M/s. Fong Moy Teng, Hyderabad V. The ITO, Ward - 6(3), Hyderabad

ITA 1387/HYD/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9950 (ITAT-HYDERABAD)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 1998-1999
• Appeal Filed On: 04-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIVEDITA BISWAS
• Assessee Lawyers: T CHAITANYA KUMAR
• Keywords: Gift

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A', HYDERABAD BEFORE SHRI G.C.GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER ITA NO.1387/HYD/10 : ASSTT . YEAR 1998-99 MS. FONG MOY TONG, HYDERABAD ( PAN ABAPT 1128 P ) V/S. INCOME-TAX OFFICER, WARD 6(3), HYDERABAD. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI T. CHAITANYA KUMAR RESPONDENT BY : SMT. NIVEDITA BISWAS CIT-DR O R D E R PER G.C.GUPTA, VICE PRESIDENT: THIS APPEAL BY THE ASSESSEE FOR THE ASSESSMENT YEAR 1998- 99 IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME -TAX(APPEALS). 2. GROUNDS OF APPEAL OF THE ASSESSEE ARE AS UNDER- '1. THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APP EALS) IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2. THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS) ER RED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN L EVYING PENALTY U/S. 271(1)(C) OF THE I.T. ACT OF RS.1,02,128 DESPI TE THE FACT THAT 5THE APPELLANT PRODUCED EVIDENCE. THE LEARNED COMMISSIONER OF INCOME-TAX(APPEALS) OUGHT TO HAVE CONSIDERED RELATIONSHIP OF THE APPELLANT WITH THE D ONORS AND THE SOURCE OF GIFT MENTIONED IN THE AFFIDAVITS.' 3. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT T HE ASSESSEE HAS PRODUCED THE EVIDENCE IN SUPPORT OF THE SOURCE OF GIFTS RECEIVED BY HER FROM HER SISTER AND THE SAME HAS BEEN IG NORED BY THE ITA NO.1387./HYD/1 0 MS. FONG MOY TONG, HYDERABAD 2 CIT(A), WHILE CONFIRMING THE PENALTY UNDER S.271(1)( C) OF THE ACT ON THE ASSESSEE. THE ASSESSEE HAS ALSO FURNISHED AFFIDAVITS TO EXPL AIN THE SOURCES OF THE OPENING BALANCE OF CASH. THE LEARNED CIT-DEPART MENTAL REPRESENTATIVE HAS RELIED ON THE ORDERS OF THE ASSESSIN G OFFICER AND THE CIT(A). 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. THE ONLY DISPUTE IN THIS APPEAL OF THE ASSESSEE IS REGARDING VALIDITY OF PENA LTY IMPOSED UNDER S.271(1)(C) OF THE ACT AMOUNTING TO RS.1,02,128 ON THE ASSESSEE. THE PENALTY WAS IMPOSED ON ACCOUNT OF REJECTION OF THE EXP LANATION OF THE ASSESSEE REGARDING THE OPENING BALANCE OF THE ASSESSEE AND T HE AMOUNT OF RS.1 LAKH REPRESENTING GIFTS CLAIMED TO HAVE BEEN RECEI VED BY THE ASSESSEE DURING THE YEAR. WE FIND THAT THE ASSESSEE HAS FILED EV IDENCE IN SUPPORT OF THE GIFTS MADE BY THE SISTER OF THE ASSESSEE. THE ASSESSEE HA S ALSO FILED AFFIDAVITS TO EXPLAIN THE SOURCES FOR THE OPENING BALA NCE OF CASH. WE FIND THAT MERELY BECAUSE THE ASSESSEE'S EXPLANATION REGARDING SOURCE OF OPENING BALANCE AND THE GIFT OF RS.1 LAKH CLAIMED TO HAVE BEEN RECEIVED BY THE ASSESSEE WAS REJECTED BY THE DEPARTMENT, IT COULD NOT BE SAID THAT THE ASSESSEE IS GUILTY OF CONCEALMENT OF INCOME OR FILING OF IN ACCURATE PARTICULARS OF INCOME. THE ASSESSEE HAS FURNISHED ALL MATERIAL FACTS RE GARDING ITS ASSESSMENT BEFORE THE ASSESSING OFFICER AND HAS ALSO FILED THE EXPLANATION REGARDING THE SOURCE OF OPENING BALANCE AS WELL AS THE GIFT CLAIMED TO HAVE BEEN RECEIVED BY HER. THERE IS NO MATERIAL ON RECORD TO SUGGEST THAT THE EXPLANATION OF THE ASSESSEE WAS NOT BONA FIDE OR THE EXPLANATION OF THE ASSESSEE WAS WITHOUT ANY BASIS OR FOUNDATION. THE FACTS OF T HE CASE MAY JUSTIFY THE ADDITION MADE BY THE DEPARTMENT TO BE SUS TAINED, BUT DOES NOT JUSTIFY THE PENALTY UNDER S.271(1)(C) OF THE ACT. RAT IO OF THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF T. ASHOK PAI 292 ITR 11(SC) APPLIES TO THE FACTS OF THE PRESENT CASE OF THE ASSESSEE IN THESE FA CTS OF THE CASE, WE ITA NO.1387./HYD/1 0 MS. FONG MOY TONG, HYDERABAD 3 ARE OF THE CONSIDERED VIEW THAT IT IS NOT A FIT CASE FOR IMPOSITION OF PENALTY UNDER S.271(1)(C) OF THE ACT ON THE ASSESSEE, WHICH IS ACCORD INGLY CANCELLED AND THE GROUNDS OF APPEAL OF THE ASSESSEE ARE ALLOWED. 5. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 7.1.2011 SD/- SD/- (CHANDRA POOJARI) (G.C.GUPTA) ACCOUNTANT MEMBER VICE PRESIDENT DT/- 7TH JANUARY, 2011 COPY FORWARDED TO: 1. MS. FONG MOY TONG, C/O. SHRI S.RAMA RAO, ADVOCATE, 102 SHRIYA'S ELEGANCE, DOOR NO.3-6-643, STREET NO.9, HIMAYATNAGAR, HYDERABAD. 2. INCOME TAX OFFICER, WARD-6(3), HYDERABAD 3. COMMISSIONER OF INCOME-TAX(APPEALS)-IV, HYDERABAD. 4. COMMISSIONER OF INCOME-TAX III, HYDERABAD 5. THE DEPARTMENTAL REPRESENTATIVE, ITAT, HYDERABAD. B.V.S