. Stancling Counscl. t vcl'stls GI{UtlNLINll DEVIILOPEITS PVT LTD ..... Rcspondent Through: Dr. Rakcsh Gupta with Ml. 'I'.R. 'l'alwar and Ms. I{ani Kiyala, Advocatcs. COIIAM: IION'I}I,I' MR. .IUSTICN, S. ITAVINDITA I}IIAT IION'llLIrl MR. JUSTICIT R.V.II'ASWAR OIIDI]I{ 05.09.2012 'l'hc ltcvctruc sccks to appcal against thc.ordcr of thc I'fA't' in I'l'A No.77l (l)cl)/20i0.'l'hc qucslion of law sought to bc urgcd is whcthcr the'l'ribunal fcll into cuol in sctting aside the oldcr of the CI'I' (A) imposing pcnalty undcr Section-27lD of thc Incomc'l'ax Act. 'l'hc lacts in blicl arc that the asscssec hacl lcccivccl a sum of I{s.19 l,aklis itr cash. l)uring thc coursc of thc asscssmcnt prococclings, thc initial cxplanation givcu was not acceptccl; conscquently, thc asscsscc statcd that thc amouut was reccivcd and clcpositcd in cash as shalc arpplicalion amount. Pcnalty procccdings uudcr Scction-2711) of thc Incornc 'l'ax Act ',vcrc initiatcd in violation of Scction-269ss and lcfcrrcd to thc Aclclitional C'omnrissioncr rvbo imposccl thc pcnalty proposcd. 'i'hc Conmissioncr of Appcal also affinlecl it. I)uring tlrc coulsc of thc plocccdings, thc (lomnrissioncr (A) rclicd upon thc judgmcnt of thc .Tharkhand IIigh CourL in llhalotiu lingincering Llrot'ks Pvt. LfcL v. CIT',275 I'Ilt 399, to hold that cven sharc application lnotlcy was covcred by Scction-269SS. 'fhc Tribural on appeal by thc assosscc ncccptcd thc contcntiou that Scction-269SS did not covcl sharc application iuttount. Agglicvcd, the l{cvcmtc 2012:DHC:9794-DB

t'7 I a\\ \v contcn<ls beforc this Courl that thc amount in question was unaccountccl and thc cottnscl \-/ sccks to rcly upon Scction-6tl and thc part of thc ordcl of thc CfI (A) in support of his submissions. This Cotut noticcs that the I'l'A1'order is premisccl ou thc fact that Scction-269SS clocs not cxtcncl ancl oovcr sharc applicalion atnount. 'I'hc'l'ribunal had rclicd upon othcr rulings such as cIT' y. Ihtgntini llum llaghuv spinners Pvt. LtLl. (2008) 304 rfl{ 417 (Maclras), cllT't:. speecfu,ct1,.s lltiltber P|L Ltc{.,326 I't'lt 31 (P&II) ctc. 'l'hc rclcvant part of its disclssion can be found in paragraphs 7-11 of thc impugnccl judgrncrrt.'l'hc Tribunal lrcld that thc facts of the case werc not covcrcd by thc ruling rn llttgntini llunt llagav's ccrse (supra). Morc importantly, the 'l'ribunal also hcld tliat the tcxt of Scction-269sS did not support the conclusion of the lowel autholitics. 11 vicw of thc fact lhat thc plcscnt appcal ariscs ont of pcnaltl' pt'tlccccliugs and thcrc is no positive fincling with rcgard to inclusiott of thc arn<lttnts ttnclcl Scction-68 or thcir bcing othcnvisc taxablc, thc only cluestion which could havc bccu considcrcd and was in fact consiclercd by thc 'I'ribunal was thc applicability of Scction-27l1) ou account of thc spccific phrascology to Scction-269SS. Sincc thc provision docs uot cxtcnd and covcr. sharc application moltcy, thc lribunal's Lcasoning catinot be faultccl. Morcovcr, thc 'l'ribulal has mcrcly followcd the othcr rulings applicablc in this rcgard. 'fhis Court cl6cs 1ot fincl a1y rcason to clisagree with thc intcrpretation of thc Madras and Pur"rjab & Ilar.yana Iligh Couls. In fact, this C'ourt has also hcld with thc samc lines in thc Conrmissioner of Incomc 'I'ax, Delhi-IV v. I.P. lndia Pvt. Ltcl., in I'I'A-] I92l20ll, clccided on 21.1 i.201 1. Ii'or thc abovc rcasolts, this Court is sertisficd that no substantial clucstion ol law 'l'hc appcal is, thcrcfolc. clisrnissccl. a al'lscs. sIfPTBMllIilt 05, 2012 /vks/ s. RAVINDI{A IlItrAT, J [t'-..-,'. l{.v.ItAsw^Il, .I 2012:DHC:9794-DB