Shri Narayanbhai S.Patel, Ahmedabad V. The Income tax Officer,Ward-12(1), Ahmedabad

ITA 1272/AHD/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 76889 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-06-2014
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 25-06-2014
• Assessment Year: 1991-1992
• Appeal Filed On: 29-04-2011
• Court: TRIBUNAL
• Department Lawyers: J P JHANGID
• Assessee Lawyers: S N DIVETIA
• Keywords: Peak credit

Judgement Text

, , , , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, AHMEDABAD , , , , 0 00 0 0 00 0 , , , , !' !' !' !' ! # ! # ! # ! # BEFORE SHRI MUKUL KR. SHRAWAT, JUDICIAL MEMBER AND SHRI N.S. SAINI, ACCOUNTANT MEMBER ITA NOS. 1272 & 1273/AHD/2011 ASSESSMENT YEARS 1991-92 & 1992-93 SHRI NARAYANBHAI S. PATEL 73/74, CHIRAG INDL. ESTATE, CTM CHAR RASTA, AMRAIWADI, AHMEDABAD-380026. PAN: ACNPP7492N VS INCOME TAX OFFICER WARD-12(1), AHMEDABAD. $%/ APPELLANT '($% / RESPONDENT REVENUE BY : SHRI J.P. JHANGID, SR. DR ASSESSEE(S) BY : SHRI S.N. DIVETIA, AR ) * +'/ // / DATE OF HEARING : 25/06/2014 ,-. * +' / DATE OF PRONOUNCEMENT: 30/06/2014 !/ !/ !/ !// // / O R D E R PER SHRI N.S. SAINI, ACCOUNTANT MEMBER: THIS ARE THE APPEALS FILED BY THE ASSESSEE AGAINS T THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-XX, AHMEDA BAD DATED 04.02.20111. 2. THE SOLE GROUND TAKEN IN BOTH THE APPEALS BY TH E ASSESSEE IS THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) E RRED IN FACTS AND IN LAW IN CONFIRMING THE PENALTY OF RS 1,33,400/- FOR ASSE SSMENT YEAR 1991-92 AND RS 3,88,700/- FOR ASSESSMENT YEAR 1992-93 LEVIED BY ASSESSING OFFICER U/S. 271(1)(C) OF THE ACT. ITA NOS. 1272 & 1273/AHD/2011 SHRI NARAYANBHAI S. PATEL, AHMEDABAD. AYS 1991-92 & 1992-93 - 2 - 3. WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIAL AVAILABLE ON RECORD. IN T HE INSTANT CASE, THE ASSESSEE FILED ITS RETURN OF INCOME DISCLOSING INCO ME OF RS 31,880/- IN ASSESSMENT YEAR 1991-92 AND RS 36,880/- IN ASSESSME NT YEAR 1992-93. THEREAFTER, IT WAS FOUND ON INVESTIGATION BY THE DE PARTMENT THAT THE ASSESSEE WAS HAVING CERTAIN BANK ACCOUNTS WHICH WER E NOT DISCLOSED TO THE DEPARTMENT. ACCORDINGLY, THE PEAK BALANCE IN THE U NDISCLOSED BANK ACCOUNTS WERE TREATED AS INCOME OF THE ASSESSEE. 4. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT BY DETERMINING ASSESSEES TOTAL INCOME AT RS 3,19,480/- IN THE ASS ESSMENT YEAR 1991-92 AND AT RS 5,77,070/- IN ASSESSMENT YEAR 1992-93. 5. ON APPEAL, THE SAID TOTAL INCOME WAS REDUCED TO RS 2,90,380/- FOR THE ASSESSMENT YEAR 1991-92 AND INCREASED TO RS 7,38,900/- FOR ASSESSMENT YEAR 1992-93 BECAUSE OF CERTAIN MISTAKE IN ARITHMETICAL CALCULATION OF THE ASSESSING OFFICER. 6. THEREAFTER, PENALTY U/S. 271(1)(C) WAS LEVIED O F RS 1,33,400/- FOR ASSESSMENT YEAR 1991-92 AND RS 3,88,700/- FOR A SSESSMENT YEAR 1992- 93. 7. ON APPEAL, THE COMMISSIONER OF INCOME TAX (APPE ALS) CONFIRMED THE LEVY OF PENALTY. 8. BEFORE US, THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE SUBMITTED THAT AS THE ADDITION WAS MADE OF THE PEAK AMOUNT OF THE RESPECTIVE ASSESSMENT YEARS, THE ADDITION WAS ON ES TIMATE BASIS AND THEREFORE PENALTY U/S. 271(1)(C) CANNOT BE LEVIED. HE, IN SUPPORT OF THE ABOVE CONTENTION, RELIED UPON THE DECISION OF THIS BENCH OF THE TRIBUNAL IN THE CASE OF MURARILAL RATANLAL AGARWAL VS. ACIT IN IT(SS)A NO. 573 & 615/AHD/2012 ASSESSMENT YEAR 2004-05 ORDER DATED 05 .07.2013 AND IN THE ITA NOS. 1272 & 1273/AHD/2011 SHRI NARAYANBHAI S. PATEL, AHMEDABAD. AYS 1991-92 & 1992-93 - 3 - CASE OF SHRI OJAS ASHOKBHAI MEHTA VS. ITO IN ITA NO . 296 & 297/AHD/2013 ASSESSMENT YEAR 2008-09 ORDER DATED 23.08.2013. 9. IN THE ALTERNATIVE, THE AUTHORIZED REPRESENTATI VE OF THE ASSESSEE ALSO CONTENDED THAT ONLY ONE UNDISCLOSED BANK ACCOU NT WAS FOUND BY THE INVESTIGATION WING OF THE DEPARTMENT AND THE ASSESS EE HIMSELF DISCLOSED THE OTHER FIVE BANK ACCOUNTS AND THE ADDITION WAS MADE ON THE BASIS OF ALL THE SIX BANK ACCOUNTS OUT OF WHICH FIVE BANK ACCOUNTS W ERE VOLUNTARILY DISCLOSED BY THE ASSESSEE AND THEREFORE, PENALTY U/S. 271(1)( C) SHOULD NOT HAVE BEEN LEVIED IN RESPECT OF INCOME ASSESSED ON THE BASIS O F THOSE FIVE BANK ACCOUNTS. 10. THE DEPARTMENTAL REPRESENTATIVE SUPPORTED THE ORDERS OF LOWER AUTHORITIES. 11. WE FIND THAT IT IS NOT IN DISPUTE THAT THE SIX BANK ACCOUNTS WITH REFERENCE TO WHICH ADDITION WAS MADE BY THE ASSESSI NG OFFICER WERE NOT DISCLOSED BY THE ASSESSEE IN ITS RETURN OF INCOME. THE SOURCE OF DEPOSIT IN THE SAID BANK ACCOUNTS COULD NOT BE EXPLAINED BY TH E ASSESSEE. IN THE ABOVE CIRCUMSTANCES, THE ADDITION OF PEAK BALANCE I N THE SAID BANK ACCOUNTS CANNOT BE HELD AS AN ADDITION MADE MERELY ON ESTIMA TE BASIS WITHOUT RELEVANT MATERIALS. THE TWO DECISIONS RELIED UPON BY THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE ARE FOUND TO BE DIST INGUISHABLE ON FACTS IN AS MUCH AS IN THOSE CASES PENALTY WAS LEVIED ONLY ON D IFFERENCE BETWEEN THE PEAK BALANCE DECLARED BY THE ASSESSEE AND THE PEAK BALANCE ESTIMATED BY THE DEPARTMENT WHEREAS IN THE INSTANT CASE, THE ADD ITION WAS MADE ON ACTUAL PEAK BALANCE IN THE BANK ACCOUNT FOR WHICH N O PLAUSIBLE EXPLANATION ABOUT THE SOURCE OF THE SAME COULD BE GIVEN BY THE ASSESSEE. THEREFORE, SUCH DECISIONS ARE FOUND TO BE NOT APPLICABLE IN TH E INSTANT CASE. 12. FURTHER, IN THIS CONNECTION WE WOULD LIKE TO Q UOTE THE DECISION OF THE HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF CIT VS. BECHARBHAI P. ITA NOS. 1272 & 1273/AHD/2011 SHRI NARAYANBHAI S. PATEL, AHMEDABAD. AYS 1991-92 & 1992-93 - 4 - PARMAR (2012) 341 ITR 0499 (GUJ.) WHEREIN THE HONB LE HIGH COURT HAS HELD AS UNDER: PENALTY CORRESPONDING TO THE ADDITION OF RS 17.22 L AKHS WAS DELETED ON THE GROUND THAT THE ASSESSEE HAD DEMONST RATED THAT THERE WAS ESTIMATION OF ADDITIONS AND THAT, THEREFO RE, NO PENALTY COULD BE LEVIED. HERE AGAIN, WE ARE OF THE OPINION THAT THE TRIBUNAL INTERFERED WITH THE PENALTY ON THE GROUND WHICH WAS NOT PERMISSIBLE. ADDITIONS MADE ON THE BASIS OF ESTIMA TION MAY BE ONE OF THE GROUNDS ON WHICH DISCRETION NOT TO IMPOS E PENALTY MAY BE EXERCISED. HOWEVER, IN THE ABSENCE OF ANY R EQUIREMENT TO PROVE THE CONCEALMENT OR FURNISHING OF INACCURAT E PARTICULARS FOUND IN SECTION 271(1)(C) OF THE ACT CANNOT FORM T HE SOLE BASIS TO DELETE PENALTY IMPOSED BY THE ASSESSING OFFICER AND CONFIRMED BY THE COMMISSIONER (APPEALS). 13. FURTHER, WE ALSO DO NOT FIND MERIT IN THE ALTE RNATIVE ARGUMENT OF THE ASSESSEE BECAUSE THE OTHER FIVE BANK ACCOUNTS W HICH WERE ALSO NOT DISCLOSED IN THE RETURN HAD TRANSFER ENTRIES TO THE ONE UNDISCLOSED BANK ACCOUNT WHICH WAS ALREADY DETECTED BY THE DEPARTMEN T. THUS, THE DISCLOSURE OF THE OTHER FIVE UNDISCLOSED BANK ACCOU NTS BY THE ASSESSEE CANNOT BE HELD AS VOLUNTARY DISCLOSURE BY THE ASSES SEE ON THE FACTS OF THE INSTANT CASE. THE DISCLOSURE CAME UP BECAUSE THE D EPARTMENT ALREADY DETECTED ONE UNDISCLOSED BANK ACCOUNT WHICH CONTAIN ED TRANSFER ENTRIES OF THE REMAINING FIVE UNDISCLOSED BANK ACCOUNTS. IN T HE ABOVE CIRCUMSTANCES, WE DO NOT FIND ANY GOOD REASON TO INTERFERE WITH TH E ORDERS OF THE LOWER AUTHORITIES. THEREFORE, BOTH THE APPEALS OF THE AS SESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE COURT ON MONDAY, THE 30 TH OF JUNE, 2014 AT AHMEDABAD. SD/- SD/- (MUKUL KR. SHRAWAT) JUDICIAL MEMBER ( N.S. SAINI) ACCOUNTANT MEMBER AHMEDABAD; DATED 30/06/2014 GHANSHYAM MAURYA, SR. P.S. ITA NOS. 1272 & 1273/AHD/2011 SHRI NARAYANBHAI S. PATEL, AHMEDABAD. AYS 1991-92 & 1992-93 - 5 - TRUE COPY !/ * '0 1!0. !/ * '0 1!0. !/ * '0 1!0. !/ * '0 1!0./ COPY OF THE ORDER FORWARDED TO : 1. $% / THE APPELLANT 2. '($% / THE RESPONDENT. 3. 2 / CONCERNED CIT 4. 2() / THE CIT(A)-III, AHMEDABAD 5. 056 ' , , / DR, ITAT, AHMEDABAD 6. 678 9) / GUARD FILE. !/ !/ !/ !/ / BY ORDER, : :: :/ // / ; ; ; ; ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD