Shri Avnishkumar Gunvantray Joshi, Nadiad V. The Income Tax Officer, Ward-2, Nadiad

CO 312/AHD/2014

• Counselvise Citation: [2017] 123 COUNSELVISE.COM (IT) 3307 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 7 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 19-12-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 12-12-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: K C THAKER
• Keywords: Audit objection; Tax effect
• Section: 273B; 234B

Judgement Text

, *CKH *CKH*CKH *CKH* ** * IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD . . , , BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI MAHAVIR PRASAD, JUDICIAL MEMBER ./ I.T.A. NOS.2988 & 2989/AHD/2014 ( / ASSESSMENT YEAR :2010-11) THE INCOME TAX OFFICER, WARD 2, NADIAD. / VS. SHRI AVINISHKUMAR GUNVANTRAY JOSHI, C/O. D.P. MEDICAL & GENERAL STORES, NR: D.P. HIGH SCHOOL, SANTRAM ROAD, NADIAD 387 001 CROSS OBJECTION NOS. 311 & 312/AHD/2014 (ASSESSMENT YEARS : 2010-11) SHRI AVINISHKUMAR GUNVANTRAY JOSHI, C/O. D.P. MEDICAL & GENERAL STORES, NR: D.P. HIGH SCHOOL, SANTRAM ROAD, NADIAD 387 001 / VS. THE INCOME TAX OFFICER, WARD 2, NADIAD. ! ./ '#$# ./ PAN/GIR NO. : ABQPJ 7574 B ( %&!' / APPELLANT ) .. ( (!' / RESPONDENT ) REVENUE BY : SHRI MUDIT NAGPAL, SR. D.R. ASSESSEE BY : SHRI K. C. THAKER, A.R. ) * + ,- / DATE OF HEARING 18/12/2017 ./01 + ,- / DATE OF PRONOUNCEMENT 19/12/2017 ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 2 - # 2 / O R D E R PER MAHAVIR PRASAD, JUDICIAL MEMBER : THESE ARE TWO APPEALS BY THE REVENUE ALONGWITH T WO CROSS OBJECTIONS BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX(APPEALS)-II, BARODA, DATED 11/12/2013 FO R THE ASSESSMENT YEARS (AY) 2010-11. 2. FIRST WE TAKE UP ITA NO.2988/AHD/2017 FOR A.Y. 2 010-11. FOLLOWING GROUNDS HAS TAKEN BY THE DEPARTMENT IN TH IS APPEAL. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. C.I.T.(A) HAS ERRED IN DELETING THE PENALTY LEVIED U/S.271D OF THE ACT, WITHOUT APPRECIATING THE FACT THAT THE ASSESSEE NEI THER PRODUCED CONFIRMATION LETTER IN SUPPORT OF THE CONTENTION TH AT HIS FATHER GAVE HIM RS.9,60,000/- TO ENABLE HIM TO SETTLE IN LIFE WITHO UT ANY PRECONDITION OF REPAYMENT, NOR DID THE ASSESSEE PRODUCE ANY EVIDENC E TO EXPLAIN THAT AMOUNT OF RS.9,60,000/- GIVEN BY HIS FATHER WAS NOT A LOAN/DEPOSIT. 3. CBDT CIRCULAR NO.21 OF 2015 DATED 10.12.2015. TH E LD. DEPARTMENTAL AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE APPEAL OF THE REVENUE NEEDS TO BE DISMISSE D ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE REPRESENTATIVE FAIRLY ADM ITTED THAT THE TAX EFFECT IS LESS THAN THE LIMIT PRESCRIBED BY THE AFORESAID CBDT CIRCULAR. ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 3 - 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. WE FIND THAT PRIMA-FACIE THIS APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 21/2015 I N F.NO.279/MISC. 142/2007-ITJ (PT) DATED 10TH DECEMBER 2015, VIDE WH ICH IT HAS BEEN PROVIDED THAT IF THE TAX EFFECT BY VIRTUE OF THE CO MMISSIONER OF INCOME- TAX (APPEALS)S ORDER IS BELOW RS. 10 LACS, THEN TH AT ORDER WOULD NOT BE CHALLENGED BEFORE THE TRIBUNAL IN FURTHER APPEAL. T HE BOARD HAS PROVIDED EXEMPTIONS AT CLAUSE (8) OF THE INSTRUCTIONS WHEREI N IT HAS BEEN PROVIDED THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE, IF VIRES OF ANY PROVISIONS HAS BEEN QUASHED BY IMPUGNED ORDER OR ADDITION WAS MADE ON SOME AUDIT OBJECTIONS OR THE ADDITION RELATES TO UNDISCL OSED FOREIGN ASSETS/BANK ACCOUNTS, ETC. WE FIND THAT THE PRESENT CASE DOES N OT FALL WITHIN THE EXEMPTION CLAUSE AND THE TAX IS LESS THAN RS.10 LAC S. THEREFORE, THE PRESENT APPEAL IS NOT MAINTAINABLE AND HENCE DISMIS SED IN LIMINE. 5. NOW WE TAKE ITA NO.2989/AHD/2014 FOR A.Y.2010-11 FOLLOWING GROUNDS HAVE TAKEN BY THE REVENUE: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LD. C.I.T.(A)- IV, BARODA, HAS ERRED IN DELETING THE PENALTY LEVIE D U/S. 271E OF THE I.T. ACT WITHOUT APPRECIATING THE FACT THAT ASSESSEE DUR ING THE COURSE OF PENALTY PROCEEDINGS HIMSELF ADMITTED TO HAVE REPAID SHORT TERM LOAN TO HIS FATHER AGGREGATING RS.12,90,000/-. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LD. C.I.T, (A)- IV, BARODA ERRED ON RELYING ON THE AFFIDAVIT FILED BY THE ASSESSEE'S WIFE DURING THE COURSE OF APPELLATE PROCEEDINGS WHILE DE LETING THE PENALTY. ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 4 - 6. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDING IN THE CASE OF ASSESSEE FOR THE ASSESSME NT YEAR 2010-11, FOUND THAT THE ASSESSEE HAS REPAID LOAN IN CASH AGG REGATING TO RS.17,40,000/- FROM PRATIXABEN A. JOSHI AND GUNVANT RAI M. JOSHI AS FOLLOWS: DATE AMOUNT NAME 20/02/2010 RS.4,50,000/- PRATIXABEN A. JOSHI 25/01/2010 RS.9,50,000/- GUNVANTRAI M. JOSHI 14/02/2010 RS.3,40,000/- GUNVANTRAI M. JOSHI TOTAL RS.17,40,000/- 2. THE ASSESSING OFFICER OBSERVED THAT AS THE REPAI D LOANS IN CASH IN AGGREGATE AS MENTIONED ABOVE EXCEEDED RS.20,000/ -, THE ASSESSEE CONTRAVENED THE PROVISIONS OF CONSEQUENCES AS ENVIS AGED UNDER THE PROVISIONS OF SECTION 271E OF THE ACT. ACCORDINGLY, THE AO REFERRED THE CASE FOR INITIATION OF PENALTY U/S.271E OF THE ACT. 3. AS THE PENALTY IS LEVIABLE U/S.271E OF THE ACT, A SHOW-CAUSE NOTICE U/S.271E OF THE ACT WAS ISSUED TO THE ASSESS EE BY THE UNDERSIGNED VIDE LETTER NO. JOINT CIT/KR/SHOW CAUSE/271E/AGJ/20 12-13 DTD.25.02.2013 ASKING THE ASSESSEE TO SUBMIT HIS EX PLANATION IN THIS REGARD EITHER PERSONALLY OR THROUGH AUTHORIZED REPR ESENTATIVE ON OR BEFORE 05.03.2013. 4. IN RESPONSE THE ABOVE NOTICE THE AR OF THE ASSES SEE ATTENDED ON THE DATE OF HEARING I.E. ON 05.03.2013 AND FILED TH E WRITTEN SUBMISSION IN THIS REGARD WHICH IS REPRODUCE HEREUNDER: RELEVANT TO THE ABOVE MATTER THE ASSESSEE HAS RE CEIVED SHOW CAUSE NOTICE FROM YOUR HONOUR CONCERNING TO IMPOSIT ION OF PENALTY UNDER SECTION 271E FOR THE ALLEGED BREACH OF SECTIO N 269T OF THE ACT (HEREINAFTER CALLED ACT FOR THE SAKE OF BREVITY ). THE ASSESSEE RAISES FOLLOWING DISPUTES AGAINST THE