Ms.Prema Gopal Rao, G-1, Everest Apt, 156 Tardeo Tardeo, Road, Tardeo, Mumbai0-400034 Vs. Dy. Commissioner of Income Tax 16(1), Matru Mandir,Tardeo Road, Mumbai-400007
January, 08th 2015
IN THE INCOME TAX APPELLATE TRIBUNAL "C" BENCH, MUMBAI
BEFORE HON'BLE S/SHRI H.L. KARWA, PRESIDENT AND B.R.BASKARAN (AM)
.. , .. ,
( / Assessment Year :2004-05)
Ms.Prema Gopal Rao, / Dy. Commissioner of Income Tax
G-1, Everest Apt, 156 Tardeo Vs. 16(1),
Tardeo, Road, Matru Mandir,Tardeo Road,
Tardeo, Mumbai0-400034 Mumbai-400007
( /Appellant) .. ( / Respondent)
. / . / PAN/GIRNo. :AABPR7003D
/ Assessee by : Shri Nishit Gandhi
/Respondent by : Shri Neil Phlip.
/ Date of Hearing
/Date of Pronouncement : 07 .01.2015
/ O R D E R
Per B.R.BASKARAN, Accountant Member:
The assessee has preferred this appeal challenging the order dated
15.11.2011 passed by Ld CIT(A)-25, Mumbai and it relates to the assessment
year 2004-05. The assessee is aggrieved by the decision of Ld CIT(A) in
confirming the penalty of Rs.2,46,300/- levied by the AO u/s 271(1)(c) of the Act.
2. The facts that led to the levy of penalty are stated in brief. The assessee
filed original return of income on 10.09.2004 declaring total income of
Rs.12,16,600/-, which included Long Term Capital Gain on sale of Shares of
Rs.3,60,305/-. The case was selected for scrutiny and hence the AO issued
notice u/s 143(2) of the Act on 28.3.2005. After the receipt of the said notice, the
assessee filed revised return of income, wherein the assessee revised the Long
term Capital gains upwards to Rs.14,87,789/-. The AO completed the
assessment as per the Revised return of income by making certain
2 ITA No.8653/M/11
disallowances. The AO took the view that the assessee has revised the return of
income only after the enquiry was initiated by him. Accordingly the AO held that
the penalty is leviable on a sum of Rs.15,84,783/-, which included following
Long Term Capital gain enhanced amount - 11,27,484
Interest income & Profit from Zuari Mutual
fund added in the assessment order - 1,40,373
Accordingly, the AO levied a penalty of Rs.2,46,300/-. The Ld CIT(A) also
confirmed the penalty mainly on the reasoning that
(a) The filing of revised return of income was not voluntary, since it was
filed after selection of the original return of income for scrutiny.
(b) The assessee had made wrong and dubious claims.
3. We heard the parties and perused the record. We notice that the
assessing officer has determined the concealed income at Rs.15,84,783/-.
However, the additions made in the assessment order was only Rs.1,40,373/-
and further the difference in Long term Capital gains between the revised return
and the original return was only Rs.11,27,484/-. Thus there is a difference in the
amount of `concealed income' determined by the AO, for which the assessing
officer has failed to give the details in the penalty order. Be that as it may, we
notice that the tax authorities have taken the view that the amount of Long term
Capital gain enhanced by the assessee in the revised return of income should be
considered as `concealed income', since the assessee had revised the same
after receipt of the notice u/s 143(2) of the Act, i.e., according to the tax
authorities the notice has prompted the assessee to file the revised return of
income hence it was not voluntary. At the time of hearing, the Ld A.R brought to
our notice that the AO did not ask for any details at the time of issuing notice u/s
143(2) and hence the question of detection of the discrepancy in the Long Term
Capital Gain by the AO does not arise in the instant case. Accordingly he
submitted that the Revised return of income was voluntary in nature and the
same has also been filed within the due date prescribed in the Act for filing
revised return of income. He further submitted that the AO has also recognised
the said return in the assessment proceedings. He also placed reliance on the
decision rendered by the Delhi bench of Tribunal in the case of ACIT Vs. Ashok
3 ITA No.8653/M/11
Raj Nath (2013)(33 taxmann.com 588), wherein the Tribunal had deleted the
penalty levied under identical set of facts.
4. We have gone through the order passed by Delhi bench of Tribunal
referred supra. We notice that the assessee therein had filed revised return of
income beyond the time prescribed u/s 139(5) by enhancing the Long term
capital gain, after the receipt of notice u/s 143(2) of the Act. Even though the
revised return was invalid, the AO completed the assessment by accepting the
income declared in the revised return. Under these set of facts, the Tribunal had
held that the additional amount of capital gain disclosed in the revised return did
not tantamount to detection of concealment of income u/s 271(1)(c) of the Act.
5. In the instant case, the revised return of income was filed within the time
prescribed u/s 139(5) of the Act. Even though the assessed filed the revised
return of income after the receipt of notice u/s 143(2) of the Act, yet the admitted
fact remains that the assessing officer did not seek any type of particulars in that
notice. Hence the mistake in the Long term Capital gain could not have come to
the notice of the AO at that point of time, meaning thereby, it should be construed
that the assessee has declared the higher amount of Long term capital gain
voluntarily upon its detection. Hence, we are unable to agree with the view of the
tax authorities that the revised return of income was not voluntary one, but the
assessee was constrined to enhance the Long term capital gain only upon the
receipt of notice u/s 143(2) of the Act. Accordingly, we set aside the order of Ld
CIT(A) on this issue and direct the assessing officer to delete the penalty levied
on the enhanced Capital gain amount.
6. With regard to the addition of Rs.1,40,373/- made in the assessment
order, we notice that the assessee has omitted to declare the same in the revised
return of income also and no convincing explanation was given for the same.
Hence we confirm the penalty levied on the above said amount.
7. With regard to the balance amount, we have already noticed that the AO
has failed to give the details of the same. Hence we restore the same to his file
with the direction to reconsider the same after giving necessary details to the
4 ITA No.8653/M/11
8. In the result, the appeal filed by the assessee is partly allowed.
The above order was pronounced in the open court on 7th Jan,2015.
7th Jan 2015
(.. / H.L. KARWA) (.. ,/ B.R. BASKARAN)
/ PRESIDENT /Accountant Member
Mumbai: 7 Jan, 2015.
. ../ SRL , Sr. PS
/Copy of the Order forwarded to :
1. / The Appellant
2. / The Respondent.
3. () / The CIT(A)- concerned
4. / CIT concerned
5. , , /
DR, ITAT, Mumbai concerned
6. / Guard file.
/ BY ORDER,
, /ITAT, Mumbai