ARUN B BANKHELE, PUNE v. ITO WD 26(2)(3), MUMBAI

ITA 1412/MUM/2010 | 2003-2004
Pronouncement Date: 28-01-2011 | Result: Allowed

Appeal Details

RSA Number 141219914 RSA 2010
Assessee PAN AAGPB8738C
Bench Mumbai
Appeal Number ITA 1412/MUM/2010
Duration Of Justice 11 month(s) 9 day(s)
Appellant ARUN B BANKHELE, PUNE
Respondent ITO WD 26(2)(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 28-01-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted G
Tribunal Order Date 28-01-2011
Date Of Final Hearing 13-01-2011
Next Hearing Date 13-01-2011
Assessment Year 2003-2004
Appeal Filed On 19-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH G MUMBAI BEFORE SHRI PRAMOD KUMAR A.M. AND SHRI V. DURGA RA O J.M. ITA NOS. 1410 1411 & 1412/M/2010 ASSESSMENT YEARS: 2002-03 2003-04 & 2004-05 MR. ARUN B. BANKHELE APPELLANT FLAT NO. 28/E CIDCO COLONY THANE BELAPUR ROAD AIROLI 400 703 (PAN AAGPB8738C) VS. INCOME TAX OFFICER RESPONDENT WARD 26(2)-3 MUMBAI. APPELLANT BY : MR. PRAKASH P. PANDIT RESPONDENT BY : MR. A.K. NAYAK . ORDER PER V. DURGA RAO J.M.: THESE THREE APPEALS PERTAIN TO SAME ASSESSEE ARE D IRECTED AGAINST THE ORDERS OF CIT(A) FOR THE ASSESSMENT YEA RS 2002-03 2003- 04 AND 2004-05. SINCE THE ISSUE IS IDENTICAL IN THE SE APPEALS THEY WERE HEARD TOGETHER AND THEREFORE A COMMON ORDER IS PASSED FOR THE SAKE OF CLARITY. 2. A COMMON GROUND RAISED IN THESE APPEALS PERTAINI NG TO LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. PENALTIES LEVIED IN THESE YEARS ARE AS UNDER:- 1. AY 2002-03 RS. 7 579/- 2. AY 2003-04 RS. 33 714/- 3. AY 2004-05 RS. 12 208/- ITA NO. 1410 1411 & 1412/M/10 ARUN B. BANKHELE 2 3. TO DECIDE THESE APPEALS WE REFER THE FACTS IN A Y 2002-03. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN EMPLOYEE OF M/S BPCL. THE ASSESSEE ENTERED INTO AN LEASE AGREEM ENT WITH THE EMPLOYER. THE AO NOTICED THAT THE ASSESSEE HAS RECE IVED LEASE RENT OF RS. 21 960/- DURING THE PREVIOUS YEAR WHICH WAS AD DED TO THE TOTAL INCOME OF THE ASSESSEE TREATING THE SAME AS INCOME FROM HOUSE PROPERTY. THE ASSESSEE HAS ALSO RECEIVED MAINTENANC E EXPENSES OF RS. 9 396/- WHICH WAS NOT SHOWN IN THE ORIGINAL RETURN FILED FOR THE YEAR. SINCE THE ASSESSEE HAD NOT SHOWN THE SAID RECEIPTS IN HIS ORIGINAL RETURN OF INCOME AND THE SAME IS BROUGHT TO THE TAX ATION AFTER THE DETECTION BY THE DEPARTMENT U/S 48 OF THE ACT THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND IM POSED PENALTY ON CONCEALED INCOME AT RS. 7 579/-. ON APPEAL THE CIT (A) CONFIRMED THE PENALTY LEVIED BY THE AO. AGGRIEVED BY THE ORDER OF CIT(A) THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE IT AT. 4. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF THE PARTIES AND PERUSED THE RECORD. THE SUBMISSIONS OF THE ASSSSEE BEFORE THE CIT(A) WAS THAT THE AO HAS NOT CONSIDERED THE AMOUNT OF P ERQUISITE VALUE ADDED IN FORM 16 AND OFFERED TO TAX WHILE CALCULATI NG INCOME FROM HOUSE PROPERTY WHICH RESULTED INTO DOUBLE TAXATION OF THE SAME INCOME. THE SUM OF RS. 21 960/- IS ALREADY FORMING PART OF THE TOTAL INCOME AND THE AO ERRED IN CONSIDERING THIS SUM AS CONCEALED. IT WAS SUBMITTED BEFORE THE CIT(A) THAT THE AO ERRED IN LE VYING PENALTY ON REIMBURSEMENT OF EXPENSES AS THE SAME HAS BEEN RECE IVED BY THE ASSESSEE AS LESSOR ON ACCOUNT OF EXPENSES FOR MAINT ENANCE AND PAYMENT TAXES ETC. AS PER THE TERMS AND CONDITIONS OF LEASE AGREEMENT AND THEREFORE THE SAME IS NOT INCOME OF THE ASSES SEE. THE CIT(A) HAS NOT CONSIDERED THE SUBMISSIONS OF THE ASSESSEE AND CONFIRMED THE PENALTY LEVIED BY THE AO IN ALL THE THREE YEARS UND ER CONSIDERATION. WE FIND THAT THE AO NOTICED IN HIS ORDER THAT IN OR IGINAL RETURN OF ITA NO. 1410 1411 & 1412/M/10 ARUN B. BANKHELE 3 INCOME THE ASSESSEE HAD NOT DISCLOSED THE LEASE RE NT AND MAINTENANCE CHARGES WHICH RESULTED INTO THE DIFFER ENCE IN INCOME OF RS. 24 770/- BETWEEN ASSESSED INCOME OF RS. 7 52 45 0/-AND RETURNED INCOME OF RS. 7 27 680/-. SINCE THE LEASE RENT WAS TAXED ONLY AFTER ITS DETECTION BY THE DEPARTMENT THE AO INITIATED PENA LTY PROCEEDINGS AND LEVIED PENALTY ON THE INCOME ON WHICH TAX IS S OUGHT TO BE EVADED AT RS. 7 579/. FOR THIS DIFFERENCE THE EXP LANATION OF THE ASSESSEE IS THAT HE WAS UNDER BONAFIDE BELIEF THAT WHATEVER INCOME EARNED FROM THE EMPLOYER REFLECTED IN FORM NO. 16. WE ARE OF THE VIEW THAT THE ASSESSEE HAD NO WILLFUL INTENTION TO CONCE AL THE INCOME OR ANY DELIBERATE INTENTION TO DEFRAUD THE REVENUE AS THE ASSESSEE WAS UNDER THE BONAFIDE BELIEF THAT WHATEVER INCOME EARN ED FROM THE EMPLOYER WAS REFLECTED IN FORM NO. 16. THE ASSESSE E IS A REGULAR AND TIMELY IN MEETING ALL HIS TAX OBLIGATIONS. THE CIT( A) HAS NOT CONSIDERED THE SUBMISSIONS OF THE ASSESSEE. THEREFO RE IN OUR CONSIDERED OPINION THE EXPLANATION OFFERED BY THE ASSSSEE IS BONAFIDE WHICH OUGHT TO HAVE BEEN ACCEPTED BY THE REVENUE AUTHORITIES. HENCE THIS IS NOT A FIT CASE FOR LEVY OF PENALTY U/S 271(1)(C). THEREFORE WE HEREBY CANCEL PENALTIES LE VIED BY THE AO AND CONFIRMED BY THE CIT(A) IN ALL THE THREE YEARS UNDE R CONSIDERATION. 5. IN THE RESULT ALL THE THREE APPEALS OF THE ASES SSEE ARE ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF JANUARY 2011. SD/- SD/- (PRAMOD KUMAR) (V. DU RGA RAO) ACCOUNTANT MEMBER JUDI CIAL MEMBER MUMBAI DATED: 28 TH JANUARY 2011. ITA NO. 1410 1411 & 1412/M/10 ARUN B. BANKHELE 4 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A) CONCERNED. 4) THE CIT CONCERNED. 5) THE DEPARTMENTAL REPRESENTATIVE G BENCH I.T .A.T. MUMBAI. BY ORDER //TRUE COPY// ASST. REGISTRAR I.T.A.T. MUMBAI. KV S.NO. DESCRIPTION DATE INTLS 1. DRAFT DICTATED ON 20/01/11 SR.P.S./P.S 2. DRAFT PLACED BEFORE AUTHOR 21/01/11 SR.P.S/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.P.S./PS SR.P.S./P.S 6. KEPT FOR PRONOUNCEMENT ON SR. P.S./P.S. 7. FILE SENT TO THE BENCH CLERK SR.P.S./P.S 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER