AJAY JAIN,MUMBAI vs. DCIT 26(2), MUMBAI

आयकर आयकर अपीलीय आयकर आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, , , , मुंबई अिधकरण मुंबई मुंबई ए खंडपीठ मुंबई खंडपीठ खंडपीठ खंडपीठ Income-tax Appellate Tribunal -“A”Bench Mumbai सव"ी राजे",लेखा सद" एवं अिमत शु" "ाियक सद" Before S/Sh.Rajendra,Accountant Member and Amit Shukla,Judicial Member आयकर अपील सं./I.T.A./5255/Mum/2014,िनधा"रण िनधा"रण िनधा"रण वष" िनधा"रण वष" वष" /Assessment Year: 2010-11 वष" Ajay Jain DCIT-26(2) Mukund M. Chitale & Co. Smt. K.G. Mittal, Ayurvedic Hospital Chartered Accountants Bldg., Charni Road 205, Agarwal Shyamkamal Vs. Mumbai-400002. A, Vile Parle(E) Mumbai-400 057. PAN: ABBPJ 7111 K (अपीलाथ" /Appellant) (""यथ" / Respondent) Revenue by: Shri Murli Assessee by: Shri A.V. Kamat सुनवाई क" तारीख / Date of Hearing: 09.03.2016 घोषणा क" तारीख / Date of Pronouncement: 16.03.2016 आयकर अिधिनयम आयकर अिधिनयम,1961 क" क" धारा धारा 254(1)केकेकेके अ"तग"त अ"तग"त आदेश आदेश आयकर आयकर अिधिनयम अिधिनयम क" क" धारा धारा अ"तग"त अ"तग"त आदेश आदेश Order u/s.254(1)of the Income-tax Act,1961(Act) लेखा सद" राजे" के अनुसार PER RAJENDRA, AM- Challenging the order of CIT (A)-28,Mumbai,dated 12/06/2014,the assessee has filed the present appeal.The effective ground of appeal is about confirmation of the penalty levied u/s. 271(1)(c) of the Act for filing inaccurate particulars of the income. 2.Assessee,an individual,filed his return of income on 31/07/2010,showing total income of Rs. 75.64 lakhs.Thereafter, a revised return was filed on 23/09/2011,declaring income at Rs.62.83 lakhs after claiming deduction u/s. 54 of the Act.In the order passed u/s.143 (3) of the Act,the deduction claimed by the assessee was disallowed and the income was assessed at Rs.75.64 lakhs.The AO also initiated penalty for filing inaccurate particulars of the income. In response to the notice issued by the AO for levying penalty,the assessee stated that he had already paid tax on long-term capital gain while filing the original return. However,the AO was not satisfied with the explanation offered and levied a penalty of Rs. 3.95 lakhs. 3.Aggrieved by the order of the AO, the assessee preferred an appeal before the first appellate authority(FAA).Before him, it was argued that the assessee had not claimed exemption u/s. 54 against capital gain in his original return and had paid tax on long-term capital gain,that subsequently he had invested in new house property on 15/01/2011 i.e. within two years from the sale of original house property and had filed the revised return by claiming exemption as per the provisions of the Act,that all the facts and figures had been disclosed in the return of income, that there was neither concealment of income not the assessee had furnished any inaccurate particulars,that he had not sought to evade any tax, that the taxes were already paid by bringing out entire details on record.The assessee relied upon various case laws and requested that penalty proceedings should be dropped. After considering the submission of the assessee and the penalty order, the FAA held that the assessee had sold his old house property for Rs. 12.81 Lacs, that the sale transaction resulted in long-term capital gain which was initially offered to tax in the return filed on 31/07/2010, that by way of a revised return the assessee had claimed deduction u/s. 54 for the entire amount of capital gain,that the amount of capital gain was neither invested towards purchase

5255/M/14-Ajay Jain

of new was property nor the same was invested in capital gain account scheme before the date of filing of return u/s.139 (1) of the Act,that one of the primary conditions for grant of deduction u/s. 54 was not complied with, that the AO had disallowed a direction in his assessment order that was accepted by the assessee in was not challenged in the appeal, that the Action of the assessee of filing revised return and claiming deduction casted a shadow of doubt on the bona fides of the assessee, that there was no doubt that the assessee was not entitled for claiming deduction u/s. 54, that no cogent explanation was filed for claiming the deduction u/s. 54 in the revised return. Finally,he upheld the order of the AO. 4.Before us,the departmental representative (DR) supported the order of the FAA. The authorised representative (AR) stated that exemption u/s. 54 was available even if the return was not filed as per the provisions of section 139 (1) of the Act, that there was no dispute that the return was filed in accordance with the provisions of section 139 (4) of the Act, that the assessee had already paid taxes while filing the original return, that all the information was made available to the AO during the assessment proceedings, that it was not a case of filing inaccurate particulars or concealing the particulars of income. He relied upon the case of Reliance Petro Proucts(322 ITR 158). 5.We have heard the rival submissions and perused the material before us. We find that assessee had not claimed exemption u/s. 54 of the Act,while filing the original return. But later on he filed a revised return and claimed the said exemption. As per the settled law, deduction u/s. 54 cannot be denied to an assessee even if the return is filed beyond the time limit prescribed by the provisions of section 139 (1) of the Act. In the case under consideration the assessee had already paid the taxes and had furnished the details of property sold to the AO. The assessee had not made any wrong claim for which he was not entitled. Filing a revised return is a right recognised by the Act and the Parliament.Therefore,just because the assessee had filed a revised return as per the provisions of section 139(4)of the Act,it cannot be held that he had conceded the particulars of income.The AO/FAA have not mentioned as to which were the particulars that could be held to be inaccurate. In the case of Reliance Petro products (supra) the Hon’ble apex court has clearly held that mere making a claim would not result in imposing the concealment penalty. In the case before us the claim was not a wrong claim – rather it was a claim as per the provisions of the Act. Therefore it can safely be said that assessee had neither furnished inaccurate particulars nor had concealed his income. Reversing the order of the FAA, we decide the effective ground of appeal in favour of the assessee. As a result, appeal filed by the assessee stands allowed. फलतः िनधा"रती "ारा दािखल क" गई अपील मंजूर क" जाती है. Order pronounced in the open court on 16th March, 2016. आदेश क" घोषणा खुले "यायालय म" "दनांक 16 माच", 2016 को क" गई । (अिमत शु"ल/ Amit Shukla ) (राजे"" / Rajendra) "याियक सद"य / JUDICIAL MEMBER लेखा लेखा सद"य सद"य / ACCOUNTANT MEMBER लेखा लेखा सद"य सद"य मुंबई Mumbai; "दनांकDated : 16 .03.2016. Jv.Sr.PS.

5255/M/14-Ajay Jain

आदेश क" क" "ितिलिप "ितिलिप अ"ेिषत अ"ेिषत/Copy of the Order forwarded to : आदेश आदेश आदेश क" क" "ितिलिप "ितिलिप अ"ेिषत अ"ेिषत 1.Appellant /अपीलाथ"