Shree Neelkanth Corporation,, ... vs Assessee

IN THE INCOME TAX APPELLATE TRIBUNAL " D " BENCH, AHMEDABAD (BEFORE SHRI MUKUL Kr. SHRAWAT, J.M. & SHRI ANIL CHATURVEDI, A.M.)

I.T. A. No.3076/AHD/2013 (Assessment Year: 2009-10)

Shree Neelkanth Corporation V/S The A.C.I.T., GNR Circlr, "Nakshatra" IOC Road Gandhinagar Chandkheda, Gandhinagar

(Appellant) (Respondent)

PAN: ABFFS 1440L

Appellant by : Shri S.N. Divetia, A.R. Respondent by : Shri B.L. Yadav, Sr. D.R.

(आदेश )/ORDER

Date of hearing : 30-01-2015 Date of Pronouncement : 20-02-2015

PER SHRI ANIL CHATURVEDI,A.M.

1. This appeal filed by the Assessee is against the order of CIT(A), Gandhinagar, Ahmedabad dated 01.11.2013 for A.Y. 2009-10.

2. The relevant facts as culled out from the material on record are as under.

3. Assessee is partnership firm stated to be engaged in the business construction work, land purchase and its development. Assessee electronically filed its return of income for A.Y. 2009-10 on 30.07.2009 2 ITA No 3076/AHD/2013 . A.Y. 2009-10

declaring total income of Rs. 20,10,190/-. Subsequently, a survey u/s. 133A was conducted on 10.09.2009 and during the course of survey, the partner Shri Rageshkumar Shah disclosed Rs. 1,20,00,000/- as undisclosed income for A.Y. 2009-10 and Rs. 1,80,00,000/- for A.Y. 2010-11. Assessee thereafter revised its return of income on 28.09.2009 for A.Y. 2009-10 declaring total income at Rs. 1,40,10,190/-. The Assessment was thereafter framed u/s. 143(3) vide order dated 02.12.2011 and the assessment was completed on the returned income. On the additional income of Rs. 1,20,00,000/- that was disclosed during the course of survey, A.O vide penalty order dated 22.06.2012 levied penalty of Rs. 45,50,000/- u/s. 271(1)(c) of the Act. Aggrieved by the order of A.O., Assessee carried the matter before CIT(A) who vide order dated 01.11.2013 confirmed the order of A.O. Aggrieved by the aforesaid order of CIT(A), Assessee is now in appeal before us and has raised the following grounds;- 1.1 The order passed u/s.250 for the A.Y.2009-10 on 1-11-2013 by CIT(A)-GNR A' BAD, confirming the penalty OF Rs. 45.50 lacs levied in respect of income of Rs.1.20 cr is wholly illegal, unlawful and against the principles of natural justice.

1.2 The Ld.CIT(A) has grievously error in not considering fully and properly the explanations furnished and evidence produced before him as well as distinguishing the case laws relied upon by the appellant.

2.1 The Ld. CIT(A) has grievously erred in law and on facts in upholding that the appellant had furnished inaccurate particulars of income to the extent of income of Rs. 1 .20 cr and thereby the provisions of Sec 271(1)(c) were attracted.

2.2 That in the facts and circumstances of the case as well as in law the LD CIT(A) ought not to have confirmed that (i) the appellant had not filed revised return of income voluntary but only after the detection by the Survey party. (ii) material was found during the course of survey showing concealed income. Thus the Ld CIT(A) has grievously erred in law and on facts in upholding the penalty of RS. 45.50 lacs levied u/s 271(1)(c).

3.1 The Ld. CIT(A) ought not to have held that the penalty proceedings were illegal and unlawful in as much as there was no act of furnishing the inaccurate particulars of income in respect of income declared. It is, therefore, prayed that the penalty of Rs. 45.50 lacs levied by AO and confirmed by CIT(A) may please be deleted.

4. Before us, ld. A.R. submitted that though Assessee has raised various grounds but the only issue is with respect to levy of penalty u/s. 271(1)(C).

3 ITA No 3076/AHD/2013 . A.Y. 2009-10

5. Before us, ld. A.R. submitted that Assessee had filed the revised return of income on 20.09.2008 declaring total income of Rs. 1,40,10,190/- which included the disclosure of Rs. 1.20 crores as admitted by the partner at the time of survey. The revised return filed by the Assessee was accepted in toto by the A.O and no addition to the income was made by the A.O. He further submitted that the revised return was filed by the Assessee voluntarily as there was no notice from the Department to the Assessee to file the return of income. He further submitted that A.O has levied the penalty u/s. 271(1)(c) on account of furnishing of inaccurate particulars of income to the extent of Rs. 1.20 crores. He submitted that Assessee has not furnished any inaccurate particulars and therefore the penalty could not have been levied by the A.O. He further submitted that during the course of survey no incriminating material was found. The ld. A.R. further submitted that the ratio of the decisions relied by the A.O and ld. CIT(A) in upholding the penalty are distinguishable on facts and cannot be applied to the present case. He, on the contrary relied on the decisions in the case of Jay Somnath Iron Works ITA NO. 2492/AHD/2012 order dated 21.06.2013, the decision of Vishakhapatnam Bench in the case of Godvari Township Pvt. Ltd. vs. DCIT (2014) 45 Taxman.com 175 Vishakhapatnam Tribunal, Delhi Tribunal decision in the case of Smt. Vinay Sharma ITA No. 871/Del/2013. He also relied on the decision of Punjab & Haryana High Court in the case of CIT vs. Careers Education & InfoTech Pvt. Ltd. The ld. D.R. on the other hand supported the order of A.O and ld. CIT(A).

6. We have heard the rival submissions and perused the material on record. It is an undisputed fact that Assessee had filed original return of income on 30.07.2009 and later on the return was revised on 28.09.2009 showing total 4 ITA No 3076/AHD/2013 . A.Y. 2009-10

income at Rs. 1.40 crores which included Rs. 1.20 crore that was admitted at the time of survey. It is also a fact that the revised return of income filed by the Assessee was accepted in totality by the A.O. and no addition was made. On the undisclosed income of Rs. 1,20,00,000/- which was disclosed by the Assessee and accepted by the Return in the return of income penalty u/s. 271(1)(c) for concealment of income has been levied. Before us, ld. A.R. submitted that during the course of survey, no incriminating material or evidences were impounded and the aforesaid statement has been controverted by Revenue by placing any material on record. Considering the fact that Assessee had made the disclosure of income in the revised return of income and the AO has also accepted the same and in view of the fact that during the courses of survey, no incriminating material was found and since Revenue has not found actual concealment of income or furnishing of inaccurate particulars of income in the return of income, we are of the view that no penalty u/s. 271(1)(c) would be attracted in the present case. We further draw support from the decision of Hon'ble Gujarat High Court in the case of Kirit Dayabhai Patel vs. Act (Tax Appeal No. 1181 of 2010 and Others order dated 03/12/20014) where the Hon'ble High Court has even in the case where income was shown in the return filed u/s. 153 of the Act has held that no penalty u/s. 271(1)(c) is leviable. In the result, the ground of Assessee is allowed.

7. In the result, the appeal of Assessee is allowed.

Order pronounced in Open Court on 20- 02 - 2015.

Sd/- Sd/- (MUKUL Kr. SHRAWAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER 5 ITA No 3076/AHD/2013 . A.Y. 2009-10

Ahmedabad. Rajesh

Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) - 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER

Deputy/Asstt.Registrar ITAT,Ahmedabad