ITO (Ward) 2(1), Panaji V. Shri. Wilson Wilfred Valadres, Goa

ITA 151/PAN/2013

• Counselvise Citation: 15124114 RSA 2013
• Duration Of Justice: 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 27-11-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 27-06-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NISHANT K
• Assessee Lawyers: S R KHOKATE
• Keywords: Unexplained cash credit; Deemed to accrue or arise in india
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PANAJI BENCH, PANAJI BEFORE SHRI P. K. BANSAL, HONBLE ACCOUNTANT MEMBER AND SHRI D.T. GARASIA, HONBLE JUDICIAL MEMBER ITA NO. 151/PNJ/2013 (ASSESSMENT YEAR - 2007 - 08 ) THE INCOME TAX OFFICER , WARD - 1(2), PANAJI, GOA. (APPELLANT) VS. SHRI WILSON WILFRED VALADRES H. NO. 79, GAVANT CARAMBOLIM, TISWADI TALUKA - GOA. PAN: ADJPV2281Q (RESPONDENT) APPELLANT BY : SHRI NISHANT K. DR. RESPONDENT BY : SHRI S.R. KHOKATE, AR DATE OF HEARING : 27/11 /2013 DA TE OF ORDER : 27/1/2014 O R D E R PER: D.T. GARASIA THIS APPEAL HAS BEEN FILED BY THE DEPARTMENT AGAINST THE ORDER OF CIT(A), PANAJI DATED 29.04.2013 F OR THE ASSESSMENT YEAR 2007 - 08 BY RAISING THE FOLLOWING GROUNDS. 1. THE ORDER OF THE HONBLE CIT (A) IS OPPOSED TO LAW AND FACTS OF THE CASE. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ID.CIT(A) ERRED IN NOT CONSIDERING THAT AS PER THE B/S THE ASSESSEE HAS SHOWN BORROWING/ADVANCES TOWARDS ANCESTRAL SHARE IN THE PROPERTY AT RS. 58,87,435. DURING THE COURSE OF ASSESSMENT PROCEEDIN GS, THE ASSESSEE PRODUCED THE DETAILS ONLY TO THE EXTENT OF RS. 9,07,738 AND THE REMAINING AMOUNT OF RS. 49,79,696 WAS ADDED TO THE TOTAL INCOME U/S 68 OF THE IT ACT. THE ASSESSEE IS GOVERNED BY SEC 5A, SO ONLY RS. 2489,848 HAS BEEN BROUGHT TO TAX. 3 . ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN NOT CONSIDERING THAT ASSESSEE DISCLOSED THAT THE INCOME OF RS. 49,79,696 WAS TO BE SHARED WITH THE PARTNERS OF REAL ESTATE. THE INCOME IS THE COMMISSION RECEIVED. HENCE THE AS SESSEE HAS NOT DISCLOSE THE CORRECT AND TRUE INCOME IN THE 2 . ITA NO. 151/PNJ/2013 (A.Y. 2007 - 08 ) ITO VS. SHRI WILSON WILFRED VALADRES RETURN OF INCOME FILED AND HAS CONCEALED THE PARTICULARS OF HIS REAL INCOME, THIS IS A FIT CASE FOR LEVY OF PENALTY U/S 271/(1)(C) OF IT ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS I S CARRYING ON BUSINESS IN REAL ESTATE. DURING THE PRE VIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2007 - 08, THE ASSESS EE HAS SOLD A PROPERTY BEARING SURVEY N O. 97/2, 97/3, SITUATED IN VILLAGE CAVELLOSSIM - SALCETE - GOA. THE ASSESSEE HAS SOLD THE PROPERTY FOR CO NSIDERATION OF 1CRORE 50 LAKHS. AS PER THE UNDERSTANDING BETWEEN ASSESSEE HAS TO PAID A SUM OF RS. 92 LAKHS TO THE LAND OWNERS AND REMAINING AMOUNT OF RS. 58 LAKHS WAS TO BE SHARED WITH THE PEOPLE WHO HELPED THEM TO FINALIZE THE DEAL. THE ASSESSEE WA S REQU IRED TO DIVIDE SUM OF RS. 49,79,696/ - TO FIVE DIFFERENT PERSONS. THE ASSESSEE WAS ASKED TO PRODUCE THE LAND OWNER DURING THE ASSESSMENT PROCEEDINGS. THE ASSESSEE COULD NOT PRODUCE THE PERSONS WHO WERE SHOWN AS LIABILITY, THEREFORE, AO MADE AN ADDITION OF RS . 49,79,696/ - U/ S. 68 OF THE IT ACT. THE MATTER CARRIED TO CIT(A) AND CIT(A) CONFIRMED THE ADDITIONS. THE ASSESSEES APPEAL WAS DISMISSED. THEREFORE, AO HAS ISSUED THE NOTICE U/S. 271 (C) R.W.S 271 AS TO WHY THE PENALTY PROCEEDING SHOULD NOT BE INITIATED I N RESPECT OF ADDITION MADE UNDER UNEXPLAINED CASH CREDIT U/S. 68 OF THE IT ACT AND AO HAS LEVIED THE PENALTY OF RS. 16,73,300/ - U/S. 271(C) OF THE ACT . 4. THE MATTER CARRIED TO CIT(A) AND CIT(A) HAS DELETED THE PENALTY BY OBSERVING AS UNDER: I HAVE GONE THROUGH THE PENALTY ORDER, FACTS OF THE CASE AND ARGUMENTS OF THE LEARNED COUNSEL OF THE APPELLANT. IN THIS CASE, THROUGH THE ADDITION HAS BEEN MADE U/S. 68, IN REALITY, NO CASH WAS CREDITED TO THE ACCOUNT OF THE APPELLANT, WHICH COULD NOT BE EXPLAINED BY THE APPELLANT. IT WAS AN ADDITION ON NOTIONAL BASIS, WHEREIN THE ASSESSEE WAS NOT ABLE TO PROVE THE EXISTENCE OF LIABILITY BEYOND DOUBT. THUS, THE ADDITION AMOUNTS TO TAXING DEEMED INCOME AND LEVY OF PENALTY ON DEEMED INCOME IS DEFINITELY HARSH IN MY OPIN ION. AT THE SAME TIME, NOT BEING ABLE TO PROVE LIABILITY DOES NOT MEAN FURNISHING OF INACCURATE PARTICULARS OR CONCEALING PARTICULARS OF INCOME. IN VIEW OF THE ABOVE FACTS, THE AO IS DIRECTED TO DELETE THE PENALTY LEVIED U/S. 271(1)(C) OF THE ACT. 3 . ITA NO. 151/PNJ/2013 (A.Y. 2007 - 08 ) ITO VS. SHRI WILSON WILFRED VALADRES 5. TH E LEARNED DR SUBMITTED BEFORE US THAT ASSESSEE HAS SHOWN IN HIS BALANCE SHEET T HE LIABILITY OF RS. 58 LAKHS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE WAS NOT ABLE TO PRODUCE THE ABOVE PERSONS BEFORE THE AO. THEREFORE, PENALTY HAS BEEN RIGHTL Y IMPOSED AND CIT(A) IS NOT JUSTIF IED IN DELETING THE PENALTY. 6. ON THE OTHER HAND, LEARNED AR RELIED UPON THE ORDER OF THE CIT(A). 7. WE HAVE HEARD THE RIVAL CONTENTION OF BOTH THE PARTIES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT CIT(A) HAS GONE THROUGH THE FACTS OF THE CASE AND HE HAS DELETED THE PENALTY. DURING THE COURSE OF HEARING LEARNED DR COULD NOT PRODUCE ANY EVIDENCE CONTRARY TO THE FIND ING OF THE CIT(A). THEREFORE, WE ENDORSE THE ACTION OF CIT(A) AND WE DISMISS THE DEPARTMENTS APPEAL. 7. IN THE RESULT, THE APPEAL FILED BY TH E D EPARTMENT IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 27. 1. 2014 . SD/ - SD/ - ( P.K. BANSAL) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE : PANAJI / GOA DATED : 27.1 . 2014 P.S. - *PK* COPY TO : ( 1 ) APPELLANT ( 2 ) RESPONDENT ( 3 ) CIT CONCERNED ( 4 ) CIT(A) CONCERNED ( 5 ) D.R ( 6 ) GUARD FILE TRUE COPY, BY ORDER PRIVATE SECRETARY, ITAT, PANAJI, GOA 4 . ITA NO. 151/PNJ/2013 (A.Y. 2007 - 08 ) ITO VS. SHRI WILSON WILFRED VALADRES