Mohan Lal Rastogi (Decd), Farrukhabad V. The ITO, Farrukhabad

ITA 130/AGR/2009

• Counselvise Citation: 13020314 RSA 2009
• Duration Of Justice: 3 year(s) 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 15-05-2012
• Assessment Year: 2001-2002
• Appeal Filed On: 06-04-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R K JAIN
• Assessee Lawyers: K C AGARWAL
• Keywords: Peak credit; Question of law; Valuation report; Revised return
• Section: 133A; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER ITA NOS.129, 130, 131 & 103/AGR/2009 ASSESSMENT YEARS : 1999-2000, 2001-02, 2002-03 & 2000-01 RESPECTIVELY SHRI MOHAN LAL RASTOGI (DECD), VS. INCOME TAX OFFI CER, THROUGH L/H. SMT. MANJU RASTOGI, WARD 1, FARRUKHA BAD. RASTOGI MOHALLA, FARRUKHABAD. (PAN: ABHPR 6608 K). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.C. AGARWAL, ADVOCATE RESPONDENT BY : SHRI R. K. JAIN, JR. D.R. DATE OF HEARING : 15.05.2012 DATE OF PRONOUNCEMENT : 25.05.2012 ORDER PER A.L. GEHLOT, ACCOUNTANT MEMBER: THESE ARE APPEALS FILED BY THE ASSESSEE AGAINST SEP ARATE ORDERS DATED 02.01.2009 PASSED BY THE LEARNED CIT (APPEALS), GHA ZIABAD FOR ASSESSMENT YEARS 1999-2000, 2001-02, 2002-03 AND ORDER DATED 28.11.2 008 FOR ASSESSMENT YEAR 2000-01 RESPECTIVELY. ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 2 2. THE COMMON GROUND RAISED IN ALL THESE APPEALS RE LATES TO LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER). 3. LD. REPRESENTATIVES OF THE PARTIES SUBMITTED THA T THE FACTS OF ALL THESE CASES ARE IDENTICAL, THEREFORE, THE FACTS FOR ASSESSMENT YEAR 1999-2000 MAY BE CONSIDERED FOR DECIDING ALL THESE APPEALS. 4. THE BRIEF FACTS OF THE CASE ARE THAT A SURVEY UN DER SECTION 133A OF THE ACT WAS CARRIED OUT ON 19.12.2003 IN THE CASE OF M/S SH RI MAHABIR COLD STORAGE, FARRUKHABAD. DURING THE COURSE OF POST SURVEY ENQU IRY, SOME BANK ACCOUNT OF ORIENTAL BANK OF COMMERCE, FARRUKHABAD WERE DETECTE D. THE ACCOUNTS OF M/S. ASHISH POTATO CO. AND M/S M.M. TRADERS WERE INTRODU CED BY THE ASSESSEE IN THE BANK. THE ASSESSEE SHRI MOHAN LAL RASTOGI HAS SUR RENDERED BOTH THE ABOVE BANK ACCOUNTS AS HIS UNDISCLOSED BENAMI ACCOUNTS. MEANW HILE, THE ASSESSEE REVISED HIS RETURN WHICH WAS FILED ON 15.01.2004. THE BRIEF SU MMARY OF ORIGINAL RETURNS FILED, REVISED RETURNS FILED, ADDITIONS MADE AND PENALTY L EVIED FOR DIFFERENT YEARS NOTED FROM PAGE NO.9 OF ASSESSEES PAPER BOOK ARE AS UNDE R :- A.Y. DT. OF FILING OF ORIGINAL RETURN INCOME SHOWN IN ORIGINAL RETURN DT. OF FILING REVISED RETURN INCOME SHOWN IN REVISED RETURN DT. OF ISSUE NOTICE U/S 148 INCOME ASSESSED BY INCOME TAX APPELLATE TRIBUNAL ORDER AMOUNT OF PENALTY LEVIED BY ITO, FARRUKHABAD. 1999-00 05.12.1999 182255 15.01.04 182255+278000=46 0255 30.01.04 182255+298080=480335 94000.00 2000-01 27.11.2000 214969 15.01.04 214969+64000=278 969 30.01.04 214969+89204=304173 20000.00 2001-02 28.11.2001 242607 15.01.04 242607+54000=296 607 30.01.04 242607+75202=317809 33500.00 2002-03 30.12.2002 269550 15.01.04 269550+72000=341 550 30.01.04 269550+100471=370021 30000.00 ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 3 5. THE CASE OF THE ASSESSING OFFICER IS THAT BEFORE FILING THE REVISED RETURNS BY THE ASSESSEE THE UNDISCLOSED BANK ACCOUNTS MAINTAIN ED BY THE ASSESSEE WITH ORIENTAL BANK OF COMMERCE WERE UNEARTHED BY THE DEP ARTMENT AND THE STATEMENT OF ASSESSEE WAS RECORDED. THE ASSESSING OFFICER WA S OF THE VIEW THAT THE INCOME ESCAPED ASSESSMENT AND REVISED RETURN FILED BY THE ASSESSEE WAS NON-EST. THE NOTICE UNDER SECTION 148 OF THE ACT WAS ISSUED TO R EGULARIZE THE PROCEEDINGS. IN THE REVISED RETURN, APART FROM SALARY AND SHARE INC OME FROM FIRM, THE ASSESSEE DECLARED PROFIT FROM POTATO BUSINESS AND HIS ENTIRE SALE PROCEEDS WERE CREDITED IN BANK COUNT MAINTAINED WITH ORIENTAL BANK OF COMMERC E, FARRUKHABAD. THE TOTAL TURNOVER IN THE NAME OF M/S ASHISH POTATO CO. & M/S M.M. TRADERS WERE RS.10,32,927/- & RS.15,69,188/- RESPECTIVELY. THE SUBMISSION OF THE ASSESSEE WAS THAT INCOME FROM PARTNERSHIP CONCERNS HAD BEEN SHOW N IN THE REVISED RETURN ALONGWITH EXPLANATION FILED WITH THE REVISED RETURN . INVESTMENT AND CREDIT PURCHASES WERE OFFERED FOR TAXATION ON PEAK BASIS I N ABSENCE OF FULL EVIDENCE. THE INCOME FROM POTATO BUSINESS WAS SHOWN AT 5% ON TOTA L SALES. THE ASSESSING OFFICER DID NOT ACCEPT THE ASSESSEES CONTENTION BE CAUSE DURING THE COURSE OF SURVEY OPERATION IN THE CASE OF M/S. SHRI MAHAVIR C OLD STORAGE, IN WHICH THE ASSESSEE IS A PARTNER, NO BOOKS NOR ANY DOCUMENTS F OUND WHICH WARRANTS THAT TRADING OF POTATOES WERE BEING CARRIED OUT IN THE N AME OF M/S. ASHISH POTATO CO. IN DISTINCTION TO THAT OF M/S. SHRI MAHAVIR COLD STORA GE. ALSO NO PROOF OF INDIVIDUAL ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 4 BUSINESS OF M/S. SHRI MAHAVIR COLD STORAGE WAS FOUN D NOR CLAIMED. FURTHER DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE FI RM M/S SHRI MAHAVIR COLD STORAGE, FOR ASSESSMENT YEAR 2001-02, THE ASSESSEE SHRI MOHAN LAL RASTOGI NEVER APPEARED TO ADDUCE EVIDENCES TO THE FACT THAT RETAI L TRADING OF POTATOES WAS CARRIED OUT. NOR WAS ANY EVIDENCE OF SUCH NATURE FURNISHED BY THE ASSESSEE THROUGH ANY WRITTEN COMMUNICATION. THE TRANSACTION IN BANK AS PER COPY OF ACCOUNT REVEALS THAT ACCOUNT WAS FOR DISCOUNTING OF DRAFTS ONLY. T HE ASSESSEE FAILED TO PRODUCE MANDI SAMITI REGISTER, PURCHASE AND SALE REGISTER, EVIDENCE REGARDING TRANSPORTATION BILL ETC. THE BANK ACCOUNT WAS ONLY FOR DRAFT COMING AND IMMEDIATE WITHDRAWAL OF CASH. THE ASSESSING OFFICER LEVIED P ENALTY IN ASSESSMENT YEAR 1999-2000 OBSERVING AS UNDER :- I HAVE GONE THROUGH THE REPLY FILED BY THE ASSESSE E. IN THIS CONNECTION, IT IS MENTIONED HERE THAT THE ASSESSEE HAD FILED REVISED RETURN OF INCOME ONLY AFTER DETECTING AN UNDISCLOSE D ACCOUNT IN THE NAMES OF M/S ASHISH POTATO CO. AND M/S M.M. TRADERS WITH ORIENTAL BANK OF COMMERCE CONSEQUENT TO SPECIAL SURVEY CONDU CTED IN THE CASE OF SHRI MAHABIR COLD STORAGE, FARRUKHABAD IN WHICH SHRI MOHAN LAL RASTOGI IS A PARTNER. THE ASSESSING OFFICER ON PAG E 2 OF THE ASSESSMENT ORDER HAS MENTIONED THAT BEFORE FILING T HE REVISED RETURN BY THE ASSESSEE THE UNDISCLOSED BANK ACCOUNTS MAINT AINED BY THE ASSESSEE WITH OBC, FARRUKHABAD WERE UNEARTHED BY TH E DEPARTMENT AND STATEMENT OF ASSESSEE WAS RECORDED. THE REVIS ED RETURN FILED BY THE ASSESSEE WAS TREATED AS NON-EST. IN THIS CONNE CTION, I WOULD LIKE TO PLACE RELIANCE ON THE JUDGEMENT IN THE CASE IN C IT VS. MOHD. MOHATRAM FARROQUI (2002) 177 CTR (RAJ.) 434 WHEREIN IT WAS HELD THAT DISCLOSURE OF INCOME IN THE REVISED RETURN AFT ER SEIZURE OF UNEXPLAINED CASH