ARAVIND KUMAR AGARWAL,KOLKATA vs. A.C.I.T.(OSD),WARD-1(1), SILIGURI

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ITA 1603/KOL/2019Status: DisposedITAT Kolkata22 July 2020AY 2015-163 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that quantum and penalty proceedings are distinct and not every addition automatically attracts penalty. Citing precedent, it found that the assessee had provided supporting evidence, and the surrender did not constitute concealment or furnishing inaccurate particulars.

What were the facts?

The assessee's appeal concerns a penalty imposed under Section 271(1)(c) for alleged bogus long-term capital gains. The Revenue argued that the assessee's voluntary surrender of these gains made him liable for the penalty.

What were the issues?

Whether a voluntary surrender of long-term capital gains, even if later deemed bogus, automatically attracts penalty under Section 271(1)(c) without considering the evidence provided.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 10(38)

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Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, “A”

Before: SHRI S. S. GODARA, JM & DR. A.L. SAINI, AM

For Appellant: Shri Subash Agarwal, Advocate
Hearing: 08/07/2020Pronounced: 22/07/2020

BEFORE SHRI S. S. GODARA, JM & DR. A.L. SAINI, AM आयकर अपीलसं./ ("नधा"रण वष" / Assessment Year: 2015-16) Aravind Kumar Agarwal Vs. ACIT(OSD), Ward-1(1), Siliguri C/o Subash Agarwal & Associates, Advocates Siddha Gibson, 1, Gibson Lane, Suite 213, 2nd Floor, Kolkata – 700069. "थायीलेखासं./जीआइआरसं./PAN/GIR No.: AACCH6877K (Appellant) .. (Respondent) Appellant by : Shri Subash Agarwal, Advocate Respondent by : Shri Dhrubajyoti Roy, JCIT सुनवाईक"तार"ख/ Date of Hearing : 08/07/2020 घोषणाक"तार"ख/Date of Pronouncement : 22/07/2020 आदेश / O R D E R Per Shri S. S. Godara: This assessee’s appeal for assessment year 2015-16 arises against the Commissioner of Income Tax (A), Siliguri dated 29.05.2019 passed in Case No.10/CIT(A)/SLG/2018-19 involving proceedings u/s 271(1)(c) of the Income Tax Act, 1961[in short ‘the Act’]. Heard both the parties. Case file perused.

2.

The assessee’s sole substantive grievance canvassed in the instant lis seeks to reverse both the learned lower authorities’ action imposing section 271(1)(c) penalty of Rs.1,85,764/- pertaining to alleged bogus long-term capital gain of Aravind Kumar Agarwal Assessment Year: 2015-16 Rs.6,38,778/- adding during the course of assessment framed on 22.09.2017. The Revenue’s case as per both the lower authorities’ detailed discussion is the assessee has been rightly penalized u/s 271(1)(c) of the Act since he himself had surrendered his long-term capital gains claim to be exempt u/s 10(38) as bogus in the above-stated assessment. It therefore emphasizes that the assessee’s said voluntary surrender makes him liable for consequential penalty as well. We see no reason to express our concurrence with the Revenue’s stand. We make it clear that hon’ble apex court’s landmark decision in Reliance Petroproducts’ case 322 ITR 158 (SC) has settled the law that quantum and penalty proceedings stand on different footing and each and every disallowance/addition in the former does not ipso facto attract the latter penal provision. We keep in mind the very distinction and notice that the assessee has filed all the relevant supporting evidence in support of genuineness of this above-stated long-term capital gains derived during the course of scrutiny. That being the case, we find that this tribunal’s coordinate bench’s decision in Smt. Amita Tulsiyan ITA No.1513/Hyd/2018 dated 10.05.2019 holds that such an instance neither amounts to concealment nor furnishing of inaccurate particulars of income u/s 271 of the Act. We therefore delete the impugned penalty.

3.

This assessee’s appeal is allowed.

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