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Shri Lokesh Kaushal, Prop. Kaushal Service Station, Industrial Area, Phase-II, Chandigarh. Vs The Income Tax Officer, Ward 1(2), Chandigarh.
May, 01st 2014
        IN THE INCOME TAX APPELLATE TRIBUNAL
          CHANDIGARH BENCH `B' CHANDIGARH

     BEFORE SHRI T.R.SOOD ACCOUNTANT MEMBER
     AND Ms. SUSHMA CHOWLA, JUDICIAL MEMBER
                                  ITA No .186/ CH D/ 2014
                               Assessm ent Y ear : 2009- 10

Shr i Lokesh K aushal ,                       Vs            T he Inco me T ax Of f i cer ,
Pr op. K aushal Ser vi ce St at i on,                       War d 1( 2) ,
Indust r i al Ar ea,                                        Chandi gar h.
Phase-I I,
Chandi gar h.

PAN : AC EPK 3701C

(Appellant )                                                  (R espondent )

               Appell ant b y : Shri Tej Mohan Singh
               Respondent b y : Shri J .S.Nagar


               Date of Heari ng :                     17.04.2014
               Date of P ronouncem ent :              28.04.2014



                                         O R D E R


PE R SUSHMA CH OWLA, JM


       The appeal by the assessee is directed against the order of

the Commissioner of Income Tax (Appeals), Chandigarh dated

21.01.2014        against      the      penalty    order   passed    under      section

271(1)(c) of the Income-tax Act, 1961 ( 'the Act' for short).


2.     The assessee has raised the following grounds of appeal :


                1. That the ld. Income Tax Officer has failed to appreciate the
                   facts and circumstances of the case and has thereby erred in
                   confirming penalty under section 271(1)(c) for furnishing
                   inaccurate particulars of income.
                2. The appellate order is devoid on any merits as the loss under
                   property income was claimed on the basis of TDS certificate
                   issued in the individual name instead of HUF.
                                                     2




3.       The only issue raised in the present appeal is against levy of

penalty under section 271(1)(c)of the Act at Rs. 92,110/-.


4.       The brief facts of the case are that in the return of income

filed for the captioned assessment year, the assessee had declared

l o s s o f R s . 2 9 7 , 6 7 3 / - u n d e r t h e h e a d ` i n c o m e f r o m h o u s e p r o p e r t y'

which was set-off against other incomes of the assessee.                                              The

Assessing          Officer        noted        during        the     course        of     assessment

proceedings that the said property did not belong to the assessee

individual but belong to his HUF and hence, the assessee was not

entitled to claim the set-off of loss from property in his hands.

The plea of the assessee was that in view of the TDS certificate

being issued in the name of the individual, the said claim was made

in the hands of assessee.                         During the course of assessment

proceedings, the assessee agreed for the addition on account of

loss and the Assessing Officer did not allow the benefit of TDS of

Rs. 81,600/- on the rental income.                              Penalty proceedings under

section 271(1)(c) of the Act were initiated against the assessee. In

the course of said penalty proceedings, the assessee claimed that

the said claim was made bonafidely as the TDS certificate was

issued in the name of the individual but the Assessing Officer was

not satisfied with the explanation of the assessee and levied

penalty under section 271(1)(c) of the Act at Rs. 99,110/-.





5.       The Commissioner of Income Tax (Appeals) did not accept

the plea of technical mistake raised by the assessee and upheld the

levy of penalty under section 271(1)(c) of the Act.
                                                        3




6.       Shri Tej Mohan Singh appeared for the assessee and Shri

J.S.Nagar          appeared          for     the        revenue        and    put    forward   their

contentions.


7.       We have heard the rival contentions and perused the record.

The assessee individual had filed its return of income at Rs.

5,83,740/-         after      claiming           loss       under      the   head    `income   from

p r o p e r t y' a t R s . 2 7 9 , 6 7 3 / - .     However, the said property did not

belong to the assessee individual but belonged to HUF of the

assessee and as such, the said loss from property was not allowed

in the hands of the assessee. The assessee claims that it had made

the said claim in his hands as the TDS certificate was issued in the

name of the assessee individual.                             However, on the mistake being

pointed out by the Assessing Officer, the assessee further claims

that it had declared the said loss in the hands of the HUF.

However, credit of TDS was not allowed in the hands of the

assessee individual. The plea of the assessee before the authorities

below was that the said mistake was a technical mistake on account

of the TDS certificate being issued in the name of the individual

and there was no furnishing of inaccurate particulars of income in

the hands of the assessee individual.                               We find merit in the said

plea of the assessee that in view of the peculiar circumstances

where       the     TDS       was      deducted             in   the    hands   of    the   assessee

individual and in order to claim the benefit of the said TDS, the

income relating thereof was offered in the hands of the assessee

individual, although the income there-from belonged to the HUF of

the assessee. In the abovesaid circumstances, where the assessee

had, under a bonafide mistake claimed the said loss arising from

income from property in his hands, we find no merit in the levy of
                                  4







penalty under section 271(1)(c) of the Act. The Assessing Officer

is directed to delete the penalty levied under section 271(1)(c) of

the Act. In the result, the grounds of appeal raised b y the assessee

are allowed.


8.   In the result, appeal of the assessee is allowed.


     Order pronounced in the open Court on 28th April,2014.


            Sd/-                                        Sd/-


    ( T.R.SOOD)                              (S USHMA CHO WLA)
 ACCO UNTANT ME MBER                         JUDICIAL ME MBER

Dat ed: 28 t h April,2014
`Poonam '
Copy to:
     The Appell ant, The Respondent, The C IT(A), The C IT,DR.


                                           Assi st ant Regi st r ar
                                                 IT AT ,CH D.

 
 
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