FROM THE ASSESSEE CAN NOT BE SAID TO BE A VOLUNTARY DISCLOSURE. RELIANCE IS ALSO PLACED IN THE CASE IN P.C. JOSEPH & BROS VS. CIT (2000) 158 CTR (KER) 104 WHEREIN IT WAS HEL D THAT WHERE THE ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 5 SURRENDER OF INCOME IN THE REVISED RETURN IS NOT VO LUNTARY BUT IS AS A RESULT OF DETECTION BY ASSESSING AUTHORITY, THE FIL ING OF REVISED RETURN IS OF NO CONSEQUENCE. CONSIDERING THE ABOVE FACTS, IT IS A FIT CASE FOR L EVY OF PENALTY U/S 271(1)(C) OF THE I.T. ACT. THEREFORE, THE ASSE SSEE IS LIABLE FOR LEVY OF PENALTY U/S 271(1)(C) OF THE I.T. ACT, 1961. MA XIMUM AND MINIMUM PENALTY LEVIABLE IN THIS CASE WORKS OUT TO RS.2,80, 575/- & RS.93,525/- RESPECTIVELY. SINCE THE QUANTUM OF LEVY OF PENALTY IS MORE THAN R S.10,000/-, THIS ORDER HAS BEEN PASSED WITH THE APPROVAL OF THE JOINT COMMISSIONER OF INCOME TAX, RANGE-2, FARRUKHABAD VI DE F.NO.JCIT- FKBD/2005-06/1250 DATED 22.03.2007. PENALTY OF RS. 94,000/- HAS BEEN IMPOSED U/S 271(1)(C) OF THE I.T. ACT, 1961. 6. THE CIT(A) HAS CONFIRMED THE ORDER OF ASSESSING OFFICER. 7. LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS FILED THE REVISED RETURN ALONGWITH REASONS FOR REVISED RETURN OF WHICH COPY IS PLACED AT PAGE NO 65 OF THE ASSESSEES PAPER BOOK. LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT APART FROM SALARY AND SHARE INCOME FROM FIRM, THE A SSESSEE HAD BEEN CARRYING ON POTATO BUSINESS AS HIS INDIVIDUAL PROPRIETORSHIP CO NCERN. THE INCOME EARNED FROM THE INDIVIDUAL PROPRIETORSHIP BUSINESS WAS NOT INCL UDED AT THE TIME OF FILING OF THE ORIGINAL RETURN UNDER THE IMPRESSION THAT INCOME OF EACH BUSINESS IS TO BE ASSESSED SEPARATELY. HOWEVER, ON LEGAL ADVICE THE ASSESSEE HAS COME TO KNOW THAT THE INCOME FROM INDIVIDUAL BUSINESS IS ALSO TO BE INCLU DED WITH THE OTHER INCOME, HENCE REVISED RETURN WAS FILED APPLYING 5% RATE OF PROFIT ON SALES AT RS.53,000/- FOR ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 6 ASSESSMENT YEAR 1999-2000 FOR PROPRIETORY BUSINESS. ON ACCOUNT OF INVESTMENT IN SUCH BUSINESS, THE ASSESSEE OFFERED FOR TAXATION RS .2,25,000/- IN THE REVISED RETURN IN RESPECT OF INVESTMENT AND CREDIT PURCHASE ON THE BASIS OF PEAK THEORY. LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT I.T.A.T. H AS ACCEPTED THE INCOME DECLARED BY THE ASSESSEE ON THE BASIS OF PEAK THEOR Y. HOWEVER, IN RESPECT OF RATE OF PROFIT THE I.T.A.T. HAS APPLIED 7% RATE OF PROFIT I NSTEAD OF 5%. LD. AUTHORISED REPRESENTATIVE FURTHER SUBMITTED THAT THE ASSESSEE HAS FILED COMPLETE DETAILS IN RESPECT OF AMOUNT SURRENDERED IN THE FORM OF CHART OF ACCOUNTS WITH ORIENTAL BANK OF COMMERCE IN THE NAME OF M/S ASHISH POTATO CO. & M/S M.M. TRADERS WHICH WERE NOT SHOWN IN THE ORIGINAL RETURN. LD. AUTHORI SED REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS VOLUNTARILY REVISED THE RETUR N AND FURNISHED ALL THE DETAILS WHICH HAVE BEEN ACCEPTED BY THE I.T.A.T. THEREFORE , THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT IN THE LIGHT OF THE F ACTS, PENALTY UNDER SECTION 271(1)(C) IS NOT LEVIABLE. THE LD. AUTHORISED REPR ESENTATIVE IN SUPPORT OF HIS CONTENTION RELIED UPON THE FOLLOWING DECISIONS :- 1) CIT VS. GURU RAM DASS FRUIT AND VEGETABLE AGENCY , 251 ITR 361 (P&H) 2) CIT VS. VED PRAKASH, 269 ITR 255 (P&H) 3) CIT VS. SURESH CHANDRA MITTAL, 251 ITR 9 (SC) 4) CIT VS. SURESH CHANDRA MITTAL, 241 ITR 124 (M.P. ) 5) SHIV LAL TAK VS. CIT, 251 ITR 373 (RAJ.) 6) CHEAP CYCLE STORE VS. CIT, 196 CTR 173 (ALL.) 7) CIT VS. RAJ BANS SINGH, 276 ITR 351 (ALL.) 8) SUDARSHAN SILKS AND SAREES VS. CIT, 300 ITR 205 (SC) ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 7 9) DECISION OF I.T.A.T., AGRA BENCH IN THE CASE OF ITO VS. SMT. PARWATI DEVI (DECEASED), ITA NO.51/AGR/2008 A.Y. 2000-01 OR DER DATED 03.02.2009. 10) DECISION OF I.T.A.T., AGRA BENCH IN THE CASE OF SUNIL CHANDRA GUPTA VS. ACIT, ITA NOS.75 & 76/AGR/2007 ORDER DATED 23.0 4.2009. (11) CIT VS. (1) RAJIV GARG, (2) SIYA RAM GARG (3) SANJAY GARG, 313 ITR 256 (P&H) (12) DR. AJIT KUMAR PANDEY VS. I.T.A.T., 310 ITR 19 5 (PATNA). 8. WE HAVE HEARD THE LD. REPRESENTATIVES OF THE PAR TIES, RECORDS PERUSED AND GONE THROUGH THE DECISIONS CITED. THE CASE UNDER C ONSIDERATION IS IN RESPECT OF LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THE SAID SECTION READS AS UNDER:- 271. (1) IF THE [ASSESSING] OFFICER OR THE [COMMISSIONE R (APPEALS)] [OR THE COMMISSIONER] IN THE COURSE OF ANY PROCEEDI NGS UNDER THIS ACT, IS SATISFIED THAT ANY PERSON (A) . (B) . (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME, OR [(D) HAS CONCEALED THE PARTICULARS OF THE FRINGE BENEFITS OR FURNISHED INACCURATE PARTICULARS OF SUCH FRINGE BENEFITS,] HE MAY DIRECT THAT SUCH PERSON SHALL PAY BY WAY OF PENALTY, (I) [* * *] [(II) IN THE CASES REFERRED TO IN CLAUSE (B), [IN ADDITION TO TAX, IF ANY, PAYABLE] BY HIM, [A SUM OF TEN THOUSAND RUPEES ] FOR EACH SUCH FAILURE ;] [(III) IN THE CASES REFERRED TO IN CLAUSE (C) [OR CLAUSE (D)], [IN ADDITION TO TAX, IF ANY, PAYABLE] BY HIM, A SUM WHI CH SHALL NOT BE LESS THAN, BUT WHICH SHALL NOT EXCEED [THREE TIMES], THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF THE CONCEALMENT OF PARTICULARS OF HIS INCOME [OR FRINGE BENEFITS] OR THE FURNISHING OF IN ACCURATE PARTICULARS OF SUCH INCOME [OR FRINGE BENEFITS]. ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 8 [* * *] [EXPLANATION 1.WHERE IN RESPECT OF ANY FACTS MATE RIAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT, (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR O FFERS AN EXPLANATION WHICH IS FOUND BY THE [ASSESSING] OFFIC ER OR THE [COMMISSIONER (APPEALS)] [OR THE COMMISSIONER] TO B E FALSE, OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS NOT ABLE TO SUBSTANTIATE [AND FAILS TO PROVE THAT SUCH EXPLANAT ION IS BONA FIDE AND THAT ALL THE FACTS RELATING TO THE SAME AND MATERIA L TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM], THEN, THE AMOUNT ADDED OR DISALLOWED IN COMPUTING T HE TOTAL INCOME OF SUCH PERSON AS A RESULT THEREOF SHALL, FOR THE P URPOSES OF CLAUSE (C) OF THIS SUB-SECTION, BE DEEMED TO REPRESENT THE INC OME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. 8.1 THE BASIC CONDITIONS FOR INVOKING SECTION 271(1 )(C) OF THE ACT ARE THAT DURING THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT INCLUDING ASSESSMENT PROCEEDINGS, IF THE ASSESSING OFFICER FOUND THAT TH E ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE P ARTICULARS OF SUCH INCOME, THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS LEVIA BLE. THE EXPLANATION TO SAID SECTION PROVIDES CERTAIN DEEMED CIRCUMSTANCES WHERE CONCEALMENT FROM PENALTY IS LEVIABLE. THE ADMITTED FACTS IN THE CASE UNDER CON SIDERATION ARE THAT THE ASSESSEE WAS RUNNING A BUSINESS OF POTATOES IN PROPRIETORSHI P OF WHICH INCOME HAS NOT BEEN SHOWN IN THE RETURN FILED BY THE ASSESSEE. THE DEP ARTMENT NOTICED IN A SURVEY UNDER SECTION 133A OF THE ACT CONDUCTED IN THE CASE OF M/S. SHRI MAHABIR COLD STORAGE, FARRUKHABAD AND DURING THE COURSE OF POST SURVEY ENQUIRY, IT HAS BEEN FOUND THAT THE ASSESSEE WAS DOING BUSINESS IN THE N AME OF M/S. ASHISH POTATO ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 9 COMPANY AND M/S. M.M. TRADERS THROUGH BANK ACCOUNT WITH ORIENTAL BANK OF COMMERCE, FARRUKHABAD. THE ASSESSEE WAS THE INTROD UCER OF THOSE BANK ACCOUNTS. THE ASSESSEE SURRENDERED THE INVESTMENT IN THAT BUS INESS ALONG WITH PROFIT BY FILING A REVISED RETURN. TO APPRECIATE THE ISSUE WHETHER THE ACTION OF THE ASSESSEE WAS VOLUNTARY IN FILING THE REVISED RETURN OR IT IS A C ASE OF DETECTION OF CONCEALED INCOME BY THE ASSESSEE BY FILING ORIGINAL RETURN AN D CONCEALING PARTICULARS OF INCOME AND FURNISHING INACCURATE PARTICULARS OF INC OME, WE WOULD LIKE TO GO THROUGH SOME JUDICIAL PRONOUNCEMENT WHICH ARE AS UN DER :- 8.2 HONBLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. RAKESH SURI, 331 ITR 458 (ALL) AFTER NOTING FACTS HELD AS UNDER :- (HEAD NOTE) THE ASSESSEE FILED HIS RETURN FOR THE ASSESSMENT Y EAR 2004-05 DISCLOSING TOTAL OF RS. 1,17,600. THE CASE WAS SELECTED FOR SCRUTINY. IT WAS FOUND THAT THE ASSESSEE HAD SHOWN LONG-TERM CAPITAL GAINS ON SALE OF SHARES. HE HAD CONSTRUCTED A HOUSE BETWEEN FINANCIAL YEARS 2001-02 AND 2004-05 INVESTING RS.56,74,567. T HE INCOME-TAX AUTHORITIES REPEATEDLY REQUIRED THE ASSESSEE TO FUR NISH THE CONTRACT NOTE OF PURCHASE AND SALE OF SHARES SOLD WITH A COP Y OF BILL OF BROKER, JUSTIFY HOLDING OF SHARES, WHICH WERE SOLD, YEAR-WI SE INVESTMENT IN THE HOUSE PROPERTY, VALUATION REPORT OF THE APPROVED VA LUER, CONFIRMATION OF SALARY RECEIVED FROM THE COMPANY AND OTHER DOCUM ENTS. THE ASSESSEE DID NOT FURNISH FULL DETAILS. HIS STATEMEN T THAT THE SHARES HAD BEEN SOLD THROUGH THE DELHI STOCK EXCHANGE WAS FOUN D TO BE FALSE. THE ASSESSEE WAS DIRECTED TO FURNISH REPLY IN TERMS OF THE ORDER DATED NOVEMBER 9, 2006. HE WAS FURTHER DIRECTED TO FURNIS H THE NAME OF THE STOCK EXCHANGE THROUGH WHICH SHARES WERE PURCHASED AND SOLD, RATE OF SHARES IN THE STOCK EXCHANGE ON DATE OF PURCHASE AND SALE ON OR BEFORE DECEMBER 6, 2006. ON DECEMBER 6, 2006, THE A SSESSEE SURRENDERED THE ENTRY APPEARING IN HIS BANK ACCOUNT ON SALE OF SHARES ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 10 AMOUNTING TO RS. 61,35,844 ON AGREED BASIS. THE ASS ESSING OFFICER TREATED THE SUM OF RS. 61,35,844 AS INCOME FROM UND ISCLOSED SOURCES UNDER SECTION 69A OF THE INCOME-TAX ACT, 1961, AND ALSO LEVIED PENALTY. THE COMMISSIONER (APPEALS) CANCELLED THE P ENALTY AND THIS WAS CONFIRMED BY THE TRIBUNAL. ON APPEAL TO THE HIG H COURT: HELD, ALLOWING THE APPEAL, THAT THE ASSESSEE HAD CO NCEALED THE MATERIAL FACTS AND GIVEN INCORRECT STATEMENT OF FAC TS IN THE APPLICATION AND ALSO NOT PROVIDED INFORMATION REQUIRED BY THE A SSESSING OFFICER, AFTER RECEIPT OF NOTICE. ACCORDINGLY THE ACTION OF THE ASSESSEE WAS NEITHER BONA FIDE NOR VOLUNTARY. THE MANNER IN WHIC H THE ASSESSEE HAD TRIED TO PROLONG THE CASE BEFORE THE ASSESSING OFFICER BY NOT PROVIDING INFORMATION IMMEDIATELY AND BY NARRATING INCORRECT FACTS IN THE LETTER DATED DECEMBER 6, 2006 SHOWED THAT THE A SSESSEE HAD CONCEALED THE INCOME AND DISCLOSURE WAS NOT VOLUNTA RY BUT UNDER COMPULSION BEING CORNERED BY THE ASSESSING OFFICER. PENALTY HAD TO BE IMPOSED. 8.3 HONBLE GUJRAT HIGH COURT IN THE CASE OF LMP PR ECISION ENGG. CO. LTD. VS. DCIT, 330 ITR 93 (GUJ) AFTER NOTING FACTS, HELD AS UNDER :- (HEAD NOTE) THE DEPUTY DIRECTOR OF INCOME-TAX (INVESTIGATION), BOMBAY UNDERTOOK SURVEY ACTION SOME TIME IN SEPTEMBER, 198 8 AND ON VERIFICATION OF CERTAIN PURCHASES MADE BY THE ASSES SEE IT WAS FOUND THAT THE PURCHASES DID NOT APPEAR TO BE GENUINE. BE FORE THE PROCEEDINGS COULD BE FINALLY CONCLUDED THE ASSESSEE FILED A DECLARATION UNDER SECTION 273A OF THE ACT DISCLOSIN G ADDITIONAL INCOME OF RS. 54,71,463 AS BEING RELATABLE TO ASSES SMENT YEAR 1985- 86. ON THE SAME DAY, DECLARATION WAS ALSO MADE OF A SUM OF RS.18 LAKHS EACH FOR ASSESSMENT YEARS 1986-87, 1987-88 AN D 1988-89. THIS APPLICATION UNDER SECTION 273A OF THE ACT WAS FOLLO WED BY REVISED RETURNS FILED ON FEBRUARY 14, 1989 FOR ALL THE THRE E ASSESSMENT YEARS DECLARING IDENTICAL ADDITIONAL INCOME IN THE REVISE D RETURNS. BEFORE ASSESSMENTS COULD BE FINALISED, AFTER REGULARISING THE SAME BY ISSUANCE OF NOTICE UNDER SECTION 148 OF THE ACT, TH E ASSESSEE CAME FORWARD WITH ANOTHER APPLICATION DECLARING ADDITION AL INCOME OF RS. 78,56,613. THE FIRST DECLARATION WAS IN RELATION TO PURCHASES FROM ISC WHILE THE SECOND DISCLOSURE WAS IN RELATION TO PURC HASE MADE FROM ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 11 SC, NB AND NPST. THE ASSESSMENTS WERE NOT CHALLENGE D BY THE ASSESSEE. THE ASSESSING OFFICER INITIATED PENALTY P ROCEEDINGS UNDER SECTION 271(L)(C). THE EXPLANATION OF THE ASSESSEE FOR ALL THE THREE YEARS WAS THAT REVISED RETURNS WERE VOLUNTARY, ADDI TIONAL INCOME IN EACH OF THE REVISED RETURNS WAS DECLARED TO PURCHAS E PEACE AND NO CONCEALMENT WAS INVOLVED. IT WAS SUBMITTED THAT THE RETURNS WERE REVISED EVEN BEFORE ISSUANCE OF NOTICE UNDER SECTIO N 148 OF THE ACT. THE ASSESSING OFFICER DID NOT ACCEPT THE EXPLANATIO N OF THE ASSESSEE AND LEVIED PENALTIES. SUCCESSIVE APPEALS FILED BY T HE ASSESSEE BEFORE THE COMMISSIONER (APPEALS) AND THE TRIBUNAL WERE DI SMISSED BY THE TWO APPELLATE AUTHORITIES CONFIRMING THE PENALTIES LEVIED BY THE ASSESSING OFFICER. HOWEVER, THE TRIBUNAL CAME TO TH E CONCLUSION THAT THE ASSESSEE HAD CO-OPERATED IN FINALISATION OF THE ASSESSMENT AND ACCEPTED THE ASSESSMENT OF ADDITIONAL INCOME AND SO , THE TRIBUNAL REDUCED THE PENALTY LEVIED FROM THE MAXIMUM TO THE MINIMUM. ON A REFERENCE: HELD, THAT IT WAS ONLY AFTER THE STATEMENT OF THE C HAIRMAN AND MANAGING DIRECTOR WAS RECORDED BY THE DEPUTY DIRECT OR OF INCOME- TAX (INVESTIGATION MUMBAI, THAT THE FIRST DISCLOSUR E DATED OCTOBER 20,1988, RS. 54,71,463 WAS MADE ACCOMPANIED BY ANOT HER DISCLOSURE OF RS. 54 LAKHS IN A ROUND FIGURE BEING DIVIDED INT O THREE SEGMENTS OF RS. 18 LAKHS EACH FOR ASSESSMENT YEAN 1986-87, 1987 -88 AND 1988-89. THE REVISED RETURN DECLARING A SUM OF RS.78,56,613 CAME ABOUT AS A CONSEQUENCE OF FOLLOW-UP PROCEEDINGS UNDERTAKEN BY THE DEPUTY DIRECTOR OF INCOME-TAX IN RELATION TO THE OTHER THR EE SUPPLIERS, VIZ., SC, NB AND NPST. THEREFORE, THE ASSESSEE COULD NOT BE STATED TO HAVE VOLUNTARILY COME FORWARD TO DISCLOSE INCOME WHICH H AD UNINTENTIONALLY BEEN OMITTED FROM THE ORIGINAL RETU RN OF INCOME. THE IMPOSITION OF PENALTY WAS VALID. 8.4 HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF PREM PAL GANDHI VS. CIT, 335 ITR 23 HELD (HEAD NOTE) THE ASSESSEE DERIVED INCOME FROM PROPERTY DEALINGS . AFTER ASSESSMENT WAS COMPLETED, THE ASSESSING OFFICER NOT ICED THAT THE ASSESSEE HAD SUBSTANTIAL TRANSACTIONS IN THE BANK W HICH WERE NOT DISCLOSED AND PROCEEDINGS WERE INITIATED FOR REASSE SSMENT. THE ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 12 ASSESSEE FILED A REVISED RETURN AND OFFERED THE PEA K CREDITS IN THE BANK ACCOUNT AND INTEREST THEREON, WITH A CONDITION THAT NO PENALTY BE IMPOSED AND HE MAY NOT BE PROSECUTED. THE ASSESSING OFFICER DID NOT ACCEPT THE CONDITIONS. THE ASSESSING OFFICER COMPLE TED THE ASSESSMENT AND ALSO IMPOSED PENALTY. THE COMMISSIONER (APPEALS ) ACCEPTED THE PLEA OF THE ASSESSEE TO THE EFFECT THAT THE ASSESSE E HAVING FILED HIGHER RETURN AND SURRENDERED THE UNDISCLOSED INCOME, PENA LTY WAS NOT LEVIABLE. THE TRIBUNAL REVERSED THE ORDER ON THE GR OUND THAT THE ASSESSEE FURNISHED INACCURATE PARTICULARS OF HIS IN COME AND ALSO CONCEALED PARTICULARS OF HIS INCOME WHILE FILING TH E ORIGINAL RETURN AND WAS NOT ABLE TO ESTABLISH THE INADVERTENT MISTA KE OR OMISSION IN THE ORIGINAL RETURN, WHEN HE DECLARED SHOWING MUCH LARGER INCOME IN THE REVISED RETURN. ON APPEAL: HELD, DISMISSING THE APPEAL, THAT THE PLAUSIBILITY OR OTHERWISE OF THE EXPLANATION OF THE ASSESSEE WAS A PURE QUESTION OF FACT. ADMITTEDLY, THE ASSESSEE CONCEALED THE TRANSACTIONS IN THE BANK ACCOUNT AND WHEN NOTICE OF REASSESSMENT WAS ISSUED, FINDING NO OTHER WAY OUT, THE ASSESSEE SURRENDERED INCOME TO AVOID P ENAL CONSEQUENCES. IN SUCH A SITUATION, IT COULD NOT BE HELD THAT THE ASSESSEE WANTED TO BUY PEACE OF MIND AND THERE WAS NO EVIDENCE OF CONCEALMENT, WHICH CALLED FOR PENALTY. THIS WAS NOT A CASE WHERE PENALTY HAD BEEN IMPOSED ONLY BECAUSE THE ASSESSEE DISCLOSED HIGHER INCOME VOLUNTARILY BUT A CASE OF CLEAR CONCEALMENT WHERE THE ASSESSEE HAVING FOUND NO OTHER WAY OUT, WAS FORCED TO SURREN DER THE UNDISCLOSED INCOME. NO SUBSTANTIAL QUESTION OF LAW AROSE. 8.5 HONBLE BOMBAY HIGH COURT IN THE CASE OF JYOTI LAXMAN KONKAR VS. CIT, 292 ITR 163 HELD (HEAD NOTE) THE ASSESSEE HAD FILED A RETURN FOR THE ASSESSMENT YEAR 1999- 2000 DECLARING AN INCOME OF RS.7,40,510. NOT SATISF IED THEREWITH, THE ASSESSING OFFICER CARRIED OUT A SURVEY UNDER SECTIO N 133A OF THE INCOME-TAX ACT, 1961, AND DURING THE SURVEY FOUND T HAT THERE WAS A DISCREPANCY IN STOCK TO THE TUNE OF RS.18,28,706 WH ICH WAS BROUGHT TO THE NOTICE OF THE ASSESSEE, AND THE ASSESSEE FILED A REVISED RETURN DISCLOSING ADDITIONAL INCOME OF RS.18,28,706. THE A SSESSING OFFICER ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 13 IMPOSED PENALTY UNDER SECTION 271(1)(C) AND THIS WA S UPHELD BY THE TRIBUNAL. ON APPEAL TO THE HIGH COURT : HELD, DISMISSING THE APPEAL, THAT THE QUESTION WHETHER TH ERE IS CONCEALMENT OF INCOME OR NOT HAS TO BE DECIDED WITH REFERENCE TO THE FACTS OF A GIVEN CASE AND THE FACT FINDING AUTHORIT IES UNDER THE ACT HAVING COME TO THE CONCLUSION THAT IN THE FACTS OF THE CASE, THE ASSESSEE HAD CONCEALED THE INCOME INITIALLY WITH A VIEW TO AVOID THE PAYMENT OF TAX, THE IMPOSITION OF PENALTY WAS VALID . 8.6 THE LD. AUTHORISED REPRESENTATIVE, HOWEVER, REL IED UPON THE DECISION OF HONBLE PUNJAB & HARYANA HIGH COURT AND OTHERS (SUP RA) IN SUPPORT OF HIS CONTENTION THAT IT IS NOT A CASE OF CONCEALMENT IN WHICH DECISION IN THE CASE OF SURESH CHAND MITTAL (SUPRA) HAS ALSO BEEN CONSIDERE D. HOWEVER, THE SAID DECISION IN THE CASE OF SURESH CHAND MITTAL HAS BEEN CONSIDE RED BY THE HONBLE PUNJAB & HARYANA HIGH COURT IN ITS LATER DECISION IN THE CAS E OF PREM PAL GANDHI VS. CIT (SUPRA) AND PENALTY HAS BEEN CONFIRMED. THEREFORE, SAID DECISIONS WOULD NOT SUPPORT THE CASE OF THE ASSESSEE. FURTHER THE ASSE SSEE MADE SURRENDER OF UNDISCLOSED INCOME ONLY WHEN HE WAS CONFRONTED WITH THE INCRIMINATING MATERIAL AGAINST HIM AND CORNERED BY THE REVENUE DEPARTMENT AFTER MAKING DETAILED ENQUIRY. THEREFORE, THE SAID DECISION WOULD NOT SU PPORT THE CASE OF THE ASSESSEE. THE LD. AUTHORISED REPRESENTATIVE FURTHER RELIED UP ON THE ORDERS OF I.T.A.T., AGRA BENCH IN WHICH THE TRIBUNAL FOUND THAT EXPLANATION FURNISHED BY THE ASSESSEE STANDS SUBSTANTIATED BY EVIDENCE BROUGHT ON RECORD. IN THE LIGHT OF THE DECISIONS OF VARIOUS HIGH COURTS, NOTED ABOVE, FIRST OF ALL DECI SION OF TRIBUNAL CANNOT BE GIVEN ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 14 PREFERENCE AND FURTHER WHEN THE ASSESSEE HIMSELF SU RRENDERED THE UNDISCLOSED INCOME AT THE ASSESSMENT STAGE AFTER DETECTING INCO ME FROM POTATO BUSINESS WHICH WAS RUNNING SYSTEMATICALLY OUT OF BOOKS OF ACCOUNT, BY THE DEPARTMENT. 8.7 ALL THE ABOVE DECISIONS SQUARELY APPLY TO THE C ASE OF THE ASSESSEE AND PROVE THAT THE ASSESSEE HAD INTENTIONALLY AND DELIBERATEL Y FILED INACCURATE PARTICULARS OF HIS INCOME IN THE ORIGINAL RETURN AND, THEREFORE, P ENALTY WAS LEVIABLE IN THE PRESENT CASE. 8.8 IN THE LIGHT OF THE ABOVE DISCUSSIONS AND AFTER CONSIDERING THE FACTS OF THE CASE, WE FIND THAT IT IS A CLEAR CUT CASE OF CONCEA LING AND FURNISHING INACCURATE PARTICULARS OF INCOME OF PROPRIETARY POTATO BUSINES S OF THE ASSESSEE WHICH WAS SYSTEMATICALLY RUN THROUGH BANK ACCOUNT. THE ASSES SEE WAS VERY MUCH AWARE ABOUT THIS INCOME OF POTATO WHICH IS SUBJECT TO TAX IN ACCORDANCE WITH LAW. INSPITE OF THIS FACT, HE TRIED TO OPERATE THIS BUSINESS UND ER THE NAME AND STYLE OF TWO PROPRIETARY CONCERNS BY INTRODUCING BANK ACCOUNTS. THESE FACTS CLEARLY SHOW THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS I NCOME, FURNISHED INACCURATE PARTICULAR OF HIS INCOME WITH HIS KNOWLEDGE AND INT ENTION TO CONCEAL HIS INCOME. WE, THEREFORE, ARE OF THE CONSIDERED VIEW THAT PENA LTY UNDER SECTION 271(1)(C) OF THE ACT HAS BEEN RIGHTLY IMPOSED BY THE ASSESSING O FFICER AND HAS RIGHTLY ITA NOS.129, 130, 131 & 103/AGR/2009 A.YS. 99-2000, 01-02, 02-03 & 2000-01 . 15 CONFIRMED BY THE CIT(A). IN THE LIGHT OF THE ABOVE DISCUSSIONS, ORDER OF THE CIT(A) IS CONFIRMED. 9. IN THE RESULT, ALL THE FOUR APPEALS FILED BY THE ASSESSEE ARE DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT) SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER PBN/* COPY OF THE ORDER FORWARDED TO: APPELLANT RESPONDENT CIT CONCERNED CIT (APPEALS) CONCERNED D.R., ITAT AGRA BENCH, AGRA GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY