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Income Tax Appellate Tribunal, DELHI BENCH: ‘C’ NEW DELHI
Before: SHRI H. S. SIDHU & SHRI PRASHANT MAHARISHI
Date of Hearing on : 10/03/2016 Order Pronounced on : 04/04/2016
ORDER
PER H.S. SIDHU, JM
This appeal is filed by the Assessee against the Order dated 31.12.2013 passed by the Ld. CIT(A), Muzaffarnagar relating to Assessment Year 2009-10 on the following grounds:-
1. Learned Commissioner of Income Tax (Appeal) is wrong and unjustified in confirming the penalty u/s 271 (1) (C) imposed by the Assessing Officer without going through the full facts of the case and cases relied upon by the appellant.
2. That the observation of Ld CIT (A) on page 6 of the appellate order to the effect. "However such contentions raised by the appellant have no force is as much as no supporting details and evidences have been furnished" is (AY 2009-10) against the facts and also contrary to the evidence filed. The appellant had filed copy of orders of State Govt. prescribing circle rate at the time of purchase and also at the time of sale to prove that the increase in values property was notional and was due to rental value increased by the State Govt.
3. That Learned CIT (A) has relied upon by the decisions which are mainly on the point of explanation and has diverted the issue to other line. The case relied upon by the appellant are of Highest Court of land i.e. Hon'ble Supreme Court while learned CIT(A) wants to take shelter from the decision of High Court and ITAT. No where the case laws relied upon by the appellant have been considered and distinguished at all.
4. That no decision has been given on ground no 2 which is on account of insufficient opportunity of being heard.
5. That learned CIT(A) has passed the order on the issue which was not raised in the appeal. No finding regarding satisfaction of the Assessing Officer in the assessment has been recorded nor has case laws relied upon been distinguished.
That appellate order as passed in the case is against the law and facts of the case.
The brief facts of the case are that the proceedings u/s. 147 of the I.T. Act, 1961 were started by issue of notice u/s. 148 dated 14.6.2011. In response to this notice the assessee filed the return of income on 21.12.2011 showing net total income of Rs. 59,730/- besides long term capital gain of Rs. 2,44,210/-. The assessee derives income from purchase and sale of cloth and also from capital gain on sale of shop. In this case assessment was completed u/s. 147/143(3) vide order dated 29.2.2012 on net total income of Rs. 3,13,940/- including long term capital gain Rs. 2,44,210/-. During the course of assessment proceedings it was found that the assessee had concealed the particulars of his income and furnished inaccurate particulars of his income. Accordingly, a notice u/s. 274 read with section 271(1)(c) was issued. In response to the same, assessee filed
(AY 2009-10) the written explanation dated 13.8.2012. Thereafter, the AO levied a penalty of Rs. 31,800/- u/s. 271(1)(c) of the I.T. Act, 1961 vide order 29.8.2012.
Against the above Penalty Order dated 29.8.2012 passed by the Assessing Officer, assessee appealed before the Ld. First Appellate Authority, who vide impugned order dated 31.12.2013 dismissed the appeal of the assessee.
Against the above order of the Ld. CIT(A) dated 31.12.2013, assessee is in appeal before the Tribunal.
In this case, Notice of hearing to the assessee was sent by the Registered AD post, in spite of the same, assessee, nor his authorized representative appeared to prosecute the matter in dispute, nor filed any application for adjournment. However, the assessee has filed the Written Submissions in order to support his case. Keeping in view the facts and circumstances of the present case and the issue involved in the present Appeal, we are of the view that no useful purpose would be served to issue notice again and again to the assessee, therefore, we are deciding the present appeal exparte qua assessee, after hearing the Ld. DR and perusing the records.
6. As per the assessee’s written submissions, he stated that no satisfaction for concealment was recorded by the AO and the case laws cited by the assessee in the reply has not been discussed at all. Therefore, the amount of Rs. 31,800/- does not attract any penalty. In support of his contention, he relied upon the decision of the Hon’ble Apex Court in the case of CIT vs. Reliance Petro Products (2010) Taxman 322.
On the other hand, Ld. DR relied upon the order of the authorities below and requested that the Appeal of the Assessee may be dismissed. 3
(AY 2009-10) 8. We have heard Ld. DR and perused the records, especially the orders of the authorities below, the Written Submissions by the assessee. We find that during the penalty proceedings, the AO held as under:-
“I have carefully considered the explanation furnished by the assessee and I am of the opinion that same has got no force. The assessee has filed his return of income showing net total income at Rs. 3,03,940/- including long term capital gain at Rs. 2,44,210/-, which being above the taxable limit, the asessee was clearly liable to file his return of income uls 139(1) of the I.T. Act, 1961 which he failed to do. In this case it was noticed that the assessee had sold shop for Rs. 34,56,000/- alongwith 8 other co-owners. The share of the assessee was 1/1/6 on which long term capital gain was not shown. Accordingly a notice U/S 148 of the 1. T.Act, 1961 dated 14-6-2011 was issued. In compliance. the assessee filed return showing long term capital gain and business income. Considering all the facts of the case, I am of the opinion that the assessee had deliberately concealed the particulars of his income and furnished inaccurate particulars of his income and accordingly this is a fit case for levy of penalty uls 271(1)( c ) of the I.T. Act, 1961.”
8.1 We further find that Ld. CIT(A) by placing reliance of the decision in the case of Ram Sewak Chandra 151 CTR 294 (All) and Gurbachan Lal 250 ITR 157 (Del.) has held that in a case of long term capital gain only declared in response to notice u/s. 148 of the Act, burden is on the assessee to prove that there was no concealment of income or of true particulars. Hence, further held that angle of concealment is more than established and therefore, upheld the penalty of Rs. 31,800/-.
(AY 2009-10) 8.2 We further note that in this case no satisfaction for concealment was recorded for penalty of Rs.31,800/-. We further note the AO observed that assessee furnished inaccurate particulars of its income and is liable for penalty u/s 271(1)(c), which did not establish from the above facts and circumstances that how the assessee has furnished inaccurate particulars of its income. Section 271(1)(c) postulates imposition of penalty for furnishing of inaccurate particulars and concealment of income. In this regard, we draw our support from the decision of the Hon'ble Apex Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd. (2010) 322 ITR-158 (SC) wherein the Hon'ble Supreme Court has held that 'where there is no findings 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 u/sec. 271(1)(c) of the Act. A mere making a claim, which is not sustainable in law, by itself, will not amount of furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the return cannot amount to furnishing a inaccurate particulars of income. As the assessee has furnished all the details of its expenditure as well as income in its return, which details, in themselves, were not found to be inaccurate nor could be viewed as the concealment of income on its part. It was up to the authorities to accept its claim in the return or not. Merely, because the assessee had claimed the expenditure, which claim was not accepted or was not acceptable to the Revenue, that by itself would not, in our opinion, attract the penalty u/sec. 271(1)(c). If we accept the contention of the Revenue then in case of every return where the claim made is not accepted by the Assessing Officer for any reason, the assessee will invite penalty u/sec. 271(1)(c). That is clearly not the intendment of the Legislature".
7.4 In the background of the aforesaid discussions and precedent, we are of the considered view that the assessee has not furnished
(AY 2009-10) inaccurate particulars of income and there are no findings of the Assessing Officer and the CIT (Appeals) that the details furnished by the assessee in his return are found to be inaccurate or erroneous or false. Under these circumstances, in our view the penalty in dispute is totally unwarranted and deserve to be deleted. Accordingly, we delete the penalty of Rs. 31,800/- made u/s. 271(1)(c) of the I.T. Act and cancel the orders of the authorities below on the issue in dispute.
In the result, the appeal filed by the Assessee stands allowed.
Order pronounced in the open court on 04/04/2016.