Sh. Anil Kumar Maheshwari, Aligarh V. I.T.O., Ward-1(4), Aligarh

ITA 14/AGR/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2111 (ITAT-AGRA)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 02-05-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 09-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KK MISHRA

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 NO.14/AGRA/2013 ASSESSMENT YEAR: 2004-05 SHRI ANIL KUMAR MAHESHWARI, VS. COMMISSIONER OF INCOME TAX, PROP. ANIL BRICK FIELD, ALIGARH. JALALI MORE, ALIGARH. (PAN : AEFPG 0019 N). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI PANKAJ GARGH, ADVOCATE RESPONDENT BY : SHRI K.K. MISHRA, JR. D.R. DATE OF HEARING : 02.05.2013 DATE OF PRONOUNCEMENT : 10.05.2013 ORDER PER A.L. GEHLOT, ACCOUNTANT MEMBER: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER DATED 16.10.2012 PASSED BY THE LD. CIT(A), MUZAFFARNAGAR FOR THE ASS ESSMENT YEAR 2004-05. 2. THE GROUND RAISED IN THE APPEAL IS IN RESPECT OF LEVY OF PENALTY OF RS.1,75,000/- UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER). 2 ITA NO.14/AGRA/2013 A.Y. 2004-05 3. THE BRIEF FACTS OF THE CASE ARE THAT ORIGINALLY THE A.O. MADE ADDITION OF TWO ITEMS, RS.1,79,878/- AND RS.3,50,000/- AS UNEXPLAIN ED CASH INTRODUCTION. THE I.T.A.T. IN ITA NO.227/AGR/2009 VIDE ORDER DATED 17 TH SEPTEMBER, 2010 DELETED THE ADDITION OF RS.1,79,878/-. HOWEVER, OUT OF THE ADDITION OF RS.3,50,000/-, THE I.T.A.T. SUSTAINED THE ADDITION TO THE EXTENT OF RS .1,75,000/-. THE ADDITION OF RS.3,50,000/- WAS MADE BY THE A.O. AS THE ASSESSEE HAS CONTRIBUTED BY WAY OF CAPITAL IN HIS PROPERTY FIRM M/S. ANIL BRICKS MILLS . IT WAS EXPLAINED BEFORE THE A.O. THAT THE SAID AMOUNT WAS DEPOSITED OUT OF THE AMOUNT WITHDRAWN FROM M/S. ANIL KUMAR MAHESHWARI, HUF. IT WAS SUBMITTED THAT M/S. ANIL KUMAR MAHESHWARI., HUF WAS CARRYING ON THE BRICK KILN BUS INESS FROM 1999-2000. THE A.O. WAS NOT SATISFIED WITH THE EXPLANATION OF THE ASSESSEE. THEREFORE, ADDITION OF RS.3,50,000/- WAS MADE. 4. THE I.T.A.T WHILE DECIDING ISSUE RELATED TO ADDI TIONS OF RS.3,50,000/- OBSERVED THAT THE EXPLANATION SUBMITTED BY THE ASSE SSEE IS NOT PLAUSIBLE ONE. THE I.T.A.T. AGREED WITH THE SUBMISSION OF THE LD. DEPA RTMENTAL REPRESENTATIVE THAT IN A RUNNING BUSINESS NOBODY WILL BELIEVE THAT THE ASS ESSEE HAS LIQUIDATED ALL THE ADVANCES. HOWEVER, THE I.T.A.T. WAS OF THE VIEW TH AT AT THE MOST THE ASSESSEE COULD HAVE TAKEN A SUM OF RS.1,75,000/- FROM THE HU F I.E. RS.1,25,000/-, RETURN OF ADVANCE AND RS.50,000/- OUT OF INCOME GENERATED DUR ING THE YEAR. ACCORDINGLY 3 ITA NO.14/AGRA/2013 A.Y. 2004-05 ADDITION TO THE EXTENT OF RS.1,75,000/- SUSTAINED A ND THE BALANCE ADDITION OF RS.1,75,000/- WAS DELETED. THE A.O. LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT ON BOTH THE ADDITIONS OF RS.1,79,878/- AND RS.3 ,50,000/- ON THE GROUND THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF IN COME. 5. THE CIT(A) DIRECTED THE A.O. TO RESTRICT THE PEN ALTY AMOUNT TO THE EXTENT OF RS.1,75,000/-. THE RELEVANT FINDING OF THE CIT(A) IS REPRODUCED AS UNDER :- (PAGE NO.8) ON THE BASIS OF ALL THE ABOVE CASE LAWS, WHICH INC LUDE THE DECISION OF THE JURISDICTIONAL HIGH COURT ALSO, I H OLD THAT IN A CASE SOURCE OF FRESH CAPITAL INTRODUCED HELD TO BE UNEXP LAINED/BOGUS, BURDEN IS ON THE ASSESSEE TO PROVE THAT THERE WAS N O CONCEALMENT OF INCOME OR OF TRUE PARTICULARS. IN MY FIRM VIEW, TH E ANGLE OF CONCEALMENT IS MORE THAN ESTABLISHED, AND, THEREFOR E, THE PENALTY IMPOSED U/S 271(1)(C) OF THE ACT IS UPHELD IN PRINC IPLE. WITHOUT PREJUDICE TO THE ABOVE, ADMITTEDLY THE ADDITIONS OF RS.1,79,878/- AND RS.1,75,000/- HAVE BEEN DELETED BY THE HONBLE ITAT , AGRA. THEREFORE, THERE IS NO BASIS FOR IMPOSING PENALTY O N THE IMPUGNED SUMS. THE A.O. IS DIRECTED TO EXCLUDE THE AMOUNT T OTALING TO RS.3,54,878/- (RS.1,79,878 + RS.1,75,000) FOR QUANT IFYING PENALTY U/S 271(1)(C) OF THE ACT. REGARDING THE OTHER ADDITION OF RS.1,75,000/- SUSTAINED BY THE HONBLE ITAT, AGRA, THE AO IS DIRE CTED TO QUANTIFY THE SAME FOR IMPOSITION OF PENALTY U/S 271(1)(C) OF THE ACT AND IMPOSE PENALTY @ 100% ONLY. THE AO IS DIRECTED TO GIVE CO NSEQUENTIAL EFFECT TO THIS ORDER. GROUNDS OF APPEAL NOS.4 TO 9 ARE PA RTLY ALLOWED. 6. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT PENALTY UNDER SECTION 271(1)(C) IS NOT LEVIABLE IN THE CASE UNDER CONSIDE RATION AS THE ADDITION OF 4 ITA NO.14/AGRA/2013 A.Y. 2004-05 RS.1,75,000/- CONFIRMED BY THE I.T.A.T. WAS ON ESTI MATION BASIS. HE FURTHER SUBMITTED THAT WHATEVER EXPENSES FURNISHED BY THE A SSESSEE WAS NOT FOUND FALSE BY THE A.O. THE LD. AUTHORISED REPRESENTATIVE IN SUPP ORT OF HIS CONTENTION RELIED UPON THE FOLLOWING DECISIONS:- I) SHREE NIRMAL COMMERCIAL LIMITED VS. CIT, 218 CTR (BOM) 581 II) CIT VS. V. RAMASWAMY NAIDU, 208 ITR 377 (MAD) III) CIT VS. JALARAM OIL MILLS, 253 ITR 192 (GUJ) IV) CIT VS. DHARAMCHAND L. SHAH, 204 ITR 462 (BOM) V) ORDER OF I.T.A.T., CHENNAI BENCH IN THE CASE OF A. RAJENDRAN & ORS. VS. ACIT, 47 DTR (CHENNAI)(TRIB) 178 7. THE LD. DEPARTMENTAL REPRESENTATIVE, ON THE OTHE R HAND, RELIED UPON THE ORDER OF CIT(A). 8. WE HAVE HEARD THE LD. LD. REPRESENTATIVES OF THE PARTIES AND RECORDS PERUSED. ADMITTED FACTS OF THE CASE ARE THAT THE A.O. MADE A DDITION OF RS.3,50,000/-. THE ASSESSEE FURNISHED NECESSARY EXPLANATION BUT THE I. T.A.T. HAS FOUND REASONABLE EXPLANATION TO THE EXTENT OF RS.1,75,000/-. IN OTH ER WORDS, THE I.T.A.T. SUSTAINED THE ADDITION ON THE BASIS OF ESTIMATION. IN THE CA SE OF ESTIMATION, IT CANNOT BE SAID THAT THE ASSESSEE HAS CONCEALED PARTICULARS OR FURN ISHED INACCURATE PARTICULARS OF INCOME. ALSO, IT CANNOT BE SAID THAT THE EXPLANATI ON FURNISHED BY THE ASSESSEE WAS FOUND FALSE. UNDER THE FACTS AND CIRCUMSTANCES, WE ARE OF THE VIEW THAT IT IS NOT A 5 ITA NO.14/AGRA/2013 A.Y. 2004-05 FIT CASE FOR PENALTY UNDER SECTION 271(1)(C) OF THE ACT. WE, THEREFORE, SET ASIDE THE ORDERS OF REVENUE AUTHORITIES AND CANCEL THE PENALT Y OF RS.1,75,000/-. 9. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS A LLOWED. (ORDER PRONOUNCED IN THE OPEN COURT) SD/- SD/- (BHAVNESH SAINI) (A.L. GEHLOT) JUDICIAL MEMBER ACCOUNTANT MEMBER PBN/* COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT (APPEALS) CONCERNED 4. CIT CONCERNED 5. D.R., ITAT, AGRA BENCH, AGRA 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY INCOME-TAX APPELLATE TRIBUNAL, AGRA TRUE COPY