The ACIT, Central Circle-1,, Surat v. M/s. K.K. Developers, Mumbai

ITA 840/AHD/2011 | 2007-2008
Pronouncement Date: 30-04-2015 | Result: Dismissed

Appeal Details

RSA Number 84020514 RSA 2011
Assessee PAN AAHFK1275G
Bench Ahmedabad
Appeal Number ITA 840/AHD/2011
Duration Of Justice 4 year(s) 1 month(s) 13 day(s)
Appellant The ACIT, Central Circle-1,, Surat
Respondent M/s. K.K. Developers, Mumbai
Appeal Type Income Tax Appeal
Pronouncement Date 30-04-2015
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 30-04-2015
Date Of Final Hearing 24-04-2015
Next Hearing Date 24-04-2015
Assessment Year 2007-2008
Appeal Filed On 17-03-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD BEFORE SHRI PRAMOD KUMAR ACCOUNTANT MEMBER AND SHRI S.S. GODARA JUDICIAL MEMBER ITA NO . 840 /AHD/201 1 A. Y. 200 7 - 08 ACIT SURAT. VS M/S. K.K. DEVELOPERS 5 TURNING POINT PALGHAR THANE. PAN: AAHFK 1275G (APPELLANT) (RESPONDENT) REVENUE BY : S HRI P.L. KUREEL SR. D.R. ASSESSEE(S) BY : SHRI TEJ SHAH A.R. / DATE OF HEARING : 24 / 0 4 /201 5 / DATE OF PRONOUNCEMENT: 30 / 0 4 /201 5 / O R D E R PER SHRI S.S. GODARA JUDICIAL MEMBER TH IS REVENUE S APPEAL FOR A.Y. 200 7 - 0 8 ARISE S FROM ORDER OF THE CIT (A) - II AHMEDABAD DATED 6.11. 2011 PASSED I N CASE NO. CIT(A) - II/CC.I/75/0 9 - 10 DELETING IMPUGNED PENALTY OF RS.4 46 000/ - IN PROCEEDINGS U/S. 271(1)(C) OF THE INCOME TAX ACT IN SHORT THE ACT . 2. THE ASSESSEE - FIRM IS IN CONSTRUCTION BUSINESS. THE DEPARTMENT HAD CONDUCTED A SEARCH IN CASE OF ITS PARTNER. HE DECLARED UNDISCLOSED INCOME OF RS.13.25 LAC AT THE ASSESSEE - FIRM S BEHEST. THE ASSESSEE FILED A RETURN ON 29.10.2007 ADMITTING INCOME OF RS.15 19 010/ - FOLLOWED BY A REVISED ONE. THE SAME WAS PROCESSED. ITA NO. 840 /AHD/201 1 M/S. K.K. DEVELOPERS FOR A.Y. 200 7 - 0 8 - 2 - TH EREAFTER THE ASSESSING OFFICER FRAMED A REGULAR ASSESSMENT ON 26.10.2008 ACCEPTING THE INCOME RETURN. HOWEVER HE INITIATED PENALTY PROCEEDINGS QUA THE UNDISCLOSED INCOME ADMITTED HEREINABOVE OF RS.13.25 LAC ALLEGING CONCEALMENT AND FURNISHING OF INACCURATE PARTICULARS OF INCOME. 3. IN PENALTY PROCEEDINGS THE ASSESSEE PLEADED FOR DROPPING THE PENALTY NOTICE SINCE ITS INCOME DECLARED STOOD ACCEPTED AND CLAIMED IMMUNITY U/S.271(1)(C) EXPLANATION 5 OF THE ACT. THE ASSESSING OFFICER DID NOT AGREE. HE OBSERVED IN PENALTY ORDER DATED 29.6.2009 THAT THE ASSESSEE - FIRM HAD DECLARED ITS UNDISCLOSED INCOME ABOVE SAID ONLY BECAUSE OF SEARCH AND NOT VOLUNTARILY ITS CLAIM OF IMMUNITY WAS NOT MAINTAINABLE SINCE NO UNDISCLOSED INCOME HAD BEEN DECLARED TO THE CHIEF COMMIS SIONER/COMMISSIONER OF INCOME TAX AND THE SAME WAS NOT ON THE BASIS OF ANY MONEY BULLION JEWELLERY OR OTHER VALUABLE ARTICLES OR THINGS FOUND IN THE COURSE OF SEARCH BUT ONLY ON THE BASIS ON INCRIMINATING ENTRIES IN THE BOOKS OF ACCOUNTS. THE ASSESSING O FFICER CONCLUDED THAT THE ASSESSEE S ACTION IN DISCLOSING THE IMPUGNED UNDISCLOSED INCOME AMOUNTED TO SUPPRESSION AND CONCEALMENT OF ITS TAXABLE INCOME BY FILING INACCURATE PARTICULARS. HE LEVIED MINIMUM PENALTY OF RS.4.46 LAC ACCORDINGLY IN THE ASSESSEE S CASE. 4. THE ASSESSEE PREFERRED AN APPEAL. THE CIT(A) TAKES INTO ACCOUNT THE CASE LAW OF CIT VS. MISHRIMAL SONI 162 TAXMAN 53 (RAJ.) THAT THERE IS NO DISTINCTION BETWEEN TANGIBLE OR INTANGIBLE ASSET ITA NO. 840 /AHD/201 1 M/S. K.K. DEVELOPERS FOR A.Y. 200 7 - 0 8 - 3 - IN RELATION TO SECTION 271(1)(C) EXPLANATION 5 (2) AND DISCLOSURE ON THE BASIS OF ENTRIES IN THE DOCUMENTS IS ALSO COVERED THEREUNDER. THE SECOND CASE LAW TAKEN NOTE OF HON BLE JURISDICTION HIGH COURT IN CIT VS. MAHINDRA C. SHAH GRANTING IMMUNITY EVEN IF NO MANNER OF EARNING THE UNDISCLOSED INCOME IN QUESTION SPECIFIED IN SECTION 32(4) STATEMENT RECORDED DURING SEARCH. THE LOWER APPELLATE ORDER ACCORDINGLY HOLDS THE ASSESSEE ENTITLED FOR IMMUNITY RELIEF. THIS MAKES THE REVENUE AGGRIEVED. 5. WE HAVE HEARD THE PARTIES. THERE IS NO DISPUTE ON THE FACTUAL POSITI ON ON MERITS HEREINABOVE. THE ASSESSEE S PARTNER HAD DECLARED ITS UNDISCLOSED INCOME OF RS.13.25 LAC. WE REITERATE THAT THE IMPUGNED ASSESSMENT YEAR IS 2007 - 08 WHEREIN THE ASSESSEE WAS YET TO FILE ITS RETURN AND THE SEARCH IS CONDUCTED IN THE RELEVANT ACCO UNTING PERIOD ON 27.12.2006. IT FILED ITS RETURN ON 29.10.2007 INCLUDING THE VERY SUM AND THE ASSESSING AUTHORITY DID NOT MAKE ANY ADDITION. IT S A REGULAR ASSESSMENT AND NOT THE ONE COVERED BY SECTION 153A OR 153C OF THE ACT. THE REVENUE STILL ALLEGES CON CEALMENT ON THE ASSESSEE S PART. WE FIND FROM A RECENT DECISION OF THE HON BLE JURISDICTIONAL HIGH COURT DATED 3.12.2014 IN KIRIT DAYABHAI PATEL VS. ACIT THAT WHEN THE RETURNED INCOME IN FURTHERANCE TO SEARCH IS ACCEPTED WITHOUT ANY ADDITION BEING MADE TH E IMPUGNED PENALTY CAN ONLY BE LEVIED QUA THE INCOME OVER AND ABOVE THE ONE RETURN AND NOT OTHERWISE. THE REVENUE FAILS TO POINT OUT ANY DISTINCTION ON FACTS SO AS TO GET THE IMPUGNED PENALTY RESTORED. ITS GROUNDS STAND REJECTED. ITA NO. 840 /AHD/201 1 M/S. K.K. DEVELOPERS FOR A.Y. 200 7 - 0 8 - 4 - 6. THE REVENUE S APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON THIS DAY THE 30 TH APRIL 201 5 AT AHMEDABAD. ( PRAMOD KUMAR ) ( S.S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHME DABAD; DATED 30 / 0 4 / 20 1 5 PRABHAT KR. KESARWANI SR. P . S . / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) - III AHMEDABAD 5. / DR ITAT AHMEDABAD 6. / GUARD FILE . / BY ORDER / ( DY./ASSTT.REGISTRAR) / ITAT AHMEDABAD