Sri. VIMLA VASWANI, MUMBAI v. ITO 12(3)(2), MUMBAI

ITA 2608/MUM/2008 | 2002-2003
Pronouncement Date: 29-01-2010 | Result: Allowed

Appeal Details

RSA Number 260819914 RSA 2008
Assessee PAN AAFPV7205F
Bench Mumbai
Appeal Number ITA 2608/MUM/2008
Duration Of Justice 1 year(s) 9 month(s) 14 day(s)
Appellant Sri. VIMLA VASWANI, MUMBAI
Respondent ITO 12(3)(2), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 29-01-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted F
Tribunal Order Date 29-01-2010
Date Of Final Hearing 08-12-2009
Next Hearing Date 08-12-2009
Assessment Year 2002-2003
Appeal Filed On 15-04-2008
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH F MUMBAI BEFORE SHRI PRAMOD KUMAR & SMT. P.MADHAVI DEVI JM & I.T.A.NO.2608/MUM/2008 - A.Y 2002-03 MRS. VIMLA VASWANI 121 MAKER CHAMBERS VI NARIMAN POINT MUMBAI 400 021 PAN NO.AAFPV 7205 F VS. INCOME TAX OFFICER 12(3) MUMBAI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI VIPUL JOSHI. REVENUE BY : SHRI VIRENDRA OJHA. O R D E R PER P.MADHAVI DEVI JM: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST CI T(A)S ORDER DATED 28/1/2008. 2. THE ONLY GRIEVANCE OF THE ASSESSEE IN THIS APPEA L IS THAT THE CIT[A] HAS ERRED IN CONFIRMING THE PENALTY LEVIED BY THE AO U/S.271[1][C] OF THE INCOME TAX ACT. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE I S AN INDIVIDUAL. SHE FILED HER RETURN OF INCOME DECLARING TOTAL INCO ME OF RS.29 98 956/-. AS PER THE RETURN OF INCOME FILED THE ASSESSEE HAD INCOME FROM HOUSE PROPERTY CAPITAL GAINS AND INCOME FROM OTHER SOURC ES. ON SCRUTINY OF DETAILS FILED ALONG WITH THE RETURN THE AO OBSERVE D THAT THE RENTAL INCOME SHOWN IN THE INCOME AND EXPENDITURE ACCOUNT AND THE TDS CERTIFICATES FILED ARE NOT TALLYING. THE ASSESSEES EXPLANATION WAS CALLED 2 FOR. THE ASSESSEE SUBMITTED THAT SHE HAS OFFERED RS .26 57 048/- FOR TAXATION AS RENTAL INCOME FROM THE PROPERTY VIZ. D ADA MANZIL BUT AS PER THE TDS CERTIFICATE THE RENT RECEIVED IS RS.27 71 520/-. IT WAS SUBMITTED THAT THE DIFFERENCE IS ON ACCOUNT OF NET AMOUNT OF INCOME OFFERED FOR TAXATION AFTER TAKING VARIOUS EXPENSES INTO ACCOUNT. AO HOWEVER WAS NOT CONVINCED WITH THE SAID EXPLANATIO N AND DISALLOWED THE CLAIM OF EXPENSES AND ADDED THE DIFFERENCE OF R S.1 14 422/- TO THE TOTAL INCOME OF THE ASSESSEE. 4. ON APPEAL CIT[A] CONFIRMED THE DISALLOWANCE. M EANWHILE AO INITIATED PENALTY PROCEEDINGS U/S.271[1][C] OF THE ACT OBSERVING THAT THE ASSESSEE HAS NOT FILED ANY EXPLANATION FOR THE DIFFERENCE. HE THEREFORE LEVIED THE MINIMUM PENALTY U/S.271[1][C] OF THE ACT. AGGRIEVED ASSESSEE FILED AN APPEAL BEFORE THE CIT[ A] WHO CONFIRMED THE ORDER OF THE AO AFTER CONSIDERING THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF DHARMENDRA TEXTILE PRO CESSORS REPORTED IN 212 CTR (SC) 432. AGGRIEVED ASSESSEE IS IN SECO ND APPEAL BEFORE US. 5. THE LD. COUNSEL FOR THE ASSESSEE WHILE REITERATI NG THE SUBMISSIONS MADE BEFORE THE AUTHORITIES BELOW HAS D RAWN OUR ATTENTION TO THE PAPER BOOK FILED BY THE ASSESSEE W HEREIN THE ASSESSEES SUBMISSIONS TO THE ITO WITH REGARD TO TH E LEVY OF PENALTY HAS BEEN FILED. THUS ACCORDING TO