PROCEEDINGS: ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 5 - 1. THAT THE CONCLUSION OF THE ASSESSMENT HAS BEEN MADE ON 12/02/2013 ACCORDING TO WHICH THE UNDERSIGNED HAS B EEN ASSESSED U/S.143(3) R.W.S. 147 OF THE I.T. ACT, 19 61; TAX AND INTEREST U/S.234A, 234B & 234C IS CHARGED. PENALTY NOTICE U/S.271(1)(C) OF THE I.T. AT, 1961 HAS BEEN ISSUED. DEMAND NOTICE AND CHALLAN ISSUED ACCORDINGLY. VIDE PLEASE LAST THREE LINES OF PARA 6.1 OF THE ORDER U/S.143(3) DTD.12/ 02/2013. INITIATION OF PENALTY HAS NOT BEEN PROPOSED ON CONC LUSION OF ASSESSMENT. 2. WHAT THE UNDERSIGNED HAS BEEN DONE WAS THE REPAYMEN T OF THE MONEY TO THE BIGGER JOINT FAMILY OF WHICH I AM A CO- PARCENER/MEMBER AND ADMINISTERED BY SHRI GUNVANTRAI M. JOSHI, FATHER WHO IS KARTA OF THE FAMILY. THE AGGRE GATE AMOUNT OF RS.12,90,000/- WAS SHORT LOAN REPAID TO F ATHER AS UNDER: AMOUNTS WERE NOT RETURNABLE AFTER A NOTICE OR PERIO D FIXED CASH RS.9,50,000/- ON 25.01.2010 & CASH RS.3,40,000/- ON 14.02.2010 AS SUCH THE REPAYMENT OF LOAN WAS NOT DEPOSITS AND AS SUCH THE SAME CANNOT BE HIT BY THE PROVISIONS OF SECTION 269T. ACCORDINGLY THERE WAS NO CASE TO INVOKE THE PROVISI ONS OF SECTION 271E. 3. SO ALSO THE PAYMENT OF RS.4,50,000/- MADE TO PRATIX ABEN A. JOSHI (WIFE)WAS ALSO OUT OF CAPITAL OF THE H.U.F. W HICH HAS BEEN KEPT BY THE BIGGER JOINT FAMILY OF GUNVANTRAI JOSHI (FATHER). THESE WERE NOT THE DEPOSITS BUT THE PAYME NT MADE BY THE JOINT FAMILY IN THE FORM OF 'MARRIED WOMAN P ROPERTY' DUE TO HER EARLIER, AND WHICH WAS A LIABILITY OF TH E FAMILY PENDING FROM MARRIAGE. CONSIDERING THE ABOVE FACTS & CIRCUMSTANCES PENALTY PROCEEDINGS MAY BE DROPPED & OBLIGE. ' 5. THE CONTENTION OF THE ASSESSEE CANNOT BE ACCEPTE D IN VIEW OF CLEAR CUT PROVISIONS U/S.269T OF THE ACT THAT THE PAYMENT OF CASH ABOVE RS.20,000/- IS PERMISSIBLE ONLY IN CERTAIN CIRCUMSTANCES/BY CERTAI N INSTITUTIONS WHICH ARE LISTED IN THE PROVISO TO THE SECTION AND WHICH ARE NOTIFIED BY THE CENTRAL GOVERNMENT AND IN NO OTHER CASE THIS HAS BEEN PERMI TTED. THEREFORE, THE ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 6 - ASSESSEE'S CONTENTION THAT UNAVOIDABLE CIRCUMSTANCE S DO NOT ATTRACT PENALTY U/S.271E CANNOT BE ACCEPTED. 6. ON THE BASIS OF THE ABOVE DISCUSSION, IT IS CONC LUDED THAT THE ASSESSEE HAS REPAID CASH DEPOSITS EXCEEDING RS.20,000/- IN V IOLATION OF PROVISIONS OF SECTION 269T OF THE ACT. ACCORDINGLY, THIS IS A FIT CASE FOR LEVY OF PENALTY U/S271E OF THE ACT. THE TOTAL PAYMENT MADE IN CASH AS PER THE ASSESSING OFFICER'S REPORT FOR THE A.Y. 2010-11 IS RS.17,40,0 00/-, ACCORDINGLY, A PENALTY OF RS.L7,40,000/- IS LEVIED U/S.271E OF THE I.T. ACT, 1961 FOR THE A.Y.2010-2011. 7. AGAINST THE SAID ORDER ASSESSEE FILED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY AND LD. CIT(A) ALLOWED THE APPE AL OF THE ASSESSEE. 