Rasai Properties Pvt. Ltd. Vs DCIT (ITAT Mumbai)
Admittedly, there has been an omission on the part of the assessee to disclose the LTCG on sale of the shops in its return of income for the year under consideration. However, at the same time, we cannot remain oblivious of the bonafides of the assessee, which can safely be gathered from the aforesaid facts and discard its explanation for no justifiable reason. Accordingly, in the totality of the facts of the case, we are of a strong conviction that imposition of penalty under Sec. 271(1)(c) would be unwarranted on account of the aforesaid inadvertent and bonafide error on the part of the assessee.
We thus not being able to persuade ourselves to accept the view taken by the lower authorities set aside the order of the CIT(A) and delete the penalty imposed by the A.O under Sec. 271(1)(c).
FULL TEXT OF THE ITAT JUDGEMENT
The present appeal filed by the assessee is directed against the order passed by the CIT(A)-21, Mumbai, dated 30.05.20 16, which in turn arises from the order passed by the A.O under Sec. 271(1)(c) of the Income Tax Act, 1961 (for short “Act“), dated 30.05.2016. The assessee has assailed the order of the CIT(A) by raising before us the following grounds of appeal:
“1. We are not agreeing with the Order U/s. 271(1) (c) of the Income Tax Act, 1961 passed by Commissioner of Income Tax (Appeals)-21, Mumbai.
2. During the assessment proceeding same mistake was notice by the assessee company and immediately it was brought to the notice of assessing officer, even before asking by the assessing officer. Which shows that this is not concealment but a bonafide mistake which was not only suo moto offered by the assessee company but also the assessee company has paid the due taxes.
3. The previous record of assessee company also shows that assessee company has always been a co-operative & honest tax payer.
4. While leaving the penalty assessing officer has written that same mistake was not rectified by filing the revised return. In this regards fact is that by the time assessee notice the mistake time for the revising the return had been expired. Since the case was in scrutiny, same was offered for tax before assessing officer could find the
5. All the additions made during the assessment order does not amount to concealment. Reliance is place on the order of honorable supreme court in the case of Reliance Petroproducts Pvt. Ltd.”
2. Briefly stated, the assessee company had e-filed its return of income for A.Y 2013-14 on 27.09.2013, declaring its total income at 80, 19,650/-. Subsequently, the case of the assessee was selected for scrutiny assessment under Sec. 143(2) of the Act.
3. During the course of the assessment proceedings it was inter alia observed by the A.O, that a deduction of Rs.6,70,000/- was discernible from the chart of “block of assets“comprising of “tangible fixed assets“, which formed part of the “balance sheet“ of the assessee company for the year under consideration. On being queried as regards the nature of the aforesaid deduction from the block of tangible assets, it was submitted by the assessee that the same pertained to certain properties which were sold during the year under The A.O called upon the assessee to explain as to why it had not offered the income from the sale of the aforementioned properties under the head income from “Long Term Capital Gain“ (for short “LTCG“). In reply, the assessee filed the working of the LTCG on sale of the three premises viz. Shop No. 10, Shop No.11, and Shop No.12, as under:
