IT : Expenditure claimed for establishing airport being disallowed as not related to business of development authority, no concealment penalty could be levied
IT : Where taxability of instalment amounts received on sale of flat as a result of change of accounting method was remitted to Assessing Officer for de novo consideration, concealment penalty was to be deleted
■■■
[2014] 51 taxmann.com 463 (Chandigarh - Trib.)
IN THE ITAT CHANDIGARH BENCH 'A'
Deputy Commissioner of Income-tax
v.
Punjab Urban Planning & Development Authority*
T.R. SOOD, ACCOUNTANT MEMBER
AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER
IT APPEAL NOS. 26 & 27 (CHD.) OF 2012
AND 149 & 815 (CHD.) OF 2013
FEBRUARY 26, 2014
I. Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income (Disallowance of claim, effect of) - Assessment year 2008-09 - Whether where assessee has bona fide explanation for non-exclusion of receipts as its income or for claiming particular item of expenditure as deduction, even where claim of assessee is rejected, no penalty could be levied under section 271(1)(c) - Held, yes - Assessee was an urban planning and development authority - It claimed expenditure incurred for establishing an international airport in vicinity of area under its control as revenue expenditure on plea that it would result in higher profitability to assessee vis-a-vis increase in price of land/houses sold by assessee - Claim was disallowed on ground that expenses was not related to assessee's business - Assessing Officer levied penalty under section 271(1)(c) for making wrong claim - Whether assessee having declared complete facts with regard to expenditure and claim of assessee being bona fide, though not allowed as expenditure in hands of assessee, levy of penalty under section 271(1)(c) was not justified - Held, yes [Paras 55 to 57] [In favour of assessee]
II. Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income (Delation of additions, effect of) - Assessment years 2004-05, 2005-06, 2007-08 to 2009-10 - Assessee had changed its method of accounting to mercantile system of accounting, but instalments received on sale of houses/flats under various schemes were not recognized as income while computing its income for relevant years - Addition was made in assessee's hands on account of such receipts and on that basis penalty was levied under section 271(1)(c) - In quantum appeal, issue of aforesaid addition had been remitted to Assessing Officer to decide same de novo - Whether on facts issue of levy of penalty under section 271(1)(c) in relation to addition did not stand and penalty was liable to be deleted - Held, yes [Para 64] [In favour of assessee]
IT : Where taxability of instalment amounts received on sale of flat as a result of change of accounting method was remitted to Assessing Officer for de novo consideration, concealment penalty was to be deleted
■■■
[2014] 51 taxmann.com 463 (Chandigarh - Trib.)
IN THE ITAT CHANDIGARH BENCH 'A'
Deputy Commissioner of Income-tax
v.
Punjab Urban Planning & Development Authority*
T.R. SOOD, ACCOUNTANT MEMBER
AND MS. SUSHMA CHOWLA, JUDICIAL MEMBER
IT APPEAL NOS. 26 & 27 (CHD.) OF 2012
AND 149 & 815 (CHD.) OF 2013
FEBRUARY 26, 2014
I. Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income (Disallowance of claim, effect of) - Assessment year 2008-09 - Whether where assessee has bona fide explanation for non-exclusion of receipts as its income or for claiming particular item of expenditure as deduction, even where claim of assessee is rejected, no penalty could be levied under section 271(1)(c) - Held, yes - Assessee was an urban planning and development authority - It claimed expenditure incurred for establishing an international airport in vicinity of area under its control as revenue expenditure on plea that it would result in higher profitability to assessee vis-a-vis increase in price of land/houses sold by assessee - Claim was disallowed on ground that expenses was not related to assessee's business - Assessing Officer levied penalty under section 271(1)(c) for making wrong claim - Whether assessee having declared complete facts with regard to expenditure and claim of assessee being bona fide, though not allowed as expenditure in hands of assessee, levy of penalty under section 271(1)(c) was not justified - Held, yes [Paras 55 to 57] [In favour of assessee]
II. Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income (Delation of additions, effect of) - Assessment years 2004-05, 2005-06, 2007-08 to 2009-10 - Assessee had changed its method of accounting to mercantile system of accounting, but instalments received on sale of houses/flats under various schemes were not recognized as income while computing its income for relevant years - Addition was made in assessee's hands on account of such receipts and on that basis penalty was levied under section 271(1)(c) - In quantum appeal, issue of aforesaid addition had been remitted to Assessing Officer to decide same de novo - Whether on facts issue of levy of penalty under section 271(1)(c) in relation to addition did not stand and penalty was liable to be deleted - Held, yes [Para 64] [In favour of assessee]
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