8. NOW APPEAL IS BEFORE US. 9. WE HAVE GONE THROUGH THE RELEVANT RECORD AND IMP UGNED ORDER. IN THIS CASE, ASSESSING OFFICER OBSERVED THAT SAID REP AID LOAN IN CASH IN AGGREGATING WAS EXCEEDING RS.20,000/-, THE ASSESSEE CONTRAVENED THE PROVISIONS OF SECTION 269T OF THE I.T. ACT, 1961 AN D THEREBY THE ASSESSEE WAS LIABLE PENAL CONSEQUENCES AS ENVISAGED UNDER TH E PROVISIONS OF SECTION 271E OF THE ACT. 10. IN THIS CASE, FATHER OF THE ASSESSEE, SHRI G. M . JOSHI HAS DEPOSITED RS.9,60,000/- IN BANK ACCOUNT NO.10424307437. THESE ARE THE DEPOSITS BY SELF WHICH THE JT. CIT HAS CONSIDERED AS A REPAY MENT OF A LOAN BY THE APPELLANT. THERE IS NOTHING ON RECORD TO SHOW THAT THE MONEY IS A ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 7 - REPAYMENT OF LOAN. THE ASSESSING OFFICER WAS FULLY EMPOWERED TO EXAMINE THE SOURCE OF THE CASH DEPOSITS OF RS.9,60, 000/- IN THE ACCOUNT OF THE FATHER MR. GUNVANTRAY M. JOSHI BUT THE SAME WIL L BE OUTSIDE THE PURVIEW OF THE PENALTY FOR THE VIOLATION OF SECTION 269T OF THE ACT, THERE IS AN ENTRY OF RS.4,50,000/- DEPOSITED BY THE APPEL LANT IN THE AXIS BANK ACCOUNT WHICH IS JOINTLY HELD WITH SMT. PRATIXABEN JOSHI, THE WIFE OF THE APPELLANT. IT IS NOT CLEAR AS TO HOW AND FROM WHERE THE JT. CIT HAS PICKED- UP THE DATE OF 20/02/2010 ON WHICH THE REPORTED REP AYMENT OF LOAN IN VIOLATION OF SECTION 269T OF THE ACT HAS TAKEN PLAC E. THE LADY SMT. PRATIXABEN A. JOSHI WHO IS THE WIFE OF THE APPELLAN T HAS FILED AN AFFIDAVIT THAT THE MONEY IN QUESTION WAS RECEIVED BY HER FROM HER FATHER-IN-LAW AND THE SAME WAS GIVEN TO THE APPELLANT/HUSBAND FOR THE ON-GOING CONSTRUCTION OF THE HOUSE. THOUGH AN AFFIDAVIT WHIC H WAS FILED BY THE PRATIXABEN A. JOSHI IS NOT ON RECORD BUT STATEMENT OF LD. AR HAS BEEN NOTED THAT THIS FACT IS CORRECT. CLEARLY, THE TRAN SACTION BETWEEN A WIFE AND A HUSBAND WHO WAS STAYING TOGETHER UNDER THE SAME R OOF IS ELIGIBLE FOR RELAXATION FROM THE PURVIEW OF REPAYMENT OF LOAN ET C. AS PROVIDED IN SECTION 273B OF THE ACT. LD. JT. CIT HAS NOT GIVEN ANY SOURCE OF LOAN FROM WHERE THIS SO CALLED LOAN WAS TAKEN. THEREFORE , IN OUR CONSIDERED OPINION THIS IS NOT A FIT CASE, WHERE PENALTY SHOUL D BE LEVIED. IN THE RESULT, APPEAL FILED BY THE DEPARTMENT IS DISMISSED . ITA NOS. 2988 & 2989/AHD/2014 CROSS OBJECTION NOS.311 & 312/AHD/2014 ASST.YEAR 2010-11 - 8 - 11. SO FAR AS CROSS OBJECTION NOS.311 & 312/AHD/201 4 FOR A.Y. 2010-11 ARE CONCERNED. SAME ARE DISMISSED AS NOT PR ESSED. 12. IN THE RESULT, ITA NOS.2988 & 2989/AHD/2014 FOR A.Y.2010-11 ARE DISMISSED AND CROSS OBJECTION NOS. 311 & 312/AH D/2014 FOR A.Y. 2010-11 ARE ALSO DISMISSED AS NOT PRESSED. THIS ORDER PRONOUNCED IN OPEN COURT ON 19/12/2017 SD/- SD/- . . ( ) ( ) ( N.K. BILLAIYA ) ( MAHAVIR PRASAD ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 19/12/2017 PRITI YADAV, SR.PS ! ' #$%& ' &$ / COPY OF THE ORDER FORWARDED TO : 1. %&!' / THE APPELLANT 2. (!' / THE RESPONDENT. 3. 56, # # ) 7, / CONCERNED CIT 4. # # ) 7, (%&) / THE CIT(A)-IV, BARODA. 5. 89: ,56 , # %&- %561 , % / DR, ITAT, AHMEDABAD 6. :; <* / GUARD FILE. ! ( / BY ORDER, (8&, , //TRUE COPY// )/ * ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD TRUE COPY