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Income Tax Appellate Tribunal, MUMBAI BENCHES “A”, MUMBAI
Before: SHRI MAHAVIR SINGH & SHRI ASHWANI TANEJA
Date of hearing : 08-12-2016 Date of order : 21 -12-2016
O R D E R
Per ASHWANI TANEJA, AM:
This appeal has been filed by the assessee against the order of the Commissioner of Income-tax (Appeals)-1, Mumbai [hereinafter called CIT(A)] dated 11-12-2013 passed against the penalty order of the AO u/s 271(1)(c) dated 30-03-2012 for A.Y 2006-07 on the following ground:-
“1. The Learned CIT(A) erred on facts and in law in confirming penalty u/s 271(1)(c) on taxing of capital gains u/s 50C Rs.54,37,010/- for sale of land which was not sold by the Appellant.”
During the course of hearing, it was stated by the Ld. Counsel that penalty was levied on the taxability of capital gains u/s 50C for Rs.54,37,010/- on account of sale of land which was stated to be not sold by the assessee during the year. In the quantum appeal, the addition made by the AO has been deleted by the Tribunal vide its order dated 25- 08-2016 in ITA No.5721/Mum/2010.
Per contra, the Ld. DR did not dispute the submissions made by the assessee. 4. We have gone through the order passed by the lower authorities as well as order passed by the Tribunal in quantum appeal. It is noted that the Tribunal in the quantum appeal has deleted the addition by observing as under:- “4. We have heard the argument advanced by the learned representative of the parties and perused the record. The bone contention of the assessee is that the income from the land is not liable to be taxed twice. The assessee has shown the land with M/s Sharp Constructions Co. wherein the income from the land was assessed by the Assessing Officer by virtue of order dated 26.12.2008 for the A.Y.2006-07. The said order was also challenged before the CIT(A) who confirmed the order of Assessing Officer by virtue of order dated 05.01.2010. Subsequently, the matter went up before the Income Tax Appellate Tribunal, Mumbai who also decided the case in for A.Y.2006-07. The said order perused which clearly speaks about the assessment of the income with regard to the land belonging to the M/s. Sharp Constructions Co. in question. The Assessing Officer has also assessed the income upon the said land on account of alienation by the Akbarali A. Porbunderwalla to M/s. Landline Builders Pvt. Ltd. by virtue of development deed registered on 23.08.2005 for a consideration of Rs.15,00,000/- again by treating the land belonging to Akbarali A. Porbunderwalla individually. Now it is not in dispute that the land has been assessed twice one on the part of M/s. Sharp Construction Co. which is the partnership firm and the other on behalf of the individual Akbarali A. Probunderwalla. The land was used for the purpose of the firm. The said consideration to the tune of Rs.15,00,000/- was assessed twice one on the part of the M/s. Sharp Construction Co. and Akbarali A. Porbunderwalla individually. It is the case of double taxation because the alienation of the land has been assessed two times which does not seem justifiable. Accordingly, these issues are decided in favour of the assessee against the revenue and set aside the finding of the CIT(A) on the above said issues.
In the result, the appeal filed by the assessee is hereby dismissed.”
5. Thus, when the quantum itself has been deleted, the penalty levied on this amount cannot survive any more. Thus, we direct the AO to delete the penalty also.
As a result, appeal of the assessee is allowed. Order was pronounced in the open court at the conclusion of the hearing.