THE LD. COUNSEL THE AOS FINDING THAT ASSESSEE HAS FAILED TO FILE ANY EXPLANATION IS NOT CORRECT. HE SUBMITTED THAT IN HER SUBMISSIONS THE ASSESSEE HAS CLEARLY S TATED THAT EVEN IF THE 3 EXPENDITURE INCURRED BY THE ASSESSEE ON THE PROPERT Y IS NOT ALLOWABLE DEDUCTION U/S.24 IT C OULD STILL BE CONSIDERED FOR DEDUCTION WHILE COMPUTING THE ANNUAL VALUE OF THE PROPERTY U/S.23 O F THE ACT. HE PLACED RELIANCE UPON THE DECISION OF THE HON'BLE SU PREME COURT IN THE CASE OF RAJASTHAN SPINNING AND WEAVING MILLS REPORT ED IN 2009 TAX- INDIA-ONLINE 63 SC-CX AND ALSO DECISION OF A BENCH OF THE ITAT AT PUNE IN THE CASE OF KANBAY SOFTWARE INDIA (P) LTD. VS. DCIT (2009) 31 SOT 153 [PUNE] FOR THE PROPOSITION THAT WHERE THE ASSESSEE HAS FURNISHED ALL THE PARTICULARS OF INCOME AND THERE IS FULL DISCLOSURE OF ALL FACTS MERE DISALLOWANCE OF THE EXPENDITURE WILL NOT ATTRACT LEVY OF PENALTY U/S.271[1][C] OF THE ACT. 6. THE LD. DR ON THE OTHER HAND SUPPORTED THE ORD ERS OF THE AUTHORITIES BELOW. 7. HAVING HEARD BOTH THE PARTIES AND HAVING CONSID ERED THEIR RIVAL CONTENTIONS WE FIND THAT THE ASSESSEE HAS FURNISHE D BEFORE THE AO ALL THE RELEVANT DETAILS NECESSARY FOR THE COMPUTATION OF HER INCOME. THE DISALLOWANCE IS OF THE EXPENDITURE CLAIMED AGAINST INCOME FROM HOUSE PROPERTY. MERE DISALLOWANCES/ADDITIONS WILL NOT ATT RACT PENALTY U/S.271[1][C] OF THE ACT. THE AO HAD PLACED RELIANC E UPON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF DHARMEN DRA TEXTILES FOR LEVY OF PENALTY. THE HON'BLE SUPREME COURT IN THE C ASE OF RAJASTHAN SPINNING AND WEAVING MILLS 2009 TAX-INDIA-ONLINE 63 SC-CX HAS CONSIDERED ITS EARLIER DECISION IN THE CASE OF DHAR MENDRA TEXTILE PROCESSORS REPORTED IN 212 CTR (SC) 432 AND HAS HEL D THAT PENALTY IS 4 NOT TO BE LEVIED AUTOMATICALLY IN EVERY CASE OF NON -PAYMENT OR SHORT PAYMENT OF TAX BUT THE CONDITIONS EXPRESSLY MENTION ED IN THE SECTION FOR ITS APPLICATION SHOULD BE SATISFIED. THE DECISI ON OF THE HON'BLE SUPREME COURT IN THE CASE OF DHARMENDRA TEXTILE PRO CESSORS [CITED SUPRA] HAS ALSO BEEN CONSIDERED BY THE ITAT AT PUNE IN THE CASE OF KANBAY SOFTWARE INDIA (P) LTD. [CITED SUPRA] FOR HO LDING THAT PENALTY IS NOT TO BE LEVIED AUTOMATICALLY. WE FIND THAT THE AS SESSEE HAS OFFERED THE EXPLANATION FOR THE DIFFERENCE AND THE AO HAS N OT FOUND IT TO BE FALSE OR INCORRECT. IN VIEW OF THE SAME WE HOLD TH AT THE PENALTY IS NOT LEVIABLE IN THIS CASE AND ACCORDINGLY ALLOW THE ASS ESSEES GROUND OF APPEAL. 8. IN THE RESULT ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED ON THIS 29 TH DAY OF JANUARY 2010. SD/- SD/- (PRAMOD KUMAR) (P.MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI: 29 TH JANUARY 2010. P/-* 5 COPY TO- 1) APPELLANT 2) RESPONDENT 3) CITA MUMBAI. 4) CIT CITY MUMBAI 5) DR BENCH MUMBAI TRUE COPY BY ORDER DY /ASST.REGISTRAR ITAT MUMBAI. P SR.NO. PARTICULARS DATE INITIALS 1 DRAFT DICTATED ON 19-1-10 P 2 DRAFT PLACED BEFORE AUTHOR 20-1-10 P 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 5 APPROVED DRAFT COMES TO SR.PS/PS 6 ORDER KEPT FOR PRONOUNCEMENT 7 FILE SENT TO BENCH CLERK 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER