THE ITO, WARD-9(1), AHMEDABAD vs. M/S. SUJAL DEVELOPERS, AHMEDABAD

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ITA 2546/AHD/2014Status: DisposedITAT Ahmedabad27 October 2017AY 2007-083 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that since the primary claim for deduction under Section 80IB(10) was subsequently allowed by the CIT(A) on merits, the penalty levied for furnishing inaccurate particulars related to that claim must also fall. The appeal by the Revenue was dismissed.

What were the facts?

The Revenue appealed against the CIT(A)'s deletion of penalty levied under Section 271(1)(c). The penalty was initiated due to the denial of deduction claimed by the assessee under Section 80IB(10) for Rs. 1,37,07,361/-.

What were the issues?

Whether penalty under Section 271(1)(c) can be sustained when the underlying deduction claim, which formed the basis for the penalty, is subsequently allowed on merits. The validity of penalty for furnishing inaccurate particulars when the primary claim is later accepted.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 80IB(10),Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “A” BENCH

Before: SHRI N.K. BILLAIYA & SHRI MAHAVIR PRASAD

For Appellant: Shri K. Madhusudan, Sr. D.R

PER N.K. BILLAIYA, ACCOUNTANT MEMBER:

1.

This appeal by the Revenue is preferred against the order of the Ld. CIT(A)- XV, Ahmedabad dated 19.06.2014 pertaining to A.Y. 2007-08.

ITA No. 2546/Ahd/2014 2 . A.Y. 2007-08 2. The only grievance of the revenue is that the ld. CIT(A) erred in deleting the penalty of Rs. 46,12,897/- levied u/s. 271(1)(c) of the Act.

3.

The roots for the levy of penalty lie in the assessment order dated 24.12.2009 framed u/s. 143(3) of the Act. The assessee is a builder and real estate developer and for the year under consideration in its return of income filed on 27.10.2007, the assessee had claimed deduction of Rs. 1,37,07,361/- u/s. 80IB(10) of the Act.

4.

After thorough scrutiny of the claim of the assessee, the A.O. denied the claim of deduction u/s. 80IB of the Act and penalty proceedings were separately initiated.

5.

Since the Assessing Officer was convinced that by claiming the deduction u/s. 80IB(10) of the Act, which was otherwise not eligible to the assessee, the A.O. levied penalty u/s. 271(1)(c) of the Act for furnishing inaccurate particulars of income and computed the penalty at Rs. 46,12,897/-.

6.

Assessee carried the matter before the ld. CIT(A) and got the relief.

7.

Facts of the case show that when the claim of deduction was denied by the A.O., the matter travelled up to the Tribunal and the Tribunal vide in ITA Nos. 2427/Ahd/2010 & 552/Ahd/2011 restored the matter to the files of the ld. CIT(A) with a direction to decide the claim of deduction afresh.

ITA No. 2546/Ahd/2014 3 . A.Y. 2007-08 8. As per direction of the Tribunal, the ld. CIT(A) vide order dated 09.09.2016 considered the issues on merits and allowed the claim of deduction u/s. 80IB(10) of the Act.

9.

“Sublato Fundamento Cadit Opus”- since the foundation has been removed, the super structure must fall. Appeal filed by the Revenue is accordingly dismissed.

Order pronounced in Open Court on 27 - 10- 2017

Sd/- Sd/- (MAHAVIR PRASAD) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad: Dated 27s/10/2017 Rajesh Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) – 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER

Deputy/Asstt.Registrar ITAT,Ahmedabad

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