SMT. URMILA CHOUDHARY, Jaipur V. ITO, Jaipur

ITA 101/JPR/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5368 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-04-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 10-02-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJ MEHRA
• Assessee Lawyers: S L PODDAR ADV DH R LS
• Keywords: Revised return
• Section: 139(5)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES SMC, JAIPUR JH VKJ-IH-RKSYKUH] U;KF;D LNL; DS LE{K BEFORE: SHRI R.P. TOLANI, JUDICIAL MEMBER VK;DJ VIHY LA- @ ITA NO. 101/JP/2014 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2005-06 URMILA CHOUDHARY, 84, SANJAY COLONY, NEHRU NAGAR, JAIPUR. CUKE VS. INCOME TAX OFFICER, WARD 4(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ L A-@ PAN/GIR NO.: ABLPC 2067 R VIHYKFKHZ @ APPELLANT IZR;FKHZ @ RESPONDENT FU/KZKFJRH DH VKSJ LS @ ASSESSEE BY : SHRI S.L. PODDAR (ADV) JKTLO DH VKSJR LS @ REVENUE BY : SHRI RAJ MEHRA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 01/02/2016 MN?KKS'K .KK DH RKJH[ K @ DATE OF PRONOUNCEMENT : 21/04/2016 VKNS'K @ ORDER PER: R.P. TOLANI, J.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 01/01/2014 BY THE LEARNED CIT(A), JODHPUR, CAMP AT JAIPUR FOR A.Y. 2005-06 RAISING FOLLOWING GROUNDS :- 1. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD ASSESSING OFFICER HAS ERRED IN PASSED THE ORDER U/S 271(1)(C) OF THE INCOME TAX ACT, 1961. ITA 101/JP/2014_ URMILA CHOUDHARY VS. ITO 2 2. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LD CIT(A) HAS ERRED IN CONFIRMING THE LEVY OF PENALTY O F RS. 3,28,168/- @ 200% ON TAX SOUGHT TO BE EVADED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 IN SPITE O F THE FACT THAT THE ASSESSEE HAS SUO MOTO SURRENDERED THE INCOME. 2. BRIEF FACTS LEADING TO IMPOSITION OF PENALTY ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND PROPRIETOR OF M/S THE PACKERS AND IS ENGAGED IN MANUFACTURING OF CORRUGATED BOX. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, FROM THE BOOKS OF ACCOUNT OF THE ASSES SEE, THE LD ASSESSING OFFICER FOUND FOLLOWING SQUARED UP CREDITS :- (I) HARI SINGH CHOUDHARY RS. 100000/- (II) MOHAL LAL CHOUDHARY RS. 150000/- (III) MADAN SINGH CHOUDHARY RS. 200000/- TOTAL RS. 450000/- THESE SQUARED UP AMOUNTS WERE RECEIVED AND REPAID BY ACCOUNT PAYEE CHEQUES. THE LD ASSESSING OFFICER INSISTED FO R PRODUCTION OF THE CREDITORS. THE ASSESSEE CONTENDED THAT SHE WAS NOT IN A POSITION TO PRODUCE THEM AND TO BUY PEACE AND AVOID LITIGATION, AGREED TO SURRENDER THE AMOUNT AS TAXABLE INCOME AND FILED A REVISED RETURN U/S 139(5) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT ). THE ASSESSMENT WAS ACCORDINGLY FRAMED AND FURTHER ADDITION OF RS. 8 8,224/- BY WAY OF ITA 101/JP/2014_ URMILA CHOUDHARY VS. ITO 3 ESTIMATED G.P. ADDITION WAS MADE. THE LD ASSESSING OF FICER INITIATED PENALTY PROCEEDINGS, WHICH WAS RESPONDED BY THE ASSES SEE BY A DETAILED REPLY DATED 08/2/2010 CONTENDING THAT: (I) THE CREDIT ENTRIES OF RS. 4.50 LACS WERE SURRENDERED BY THE ASSESSEE, WHICH CLEARLY UNDERSTANDING THAT NO PENAL TY WILL BE LEVIED IN THIS BEHALF. (II) THE ASSESSEE HAD DECLARED THIS IN REVISED RETURN. (III) THE PENALTY PROCEEDINGS ARE DISTINCT AND SEPARATE AN D ASSESSEE CAN FURNISH ITS REPLY IN SUPPORT OF CASH CREDITS BY WAY OF ACCOUNT PAYEES CHEQUES I.E. BANKING CHANNEL. NO INACCURATE PARTICULARS OF INCOME HAS BEEN FURNISHED. INASMUCH AS ALL THE DETAILS WERE REFLECTED IN THE RETURN OF INCOME FILED BY THE ASSE SSEE AND DETAIL CONTEND IN THE ACCOUNT BOOKS, WHICH ARE DULY AUDITED . (IV) QUA TRADING ADDITION, IT WAS CONTENDED THAT THEY ARE ON THE BASIS OF INFORMATION BASED ESTIMATE, THEREFORE, PEN ALTY WAS NOT EXIGIBLE. THE LD AO HOWEVER REJECTED THE ASSESSEES EXPLANATION AND IMPOSED IMPUGNED PENALTY @ 200% OF THE TAX LEVIABLE THEREON. ITA 101/JP/2014_ URMILA CHOUDHARY VS. ITO 4 3. AGGRIEVED, THE ASSESSEE PREFERRED FIRST APPEAL WH ERE LD CIT(A) CONFIRMED THE PENALTY. AGGRIEVED ASSESSEE IS IN SEC OND APPEAL. 4. THE LD COUNSEL FOR THE ASSESSEE CONTENDS THAT (I) THE AMOUNTS SQUARED UP CREDITS WERE SURRENDERED TO BUY PEACE OF MIND AND AVOID LITIGATION AS THE ASSESSEE WAS NOT IN A POSITION TO PRODUCE THE CREDITORS, A FACT, WHICH IS NOT DISPUTE D BY THE ASSESSING OFFICER. (II) THE AMOUNTS RECEIVED AND REPAYMENTS THEREOF HAV E BEEN DULY INCORPORATED IN THE AUDITED BOOKS AND DISCLOSED IN THE RETURN OF INCOME FILED WITH THE ASSESSEE ALONG WITH ALL THE REL EVANT PARTICULARS. CONSEQUENTLY, NO PENALTY CAN BE IMPOSED IN VIEW OF T HE HON'BLE SUPREME COURT DECISION IN THE CASE OF CIT VS RELIANC E PETRO PRODUCTS P LTD. 322 ITR 158. FINDING OF REVISED RETURN INDICA TES THAT THE ASSESSEE HAD NO MALAFIDE INTENTION. RELIANCE IS ALS O PLACED ON THE FOLLOWING DECISIONS:- (I) MANJUNATHA COTTON & GINNING FACTORY 259 ITR 565(KN) (II) RAJESH C. GANDHI VS. ITO 38 SOT 537 (MUM). (III) DR. HAKIM VS ACIT (2009) 314 ITR 290 (CHENNAI) (IV) CIT VS AMALENDU PAUL (1984) 145 ITR 439 (CAL). (V) CIT VS SURESH CHAND MITTAL 251 ITR 9 (SC). ITA 101/JP/2014_ URMILA CHOUDHARY VS. ITO 5 (VI) HAGVANJI BHAWANBHAI & CO. (1983) 141 ITR 640 (C AL). (VII) CIT VS M.GEORGE & BROS (1986) 160 ITR 511 (KE R.) (VIII) KRISHAN LAL SHIV CHAND RAI (1973) 88 ITR 253 (P&H). (IX) MARATHAN NEXTGEN REALITY AND TEXTILES 59 SOT 36 (MUM). (X) JAI SHREE SOMANI VS. ACIT 47 TW 219 ITAT JAIPUR (XI) CIT VS MAHENDRA SINGH KHEDLA (2012) 71 DTR 189 (RAJ) (XII) CIT VS SLN TRADERS (2011) 60 DTR 44 (KERALA HIG H COURT) (XIII) KRISHI TYRE RETRADING & RUBBER IND. 263 CTR 4 84 (RAJ). 5. THE LD DR ON THE OTHER HAND, CONTENDS THAT THE LD CIT(A) HAS CONFIRMED THE PENALTY AFTER RECORDING PROPER FINDIN GS OF FACTS THAT THE AMOUNT WAS REPAID BY BEARER CHEQUES. THE ASSESSEE HER SELF ADMITTED THAT THE MONEY USED IN DEPOSITING IN THE ACCOUNTS O F CREDITORS WERE HER OWN AND THEIR NAMES WERE USED. IN VIEW OF THESE FA CTS, IT IS A FIT CASE OF IMPOSITION OF PENALTY. THE LD CIT(A) HAS RIGH TLY RELIED ON THE DECISIONS IN THE CASE OF P.C. JOSEPH & BROTHERS VS. CIT (240 ITR 808), CIT VS R. KESAVAN NAIR, 287 ITR 276, CIT VS RAKESH P URI 331 ITR 458. FURTHER RELIANCE IS PLACED ON THE DECISION IN THE C ASE OF ADDL.CIT VS BHARTIYA BHANDAR (1979) 13 CTR 0159/(1980) 122 ITR 0 622 & SMT. ANITA AGGARWAL VS ITO (2015) 61 TAXMANN.COM 337 (CHA NDIGARG TRIB). ITA 101/JP/2014_ URMILA CHOUDHARY VS. ITO 6 6. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE P ARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. APROP OS LEVY OF PENALTY ON THE GROUND OF CASH CREDITS IT EMERGES FROM THE R ECORD THAT THE ASSESSEE HAD ACCEPTED THAT THE PERSON IN QUESTIONS WERE NAME LENDERS AND MONEY DEPOSITED IN THEIR BANK ACCOUNTS WERE HER OWN MONEYS. IN THESE CIRCUMSTANCES, MERE FILING OF REVI SED RETURN CANNOT BE OF ANY USE TO ASSESSEE. CONSIDERING ALL THE FACT S AND CIRCUMSTANCES, IT WILL BE IN THE INTEREST OF JUSTICE TO CONFIRM THE PENALTY QUA THE CASH CREDITS @ 100% OF TAX SOUGHT TO BE EVADED. APROPOS T RADING RESULTS, I FIND MERIT IN THE CONTENTION OF THE LD COUNSEL THAT TRADING ADDITION ATTRIBUTABLE TO VARIATION OF GP % ARE ON ESTIMATED BASIS WHERE TWO VIEWS ARE POSSIBLE. THE PENALTY QUA THE TRADING ADDIT ION IS DELETED. 7. IN THE RESULT, THE ASSESSEES APPEAL IS PARTLY A LLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21/04/2016. SD/- VKJ-IH-RKSYKUH (R.P.TOLANI) U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ @ JAIPUR FNUKAD @ DATED:- 21 ST APRIL, 2016 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- SMT. URMILA CHOUDHARY, JAIPUR. ITA 101/JP/2014_ URMILA CHOUDHARY VS. ITO 7 2. IZR;FKHZ @ THE RESPONDENT- THE ITO, WARD 4(1), JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDR @ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 101/JP/2014 VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR