Srinivasa Chary Mandalozu, Hyderabad, Hyderabad V. ITO, Ward-9(3), Hyderabad, Hyderabad

ITA 1522/HYD/2016

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3254 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB-A
• Next Hearing Date: 13-11-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 11-11-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Set aside
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES SMC, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER ITA NO. A.Y. APPELLANT RESPONDENT 1522/HYD/16 2010-11 SRI M.SRINIVASA CHARY, HYDERABAD [PAN: AKJPM2144C] INCOME TAX OFFICER, WARD-9(3), HYDERABAD 1523/HYD/16 FOR ASSESSEE : SHRI A.SRINIVAS, AR FOR REVENUE : SHRI SUNKU SRINIVAS, DR DATE OF HEARING : 13-11-2019 DATE OF PRONOUNCEMENT : 15-11-2019 O R D E R BOTH ARE ASSESSEES APPEALS FOR THE AY.2010-11, AGAIN ST THE ASSESSMENT ORDER U/S.143(3) AND PENALTY ORDER U/S . 271(1)(C) OF THE INCOME TAX ACT [ACT]. 2. BRIEF FACTS OF THE CASE ARE THAT, THE ASSESSEE IS A P ARTNER IN M/S.SRI SAI ENGINEERINGS AND FILED HIS RETURN OF INCOME FOR THE AY.2010-11 ON 30-03-2012, DECLARING TOTAL INCOME O F RS.1,94,590/-. 3. DURING THE ASSESSMENT PROCEEDINGS U/S.143(3) OF TH E ACT, THE ASSESSING OFFICER (AO) OBSERVED THAT THE ASSESS EE HAS MADE CASH DEPOSITS TO THE EXTENT OF RS.13,72,000/- IN H IS SB A/C WITH INDIAN OVERSEAS BANK. WHEN THE ASSESSEE WA S ASKED TO EXPLAIN THE SOURCES FOR THE CASH DEPOSITS, HE HAD SU BMITTED THAT HE HAD WITHDRAWN THE CASH THROUGH SELF AND BEARER CHEQUES TO THE EXTENT OF RS.16 LAKHS AND THE SAME WAS RE-DEPOSITED INTO HIS BANK ACCOUNT ON DIFFERENT DATES. F URTHER, ITA NOS. 1522/HYD/2016 1523/HYD/2016 :- 2 -: THE ASSESSEE HAD SUBMITTED THAT HE HAS RECEIVED RS.5 L AKHS IN CASH FROM SHRI K.GOVERDHAN FOR SALE OF HIS AGRICULT URE LANDS SITUATED AT SARVIN VILLAGE, NARAYANAPUR MANDAL, NALGO NDA DIST. THE AO, HOWEVER, WAS NOT CONVINCED WITH THE ASS ESSEES CONTENTIONS AND TREATED THE SUM OF RS.13,72,000/- AS ASSESSEES INCOME AND BROUGHT IT TO TAX AS UN-EXPLAI NED INVESTMENT U/S.69 OF THE ACT. THEREAFTER, HE ALSO INITI ATED PENALTY PROCEEDINGS U/S.271(1)(C) OF THE ACT. AGGRIEVED, THE ASSESSEE FILED AN APPEAL BEFORE THE CI T(A), WHO GRANTED PARTIAL RELIEF BY ACCEPTING THE SOURCES TO TH E EXTENT OF RS.5 LAKHS, AGAINST WHICH, THE ASSESSEE IS NO W IN APPEAL BEFORE THE TRIBUNAL, BY RAISING THE FOLLOWING GROUNDS: 1. THE APPELLATE COMMISSIONER OUGHT NOT TO HAVE CO NFIRMED AN AMOUNT OF RS.5,00,000/- U/S.69 OF THE I.T ACT WHEN THE TOTAL SOURCES HAVE BEEN EXPLAINED AND THE BOOKS SUBJECTED TO AUDI T. 2. THE APPELLATE COMMISSIONER OUGHT NOT TO HAVE CON FIRMED THE DISALLOWANCE OF THE DEDUCTION CLAIMED UNDER CHAPTER VIA AMOUNT INTO RS.69,320/-. 3. ANY OTHER GROUNDS WHICH THE APPELLANT MAY URGE E ITHER AT OR BEFORE THE DATE OF HEARING. 4. LD.COUNSEL FOR THE ASSESSEE SUPPORTED THE ORDER OF THE CIT(A), WHILE THE LD.DR RELIED ON THE ORDER OF THE AO . 5. HAVING REGARD TO THE RIVAL CONTENTIONS, I FIND THAT ASSESSEE HAS NOT BEEN ABLE TO SUBSTANTIATE THE CLAIM OF RECEIPT OF RS.5 LAKHS ON SALE OF LAND WITH ANY EVIDENCE. TH EREFORE, THE CIT(A) HAS CONFIRMED THE ADDITION AND EVEN BEFORE THE TRIBUNAL, THE ASSESSEE HAS NOT FILED ANY EVIDENCE. T HEREFORE, I DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF LD .CIT(A). HENCE, THE GROUNDS RAISED BY ASSESSEE IN THIS REGARD ARE ITA NOS. 1522/HYD/2016 1523/HYD/2016 :- 3 -: REJECTED AND THE APPEAL IN ITA NO.1522/HYD/2016 IS DISMISSED. 6. AS REGARDS THE PENALTY PROCEEDINGS U/S.271(1)(C) IN ITA NO.1523/HYD/2016 ARE CONCERNED, THE AO HAD LEVIED TH E PENALTY ON THE ENTIRE ADDITION OF RS.13,72,000/- AND ON APPEAL, THE LD.CIT(A) PARTLY ALLOWED THE APPEAL SINCE HE HAD DELETED PART OF THE ADDITION IN THE APPEAL AGAINST THE ASSESSMENT ORDER. AGAINST THIS ORDER OF THE LD.CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL, BY RAISIN G THE FOLLOWING GROUNDS: 1. THE APPELLATE COMMISSIONER OUGHT NOT TO HAVE SU STAINED THE LEVY OF THE PENALTY IN THE SAME PROPORTION AS THE RELIEF GIVEN IN THE QUANTUM APPEAL. 2. THE APPELLATE COMMISSIONER OUGHT NOT TO HAVE SUS TAINED THE PENALTY BASED ON THE RELIEF GIVEN. 3. ANY OTHER GROUNDS WHICH THE APPELLANT MAY URGE E ITHER AT OR BEFORE THE DATE OF HEARING. 6.1. FURTHER, THE ASSESSEE HAD ALSO FILED THE FOLLOWIN G ADDITIONAL GROUNDS: 1. THE LEVY OF PENALTY U/S.271(1)(C), IS BAD IN LA W AND LIABLE TO BE QUASHED AS THE ASSESSING OFFICER OMITTED TO EXPLICI TLY MENTION WHETHER THE PENALTY PROCEEDINGS ARE BEING INITIATED FOR FURNISHING OF INACCURATE PARTICULARS OR THAT FOR CONCEALMENT OF I NCOME. 2. ANY OTHER GROUND WHICH THE APPELLANT MIGHT URGE EITHER BEFORE OR AT THE TIME OF HEARING 7. LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE HON'BL E HIGH COURTS AND THE HON'BLE SUPREME COURT IN A NUMBE R OF CASES HAVE HELD THAT IF THE PENALTY NOTICES ARE NOT CORRECTLY ISSUED BY EXPLICITLY MENTIONING THE REASON FOR INIT IATING THE ITA NOS. 1522/HYD/2016 1523/HYD/2016 :- 4 -: PENALTY PROCEEDINGS, THEN THE PENALTY ORDER PASSED ON SUCH PENALTY NOTICE IS NOT VALID . THUS, HE SUBMITTED THAT THE LEGAL QUESTION AS RAISED IN ADDITIONAL GROUNDS SHOULD BE A DMITTED AND ADJUDICATED. 8. LD.DR OPPOSED THE ADMISSION OF THE ADDITIONAL GROUN D. HOWEVER, I AM OF THE OPINION THAT THIS IS A LEGAL GR OUND, WHICH CAN BE RAISED AT ANY POINT OF TIME AND THE RELEVANT NOTIC E IS ALSO ON RECORD. THEREFORE, I AM INCLINED TO ADMIT THE SAME. FURTHER, I ALSO FIND FROM THE COPY OF THE NOTICE ISSUED U/S.271(1)(C) OF THE ACT, THAT THE AO HAS NOT STRUCK-OFF TH E INAPPROPRIATE PORTION OF THE NOTICE ISSUED U/S.271(1)(C ) OF THE ACT AND THEREFORE, IT IS NOT CLEAR IF THE PENALTY IS INI TIATED FOR FURNISHING OF INACCURATE PARTICULARS OR CONCEALMENT OF INCOME OR FOR BOTH. THIS ISSUE IS COVERED IN FAVOUR OF ASS ESSEE BY THE DECISIONS OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF PR.CIT VS. BAISETTY REVATHI, PRONOUNCED ON 13 TH JULY, 2017 AND ALSO THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. M/S.SSAS EMERALD MEADOWS, IN SLP NO.11485/2016, DT. 05- 08-2016. THUS, THE PENALTY ORDER U/S. 271(1)(C) OF TH E ACT IS SET ASIDE AND THIS APPEAL OF ASSESSEE IS ALLOWED. 9. TO SUM UP, THE APPEAL OF ASSESSEE IN ITA NO.1522/HYD/2016 IS DISMISSED AND ITA NO.1523/HYD/2 016 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH NOVEMBER, 2019 SD/- (P. MADHAVI DEVI) JUDICIAL MEMBER HYDERABAD, DATED: 15-11-2019 TNMM ITA NOS. 1522/HYD/2016 1523/HYD/2016 :- 5 -: COPY TO : 1. SRI M.SRINIVASA CHARY, PROP: SRI SAI ENGINEERING S, C/O. D.RAJASEKHAR & CO., CHARTERED ACCOUNTANTS, PLOT NO. 42, III FLOOR, ANDHRA BANK COLONY, NEAR KONARK DIAGNOST IC CENTRE, DILSUKH NAGAR, HYDERABAD. 2. INCOME TAX OFFICER, WARD-9(3), HYDERABAD. 3. CIT(APPEALS)-7, HYDERABAD. 4. PR.CIT-7, HYDERABAD. 5. D.R. ITAT, HYDERABAD. 6. GUARD FILE.