The ACIT, Central Circle-2(4), Ahmedabad V. Smt. Jayshreeben D.Soni, Ahmedabad

ITA 1117/AHD/2010

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 67896 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 24-10-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 12-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Assessee Lawyers: MEHUL K PATEL
• Keywords: Gift
• Section: 143(3); 5(2); 132

Judgement Text

ITA NO 1117/AHD/2010 . A.Y. 2007- 08 1 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD (BEFORE SHRI D.K. TYAGI, J.M. & SHRI ANIL CHATURVE DI, A.M.) I.T. A. NO. 1117/AHD/2010 (ASSESSMENT YEAR: 2007-08) A.C.I.T, CENTRAL CIRCLE-2(4), AHMEDABAD V/S SMT. JAYSHEEBEN D. SONI, D- 45, SHREE KRISHNA CENTRE, NEAR MITHKHALI SIX ROADS, NAVRANGPURA, AHMEDABAD (APPELLANT) (RESPONDENT) PAN: ACIPS 7057 B APPELLANT BY : SHRI P.L. KUREEL, SR. D.R. RESPONDENT BY : SHRI MEHUL K. PATEL ( )/ ORDER DATE OF HEARING : 24-10-201 3 DATE OF PRONOUNCEMENT : 31 -10-2013 PER SHRI ANIL CHATURVEDI,A.M. 1. THE PRESENT APPEAL OF THE REVENUE IS AGAINST THE OR DER OF CIT(A) DATED 29.1.2010 WHEREBY THE PENALTY OF RS 4,97,955/- LEVI ED U/S 271(L)(C) BY THE AO FOR AY 2006-07 VIDE ORDER DATED 30.6.2009 WA S CONFIRMED BY CIT(A). 2. FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER: ITA NO 1117/AHD/2010 . A.Y. 2007- 08 2 3. A SEARCH ACTION U/S 132 OF THE ACT WAS CARRIED OUT IN THE GROUP CASES OF SWAGAT GROUP ON 10.5.2006 AND AT THE RESIDENCE OF A SSESSEE. DURING THE COURSE OF SEARCH PROCEEDINGS, CASH AMOUNTING TO RS 14,94,000/- FOUND FROM THE LOCKER (WHICH WAS IN THE JOINT NAME OF THE ASSESSEE WITH HER HUSBAND SHRI DILIP SONI) WAS SEIZED. THE ASSESSEE A CCEPTED THE CASH BELONGED TO HER AND OFFERED RS. 15 LAC TO TAX. ASS ESSEE FILED HER RETURN OF INCOMED ON 31.10.2007 DECLARING TOTAL INCOME OF RS 16,81,170/- (WHICH INCLUDED THE CASH SEIZED OF RS 15 LACS). ASSESSMENT WAS FRAMED U/S 143(3) VIDE ORDER DATED 29.12.2008 AND THE INCOME R ETURNED BY THE ASSESSEE WAS ACCEPTED WITHOUT ANY CHANGE. HOWEVER, THE A.O. INITIATED THE PENALTY PROCEEDINGS U/S. 271(L)(C) OF THE ACT O N THE INCOME SURRENDERED DURING THE COURSE OF SEARCH AND VIDE PE NALTY ORDER DATED 30.6.2009 LEVIED PENALTY OF RS.4,97,955/-U/S. 271(L )(C) AS HE WAS OF THE VIEW THAT THE DISCLOSURE WAS NOT MADE BY THE ASSESS EE DURING THE COURSE OF SEARCH AND HENCE THE BENEFIT OF EXPLANATION 5(2) TO S. 271(1) CANNOT BE GIVEN TO THE ASSESSEE AND THEREFORE THE ASSESSEE HA S CONCEALED THE PARTICULARS OF INCOME. AGGRIEVED BY THE PENALTY ORD ER OF AO, ASSESSEE CARRIED THE MATTER BEFORE THE CIT (A). 4. CIT(A) GRANTED PARTIAL RELIEF TO THE ASSESSEE BY HO LDING AS UNDER: 6. BEFORE ME, IT WAS SUBMITTED THAT IN THE STATEMENTS RECORDED U/S. 132(4), THE ASSESSEE WAS NEVER SPECIFICALLY MADE AWARE OF THE PROVISIONS OF EXPLAN ATION 5 TO SECTION 271(1)(C) OF THE ACT. CITING THE DECISION OF THE GUJARAT HIGH COURT REPORTED IN 299 ITR 307 IN CASE OF MAHINDRA SHAH, IT WAS CONTENDED THAT IT WOULD BE TOO MUCH TO EXPECT FROM THE ASSESSEE, A LAYMAN TO HAVE KNOWN THE INTRICACIES OF THE I.T. ACT AND EXPLANATION 5 TO SE CTION 271(L)(C) AND TO MAKE A SURRENDER ON HIS OWN. EVEN OTHERWISE, THE RETURN FOR THE PREVIOUS YE AR WAS NOT DUE U/S. 139(1). FURTHER, THE EXPLANATION GIVEN FOR THE CASH FOUND, WAS, AT NO PO INT DISPROVED AND / OR FOUND FALSE BY THE AO. IN FACT, THE EXPLANATION GIVEN, FOR EXAMPLE, PART OF I T BEING OUT OF BANK WITHDRAWALS, AND MATURITY PROCEEDS OF NSC/RD ACCOUNTS WAS VERIFIABLE/VERIFIED . THERE COULD HAVE BEEN NO SPECIFIC EVIDENCE FOR THE CASH EXPLAINED, TO BE THE SAVINGS, OF THE F AMILY, INCLUDING THE CHILDREN AND THE CHILDREN OF SHRI DILIP'S SISTER, AND GIFTS RECEIVED BY FAMILY M EMBERS AS PER TRADITIONS AND ON OCCASIONS. NO EVIDENCE AS SUCH IS KEPT IN RESPECT OF SMALL GIFTS, ETC., RECEIVED DURING VARIOUS FESTIVITIES AND CUSTOMS. FURTHER, THE CASH FOUND WAS NOT DISPROPORT IONATE, IN ANY MANNER TO THE OVERALL INCOME /WITHDRAWALS OF THE ASSESSEE COUPLE. IN NONE OF THE STATEMENT RECORDED U/S. 132(4) WAS THE ITA NO 1117/AHD/2010 . A.Y. 2007- 08 3 ASSESSEE INFORMED/REQUIRED TO COMPLY WITH THE PROVI SIONS OF EXPLANATION 5.TO SECTION. 271(1.)(C) AND NONE OF THE EXPLANATION, OF THE CASH FOUND DUR ING THE SEARCH HAD BEEN DISPROVED BY THE AO. REFERENCE WAS MADE TO THE STATEMENTS RECORDED ON 10 /5/2006, 19/5/2006, 22/5/2006 AND 7/7/2006 IN THIS REGARD AND A COPY THEREOF FILED WITH SUBMIS SIONS. FURTHER THE APPELLANT ONLY WANTED TO BUY PEACE AND SETTLEMENT AND TO AVOID LITIGATION. NONE OF THE EXPLANATION OFFERED DURING THE STATEMENTS, INCLUDING THAT FOR OTHER ASSETS/VALUABL ES/DOCUMENTS FOUND ETC. WAS FOUND TO BE FALSE OR INCORRECT. THE APPELLANT/FAMILY HAD ADEQUATE INCOME /WITHDRAWALS TO JUSTIFY THE SAVINGS. SOME CORROBORATING EVIDENCE SUCH AS CONFIRMATION OF THE FATHER OF JAYSHREE WAS NOT POSSIBLE AS HE HAD DIED BUT THE CUSTOMARY PRACTICES SHOULD NOT HAVE BE EN OVERLOOKED. THE EXPLANATION GIVEN BY JAYSHREE WAS BASED ON FACTS AND DID NOT LACK CREDIB ILITY AS IT WAS WELL WITHIN THE REALM OF POSSIBILITY AND WAS PLAUSIBLE. A NUMBER OF JUDICIAL DECISIONS WERE ALSO CITED. 7. THE CONTENTIONS WERE CAREFULLY CONSIDERED. AS POINT ED OUT IN THE CASE OF ADDL. CIT VS. PREMCHAND GAUR, 24 DTR (DEL) (TM), 513, IT WAS HELD THAT THE OFFER MADE TO AVOID HARASSMENT/LITIGATION/BY PEACE, CANNOT CONVERT AN OFFER TO TAX, AS CONCEALME NT OF INCOME. THE APPELLANT HAS ALSO REFERRED TO THE DECISION REPORTED IN 291 ITR 519 (SC) THAT I F ON FACTS, THE ADDITIONAL INCOME ASSESSED IS THE SAME AS THE ADDITIONAL INCOME OFFERED, AND EVEN IF THE OFFER CAME IN CONSEQUENCE OF SEARCH, IT IS AN OFFER MADE IN SPIRIT OF SETTLEMENT AND BY ITSELF NOT AN ADMISSION OF CONCEALMENT. THE CONCLUSION OF CONCEALMENT IS NOT VALID PARTICULARLY WHEN IT WAS ACCEPTED WITHOUT DISCUSSION OF THE DOCUMENTS/EXPLANATION WHICH COMPELLED THE OFFER OF ADDITIONAL INCOME. IN THE CASE OF THE APPELLANT, NO REFERENCE HAD BEEN SPECIFICALLY MADE OF EXPLANATION 5 TO SECTION 271(1)(C). THE EXPLANATION GIVEN IN RESPECT OF OTHER ASSETS I.E. F LATS, RBI BONDS AND DOCUMENTS, ETC., WAS NOT FOUND TO BE FALSE AND NO ADDITION HAS BEEN MADE ACC ORDINGLY. IN STATEMENT DATED 19/5/2006, SHRI DILIP WHEN ASKED (IN Q.NO.8) IF HE WANTED TO STATE ANYTHING (ABOUT CASH/GOLD FOUND AND ASKED.ABOUT IT Q.NO.7) HE STATED THAT IF ANY LIABIL ITY OF IT DID ARISE, ON HIS FIRM/FAMILY MEMBERS, HE WOULD DISCHARGE MY LIABILITIES. IN OTHER WORDS, HE ACCEPTED TO PAY TAX ON WHATEVER LIABILITY THAT WOULD ARISE. 8. JAYSHREE, IN HER STATEMENT ON 10/05/2006, IN REPLY TO Q. NO. 3, STATED THAT THE CASH OF RS. 50,000/- (APPROX.) IN THE HOUSE BESIDE CASH OF RS. 15,000/- TO RS.20,000/- OF HER TWO DAUGHTERS. THE CASH RECEIVED ON MATURITY OF NSCS., DETAILS OF WHICH ARE AVAILABLE IN MY HAND WRITTEN DIARY, WAS ALSO AT THE PREMISES. FURTHER CASH OF JAY AND JANKI, CHIL DREN OF MY SISTER-IN-LAW, BETWEEN RS.25,000/- TO RS.35,000/- WAS ALSO LYING WITH US BUT NOT OWNED BY US. SHE STATED THAT THE JEWELLERY WAS KEPT IN BANK LOCKERS. IN HER STATEMENT RECORDED ON 22/5/200 6, IN REPLY TO Q.NO.5, SHE EXPLAINED THE CASH OF RS. 14.94 LAKHS FOUND IN THE LOCKER NO.450 AS, R S.4 LAKHS BEING WITHDRAWALS OF HER HUSBAND, DILIPBHAI FROM THE BANK FOR PURCHASE OF GOLD FOR MA RRIAGE OF DAUGHTERS. RS.3 LAKHS KEPT IN HER JEWELLERY BOX WAS STATED TO BE GIFT OF DAUGHTERS RE CEIVED FROM GRAND PARENTS ON DIFFERENT OCCASIONS AND THE CASH PRIZES WON BY DAUGHTER. RS. 2.35 LAKHS WERE EXPLAINED AS MATURITY PROCEEDS OF POST OFFICE RECURRING SCHEME, IN HER NA ME AND IN THE NAME OF HER DAUGHTERS. RS.5 LAKHS WERE EXPLAINED AS RECEIVED FROM HER LATE FATH ER JAYANTILAL R. SONI, TO BE GIVEN TO HER DAUGHTERS ON THEIR MARRIAGE IN FUTURE. HER LATE FAT HER HAD GIVEN THIS AMOUNT WITHOUT THE KNOWLEDGE OF HER BROTHERS (HIS SONS). THE REST OF T HE AMOUNT WAS ATTRIBUTED TO HER SAVINGS. 