9911796707
TMI Blog2024 (12) TMI 493X X X X Extracts X X X X X X X X Extracts X X X X ..... that basis initiated penalty proceeding under section 271(1)(c) then consequential notice u/s 274 issued by AO to the assessee to afford him opportunity of hearing, was specifically a notice for penalty for concealment of particulars of income/undisclosed income. Such a notice complied with the principles of natural justice and was a valid notice under section 274. Hence, ground no. 2 of the appeal is hereby dismissed. Penalty on the returned income - As in view of the finding in the case of Meeta Gutgutia [ 2016 (5) TMI 339 - ITAT DELHI ] in which reliance has been placed on the decision of Varkey Chacko [ 1993 (8) TMI 1 - SUPREME COURT ] and M/S S.A.S. Pharmaceuticals [ 2011 (4) TMI 888 - DELHI HIGH COURT ] and also in the case of Armoury International [ 2019 (2) TMI 1056 - ITAT MUMBAI ] if the compensation amount is excluded, as the same was capital receipt in nature and therefore not liable to be added to the income, there remains no difference between the income returned in response to the notice u/s 148 of the Act and the income assessed u/s 143(3) read with section 147 of the Act. Hence, no penalty was imposable u/s 271(1)(c) of the Act. We accordingly, direct the Ld. AO to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be automatically imposed. 3. In this case initially the coordinate Bench of the Tribunal had decided the appeal in ITA No. 359/KOL/2022 for A.Y. 2011-12 vide order dated 13th March, 2023. The assessee filed a Miscealleneous Application ( MA ) u/s 254(2) of the Act, stating that the assessee had raised five grounds of appeal and the aforesaid appeal was disposed of by the Tribunal vide order dated 17th Jan 2018 and the said order was uploaded online and served upon the assessee for the first time on 13th March, 2023. However, this statement of the assessee is not correct as the order in ITA No.359/KOL/2023 for A.Y. 2011-12 was pronounced on 13th March, 2023 and not on 17th January, 2018, as is mistakenly stated. It was further stated in the MA that the Tribunal had only adjudicated ground no. 4 and decided the appeal in favour of the assessee. However, the Tribunal did not adjudicate other ground nos. 1, 2, 3 and 5 under the assumption that these grounds were connected and consequential and Ground no. 4 was the only ground adjudicated by the Tribunal. The assessee contended vide the MA filed that the Tribunal had failed to appreciate that the ground nos.1, 2, 3 and 5 would requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot be automatically imposed. In this context, it would be relevant to refer to the penalty order in which the Ld. AO has mentioned as under: - In this case, an assessment order was passed u/s 147/143(3) on 19.11.2018 at a total income of Rs. 23,75,350/-. During the year under consideration the assessee entered into a joint development agreement in respect of his landed property for developing premises. As per agreement, the assessee was entitled to receive 50% built up area, which he took possession on 05.06.2013 and received Rs. 22,75,000/- as consideration in lieu of his old property. Although having taxable income, the assessee did not submit his return of income u/s 139 of the Income-tax Act, 1961 and had not disclosed his true and fair view of his total income and also had not paid due tax on the same. During the year under consideration, the developer paid rent on behalf of the assessee towards alternative accommodation to the tune of Rs. 79,500/-, which the assessee did not consider as part of his total income in his return of income filed u/s 148 of the Income-tax act, 1961. On being confronted, the assessee submitted that he has no objection to treat the same as his o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts his return of income only after receipt of notice u/s 148 from the Department. iii) Onus is on the assessee to furnish complete disclosure of income voluntarily before filing return of income u/s 139 of the Income-tax Act, 1961. The mistake was detected by the Department for this A.Y. In this case, the assessee had not filed his return of income u/s 139 of the Income-tax Act, 1961. Further, he had not produced any proof of payment of taxes before the issue of notice u/s 148. Had the case not been scrutinized the whole taxable amount would have gone tax free. iv) Regarding addition of Re 79,500 in respect of alternative accommodation, the assessee had mentioned that he was in the mis-conception that the rent paid by the developer is a part of contract agreement and for that reason he did not consider the monetary value of alternative accommodation as his income. In this context it is worth mentioning that our important legal principle is that ignorance of the law is no excuse . Thereby this rule really means actions by claiming that they didn't know the people can't defend their actions by claiming that they didn t know the law. The Ld. AO accordingly imposed a penalty of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y levied by the Assessing Officer is reasonable and deserves to be upheld. Further reliance is placed on the case laws given below: CIT V. HANDLOOM EMPORIUM [2006] 282 ITR 431(ALL.) Penalty under section 271(1)(c) is applicable even when concealment of income is admitted by filing a revised return after detection of concealment. M. S. MOHAMMED MARZOOK (LATE) AND ANOTHER (REPRESENTED BY LEGAL HEIRS) v. INCOME-TAX OFFICER, [2006] 283 ITR 254 (MAD) Penalty- concealment of income-revised return filed after search proceedings -Finding by Tribunal that there had concealment of income-levy of penalty valid-Income-tax Act, 1961, s. 27(1)(c). Held that the Tribunal on the facts of the case, found that the omission or wrong statement by the assessee in the original return was not bona fide or due to any inadvertence or mistake on his part, but the revised return was filed only after the search action. The levy of penalty was valid. ASHOK KUMAR GUPTA V COMMISSIONER OF INCOME-TAX, [2006] 287 ITR 376 (P H). Penalty-Concealment of Income Search and seizure-Effect of Explanation 5 to section 271(1)(c) Surrender of income found during search No filing of return in respect of such income and no pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see owned flat went for re-development as per the agreement between the developers and flat owners dated 28.03.2008. The said compensation was paid towards hardship Rs. 13,45,278/-; rehabilitation Rs, 5,90,625/- and for shifting Rs. 15,000/-. We also note that the assessee paid Rs. 18,63,000/- to Joys Developers for acquiring additional area of 138 Sq Ft. It was also noted that the assessee shifted to his own house when the building went for re-development. Now the question before is whether the compensation upon re-development of property towards hardship, rehabilitation and shifting received by the assessee is taxable if the potential TDR/FSI is available to the land owner or society which owns the land depending upon the terms of the re-development agreement without transferring the land. In the present case the assessee who was flat owner in the building was member of the society. As per the agreement each member of the society including the assessee was to be given a flat in lieu of the old one and the each member including the assessee was given compensation. We also note that In the decisions in ITA No 72/Mum/2012 assessment year 2008-09 Bench E and ITA No 5271/Mum/2012 asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is computed as per separate sheet enclosed. 10.1 Recently, Hon'ble Calcutta High Court in case of Principal Commissioner of Income-tax v. Thakur Prasad Sao Sons (P.) Ltd. [2024] 163 taxmann.com 449 (Calcutta) have held in Para 39 that when the Assessing Officer had recorded in the assessment order the particulars of concealed income/undisclosed income of the assessee and on that basis initiated penalty proceeding under section 271(1)(c) then consequential notice under section 274 issued by Assessing Officer to the assessee to afford him opportunity of hearing, was specifically a notice for penalty for concealment of particulars of income/undisclosed income. Such a notice complied with the principles of natural justice and was a valid notice under section 274. Hence, ground no. 2 of the appeal is hereby dismissed. 11. However, as regards ground nos. 1, 3 and 5, on the issue of penalty on the returned income, the coordinate bench of the Tribunal, Delhi Bench, while deciding the appeal in the case of Meeta Gutgutia Vs. ACIT in ITA No. 327/Del/2014 A.Y. 2008-09 vide order dated 31st March, 2023, have held as under: - 6. We have heard the rival submissions and perused the material o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urned income and such variation should be as a result of concealment. It is not the case of assessing officer that penalty u/s 271(1)(c) has been imposed on certain additions made to the returned income. Hon'ble Delhi High Court in the case of M/S S.A.S. Pharmaceuticals (supra) while deciding the issue levy of penalty u/s 271(1)(c) in paragraph 15 has held as under: 15. It necessarily follows that concealment of particulars of income or furnishing of inaccurate particulars of income by the assessee has to be in the income tax return filed by it. There is sufficient indication of this Court in the judgment in the case of Commissioner of Income Tax, Delhi-I Vs Mohan Das Hassa Nand 141 ITR 203 and in Reliance Petro products Pvt. Ltd (supra), the Supreme court has clinched this aspect, viz., the assessee can furnish the particulars of income in his return and everything would depend upon the income tax return filed by the assessee. 7. Therefore, in view of the facts of the case we are of the opinion that no penalty was imposable u/s 271(1)(c) of the Act I.T.A. No. 327/Del/2014 Assessment year 2008-09 and we accordingly direct the AO to delete the penalty. 12. Similar finding has al ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
