Sh. Harjit Singh, Cheeka V. ITO, Kaithal

ITA 1106/CHANDI/2011

• Counselvise Citation: 110621514 RSA 2011
• Duration Of Justice: 2 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 23-01-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 14-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S K MUKHI; JYOTI
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL: SMD BENCH: CHANDIGARH BEFORE SHRI D.K.SRIVASTAVA, AM AND MS. SUSHMA CHOWL A, JM ITA NO. 1106/CHD/2011 ASSESSMENT YEAR: 2005-06 SHRI HARJIT SINGH, VS ITO, WARD-3, PROP C/O M/S KARTAR TRADING CO., KAITHAL CHEEKA PAN NO. ACMPS3870J APPELLANT BY: SHRI S.K. MUKHI & MS JYOTI RESPONDENT BY: SHRI AKHILESH GUPTA, DR DATE OF HEARING:23.01.2012 DATE OF PRONOUNCEMENT: 3.2 .2012 ORDER D.K.SRIVASTAVA, AM : THE APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A) ON 5.9.2011 BY WHICH HE HAS CONFIRMED THE PENALTY AMOUNTING TO RS. 44,637/- LEV IED BY THE ASSESSING OFFICER U/S 271(1) (C) OF THE ACT. 2. IN NUTSHELL, THE FACTS OF THE CASE ARE THAT THE ASSESSEE WAS CARRYING ON THE BUSINESS OF COMMISSION AGENCY IN FOOD GRAINS APART FROM HAVING AGRICULTURAL INCOME. HE FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER APPEAL DECLARING TOTAL INCOME AT RS. 95,000/- IN ADDITION TO AGRICULTURAL INCOME OF RS. 1 LAKH. ASSESSMENT WAS COMPLETED U/S 143(3) ASSESSING THE TOTAL INCOME AT RS. 2,52,374/- IN ADD ITION TO AGRICULTURAL INCOME OF RS. 5 LAKHS. 3. THE FACTS GIVING RISE TO THE AFORESAID ADDITION MADE BY THE ASSESSING OFFICER ARE THAT THE ASSESSEE SUBMITTED BEFORE THE ASSESSING OFFICER AT THE TIME OF HEARING THAT HIS AGRICULTURAL INCOME WAS RS . 5 LAKHS. THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAD WITHD RAWN A SUM OF RS. 1,02,907/- FOR MEETING HOUSE HOLD EXPENSES AND EXPE NSES ON AGRICULTURE OPERATIONS. HE CONSIDERED THE AFORESAID WITHDRAWAL S AS LOW. AFTER GIVING BENEFIT OF PAST SAVINGS TO THE EXTENT OF RS. 1 LAKH , THE ASSESSING OFFICER 2 ESTIMATED THE HOUSEHOLD EXPENSES AND AGRICULTURAL E XPENSES AT AS 2,48,781/- AS AGAINST RS. 1,02,907/- SHOWN BY THE A SSESSEE. THUS, A SUM OF RS. 1,45,874/- WAS ADDED BY THE ASSESSING OFFICE R AS UNEXPLAINED EXPENSES. ON APPEAL, THE LD. CIT(A) AS WELL AS THI S TRIBUNAL HAS CONFIRMED THE AFORESAID ADDITION. 4. IT IS WITH REFERENCE TO THE AFORESAID ADDITION A MOUNTING TO RS. 1,45,874/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF LOW WITHDRAWALS FOR HOUSEHOLD AND AGRICULTURAL EXPENSES THAT THE IM PUGNED PENALTY HAS BEEN LEVIED BY THE ASSESSING OFFICER, WHICH, ON APP EAL, HAS BEEN CONFIRMED BY THE CIT(A). 5. IN SUPPORT OF APPEAL, THE LD. COUNSEL FOR THE AS SESSEE SUBMITTED THAT THE IMPUGNED ADDITIONS WERE MADE BY THE ASSESSING O FFICER ON THE BASIS OF ESTIMATION OF EXPENSES ON HOUSEHOLD AND AGRICULTURA L OPERATIONS AFTER REJECTING THE EXPLANATION OF THE ASSESSEE THAT THEY WERE MET OUT OF PAST SAVINGS. HE ALSO SUBMITTED THAT THE ASSESSEE WAS LI VING IN A JOINT FAMILY AND THEREFORE, MOST OF HIS EXPENSES WERE MET BY THE JOINT FAMILY. RELYING UPON THE DECISION IN DCIT V PATHANKOT CO-OPERATIVE DEVELOPMENT BANK LTD (2011) 59 DTR (AMRITSAR)(TRIB) 67; CIT V MODI INDUS TRIAL CORPORATION (2010) 34 DTR (P&H) 158; CIT V RELIANCE PETROPRODUC TS (P) LTD (2010) 36 DTR (SC) 449 AND CIT V AJAIB SINGH AND CO. 253 ITR 630(P&H), HE SUBMITTED THAT THE IMPUGNED PENALTY WAS LIABLE TO B E CANCELLED AND, THEREFORE, SHOULD BE CANCELLED. 6. IN REPLY, THE LD. DR SUPPORTED THE ORDERS PASSED BY THE ASSESSING OFFICER AND CIT(A) IN THIS REGARD. 7. WE HAVE HEARD BOTH THE PARTIES. THE IMPUGNED PE NALTY HAS BEEN LEVIED ON ACCOUNT OF ADDITIONS MADE BY THE ASSESSIN G OFFICER DUE TO LOW WITHDRAWALS FOR MEETING HOUSE HOLD EXPENSES AND EXP ENSES ON AGRICULTURAL OPERATIONS. CONSIDERING THE SMALLNESS OF THE AMOUN T, THE EXPLANATION GIVEN BY THE ASSESSEE, NATURE OF THE ADDITION AND T HE FACT THAT ADDITIONS HAVE BEEN MADE ON THE BASIS OF ESTIMATION, WE CONSI DER IT APPROPRIATE TO 3 CANCEL THE PENALTY LEVIED BY THE ASSESSING OFFICER AND CONFIRMED BY THE CIT(A). WE ORDER ACCORDINGLY. APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 3 RD FEBRUARY, 2012 SD/- SD/- (SUSHMA CHOWLA) (D.K.SRIVASTAVA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: THE 3 RD FEBRUARY, 2011 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR TRUE COPY BY ORDER ASSISTANT REGISTRAR