8A IT IS FURTHER SEEN THAT IN Q. NO. 4 OF THE STATE MENT OF JAYSHREE, RECORDED ON 22/05/2006, IT WAS STATED THAT ON OPENING HER LOCKER, A SLIP OF PAPER WITH ENTRIES THEREON HAD FALLEN. IT APPEARED THAT THIS SLIP OF PAPER WAS INSERTED IN THE LOCKER AFTER THE LOCKER HAD BEEN RESTRAINED U/S. 132(3) OF THE ACT. THE ENTRIES IN THE SLIP OF PAPER WERE (I) RS. 4 LAKHS WITHDRAWN FROM DILIPS BCANK -19/05/2005 (II) RS. 5 LAKHS RECEIVED FROM BAPUJI FOR GIVING -23/09/2005 30-30 TOLAS GOLD TO TWO DAUGHTERS ON THE OCCASION OF THEIR MARRIAGE (III) RS. 3 LAKHS GOT FROM JAYSHREEBEN ON ACCOUNT OF FLAT OF KONARK - 22/04/2005 IN HER RESPONSE, JAYSHREE, IN HER ANSWER NO.4 STATE D THAT NO COGNIZANCE NEED BE TAKEN OF THIS PIECE OF PAPER. IN THE APPELLATE HEARING IT WAS POI NTED OUT THAT THE FACTS WERE WRITTEN IN THE SLIP OF PAPER WERE VERIFIABLE FROM CORROBORATING EVIDENCE E VEN OTHERWISE. THUS, RS.4 LAKHS WERE WITHDRAWN FROM BANK ACCOUNT OF DILIP, IN PUNJAB NAT IONAL BANK, ON 18/5/2005 CHEQUE NO.38792, AS PER THE COPY OF THE BANK STATEMENT FILED. THE A FFIDAVIT/EVIDENCE OF THE AMOUNT RECEIVED FROM ITA NO 1117/AHD/2010 . A.Y. 2007- 08 4 HER LATE FATHER WAS NOT AVAILABLE PER SE DUE TO THE DEATH OF HER FATHER. HOWEVER, THE CUSTOMARY PRACTICE/TRADITION/FINANCIAL STATUS OF THE FAMILY A ND CHARACTERISTIC FEATURES SUCH AS FATHER NOT WANTING THAT HIS SONS SHOULD KNOW OF SUCH GIFTS ETC ., SHOULD NOT HAVE BEEN SUMMARILY REJECTED. THE OTHER EXPLANATION OF RS.2.35 LAKHS BEING MATURITY P ROCEEDS AND THE FACT THAT RS.3 LAKHS HAD BEEN SEPARATELY KEPT IN A JEWELLERY BOX, REPRESENTING SA VINGS OF HER DAUGHTERS, ETC., WERE ALSO NOT FOUND TO BE INCORRECT PARTICULARLY IN THE CONTEXT OF THE OVER ALL INCOME/WITHDRAWALS OF THE FAMILY.- THE SUBSTANTIAL SAVINGS OF SMT. JAYSHREE ALSO CANNOT BE RULED OUT. FROM THE COPY OF THE BANK STATEMENT FILED, IT IS SEEN THAT THE WITHDRAWAL OF RS.4 LAKHS HAD BEEN MADE AS STATED. FURTHER, THE PREVAILING RATE OF GOLD IN SEPTEMBER, 2005 WAS APPROXIMATELY, RS.6,600/- FOR 10 GMS. AND SO THE CONTENTION THAT HER LATE FATHER HAD GIVEN AMOUNT FOR PURCHASE OF GOLD (30 TOLAS EACH) FOR -HIS GRAND- DAUGHTERS, WAS ALSO PLAUSIBLE. THE AO HAS NOT COMME NDED ADVERSELY ABOUT THE EXPLANATION OF RS.2.35 LAKHS, BEING OUT OF MATURITY PROCEEDS OF RE CURRING ACCOUNT. THE SAVINGS OF SMT. JAYSHREE AND THE FACT OF GIFTS, ETC. RECEIVED BY CHILDREN ON VARIOUS FUNCTIONS/FESTIVALS, ALSO CANNOT BE IGNORED IN THE CONTEXTUAL SET UP OF THE APPELLANT. IN OTHER WORDS, AFTER CONSIDERING THE ENTIRE EXPLANATION IT WOULD BE REASONABLE TO ASSUME THAT N O EXPLANATION/EVIDENCE WAS FORTHCOMING IN RESPECT OF THE AMOUNT OF RS.3 LAKHS. HENCE, ON A HO LISTIC CONSIDERATION, IT IS HELD THAT THE AMOUNT OF RS. 3 LAKHS DID ATTRACT THE PROVISIONS OF SECTIO N 271(1)(C) OF THE ACT, AT THE MINIMUM IMPOSABLE PENALTY, WHICH COMES TO RS. 1,01,000/-. AS SUCH THE IMPOSED PENALTY IS RESTRICTED TO RS. 1,01,000/- AND THE BALANCE IS DELETED. 5. AGGRIEVED BY THE ORDER OF CIT(A), REVENUE IS NOW IN APPEAL BEFORE US. 6. BEFORE US LD. D.R. POINTED TO THE FINDINGS OF AO. H E FURTHER SUBMITTED THAT THE CASE OF THE ASSESSEE WOULD SQUARELY FALL W ITHIN THE DEEMING PROVISION OF EXPLANATION-5. HE FURTHER SUBMITTED TH AT THE ASSESSEE WOULD NOT BE ELIGIBLE FOR THE PROTECTION PROVIDED UNDER T HE EXCEPTION TO EXPLANATION-5 FOR THE REASON THAT THE ASSESSEE HAD MADE NO DISCLOSURE ON THE BASIS OF ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ARTICLE OR THING FOUND IN HER POSSESSION OR UNDER HER CONTROL AND THE ASSESSEE HAD NOT SPECIFIED THE MANNER OF DERIVATION OF UNDISCLOS ED INCOME IN THE STATEMENTS RECORDED. IT WAS THEREFORE URGED THAT TH E CASE OF THE ASSESSEE IS SQUARELY COVERED UNDER EXPLANATION-5 TO SEC. 271(L) (C) AND ASSESSEE IS LIABLE TO PENALTY. HE THEREFORE URGED THAT THE ORDE R OF A.O. BE UPHELD . 7. LD A.R. ON THE OTHER HAND SUBMITTED THAT IN THE PRE SENT CASE NO PENALTY WAS LEVIABLE AS THE RETURNED INCOME AND THE ASSESSE D INCOME OF THE ITA NO 1117/AHD/2010 . A.Y. 2007- 08 5 ASSESSEE IS SAME. HE FURTHER SUBMITTED THAT IN NONE OF THE STATEMENT RECORDED U/S 132(4) THE ASSESSEE WAS INFORMED/REQUI RED TO COMPLY WITH THE PROVISIONS OF EXPLANATION 5 TO S. 271(L)(C) AND FURTHER NONE OF THE EXPLANATION OF THE CASH FOUND DURING THE SEARCH HAS BEEN DISPROVED BY THE AO. HE FURTHER SUBMITTED THAT NONE OF THE EXPLA NATION OFFERED DURING THE STATEMENT WAS FOUND TO BE FALSE OR INCORRECT. H E THUS SUPPORTED THE ORDER OF CIT(A). 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL PLACED ON RECORD. IT IS AN UNDISPUTED FACT THAT THERE WAS A S EARCH AT THE RESIDENTIAL PREMISES OF THE ASSESSEE ON 10.5.2006 AND DURING TH E COURSE OF SEARCH, CASH AMOUNTING TO RS 14.94 LACS WAS FOUND FROM THE LOCKER, WHICH WAS IN THE JOINT NAME OF THE ASSESSEE ALONG WITH HER HUSBA ND. IT IS ALSO A FACT THAT SUBSEQUENTLY THE ASSESSEE FILED RETURN OF INCO ME ON 31.10.2007 FOR AY 2007-08 DECLARING TOTAL INCOME OF RS 16,81,170/- WHICH INCLUDED THE CASH AMOUNTING TO RS 15 LACS FOUND DURING THE COURS E OF SEARCH. IN THE ASSESSMENT ORDER DATED 29.12.2008 FRAMED 143(3) THE TOTAL INCOME WAS ALSO DETERMINED AT RS 16,81,170/- MEANING THEREBY T HAT THE SAME INCOME WAS ASSESSED AS THE INCOME RETURNED BY THE ASSESSEE WITHOUT ANY CHANGE OR ADDITIONS. ASSESSEE HAD ALSO PAID THE DUE TAXES. 9. EXPLANATION 5 TO SECTION 271(L)(C) ENACTS DEEMING P ROVISION AND HAS APPLICATION TO A SITUATION WHERE IN THE COURSE OF A SEARCH U/S.132 THE ASSESSEE IS FOUND TO BE THE OWNER OF ANY UNEXPLAINE D ASSET AND THE ASSESSEE CLAIMS THAT SUCH ASSET HAS BEEN ACQUIRED B Y HIM BY UTILIZING WHOLLY OR IN PART HIS INCOME FOR ANY PREVIOUS YEAR WHICH HAS ALREADY ENDED BEFORE THE DATE OF THE SEARCH OR WHICH IS TO END ON OR AFTER THE DATE ITA NO 1117/AHD/2010 . A.Y. 2007- 08 6 OF SEARCH. IN SUCH A SITUATION DESPITE THE FACT THA T SUCH INCOME IS DECLARED BY HIM IN ANY RETURN OF INCOME FURNISHED ON OR AFTE R THE DATE OF SEARCH, HE SHALL FOR THE PURPOSES OF SEC.271(L)(C) BE DEEME D TO HAVE CONCEALED HIS INCOME. HOWEVER, 2 EXCEPTIONS GRANTING IMMUNITY FROM PENALTY ARE (1) IF THE TRANSACTIONS HAVE BEEN DISCLOSED TO THE CHIEF COMMISSIONER OF INCOME TAX OR THE ASSESSEE MAKES A STATEMENT U/S. 1 32(4) STATING THAT THE ASSETS WERE ACQUIRED OUT OF THE INCOME WHICH HAS BE EN DISCLOSED IN THE RETURNS AND ALSO SPECIFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED AND PAYS TAX TOGETHER WITH INTEREST ON SUCH INCOME. 10. THE CONTENTION OF THE A.O. IS THAT ASSESSEE IS NOT ENTITLED TO IMMUNITY PROVIDED UNDER THE EXCEPTION TO EXPLANATION-5 FOR T HE REASON THAT THE ASSESSEE HAS NOT SPECIFIED THE MANNER OF DERIVATION OF UNDISCLOSED INCOME . 11. IN THE CASE OF CIT VS. RADHA KISHAN GOEL (2005) 278 ITR 454 (ALL), THE HON'BLE HIGH COURT HAS HELD AS UNDER:- 'THAT THE OBJECT OF THE PROVISION IS ACHIEVED BY MA KING THE STATEMENT ADMITTING THE NON-DISCLOSURE OF MONEY, BULLION, JEWELLERY ETC. THUS, MUCH IMPORTANC E SHOULD NOT BE ATTACHED TO THE STATEMENT ABOUT THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED. IT CA N BE INFERRED ON THE FACTS AND CIRCUMSTANCES OF THE CASE, IN THE ABSENCE OF ANYTHING TO THE CONTRAR Y. THEREFORE, MERE NON-STATEMENT OF THE MANNER IN WHICH SUCH INCOME WAS DERIVED WOULD NOT MAKE EXPLAN ATION 5(2) IS APPLICABLE. THE CASE OF THE ASSESSEE IS SQUARELY COVERED UNDER EXCEPTION IN SUB CLAUSE (2) OF EXPLANATION 5 AND IS OUT OF DEEMED CONCEALMENT IN RESPECT OF INCOME WHICH IS INCLUDED IN THEN REGULAR RETURN.' 12. IN THE CASE BEFORE HON. ALL HIGH COURT, IT HAS BEEN FURTHER HELD THAT U/S. 132(4) UNLESS THE AUTHORIZED OFFICER PUTS A SPECIFI C QUESTION WITH REGARD TO THE MANNER IN WHICH INCOME HAS BEEN DERIVED, IT IS NOT EXPECTED FROM THE PERSON TO MAKE A STATEMENT IN THIS REGARD AND I N CASE IN THE STATEMENT THE MANNER IN WHICH INCOME HAS BEEN DERIVED HAS NOT BEEN STATED BUT HAS ITA NO 1117/AHD/2010 . A.Y. 2007- 08 7 BEEN STATED SUBSEQUENTLY THAT AMOUNTS TO COMPLIANCE WITH EXPLANATION 5(2). 13. IN THE CASE OF CIT VS MAHENDRA C SHAH (SUPRA) THE H 'BLE HIGH COURT HAS HELD AS UNDER;- 'INSOFAR AS THE ALLEGED FAILURE ON THE PART OF THE ASSESSEE TO SPECIFY IN THE STATEMENT UNDER S. 132(4) REGARDING THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED, SUFFICE IT TO STATE THAT WHEN THE STATEMENT IS BEING RECORDED BY THE AUTHORIZED OFFIC ER IT IS INCUMBENT UPON THE AUTHORIZED OFFICER TO EXPLAIN THE PROVISIONS OF EXPLN. 5 IN ENTIRETY TO T HE ASSESSEE CONCERNED AND THE AUTHORIZED OFFICER CANNOT STOP SHORT AT A PARTICULAR STAGE SO AS TO PE RMIT THE REVENUE TO TAKE ADVANTAGE OF SUCH A LAPSE IN THE STATEMENT. THE REASON IS NOT FAR TO SEEK. IN TH E FIRST INSTANCE, THE STATEMENT IS BEING RECORDED I N THE QUESTION AND ANSWER FORM AND THERE WOULD BE NO OCCA SION FOR AN ASSESSEE TO STATE AND MAKE AVERMENTS IN THE EXACT FORMAT STIPULATED BY THE PROVISIONS CO NSIDERING THE SETTING IN WHICH SUCH STATEMENT IS BE ING RECORDED. SECONDLY, CONSIDERING THE SOCIAL ENVIRONM ENT IT IS NOT POSSIBLE TO EXPECT FROM AN ASSESSEE, WHETHER LITERATE OR ILLITERATE, TO BE SPECIFIC AND TO THE POINT REGARDING THE CONDITIONS STIPULATED BY EXCEPTION NO. 2 WHILE MAKING STATEMENT UNDER S. 132 (4).' 14. IN THE PRESENT CASE, SEEN IN THE LIGHT OF AFORESAID HIGH COURT DECISIONS, IT CAN BE SEEN THAT THE ASSESSEE HAD DISCLOSED THE CAS H FOUND AT THE TIME OF SEARCH IN THE RETURN OF INCOME AND THE TAX WAS ALSO PAID. THE LD. D.R. COULD NOT BRING ON RECORD ANY MATERIAL TO PROVE THA T THE SPECIFIC QUESTION WAS PUT TO ASSESSEE DURING THE COURSE OF RECORDING OF STATEMENT U/S. 132(4) WITH REFERENCE TO THE MANNER IN WHICH SHE HA S DERIVED THE INCOME AND IN RESPONSE TO SUCH QUESTION THE ASSESSEE DID N OT RESPOND TO THE SAME. THE H'BLE GUJARAT HIGH COURT IN THE CASE OF M AHENDRA C. SHAH (SUPRA) HAS HELD THAT WHEN A STATEMENT IS RECORDED U/S 132(4) REGARDING THE MANNER IN WHICH THE INCOME HAS BEEN DERIVED, IT IS INCUMBENT UPON THE AUTHORISED OFFICER TO EXPLAIN THE PROVISIONS OF EXPLN. 5 IN ENTIRETY TO THE ASSESSEE CONCERNED AND THE AUTHORISED OFFICER C ANNOT STOP SHORT AT A PARTICULAR STAGE SO AS TO PERMIT THE REVENUE TO TAK E ADVANTAGE OF SUCH A LAPSE IN THE STATEMENT. IN THE PRESENT CASE BEFORE US, NOTHING HAS BEEN BROUGHT ON RECORD BEFORE US TO DEMONSTRATE THAT THE ASSESSEE WAS ASKED ITA NO 1117/AHD/2010 . A.Y. 2007- 08 8 QUESTION TO EXPLAIN THE MANNER IN WHICH SHE HAD DER IVED THE INCOME. FURTHER, CIT(A) BY WELL REASONED ORDER HAS GRANTED PARTIAL RELIEF TO THE ASSESSEE. BEFORE US, REVENUE COULD NOT CONTROVERT T HE FINDINGS OF CIT(A). IN VIEW OF THE AFORESAID FACTS AND RELYING ON THE DECISIONS OF H'BLE HIGH COURTS CITED ABOVE, WE ARE OF THE VIEW T HAT IN THE PRESENT CASE NO INTERFERENCE IS CALLED FOR TO THE ORDER OF CIT(A ) AND THUS THE GROUND OF REVENUE IS DISMISSED. 15. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 31 - 10 - 2013. SD/- SD/- (D.K. TYAGI) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH 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