Shri. Mohan Marotrao Dev, Nagpur V. Income Tax Officer Ward- 1(1), Nagpur

ITA 132/NAG/2011

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 3103 (ITAT-NAGPUR)
• Duration Of Justice: 7 year(s) 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 12-09-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B RAJARAM
• Assessee Lawyers: J M RANADE
• Keywords: Unexplained investment
• Section: 271(1)(c)

Judgement Text

, - IN THE INCOME TAX APPELLATE TRIBUNAL NAGPUR , BENCH , ( E - COURT), MUMBAI , BEFORE SHRI R.K.GUPTA , J M & SHRI RAJENDRA , A M ITA NO. 132 / N AG / 20 1 1 ( ASSESSMENT YEAR : 200 6 - 0 7 ) MOHAN MAROTRAO DEV, FLAT NO. 5, 3 RD FLOOR, KAMLA NIKETAN PLOT NO. 17, OPP. KACHIPURA GARDEN, RAMDASPETH, NAGPUR - 440 010 VS. ITO WARD - 1(1) , NAGPUR - 440 006. PAN/GIR NO. : ABHPD 8916 A ( APPELLANT ) .. ( RESPONDENT ) /ASSESSEE BY : MR. J.M.RANADE /REVENUE BY : MR. B. RAJARAM DATE OF HEARING : 21 ST DEC ., 2012 DATE OF PRONOUNCEMENT : 4 TH JAN . ,201 3 O R D E R P ER SHRI R.K.G UPTA, JM : TH E ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE ITAT NAGPUR BENCH, NAGPUR, AGAINST THE ORDER DATED 27 - 06 - 2011 OF LEANED CIT (A) - I , NAGPUR (MAHARA SHTRA) , RELATING TO THE ASSESSMENT YEAR 2006 - 07, WHICH HAS BEEN HEARD THROUGH E - COURT, MUMBAI . 2 . THE ASSESSEE IS OBJECTING THE CONFIRMING THE PENALTY OF RS. 4,50,000/ - LEVIED BY THE AO UNDER SECTION 271(1)(C) . ITA NO . 132 /20 1 1 2 3 . BRIEF FACTS OF THE CASE ARE THAT THE ASSES SEE FILED RETURN DECLARING INCOME OF RS. 2,06,540/ - . ASSESSMENT WAS COMPLETED AT AN INCOME OF RS. 22,13,490/ - . THE ASSESSEE PREFERRED APPEAL BEFORE LEARNED CIT(A) , WHO CONFIRMED THE ADDITION OF RS. 12,25,387/ - MADE BY THE AO BEING UNEXPLAINED INVESTMENT IN CA PITAL ACCOUNT OF THE PROPRIETOR. THE PENALTY PROCEEDING UNDER SECTION 271(1)(C) WAS ALSO INITIATED. DURING THE PENALTY PROCEEDING, THE AO NOTED THAT THE ASSESSEE HAS ACCEPTED A SUM OFRS. 12,25,387/ - AS INCOME OF THE ASSESSEE DURING REMAND PROCEEDINGS BEFORE THE APPELLATE AUTHORITY. EXPLANATION OF THE ASSESSEE DURING PENALTY PROCEEDING WAS ALSO CONSIDERED BY THE A O . IT WAS EXPLAINED BEFORE THE AO THAT IN FACT A SUM OF RS. 10,68,175/ - WAS RECEIVED FROM ONE SHRI C.R.SAGDEO, WHICH REPRESENTS THE ADVANCE AGAINST S ALE OF PLOTS AT PUNE. IT WAS ALSO STATED THAT THESE ADVANCES WERE RECEIVED FROM 15 - 6 - 2002 TO 21 - 9 - 2006. SINCE COPY OF SALE WITH REGARD TO FLAT AT PUNE COULD N OT BE PRODUCED, THEREFORE, THE AO DID NOT ACCEPT THE CONTENTION OF THE ASSESSEE THAT ADVANCE WAS RECEIVED IN EARLIER YEARS. THE AO ALSO NOTED THAT IN BALANCESHEET AS ON 31 - 3 - 2005 AN AMOUNT OF RS. 10,68,175/ - THOUGH WAS SHOWN AS ADVANCE BUT NAME OF ONE SHRI C.R.SAGDEO WAS NOT MENTIONED, HENCE, THE CONTENTION OF THE ASSESSEE WAS REJECTED. REGARDING AN AM OUNT OF RS. 1,57,212/ - , RECEIVED FROM ASSESSEES WIFE SMT. ANURADHA DEV, WHICH WAS ALSO RECEIVED IN EARLIER YEAR, WAS ALSO NOT ACCEPTED BY THE AO AS THE ASSESSEE COULD NOT LEAD ANY EVIDENCE, THEREFORE, HE LEVIED A PENALTY OF RS. 4,50,000/ - ON ACCOUNT OF TAX CALCULATED AT RS. 12,25,387/ - . ITA NO . 132 /20 1 1 3 4 . LEARNED CIT(A) ALSO CONFIRMED THE ACTION OF THE AO BY OBSERVING THAT THOUGH THE AMOUNT WAS RECEIVED IN EARLIER YEAR BUT WHY THE ASSESSEE HAS CONCEALED TO ADD IN THE INCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION. THEREFORE, HE WAS SATISFIED WITH THE FINDING OF THE AO AND CONFIRMED THE LEVY OF PENALTY. NOW, THE ASSESSEE IS IN APPEAL HERE BEFORE THE TRIBUNAL. 5 . AFTER CONSIDERING THE SUBMISSIONS AND PERUSING THE MATERIAL ON RECORD, WE FOUND THAT THE ASSESSEE DESERVE S TO SUCCEED IN HIS APPEAL. WE NOTED THAT THE AO HIMSELF HAS VERIFIED THAT A SUM OF RS. 10,68,175/ - WAS APPEARING IN THE BALANCE SHEET AS ON 31 - 3 - 2005 RELATING TO ASSESSMENT YEAR 2005 - 06 . THE YEAR UNDER CONSIDERATION IS FOR THE ASSESSMENT YEAR 2006 - 07 . THER EFORE, PENALTY OF AN AMOUNT OF RS. 10,68,175/ - SHOULD NOT HAVE BEEN LEVIED AT LEAST. IF BY ANY WRONG MOTIVE OR BY ANY OTHER REASON THE ASSESSEE HAS ACCEPTED THIS AMOUNT AS INCOME FOR THE YEAR UNDER CONSIDERATION, IT DOES NOT MEAN THAT THE PENALTY O N THAT AM OUNT IS ALSO LEVIABLE A S LEVY OF PENALTY IS NOT AUTOMATIC. EXPLANATION OF THE ASSESS EE HAS TO BE CONSIDERED IN RIGHT PERSPECTIVE. IF THE EXPLANATION OF THE ASSESSEE IS BONAFIDE THEN OF COURSE THE SAME SHOULD HAVE BEEN ACCEPTED BY THE LOWER AUTHORITIES. THE REFORE, WE CANCEL THE LEVY OF PENALTY ON THE AMOUNT OF INCOME OF RS. 10,68,175/ - AS THE SAME RELATES TO EARLIER YEAR . REGARDING REMAINING AMOUNT OF RS. 1,57,212/ - , WHICH WAS RECEIVED BY THE ASSESSEE FROM HIS WIFE IN EARLIER YEAR. IN OUR OPINION, ON THIS AMOU NT ITA NO . 132 /20 1 1 4 ALSO PENALTY IS NOT LEVIABLE FOR THE REASON DISCUSSED ABOVE. ACCORDINGLY, WE CANCEL THE LEVY OF PENALTY ON TH IS AMOUNT ALSO. 6 . RESULTANTLY , APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE E - COURT ON THIS 4 TH DAY OF JAN . 201 3 . - 201 3 SD/ - SD/ - ( ) ( RAJENDRA ) ( ) ( R.K.G UPTA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 04 / 01 / 201 3 . /PKM , PS COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A) , MUMBAI / NAGPUR . 4. / CIT 5. / DR, ITAT, MUMBAI / NAGPUR . 6. GUARD FILE. //TRUE COPY// / BY ORDER, ( DY./ASSTT. REGISTRAR) / ITAT, MUMBAI