Deputy Commissioner of Income-tax, V. Shri Ritesh Anil Jain, Pune

ITA 1054/PUN/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9143 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-07-2017
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2003-2004
• Appeal Filed On: 27-07-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MUKESH JHA
• Keywords: Search and seizure; Documents seized
• Section: 143(3); 153A; 6; 132; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE . , , , BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO S. 1052 TO 1058 /P U N/201 5 / ASSESSMENT YEAR S : 20 0 1 - 02 TO 2007 - 08 DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 2(2), PUNE ....... / APPELLANT / V/S. RITESH ANIL JAIN, L/H OF LATE SHRI ANIL JAIN, 578, SACHAPIR STREET, CAMP, PUNE 411001 PAN : AFPPJ5330Q / RESPONDENT ASSESSEE BY : S HRI SUHAS P. BORA REVENUE BY : SHRI MUKESH JHA / DATE OF HEARING : 27 - 07 - 2017 / DATE OF PRONOUNCEMENT : 28 - 0 7 - 2017 / ORDER PER BENCH : TH ESE APPEALS BY THE REVENUE FOR THE ASSESSMENT YEARS 200 1 - 02 TO 2007 - 08 ARE DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) - 12, PUNE DATED 05 - 05 - 2015, COMMON FOR ALL THE SEVEN ASSESSMENT YEARS MENTIONED ABOVE. SINCE, ALL THE SEVEN APPEALS ARE EMANATING FROM SAME SET OF FACTS AND THE GROUNDS RAISED BY THE REVENUE 2 ITA NO S. 1052 TO 1058/PUN/2015, A.YS. 2001 - 02 TO 2007 - 08 IN ALL THE ASSESSMENT YEARS ARE IDENTICAL, THESE APPEALS ARE TAKEN UP TOGETHER FOR ADJUDICATION AND ARE DECIDED BY THIS COMMON ORDER. 2. THE REVENUE IN ALL THE APPEALS HAS PRIMARILY ASSAILED THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IN RESTRICTING THE LEVY OF PENALTY U/S. 271(1)(C) O F THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) ON THE ADDITIONAL INCOME ASSESSED U/S. 143(3) R.W.S. 153A OF THE ACT BY TAKING THE INCOME RETURNED BY THE ASSESSEE IN RETURN OF INCOME FILED IN RESPONSE TO NOTICE U/S. 153A OF THE ACT RATHER THAN THE INCOME RETURNED IN THE ORIGINAL RETURN OF INCOME U/S. 1 39(1) OF THE ACT. 3. SHRI MUKESH JHA REPRESENTING THE DEPARTMENT SUBMITTED THAT THE ASSESSEE IS A COMMISSION AGENT. A SEARCH AND SEIZURE ACTION U/S. 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF SHRI ANIL JAIN AND SHRI RITESH JAIN AT THEIR RESIDENTIAL PR EMISES AND BUSINESS PREMISES ON 26 - 06 - 2007. DURING THE COURSE OF SEARCH APART FROM CERTAIN INCRIMINATING DOCUMENTS, JEWELRY AND CASH WERE FOUND AND SEIZED. THE STATEMENT OF ASSESSEE WAS RECORDED U/S. 132(4) OF THE ACT ON 27 - 06 - 2007. NOTICE U/S. 153A OF THE ACT WAS ISSUED TO THE ASSESSEE. IN RESPONSE TO THE NOTICE, THE ASSESSEE FILED RETURN OF INCOME FOR THE ASSESSMENT YEARS 2005 - 06 TO 2008 - 09. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAS NOT MAINTAINED REGULAR BOOKS OF ACCOUNT. FURTHER, THE ASSESSEE COULD NOT PRODUCE COGENT EVIDENCE IN RESPECT OF EXPENSES CLAIMED BY THE ASSESSEE. ON THE BASIS OF STATEMENT MADE BY THE ASSESSEE DURING SEARCH PROCEEDINGS , THE ASSESSING OFFICER APPLIED UNIFORM RATE OF COMM ISSION I.E. RS.24, 000/ - PER AUTO RICKSHAW . ACCORDINGLY, THE ASSESSING OFFICER COMPUTED ASSESSEES INCOME FROM COMMISSION AND MADE CORRESPONDING ADDITIONS IN THE IMPUGNED ASSESSMENT YEARS . APART FROM 3 ITA NO S. 1052 TO 1058/PUN/2015, A.YS. 2001 - 02 TO 2007 - 08 THE ADDITION MADE ON ACCOUNT OF COMMISSION INCOME ADDIT IONS WERE ALSO MADE IN RESPECT OF INTEREST INCOME ON FIXED DEPOSITS , ETC. 3.1 AGGRIEVED BY THE ASSESSMENT ORDERS FOR THE RESPECTIVE ASSESSMENT YEARS, THE ASSESSEE FILED APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) UPHELD THE FINDINGS OF ASSESSING OFFICER AND CONFIRMED THE ADDITIONS. THE ASSESSEE FURTHER CARRIED THE MATTER IN SECOND APPEAL BEFORE THE TRIBUNAL IN ITA NOS. 731 TO 739/PN/2012 FOR THE ASSESSMENT YEARS 2001 - 02 TO 2008 - 09 . THE TRIBUNAL VIDE ORDER DATED 07 - 06 - 2013 SET ASIDE THE IMPUGNED ORDER AND REMITTED THE FILE BACK TO ASSESSING OFFICER TO RE - EXAMINE THE DOCUMENTS SEIZED AND THEREAFTER DETERMINE THE COMMISSION INCOME EARNED BY THE ASSESSEE IN VARIOUS ASSESSMENT YEARS UNDER APPEAL. THE ASS ESSING OFFICER AFTER GIVING EFFECT TO THE ORDER OF TRIBUNAL PASSED ASSESSMENT ORDER S U/S. 143(3) R.W.S. 254 OF THE ACT ON 24 - 04 - 2014 IN ALL THE ASSESSMENT YEAR AND ALSO INITIATED PENALTY PROCEEDINGS U/S. 271(1)(C) OF THE ACT. THE ASSESSING OFFICER VIDE SE PARATE ORDER S OF EVEN DATE 31 - 10 - 2014 LEVIED PENALTY U/S. 271(1)(C) OF THE ACT IN THE IMPUGNED ASSESSMENT YEARS AS UNDER : ASSESSMENT YEAR PENALTY LEVIED 2001 - 02 RS.16,67,952/ - 2002 - 03 RS.19,33,614/ - 2003 - 04 RS.26,21,808/ - 2004 - 05 RS.21,27,312/ - 2005 - 06 RS.15,37,252/ - 2006 - 07 RS.19,53,963/ - 2007 - 08 RS.21,23,695/ - 3.2 THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). THE COMMISSIONER OF INCOME TAX (APPEALS) VIDE 4 ITA NO S. 1052 TO 1058/PUN/2015, A.YS. 2001 - 02 TO 2007 - 08 IMPUGNED ORDER UPHELD INVOKING OF EXPLANATION 5A BUT DELETED THE PENALTY BY HOLDING THAT THE PENALTY U/S. 271(1)(C) CAN BE LEVIED ONLY ON THE DIFFERENCE BETWEEN INCOME RETURNED U/S. 153A VIS - - VIS INCOME ASSESSED U/S. 153A OF THE ACT. THE LD. DR SUBMITTED THAT THE COMMISSIONER OF INCOME T AX (APPEALS) HAS ERRED IN HOLDING THAT PENALTY U/S. 271(1)(C) CANNOT BE LEVIED ON THE BASIS OF INCOME DECLARED U/S. 139(1) VIS - - VIS INCOME ASSESSED U/S. 153A OF THE ACT. THE LD. DR CONTENDED THAT THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF MRS. SARITA KAUR MANJEET SINGH CHOPRA VS. INCOME TAX OFFICER IN ITA NO. 1562/PN/2013 FOR ASSESSMENT YEAR 2009 - 10 DECIDED ON 30 - 10 - 2015 HAS HELD THAT IN CASE OF SEARCH PENALTY U/S. 271(1)(C) HAS TO BE LEVIED ON THE DIFFERENCE BETWEEN THE INCOME DECLARED IN ORIGI NAL RETURN OF INCOME U/S. 139(1) AND THE INCOME ASSESSED UNDER THE PROVISIONS OF SECTION 153A OF THE ACT . THE LD. DR PRAYED FOR REVERSING THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) AND RESTORING THE QUANTUM OF PENALTY AS LEVIED BY THE ASSESSING OFFICER. 4. ON THE OTHER HAND SHRI SUHAS P. BORA APPEARING ON BEHALF OF THE ASSESSEE VEHEMENTLY DEFENDED THE FINDINGS OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE PENALTY . THE LD. AR SUBMITTED THAT THE COMMISSIONER OF INCOME TAX (APPEALS) HA S DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE BY FOLLOWING VARIOUS DECISIONS OF THE TRIBUNAL ON THIS ISSUE. THE LD. AR SUBMITTED THAT THOUGH THE ASSESSEE GOT RELIEF FROM THE COMMISSIONER OF INCOME TAX (APPEALS) ON MERITS , THE PENALTY ORDERS ARE LIABLE TO BE SET ASIDE ON TECHNICAL GROUND S VIZ. DEFECT IN RECORDING OF SATISFACTION AND AMBIGUITY IN NOTICE ISSUED U/S. 274 R.W.S. 271(1)(C) OF THE ACT. 5 ITA NO S. 1052 TO 1058/PUN/2015, A.YS. 2001 - 02 TO 2007 - 08 5. W E HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENTATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF TH E AUTHORITIES BELOW . THE REVENUE HAS ASSAILED THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING PENALTY BY HOLDING THAT PENALTY U/S. 271(1)(C) IS LEVIABLE ON DIFFERENCE BETWEEN INCOME RETURNED IN RESPONSE TO NOTICE U/S. 153A VIS - - VIS U/S. 143(3) R.W.S. 153A OF THE ACT. THE STAND OF THE REVENUE IS THAT THE COMMISSIONER OF INCOME TAX (APPEALS) SHOULD HAVE UPHELD THE LEVY OF PENALTY AFTER TAKING INTO CONSIDERATION THE INCOME DISCLOSED BY THE ASSESSEE IN ORIGINAL RETURN OF INCOME FILED U/S. 13 9(1) AND THE INCOME ASSESSED U/S. 143(3) R.W.S. 153A OF THE ACT. TO SUPPORT THIS CONTENTION OF THE REVENUE , THE LD. DR HAS PLACED RELIANCE ON THE DECISION OF CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF MRS. SARITA KAUR MANJEET SINGH CHOPRA VS. INCOME TAX OFFICER (SUPRA). WE FIND THAT THE ABOVE SAID ORDER OF THE TRIBUNAL WAS PASSED SUBSEQUENT TO THE PASSING OF IMPUGNED ORDER. WITHOUT GOING INTO THE MERITS OF THE GROUNDS RAISED BY THE REVENUE IN APPEAL , WE DEEM IT APPROPRIATE TO REMIT THESE APPEALS BA CK TO THE FILE OF COMMISSIONER OF INCOME TAX (APPEALS) TO CONSIDER THE RATIO LAID DOWN BY THE CO - ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF MRS. SARITA KAUR MANJEET SINGH CHOPRA VS. INCOME TAX OFFICER (SUPRA). 6. THE LD. AR OF THE ASSESSEE HAS PRAYED THAT THE PENALTY ORDERS ARE LIABLE TO SET ASIDE ON TECHNICAL GROUNDS VIZ. AMBIGUITY IN RECORDING OF SATISFACTION AND THE NOTICE ISSUED U/S. 274 R.W.S. 271(1)(C) OF THE ACT. THE ASSESSEE HAS NOT FILED ANY APPEAL OR CROSS OBJECTIONS BEFORE THE TRIBUNAL CHA LLENGING THE VALIDITY OF NOTICE FOR LEVY OF PENALTY. THE ASSESSEE IS AT L IBERTY TO CHALLENGE THE VALIDITY OF NOTICE BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) BY WAY OF RAISING ADDITIONAL GROUNDS. THE COMMISSIONER OF INCOME TAX (APPEALS) IS DIRECTED TO DECIDE THE APPEALS OF 6 ITA NO S. 1052 TO 1058/PUN/2015, A.YS. 2001 - 02 TO 2007 - 08 THE ASSESSEE DE - NOVO AFTER TAKING INTO CONSIDERATION THE DECISION CITED BY THE LD. DR AND THE ADDITIONAL GROUNDS , IF ANY RAISED BY THE ASSESSEE, IN ACCORDANCE WITH LAW. ACCORDINGLY, THE IMPUGNED ORDER IS SET ASIDE AND THE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSE IN THE AFORESAID TERMS. 7. IN THE RESULT, ALL THE APPEALS OF THE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON FRIDAY, THE 28 TH DAY OF JULY, 2017 . SD/ - SD/ - ( . /D. KARUNAKARA RAO ) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 28 TH JULY, 2017 RK / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 12, PUNE 4. / THE CIT (CENTRAL), PUNE 5. , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / / // TRUE COPY// / BY ORDER, / PRIVATE SECRETARY, , / ITAT, PUNE