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TMI Blog2023 (10) TMI 833X X X X Extracts X X X X X X X X Extracts X X X X ..... 783 - BOMBAY HIGH COURT] Thus in this case we note the amount remain to be added [after deducting the initial exemption and consideration] is the only amount added on account of the difference in the stamp duty valuation and the levy of the penalty on that amount is not legal based on the finding of the Bombay High Court we vacate the levy of the penalty in the case and thus, the assessee grounds of appeals are allowed. - DR. S. SEETHALAKSHMI, JM SHRI RATHOD KAMLESH JAYANTBHAI, AM For the Assessee by : Shri S. K. Gogra (C.A.) For the Revenue by : Smt Monisha Chaudhary (Addl. CIT) ORDER PER: RATHOD KAMLESH JAYANTBHAI, AM This appeal is filed by assessee and is arising out of the order of the National Faceless Appeal Centre, Delhi dated 24.02.2023 [here in after (NFAC) / ld. CIT(A) ] for assessment year 2010-11 which in turn arise from the order of the Income Tax Officer, Ward -6(1), Jaipur [here in after the ld. AO ] passed under section 271(1)(c) of Income Tax Act, 1961 [hereinafter referred to as Act ] dated 26.06.2018. 2. In this appeal, the assessee has raised following grounds: - 1. That action of Ld AO in levying penalty u/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that income to the tune of Rs. 11,11,200/- has escaped assessment. Notice u/s 148 was issued on 27.03.2017 after invoking the provisions of Section 147 of the I.T. Act, 1961. Mean-while, the case was assigned to ITO Ward 6(5), Jaipur u/s 127 of the IT Act, 1961 as per Order No. Pr. CIT-2/JPR/127/2017- 18/411 Dated 02.06.2017 and the assessment records pending assessment u/s 143(3) were received in this Ward on 07.06.2017. Notice u/s 142(1) of the I.T. Act along with the specific questionnaire were issued on 23.06.2017. In response to the notices issued and served/affixed the assessee has not filed any return of income or no submission was filed. Therefore, a final show cause notice was issued on 01.12.2017 fixing for hearing on 08.12.2017. In compliance to final show cause notice dated 01.12.2017, no written submission was filed or any justification was provided so as to reach a conclusion anything contrary to the show cause issued. The assessment being time barring, no further opportunities provided to the assessee and therefore the assessment completed ex-parte. On completion of the assessment a show cause notice was issued seeking explanation of the assessee as to why the penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is essential for deciding of the case and which is arising from penalty order dt. 20.6.208 and from appeal order passed by CIT(A), NFAC vide order dt. 24.2.2023. ADDITIONAL GROUND: THAT LD AO HAS ERRED IN LEVYING PENALTY U/S. 271(1)(c) BASED ON DLC VALUE U/S. 50C WHICH IS ABSOLUTELY ILLEGAL AND UNJUSTIFIED AND SAME MAY PLEASE BE DELETED. 2. That in the case of CIT, Delhi vs. Jai Parabolic Springs Ltd (reported in 306-ITR-42 Delhi HC) it has been held that there is no prohibition on the powers of the Tribunal to entertain an additional ground which according to Tribunal arises in the matter and for the just decision of the case. The Humble appellant with utmost respect request to kindly allow the additional ground in the interest of equity and justice. 3. That facts of the case are that appellant has filed appeal before Hon'ble Tribunal against the appeal order dt. 24.2.2023 passed by CIT(A), NFAC against the penalty order passed by Assessing Officer vide their order dt. 26.6.2018 on the ground that it is preceded to the quantum appeal case. That appellant has filed appeal against the assessment order dt. 26.12.2017 before CIT(A), Jaipur on dt. 15 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i is also mentioned in the sale deed (at page no.2 of sale deed). The copy of power of attorney dt. 27.10.1998 whereby power is given by Mr. Surya Prakash Nathani to the appellant (Mr. Subhash Patni) was filed before the CIT(A), NFAC in quantum appeal proceedings. 3. That Ld AO passed penalty order u/s 271(1)(c) of the Act has not brought on record that appellant has received anything over and above the actual sale consideration declared in the sale deed. That it is incumbent on AO to bring any evidence that appellant has received over and above to the actual sale consideration for assuming legal jurisdiction to levy penalty. That for making addition no such duty is casted upon AO but while making addition and imposing penalty are quiet different and penalty proceedings are independent proceedings. The income presumed by fiction of law is not the real income unless otherwise prove by adducing additional evidences. 