Shri Vallbhabhai N.Lakhani, Surat V. The Income tax Officer,Ward-8(4), Surat

ITA 1069/AHD/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9110 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 17-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRADEEP KUMAR MAJUMDAR
• Keywords: Tangible material; Revised return
• Section: 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHM EDABAD , (BEFORE SHRI ANIL CHATURVEDI, A.M. & SHRI S. S. GOD ARA, J.M.) ( , !' !#!#$% , &' ) ITA NO: 1069/AHD/2013 (ASSESSMENT YEAR: 2009-10) SHRI VALLABHBHAI N. LAKHANI 34, PRIYA PARK SOCIETY, VED ROAD, DABHOLI CHAR RASTA, SURAT VS. ITO, WARD-8(4), SURAT PAN: ACUPL6015E (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI PRADEEP KUMAR MAJUMDAR, S R. D.R. DATE OF HEARING : 15-03-201 6 DATE OF PRONOUNCEMENT : 18-03-2016 ( )/ ORDER PER ANIL CHATURVEDI, ACCOUNTANT MEMBER THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-V, SURAT, DATED 04.02.2013 FOR A.Y. 2009-10, WHEREBY LEVY OF PENALTY LEVIED U/S.271(1)(C) OF THE ACT BY A.O. WAS UPHELD BY THE LD. CIT(A). 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERI ALS ON RECORD ARE AS UNDER: 3. ASSESSEE IS AN INDIVIDUAL STATED TO BE HAVING IN COME FROM BROKERAGE AND COMMISSION. ASSESSEE FILED HIS ORIGINAL RETURN OF INCOME FOR A.Y. 2009-10 ON ITA NO .106 9/AHD/2013 . A.Y. 2009-10 (SHRIVAL LABHBHAI N. LAKHANI VS. ITO) 2 30.11.2009 DECLARING TOTAL INCOME AT RS.1,55,900/-. SUBSEQUENTLY, ASSESSEE FILED REVISED RETURN ON 15.09.2010 DECLARING TOTAL INCOME OF RS.4,55,900/-. SUBSEQUENTLY, NOTICE U/S.148 OF THE ACT WAS ISSUED ON 30.09.2010 AND THEREAFTER, THE ASSESSMENT WAS FRAMED U/S.143(3) R.W.S. 147 OF THE ACT VIDE ORDER DATED 24.09.2011 AND THE TOTAL INCOME WAS DETERMINED AT R S. 4,55,900/-. ON ADDITIONAL BROKERAGE INCOME OF RS.3LACS, WHICH WAS OFFERED BY ASSESSEE IN THE REVISED RETURN, A.O. VIDE ORDER DATED 25.01.2012 HELD THAT DURING T HE INQUIRY CONDUCTED IN RESPECT OF SHRI BHRIGU BRAHMIN SAMAJ TRUST AND ITS ADMINIS TRATOR SHRI GOPAL LUNKARAN RAWAL, IT WAS ADMITTED BY SHRI GOPAL L. RAWAL THAT HE HAD PURCHASED A PROPERTY AT SURAT FOR WHICH BROKERAGE OF RS.3LACS WAS PAID T O THE ASSESSEE. AFORESAID BROKERAGE OF RS.3 LACS THAT WAS PAID TO THE ASSESSE E WAS DECLARED BY THE ASSESSEE IN THE REVISED RETURN OF INCOME. A.O. CONCLUDED THAT WHILE FILING THE ORIGINAL RETURN OF INCOME, ASSESSEE HAD KNOWINGLY AND DELIBERATELY CONCEALED THE PARTICULARS OF INCOME TO THE EXTENT OF RS.3LACS AND THAT FILING OF REVISED RETURN WAS ONLY WITH THE PURPOSE TO INCORPORATE THE UNDISCLOSED INCOME DETEC TED BY THE DEPARTMENT. HE WAS THEREFORE OF THE VIEW THAT IT WAS A FIT CASE OF LEVY OF PENALTY U/S.271(1)(C) OF THE ACT ON ACCOUNT OF CONCEALMENT OF INCOME AND ACC ORDINGLY VIDE ORDER DATED 25.01.2012 LEVIED PENALTY OF RS.47,565/-. AGGRIEVE D BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) W HO VIDE ORDER DATED 04.02.2013 (IN APPEAL NO.CAS/V/300/2011-12) UPHELD THE LEVY OF PENALTY AND DISMISSED THE APPEAL OF ASSESSEE BY HOLDING AS UNDER: 6. I HAVE CONSIDERED THE PENALTY ORDER AS WELL AS THE SUBMISSIONS OF THE APPELLANT. THE GROUNDS OF APPEAL- GROUND NO. 1 PERTAINS TO LEV YING OF PENALTY OF RS.47565 U/S 271(1) (C) OF THE ACT. ON THE PERUSAL OF THE DETAIL S IT IS SEEN THAT THE APPELLANT HIMSELF ADMITTED THE RECEIPT OF RS.300000 AS BROKERAGE INCO ME WHICH WAS NOT DISCLOSED IN THE RETURN OF INCOME AND SUBSEQUENTLY REVISED THE RETUR N OF INCOME. THE CASE LAWS RELIED UPON BY THE APPELLANT ARE NOT APPLICABLE IN THE FAC TS AND CIRCUMSTANCES IN THE CASE. THE APPELLANT HAD NOT DISCLOSED THIS COMMISSION INCOME AND ONLY AFTER THE INFORMATION WAS RECEIVED FROM THE INVESTIGATION WING AND THE APPELLANT BEING CONFRONTED THAT THE REVISED RETURN OF INCOME WAS FILED. ITA NO .106 9/AHD/2013 . A.Y. 2009-10 (SHRIVAL LABHBHAI N. LAKHANI VS. ITO) 3 6.1 IT HAS BEEN HELD IN VARIOUS JUDICIAL PRONOUNCEM ENTS THAT SIMPLY BECAUSE ASSESSEE AGREED TO THE ADDITION OF CONCEALED INCOME AFTER DE TECTION THEREOF AND FILED RETURN IN RESPONSE TO NOTICE U/S 148 OF IT ACT, 1961 OFFERING ADDITIONAL INCOME, ASSESSEE CANNOT ESCAPE PENALTY U/S 271(1)(C) OF THE ACT. THE RELEVA NT CASE LAWS ARE AS FOLLOWING: > PC JOSEPH & BROS (KERALA) 240 ITR 818 > RAKESH SURI (ALL) 331 ITR 458 > SUSHMA DEVI AGARWAL (ITAT-KOL-TM) 67 DTR 430 6.1.1 WHERE THE OMISSION IS DELIBERATE, HE CANNOT G ET RID OF MERELY BY FILING A REVISED RETURN. THE REVISED RETURN BEING FILED ONLY AFTER T HE DEPARTMENT GOT INFORMATION WHICH WAS CONFRONTED TO THE ASSESSEE, PENALTY IS ATTRACTE D. SIMILAR VIEW HAS BEEN UPHELD BY SEVERAL COURTS IN THE FOLLOWING JUDGMENTS: > DAYABHAI GIRDHARBAI VS CIT (BOM) 32 ITR 677 > CIT VS HAJI P. MOHAMMED (KER) 132 ITR 623 > MAHAVIR WORKS VS CIT (P&H) 92 ITR 513 > BADRI PRASAD OM PRAKASH VS CIT (RAJ) 163 ITR 44 0 > S.R. ARULPRAKASAM VS PREMA MALINI VASAN, ITO (M AD) 163 ITR 487 > F.C. AGARWAL VS CIT (GAUHATI) 102 ITR 408 > CIT VS J.K.A. SUBRAMANIA CHETTIAR (MAD) 110 ITR 602 > RAVI & CO. VS ACIT (MAD) 271 ITR 286 6.1.2 IN VIEW OF THE ABOVE FACTS' AND CIRCUMSTANCES , IT IS EVIDENT THAT THE COMMISSION INCOME WAS NOT DISCLOSED IN THE RETURN OF INCOME AN D WAS LATER ADMITTED AND RETURN OF INCOME WAS REVISED. THIS ACT OF THE APPELLANT WAS W ITH AN INTENTION TO EVADE TAX. THEREFORE, THE PENALTY ORDER LEVYING A PENALTY OF R S. 47565/- IS BEING UPHELD AND GROUND OF APPEAL IS DISMISSED. 4. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE I S NOW IN APPEAL BEFORE US AND HAS RAISED FOLLOWING GROUND: 1. THAT THE CIT(A) ERRED IN CONFIRMING PENALTY OF RS.47,565/-. 2. THAT CIT(A) ERRED IN NOT OBSERVING THAT THE EXPL ANATION OF THE ASSESSEE IS EITHER FALSE OR NOT SUBSTANTIATED. 3. THAT THE CIT(A) ERRED NOT OBSERVING THAT THE A.O . HAD NOT TANGIBLE MATERIAL TO TAX THE BROKERAGE INCOME OF ASSESSEE EXCEPT THE STATEME NT OF ASSESSEE. 4. THAT THE CIT(A) ERRED IN NOT OBSERVING THAT THE PENALTY IS NOT LEVIABLE IN ABSENCE OF TANGIBLE MATERIAL. THE A.O. FAILED TO ESTABLISH CONCEALMENT BY TOOTH & NAIL. THE A.O. ACCEPTED THE INCOME DECLARED IN REVISED RE TURN. 5. THAT THE PENALTY LEVIED OF RS.47,565/- MAY KINDL Y CANCELLED . ITA NO .106 9/AHD/2013 . A.Y. 2009-10 (SHRIVAL LABHBHAI N. LAKHANI VS. ITO) 4 5. BEFORE US, ON BEHALF OF ASSESSEE, THE ADJOURNMEN T APPLICATION HAS BEEN FILED. THE ADJOURNMENT APPLICATION IS REJECTED AND WE PROC EED TO DISPOSE OF THE APPEAL EX PARTE QUA THE ASSESSEE ON THE BASIS OF MATERIALS AV AILABLE ON RECORD. BEFORE US, LD. D.R. SUPPORTED THE ORDERS OF A.O. AND LD. CIT(A). 6. WE HAVE HEARD THE LD. D.R. AND PERUSED THE MATER IALS ON RECORD. THE ISSUE IN THE PRESENT CASE IS WITH RESPECT TO LEVY OF PENA LTY ON THE ADDITIONAL BROKERAGE INCOME OF RS.3LACS DISCLOSED BY THE ASSESSEE IN THE REVISED RETURN OF INCOME. WE FIND THAT THE ADDITIONAL INCOME THAT HAS BEEN DISCL OSED BY THE ASSESSEE HAS BEEN ACCEPTED IN TOTALITY BY THE A.O. WHILE PASSING THE ASSESSMENT ORDER U/S.143(3) R.W.S. 147 OF THE ACT. IT IS SETTLED LAW THAT PENAL TY PROCEEDINGS AND ASSESSMENT PROCEEDINGS ARE TWO INDEPENDENT PROCEEDINGS AND THE PENALTY ORDER CANNOT BE SOLELY BASED ON THE REASONS GIVEN IN THE ORIGINAL O RDER OF ASSESSMENT. FURTHER APART FROM THE FALSITY OF THE EXPLANATION GIVEN BY THE AS SESSEE, THE DEPARTMENT MUST HAVE BEFORE IT BEFORE LEVYING THE PENALTY, COGENT M ATERIAL OR EVIDENCE FROM WHICH IT COULD BE INFERRED THAT ASSESSEE HAS CONSCIOUSLY CONCEALED THE PARTICULARS OF HIS INCOME OR HAD DELIBERATELY FURNISHED INACCURATE PAR TICULARS OF INCOME. IT IS WELL SETTLED THAT THE PARAMETERS OF JUDGING THE JUSTIFIC ATION FOR ADDITION MADE IN THE ASSESSMENT CASE OF THE ASSSESSEE IS DIFFERENT FROM THE PENALTY IMPOSED ON ACCOUNT OF CONCEALMENT OF INCOME OR FILING INACCURATE PARTI CULARS OF INCOME AND THAT CERTAIN DISALLOWANCE/ADDITION COULD LEGALLY BE MADE IN THE ASSESSMENT PROCEEDINGS ON THE PREPONDERANCE OF PROBABILITIES BUT NO PENALT Y COULD BE IMPOSED U/S. 271(1)(C) OF THE ACT ON THE PREPONDERANCE OF PROBAB ILITIES AND REVENUE HAS TO PROVE THAT THE CLAIM OF EXPENSES BY THE ASSESSEE WA S NOT GENUINE OR WAS INFLATED TO REDUCE ITS TAX LIABILITY. FURTHER MERELY BECAUSE A DDITIONS HAVE CONFIRMED IN APPEAL OR NO APPEAL HAS BEEN FILED BY ASSESSEE AGAINST ADD ITIONS MADE, IT CANNOT BE THE SOLE GROUND FOR COMING TO THE CONCLUSION THAT ASSES SEE HAS CONCEALED ANY INCOME. ITA NO .106 9/AHD/2013 . A.Y. 2009-10 (SHRIVAL LABHBHAI N. LAKHANI VS. ITO) 5 CONSIDERING THE AFORESAID FACTS AND PECULIAR FACTS OF THE CASE, WE ARE OF THE VIEW THAT IN THE PRESENT CASE NO CASE FOR LEVY OF PENALT Y U/S. 271(1)(C) OF THE ACT HAS BEEN MADE OUT. WE THUS DIRECT THE DELETION OF PENAL TY U/S. 271(1)(C) OF THE ACT. THUS, THE GROUND OF ASSESSEE IS ALLOWED. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED IN OPEN COURT ON 18-03- 2016. SD/- SD/- (S. S. GODARA) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD: DATED. 18/03/2016 TRUE COPY S K SINHA COPY OF THE ORDER FORWARDED TO:- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD