Bama Selvamani, Ariyalur V. ITO, Trichy

ITA 1342/CHNY/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96457 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2015
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 01-09-2015
• Assessment Year: 2000-2001
• Appeal Filed On: 01-06-2015
• Court: TRIBUNAL
• Department Lawyers: P RADHAKRISHNAN
• Assessee Lawyers: G BASKAR

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI . . . , ! ' , # $% & [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER ] ./ I.T.A.NO.1342/MDS/2015 / ASSESSMENT YEAR : 2000-01 SMT. BAMA SELVAMANI MAIN ROAD, ANDIMADAM ARIYALUR DT. 621 801 VS. THE INCOME TAX OFFICER WARD IV(2) TRICHY [PAN AJSPB 2936 R ] ( '( / APPELLANT) ( )*'( /RESPONDENT) / APPELLANT BY : SHRI G. BASKAR, ADVOCATE /RESPONDENT BY : SHRI P. RADHAKRISHNAN, JCIT / DATE OF HEARING : 01 - 09 - 2 015 / DATE OF PRONOUNCEMENT : 20 - 1 1 - 2015 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, TIRUCH IRAPALLI, DATED 4.3.2015 AND PERTAINS TO ASSESSMENT YEAR 2000-01. 2. SHRI G. BASKAR, LD. COUNSEL FOR THE ASSESSEE SUBMIT TED THAT DURING THE YEAR UNDER CONSIDERATION THE ASSESSEE H AS INCURRED AN EXPENDITURE OF ` 5,40,000/- TOWARDS CONSTRUCTION OF A KALYANAMANDAPAM. THE TOTAL EXPENDITURE FOR CONSTRU CTION OF ITA NO.1342/15 :- 2 -: KALYANAMANDAPAM WAS ` 25,40,000/-. IN THE CASH FLOW STATEMENT, THE ASSESSEE SHOWN THE EXPENDITURE AT ` 20 LAKHS, THEREFORE, THE ASSESSING OFFICER FOUND THAT THERE WAS AN INCREASE IN THE INVESTMENT WITH REGARD TO KALYANAMANDAPAM AND THE ASSESSEE WA S ASKED TO PRODUCE THE BILLS, VOUCHERS ETC. FOR MAKING THE INV ESTMENT. THE ASSESSING OFFICER FOUND THAT THERE WAS NO SUPPORTIN G VOUCHERS FOR THE EXPENDITURE INCURRED IN RELATION TO ` 5,40,000/-, THEREFORE, HE FOUND THAT THERE WAS CONCEALMENT OF INCOME. ACCORDING TO THE LD. COUNSEL, PENALTY U/S 271(1)(C) OF THE ACT COULD BE IMPOSED ONLY IN CASE THE ASSESSING OFFICER IS SATISFIED THAT THE ASSESSEE H AS CONCEALED ANY PART OF HER INCOME OR FURNISHED INACCURATE PARTICULARS O F SUCH INCOME. IN THIS CASE, ACCORDING TO THE LD. COUNSEL, THE ASSES SEE HAS NOT CONCEALED ANY PARTICULARS OF HER INCOME OR FURNISH ED ANY INACCURATE PARTICULARS OF INCOME. THE ASSESSEE HAS SHOWN IN THE STATEMENT OF AFFAIRS THAT THE COST OF CONSTRUCTION WAS ` 25,40,000/-. THE CASH FLOW STATEMENT INDICATES THE EXPENDITURE AT ` 20 LAKHS. THIS DIFFERENCE CANNOT BE CONSTRUED AS FURNISHED INACCURATE PARTICU LARS. ACCORDING TO THE LD. COUNSEL, THE STATEMENT OF AFFAIRS AND THE C ASH FLOW STATEMENT WERE FURNISHED BY THE ASSESSEE BEFORE THE ASSESSIN G OFFICER. IF THE ASSESSEE INTENDED TO CONCEAL ANY PART OF THE INCOME , THE STATEMENT OF AFFAIRS FOR THE YEAR UNDER CONSIDERATION WHICH INDI CATES THE EXPENDITURE OF ` 25,40,000/- WOULD NOT HAVE BEEN FILED BEFORE THE ITA NO.1342/15 :- 3 -: ASSESSING OFFICER. IN SUCH A CASE, THERE MAY BE A CONCEALMENT OF INVESTMENT MADE BY THE ASSESSEE. BUT THE FACT REM AINS THAT ACCORDING TO THE LD. COUNSEL, THE ASSESSEE HAS FUR NISHED THE STATEMENT OF AFFAIRS AND THE CASH FLOW STATEMENT BE FORE THE ASSESSING OFFICER, THEREFORE, NEITHER THE INCOME OF THE ASSE SSEE WAS CONCEALED NOR THE ASSESSEE HAS FURNISHED ANY INACCURATE PART ICULARS. THEREFORE, THE ASSESSING OFFICER IS NOT JUSTIFIED IN LEVYING P ENALTY U/S 271(1)(C) OF THE ACT. 3. REFERRING TO PAGE 2 OF THE PAPER BOOK, THE LD. COUN SEL POINTED OUT THAT IN THE STATEMENT OF AFFAIRS AS ON 31.3.2000, THE ASSESSEE HAS SHOWN THE EXPENDITURE AT ` 25,40,000/- UNDER THE HEAD KALYANAMANDAPAM UNDER CONSTRUCTION. IN THE CASH FLOW STATEMENT, THE ASSESSEE HAS SHOWN ` 5,40,000/-. THE LD. COUNSEL FURTHER SUBMITTED THAT THE DIFFERENCE BETWEEN THE AMOUNTS D ISCLOSED IN THE STATEMENT OF AFFAIRS AND THE CASH FLOW STATEMENT I S LESS THAN 15%. THEREFORE, THIS WOULD NOT AMOUNT TO FURNISHING ANY INACCURATE PARTICULARS OF INCOME MERELY BECAUSE THE ASSESSEE COULD NOT PRODUCE VOUCHERS DUE TO PAUCITY OF TIME. 4. ON THE CONTRARY, SHRI P. RADHAKRISHNAN, LD. DEPARTM ENTAL REPRESENTATIVE SUBMITTED THAT THE IN THE CASH FLOW STATEMENT, THE ASSESSEE HAS SHOWN THE COST OF CONSTRUCTION AT ` 20 LAKHS. HOWEVER, ITA NO.1342/15 :- 4 -: IN THE STATEMENT OF AFFAIRS, IT WAS SHOWN AS ` 25,40,000/-. WHEN THE ASSESSING OFFICER CALLED FOR THE ASSESSEE TO EXPLA IN THE DIFFERENCE, THE ASSESSEE, IN FACT EXPRESSED HER INABILITY TO PRODUC E THE BILLS AND VOUCHERS AND OTHER DETAILS. IN FACT, THE ASSESSEE ACCEPTED THE ADDITION MADE BY THE ASSESSING OFFICER TO THE EXTEN T OF ` 5,40,000/-. THEREFORE, ACCORDING TO THE LD. DR, THE ASSESSEE H AS FURNISHED INACCURATE PARTICULARS WITH REGARD TO COST OF CONST RUCTION, THEREFORE, THE ASSESSING OFFICER HAS RIGHTLY LEVIED PENALTY U /S 271(1)(C) OF THE ACT. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. UN DER SEC. 271(1)(C) OF THE ACT, THE ASSESSING OFFICER IS EMPOWERED TO L EVY PENALTY IN CASE THE ASSESSEE HAS FURNISHED ANY INACCURATE PARTICUL ARS OF HER INCOME OR CONCEALED ANY PART OF THE INCOME. IT IS AN ADMITT ED FACT THAT THE STATEMENT OF AFFAIRS AS WELL AS THE CASH FLOW STATE MENT WERE FILED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER. THE DI FFERENCE BETWEEN THE CASH FLOW STATEMENT AND THE STATEMENT OF AFFAIR S COULD NOT BE SUBSTANTIATED BY THE ASSESSEE BY PRODUCING NECESSA RY BILLS AND VOUCHERS. THE ASSESSEE BY LETTER DATED 29.12.2008 ACCEPTED THE ADDITION WITH REGARD TO COST OF CONSTRUCTION TO THE EXTENT OF ` 5,40,000/- DUE TO HER INABILITY TO PRODUCE THE BILL S AND VOUCHERS FOR CONSTRUCTION DUE TO PAUCITY OF TIME. THE QUESTION ARISES FOR ITA NO.1342/15 :- 5 -: CONSIDERATION IS WHEN THE ASSESSEE HAS FURNISHED T HE STATEMENT OF AFFAIRS AND THE CASH FLOW STATEMENT AND THE ASSESSI NG OFFICER FOUND THE DIFFERENCE BETWEEN THE CASH FLOW STATEMENT AND THE STATEMENT OF AFFAIRS FURNISHED BY THE ASSESSEE, CAN WE SAY THAT THERE WAS CONCEALMENT OF INCOME OR THE ASSESSEE HAS FURNISHE D INACCURATE PARTICULARS OF INCOME. THIS TRIBUNAL IS OF THE CO NSIDERED OPINION THAT THE ASSESSEE HAS FURNISHED ALL THE DETAILS INCLUDI NG THE STATEMENT OF AFFAIRS AND THE CASH FLOW STATEMENT AND THE ASSESSI NG OFFICER HAS TAKEN THE DIFFERENCE IN FIGURE ONLY FROM THE STATEM ENT OF AFFAIRS AND THE CASH FLOW STATEMENT, THIS CANNOT BE CONSTRUED A S CONCEALING ANY PART OF THE INCOME OR FURNISHING ANY INACCURATE PAR TICULARS OF INCOME. THE APEX COURT IN THE CASE OF CIT VS RELIANCE PETRO PRODCTS PVT. LTD. [2010] 322 ITR 158, HAD AN OCCASION TO CONSIDER AN IDENTICAL ISSUE. THE APEX COURT HELD THAT MERELY BECAUSE THE ASSESS EE COULD NOT SUBSTANTIATE THE CLAIM MADE BEFORE THE ASSESSING OF FICER IN THE ASSESSMENT PROCEEDINGS, THAT DOES NOT RESULT IN LEV Y OF PENALTY U/S 271(1)(C) OF THE ACT. IN THIS CASE, THE DIFFERENCE HAS OCCURRED IN THE CASH FLOW STATEMENT AND THE STATEMENT OF AFFAIRS AN D BOTH THE STATEMENTS ARE AVAILABLE BEFORE THE ASSESSING OFFIC ER, THEREFORE, AT ANY STRETCH OF IMAGINATION, THIS COULD NOT BE CONSTRUED AS CONCEALING OF ANY PART OF INCOME INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME BY THE ASSESSEE. THEREFORE, THIS TRIBUNAL IS UNABLE TO UPHOLD ITA NO.1342/15 :- 6 -: THE ORDERS OF THE LOWER AUTHORITIES AND ACCORDINGLY , THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT IS DELETED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 20 TH NOVEMBER, 2015, AT CHENNAI. SD/- SD/- ( ! ' ) (CHANDRA POOJARI) # / ACCOUNTANT MEMBER ( . . . ! ) (N.R.S. GANESAN) / JUDICIAL MEMBER '# / CHENNAI $% / DATED: 20 TH NOVEMBER, 2015 RD %&'' ()'*) / COPY TO: ' 1 . / APPELLANT 4. ' + / CIT 2. / RESPONDENT 5. ),-' . / DR 3. ' +'/! / CIT(A) 6. -0'1 / GF