INCOME TAX APPELLATE TRIBUNAL “SMC” BENCH, AHMEDABAD

ITA No. 3159/Ahd/2015; Assessment Year: 2008-09
Smt. Riddhi Kiranbhai Gandhi (Appellant) vs. Income Tax Officer (Respondent)
Date of Order: 01-01-2016

ORDER

This appeal has been filed by the assessee against the order of the Learned Commissioner of Income Tax (Appeals)-3, Ahmedabad, dated 04.09.2015 for Assessment Yeas 2008-09, confirming penalty of Rs.5,46,622/- u/s 271(1)(c).

2. Brief facts of the case are that the assessee has filed her return of income for the year under consideration on 12.11.2010, determining the total income at Rs.2,68,830/-. Thereafter, the Assessing Officer framed assessment u/s 143(3) r.w.s. 147 of the Act vide order dated 28.10.2013, thereby the AO determined the total income of the assessee at Rs.19,10,270/-. Subsequently, the Assessing Officer imposed penalty u/s 271(1)(c) vide order dated 28.04.2014 of Rs.5,46,622/-, on the ground that the assessee has furnished the inaccurate particulars of her income. Being aggrieved by the penalty order, the assessee carried the matter before the CIT(A), who after considering the submissions of the assessee, has confirmed the penalty levied by the Assessing Officer. Aggrieved by the order of the CIT(A), now the assessee is further in appeal before us.

2. The Authorized Representative for the assessee has submitted that the order of the ld. CIT(A) was not justified and he also placed reliance on the decision of Co-ordinate Bench in the case of Smt. Sudhaben T. Parikh vs. ITO, vide ITA No.831/Ahd/2011. On the contrary, ld. Departmental Representative relied upon the order of the CIT(A).

3. I have heard the rival contentions and perused the material on record. I find that, under the similar set of facts and circumstances, the Co-ordinate Bench of Tribunal (Ahmedabad “A” Bench) in the case of Smt. Sudhaben T. Parikh vs. ITO (supra) has cancelled the penalty levied by the Assessing Officer, by observing as under:-

6. We have heard the rival submissions and perused the material on record. It is an undisputed fact that during the course of assessment proceedings, Assessee had revised the calculation of capital gains on account of wrong consideration of the date of purchase. It is also a fact that the correction position about the capital gain was brought to the notice of the A.O by the Assessee. There is nothing on record to demonstrate that the Revenue had detected concealment on account of wrong mentioning of the date.

7. The penalty under section. 271(l)(c) of the Act is leviable if the AO is satisfied in the course of any proceedings under the Act that any person has concealed the particulars of his income or furnished inaccurate particulars of such income.

8. The necessary ingredients for attracting Expln. 1 to section. 271(l)(c) are that (i) the person fails to offer the explanation, or (ii) he offers the explanation which is found by the AO or the CIT(A) or the CIT to be false, or (iii) the person offers explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relating to the same have been disclosed by him. If the case of any assessee falls in any of these three categories, then according to the deeming provision provided in Expln. 1 to section. 271(l)(c) the amount added or disallowed in computing the total income shall be considered as the income in respect of which particulars have been concealed, for the purposes of clause. (c) of s. 271(1), and the penalty follows. On the other hand, if the assessee is able to offer an explanation, which is not found by the authorities to be false, and assessee has been able to prove that such explanation is bona fide and that all the facts relating to the same have been disclosed by him, then in that case penalty shall not be imposed.

9. In the present case the assessee had during the course of assessment proceedings revised the return of income and the same was accepted by the A.O. Before us, no material has been brought on record to demonstrate that the submissions of the Assessee were false. When the assessee has furnished all the material facts relevant thereto, the disallowance of such claim cannot automatically lead to the conclusion that there was concealment of particulars of his income by the assessee or furnishing inaccurate particulars thereof. What is to be seen is whether the said claim made by the assessee was bona fide and whether all the material facts relevant thereto have been furnished and once it is so established, the assessee cannot be held liable for concealment penalty under s. 271(1) (c) of the Act. In the present case since all the necessary facts were furnished, we are of the view that simply because the addition has been made it does not call for levy of penalty under s. 271(l)(c). We thus cancel the penalty levied by the AO. Therefore, this ground of Assessee is allowed.”

4. Nothing contrary was brought on record on behalf of the Revenue. Facts being similar, so following the same reasoning I am not inclined to concur with the findings of the ld. CIT(A); therefore, respectfully following the decision of Co-ordinate Bench in the case of Smt. Sudhaben T. Parikh (supra), I allow this appeal filed by the assessee and delete the penalty of Rs.5,46,622/- levied by the Assessing Officer u/s 271(1)(c) of the Act.

5. In the result, appeal filed by the assessee is allowed.

Order pronounced in the Court on 1st January, 2016 at Ahmedabad.

(SHAILENDRA KUMAR YADAV)
JUDICIAL MEMBER

Related Judgment:
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