4. That in cases below it has been held that income assessed based on deeming fiction does not contemplate income and thus no penalty can be levied:- (i). Virendra Singh Verma Vs. ITO (Appeal No.ITA No. 962/JP/2019 ITAT Jaipur Bench ) that Hon ble ITA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 337/Mum/2016)- ITAT Mumbai that Hon ble bench while deciding the case the bench has relied upon the judgment of Hon ble Bombay HC in the case of CIT Vs. Fortune Hotels Estate Pvt. Ltd. and has held that addition by invoking provision of section 50C, penalty u/s. 271(1)(c) is unsustainable. (copy of all judgements are enclosed) GROUND NO. 2: ERRONEOUS ACTION OF LEVY OF PENATLY U/S. 271(1)(C) WITHOUT ASCERTAINING CORRECT FACTS OF CASE 1. That facts of the case are that appellant has got registered a sale deed of sale of agricultural land situated at Khasra no. 293/1 and 293/2 situated at village-kanota, Tehsil-Bassi, Distt: Jaipur as Power of Attorney holder of Mr. Surya Prakash Nathani resident of opp. Railway station, Bhilwara and has received a sale consideration of Rs.1,20,000/- in cash from buyer and which has also been handed over to Mr. Surya Prakash Nathani (actual legal owner of above agricultural land) and of which receipt is submitted before CIT(A), NFAC. 2. The fact about doing sale by appellant as power of attorney holder of Mr. Surya Prakash Nathani is also mentioned in the sale deed (at page no. 2 of sale deed). The copy of power of attor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t entire documents have been submitted in quantum appeal proceedings, Ld CIT(A), NFAC has passed the order and thus appellant was deprived from making submission in penalty appeal. 6. That the appellant has also filed an application dt. 19.5.2023 under rule 11 of ITAT Rules wherein request is made for allowing to submit additional ground for consideration before Hon ble Bench and same may please be allowed to taken and be decided in these facts circumstances of the case. Thus looking to these facts it is humbly requested to kindly consider the case of the appellant and penalty may please be deleted in light of above submissions oblige. 6.1 The ld. AR of the assessee also submitted a paper book dated 19.05.2023 the details of the paper relied upon are as under:- Sr. No. Particulars Page No. 1. Written submission in the penalty appeal before ITAT 1-4 2. Assessment order dt. 26.12.2017 5-7 3. Copy of Sale deed dt. 31.07.2009 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the initial deduction available to the assessee for the year under consideration being the maximum amount not chargeable to tax and also not given the benefit of the consideration already flowed to the assessee which is Rs. 1,20,000/- in this case, the ld. AO also not allowed any indexed cost of acquisition. The ld. AR without prejudice to these facts submitted before us the addition so made is of the amount being the amount considered for the stamp duty u/s. 50C of the Act. Considering the various judicial decision the levy of penalty on addition made u/s. 50C of the Act is not justified and therefore, even on merits the matter may be decided by the bench to render the justice to the assessee as the matter is of the assessment year 2010-11. 9. We have heard the rival contentions and perused the material placed on record. The bench noted that on the date of hearing the assessee sought an adjournment before the ld. CIT(A). The ld. CIT(A) has neither dismissed the adjournment application nor given any further date of hearing and he has proceeded ex-party which is not correct and is against the principles of natural justice. Thus, on careful consideration of the facts of the case a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ale consideration was Rs. 2 crores. The Assessing Officer noted that the market value adopted by the Registrar of Assurances for levy of stamp duty was Rs. 3,72,42,000/-. In view thereof by taking recourse to Section 52C(2) the Assessing Officer called upon the Assessee to show cause as to why the full value of consideration received on transfer should not be adopted as per the stamp valuation. The Assessee insisted that the question of valuation of the property should be referred to the Departmental Valuation Officer. That was so referred and the report was submitted by the Valuation Officer dated 27.12.2006 determining the market value of the property at Rs. 2,70,03,920/-. The Assessee maintained that the value of Rs. 2 crores is actual sale consideration received by it. However, this was not accepted and the difference between the consideration received and determination of the Valuation Officer was declared as tax liability. 3. To this extent there is no dispute and what later on followed was the imposition of penalty. The Tribunal held that this cannot be taken as a case of furnishing inaccurate particulars of income inasmuch as there was a registered sale deed and there ..... X X X X Extracts X X X X X X X X Extracts X X X X
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