The ACIT-1(1), Bhopal v. M/s. Khialdas Construction Pvt. Ltd., Bhopal

ITA 384/IND/2013 | 2006-2007
Pronouncement Date: 31-10-2013 | Result: Dismissed

Appeal Details

RSA Number 38422714 RSA 2013
Assessee PAN AADCK3822A
Bench Indore
Appeal Number ITA 384/IND/2013
Duration Of Justice 4 month(s) 27 day(s)
Appellant The ACIT-1(1), Bhopal
Respondent M/s. Khialdas Construction Pvt. Ltd., Bhopal
Appeal Type Income Tax Appeal
Pronouncement Date 31-10-2013
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 31-10-2013
Assessment Year 2006-2007
Appeal Filed On 03-06-2013
Judgment Text
PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH J.M. AND SHRI R.C.SHARM A A.M. PAN NO. : AADCK3822A I.T.A.NO.384/IND/2013 A.Y. : 2006-07 ACIT 1(1) BHOPAL VS. M/S. KHIALDAS CONSTRUCTIONS PVT.LTD. BHOPAL APPELLANT RESPONDENT APPELLANT BY : SHRI BHEEM KUNWAR SR. DR RESPONDENT BY : SHRI S.S.DESHPANDE C. A. DATE OF HEARING : 29 . 10 .201 3 DATE OF PRONOUNCEMENT : 31 . 10 .201 3 O R D E R PER R. C. SHARMA A.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER PASSED BY THE CIT(A) DATED 18.03.2013 FOR TH E ASSESSMENT YEAR 2006-07 IN THE MATTER OF IMPOSITION OF PENALTY U/S 271(1)(C) OF THE INCOME-TAX ACT 1961. 2. THE RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. PENALTY IMPOSED U/S 271(1)(C) OF THE ACT W AS KHIALDAS CONSTRUCTIONS PVT.LTD. BHOPAL A.Y. 2006-07 2 PAGE 2 OF 5 DELETED BY THE LD.CIT(A) AFTER HAVING THE FOLLOWING OBSERVATIONS :- 6. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE APPELLANT AND FACTS OF THE CASE. AS MENTIONED ABOVE THE ISSUE INVOLVED IN THIS CASE WAS REGARDING ASSESSABILITY OF PROFITS ARISING FROM SALE OF LAND AT CHUNA BHATTI BY THE APPELLANT. THE APPELLANT CONTENDED THAT PROFITS ARISING FROM THE SALE OF THE SAID LAND WERE ASSESSABLE AS BUSINESS INCOME U/S 28 WHEREAS THE ASSESSING OFFICER ASSESSED THE SAME AS CAPITAL GAINS U/S 45 WHICH HAD RESULTED INTO ADDITION TO THE INCOME. THE APPELLANT HAD DISCLOSED ALL MATERIAL FACTS RELATING TO SALE OF THE SAID LAND AND THERE WAS DIFFERENCE I N OPINION BETWEEN THE APPELLANT AND THE ASSESSING OFFICER AS TO WHETHER THE INCOME ON SALE OF THE SAI D LAND WAS CHARGEABLE U/S 28 OR U/S 45 AND HENCE IT WAS NOT A CASE WHERE THE ASSESSEE HAD EITHER FURNISHED INACCURATE PARTICULARS OR CONCEALED PARTICULARS OF INCOME. NOW THIS ISSUE HAS BEEN DECIDED BY THE HON'BLE I.T.A.T. INDORE BENCH IN KHIALDAS CONSTRUCTIONS PVT.LTD. BHOPAL A.Y. 2006-07 3 PAGE 3 OF 5 I.T(SS).A.NO. 36/IND/2010 ASSESSMENT YEAR 2006- 07 ORDER DATED 26.02.2013 THAT THE PROFITS ARISING ON SALE OF LAND WERE ASSESSABLE AS BUSINESS INCOME UNDER THE HEAD PROFIT AND GAINS OF THE BUSINESS U/S 28 OF THE INCOME-TAX ACT 1961. THE RELEVANT DECISION OF THE HON'BLE I.T.A.T. IS REPRODUCED AS UNDER :- 12. IN VIEW OF THE ABOVE DISCUSSION THE MATTER IS RESTORED BACK TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION TO COMPUTE BUSINESS INCOME IN RESPECT OF PROFIT ARISING ON SALE OF LAND UNDER THE HEAD PROFIT AND GAINS OF BUSINESS U/S 28 OF THE INCOME-TAX ACT 1961. PART D OF CHAPTER IV. AS THE GAIN IS NOT ASSESSABLE UNDER THE HEADS OF CAPITAL GAINS U/S 45 PART E OF CHAPTER IV THE ASSESSEE IS NEITHER ENTITLED FOR BENEFIT OF INDEXATION NOR PROVISIONS OF SECTION 50C IS APPLICABLE. WE DIRECT ACCORDINGLY. IN VIEW OF THE ABOVE DECISION OF THE HON'BLE I.T.A. T. INDORE BENCH THE ADDITION MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER STANDS DELETED AND KHIALDAS CONSTRUCTIONS PVT.LTD. BHOPAL A.Y. 2006-07 4 PAGE 4 OF 5 THERE REMAINS NO BASIS FOR PENALTY U/S 271(1) AS T HE SAME WAS LEVIED ON THE BASIS OF ADDITION IN INCOME UNDER THE HEAD CAPITAL GAINS BY INVOKING PROVISIONS OF SECTION 50C BY CONSIDERING THE FULL VALUE OF CONSIDERATION AT THE VALUE ADOPTED BY STAMP VALUATI ON AUTHORITIES FOR THE PURPOSE OF STAMP DUTY. FROM THE ABOVE IT IS CLEAR THAT THE BASIS ON WHICH PENALTY U/S 271(1) WAS LEVIED HAS ITSELF BEEN DECI DED IN FAVOUR OF THE APPELLANT BY THE HON'BLE I.T.A.T. THEREFORE THE PENALTY CANNOT STAND BY ITSELF AND THUS THE SAME IS LIABLE TO BE CANCELLED. 3. IT IS CLEAR FROM THE ABOVE ORDER OF CIT(A) THAT QUANTUM ADDITION WITH RESPECT TO WHICH PENALTY WAS LEVIED HAS BEEN DELETED BY THE TRIBUNAL VIDE ITS ORDER DAT ED 26.2.2013 WHEREIN IT WAS HELD THAT PROFIT ARISING ON SALE OF LAND WAS ASSESSABLE AS BUSINESS INCOME UNDER THE HE AD PROFIT AND GAINS OF BUSINESS U/S 28 OF THE INCOME -TAX ACT 1961 THEREFORE PROVISIONS OF SECTION 50C ARE NOT APPLICABLE. AS THE ADDITION ITSELF HAS BEEN DELETED THERE IS NO INFIRMITY IN THE ORDER OF CIT(A) FOR CANCELLING THE PENALTY IMPOSED WITH REFERENCE TO THE ADDITIONS SO DELETED . KHIALDAS CONSTRUCTIONS PVT.LTD. BHOPAL A.Y. 2006-07 5 PAGE 5 OF 5 4. IN THE RESULT THE APPEAL OF THE REVENUE IS DISMISSED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 31 ST OCTOBER 2013. SD/- SD/- (JOGINDER SINGH) (R. C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 31 ST OCTOBER 2013. CPU* 303110