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TMI Blog2024 (6) TMI 1438X X X X Extracts X X X X X X X X Extracts X X X X ..... N SAHAY, ACCOUNTANT MEMBER For the Assessee : None For the Revenue : Shri P. D. Chougule (Addl. CIT), SR. D.R. ORDER Per: Ratnesh Nandan Sahay, Accountant Member: 1. This appeal has been filed by the Addl. Commissioner of Income Tax (Mumbai) against the order of Ld. CIT (A) passed u/s. 17 of the Black Money Act, 2015. 2. The following grounds of appeal have been raised: i. "On the facts and circumstances of the case and in law, the Ld CIT(A) has erred in deleting the penalty imposed of Rs.10 lakhs u/s. 43 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, in the case of the assessee, ignoring the fact that the assessee has not disclosed the foreign asset in Schedule FA (Details of Foreign Assets and Income from any source outside India) of the Return of Income. ii. On the facts and circumstances of the case and in law, the Ld.CIT(A) has erred in deleting the penalty imposed of Rs.10 lakhs u/s. 43 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, in the case of the assessee, ignoring the fact that disclosure of investment in foreign asset in Schedule FA in the return filed u/s.153 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty in Dubai is still under construction. However, the assessee has not shown the said property in Schedule FA of his return of income for the assessment year 2016-17 as required under the Black Money (Undisclosed Foreign Income and Assets) and imposition of the Tax Act 2015 (hereinafter referred to as Black Money Act 2015). This information was forwarded to the PCIT23, Mumbai, for initiation of penalty proceedings u/s. 43 of the Black Money Act 2015. Accordingly, the jurisdictional assessing officer i.e. the JCIT, Range-23(3), Mumbai, issued notice u/s. 43 of the Act dated 23/12/2019 to the assessee. However, the assessee did not furnish any reply in response to that notice. Another opportunity was given to the assessee vide show cause notice dated 23/03/2021 to give reasons as to why penalty u/s. 43 of the Black Money Act 2015 should not be levied on the assessee for the assessment year 2016-17, the assessee filed the submissions on 30/03/2021, the details of which are given as under: "The assessee submitted that it is not the case of the Department that the said asset is an undisclosed foreign asset and the only fault is that the advance given by him has not been specifica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... foreign asset held by the assessee has undergone no change since the year of purchase, as the assessee has failed to disclose the information relating to asset located outside India in his return of income for A.Y. 2016-17. Disclosure made in earlier years and subsequent years cannot help the cause of the assessee as each assessment year is a separate and distinct. As per the provisions of the Income-tax Act. 1961, it is mandatory on the part of the assessee to disclose the asset located outside India in his return of income filed u/s. 139(1) or 139(4) or 139(5) of the Income- tax Act, 1961. But, he failed to do so. * In the instant case, the assessee has failed to report the assets in Schedule FA of the Income-tax Return for assessment year 2016-17 which is in contravention of the provision of the Black Money Act. * The assessee has made investment in immovable property by way of advance to the builder outside India and failed to disclose in his return of income for A.Y 2016-17 as mandated by the provisions of the Black Money Act. * The assessee did not submit anything about the reasonable cause which existed for non-disclosure of the advance in the ITR of the assessee at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. has held in Para 8 as under :- "....There can be no dispute that everything would depend upon the return filed, because that it is the only document, where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate the liability would arise" Thus, in view of the ratio laid down by the Hon'ble Apex Court in the aforesaid decisions, penalty u/s. 43 of the Black Money Act, 2015 is leviable in this case." 7. Aggrieved by the order of the Additional Commissioner of Income Tax, Central Range- 8, Mumbai, the assessee filed appeal before the Ld. CIT (A) who decided the appeal in favour of the assessee vide its order no. ITBA/COM/F/17/2023-24/1057583854(1) dated 01/11/2023 by holding as under:- "9.3. The AO levied the penalty u/s. 43 of BMA as it was found that the assessee had not disclosed in Schedule FA of the ITR for AY 2016-17 the investment made in immovable property in Dubal. While the assessee had claimed that the foreign asset was duly disclosed in the ITRs of the preceding and the subsequent years and that there was no change in the in the status of the foreign asset since its purchase, the AO held that each assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reach or defiance of the law and hence not liable for penalty u/s 43 of BMA. The relevant extracts are as under: "9.10. From the aforesaid considerations and analyzations, it is clear that case in hand is not the case of deliberate or malafide or dishonest action or non-action or breach or defiance or disregard of statutory provisions of law, but infact, as the Assessee had shown the foreign investment in Schedule "FA" initially in the AY 2012-13 itself when such investment was made and thereafter occasionally in Schedule "Holding Status" but continuously in its books of account, therefore there is no justification for imposition of penalty, hence we are inclined not to interference in the decision of the Id. Commissioner in deletion of penalty under consideration. Consequently appeal filed by the Revenue Department is liable to be dismissed." 9.7. The ratio of the aforesaid decision of the Hon'ble jurisdictional ITAT is clearly applicable to the facts of the present case where the assessee had duly disclosed the foreign asset initially in the ITR for AY 2013-14 and thereafter also for all years except the year under consideration i.e AY 201617. As held by the Hon&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad failed to disclose a foreign bank account in the Schedule FA. Thereafter, consequent to a search proceedings against her, the assessee disclosed such bank account in the return filed u/s. 153A of the Income-tax Act. The Hon'ble Tribunal held that this was a bona fide mistake, and gave the following findings which are squarely applicable in the present Appellant's case also: * Non-disclosure of the foreign asset in the original return cannot be put against the assessee, particularly when the said disclosure was admittedly made in the subsequent return filed under section 153 A. [In the case of the present Appellant also, the disclosure of the advance payment has been made in all earlier years as well as in subsequent years, thus, applying the same rationale as given in this decision by the Hon'ble Tribunal, the penalty u/s. 43 cannot be levied against the Appellant.] * A mere non-disclosure of a foreign asset in the income tax return by itself is not a valid reason for penalty under the Black Money Act. * The unambiguous intent of the legislature is to exclude trivial cases of lapses which can be attributed to a reasonable cause. * Section 43 of the Black ..... X X X X Extracts X X X X X X X X Extracts X X X X
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