ACIT, Madurai V. Shri A.N.Annaamalaisamy (HUF), Sivakasi

ITA 1634/CHNY/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0824 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 04-02-2013
• Assessment Year: 2009-2010
• Appeal Filed On: 21-08-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: GURU BASHYAM IRS
• Assessee Lawyers: K V RAMAN
• Keywords: Revised return

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A.NO. 1634/MDS/2012 ASSESSMENT YEAR : 2009-10 THE ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE II, MADURAI. VS. SHRI A.N.ANNAMALAISAMY (HUF), NO.5A, CHAIRMAN A SHANMUGA NADAR ROAD, SIVAKASI. PAN AADHA1635C (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI GURU BASHYAM, IRS, JC IT RESPONDENT BY : SHRI K.V.RAMAN, FCA DATE OF HEARING : 4 TH FEBRUARY, 2013 DATE OF PRONOUNCEMENT : 5 TH FEBRUARY, 2013 O R D E R PER DR. O.K. NARAYANAN, VICE-PRESIDENT THIS APPEAL IS FILED BY THE REVENUE. THE RELEVANT ASSESSMENT YEAR IS 2009-10. THE APPEAL IS DIRECTE D AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX(APPEALS)-II AT MADURAI, ITA 1634/12 :- 2 -: DATED 11.5.2012. THE APPEAL ARISES OUT OF THE PENA LTY LEVIED UNDER SEC.271AAA OF THE INCOME-TAX ACT, 1961. 2. THERE WAS A SEARCH IN THE PRESENT CASE UNDER SEC .132. IN THE COURSE OF SEARCH, ON THE BASIS OF MATERIALS FOU ND THEREIN, THE ASSESSEE HAD ADMITTED AN ADDITIONAL INCOME OF ` 38,45,416/- PERTAINING TO JEWELLERY. WHILE FILING THE ORIGINAL RETURN, THE ASSESSEE ADMITTED AN INCOME OF ` 10,98,146/-. BUT IN THE COURSE OF ASSESSMENT PROCEEDINGS, BEFORE THE COMPLETION OF ASSESSMENT, THE ASSESSEE FILED A REVISED RETURN OFF ERING THE ENTIRE VALUE OF JEWELLERY AMOUNTING TO ` 38,45,416/-. THE ASSESSMENT WAS ACCORDINGLY COMPLETED. BUT THE ASSESSING OFFIC ER LEVIED PENALTY UNDER SEC.271AAA FOR THE REASON THAT THE AS SESSEE HAS NOT ACTED ACCORDING TO THE STATEMENT MADE UNDER SEC . 132(4) IN THE COURSE OF SEARCH, WHEREIN UNDISCLOSED INCOME WA S ADMITTED. 3. IN FIRST APPEAL, THE COMMISSIONER OF INCOME-TAX( APPEALS) FOUND THAT THE PENALTY CANNOT BE LEVIED IF THE FOUR CONDITIONS LAID DOWN IN THAT SECTION WERE SATISFIED BY THE ASSESSEE . THE FOUR CONDITIONS ARE AS FOLLOWS : 1. IF THE ASSESSEE IN A STATEMENT UNDER SEC. 132(4 ) IN THE COURSE OF SEARCH, ADMITS THE UNDISCLOSED INCOME. ITA 1634/12 :- 3 -: 2. FURTHER, HE SPECIFIES THE MANNER IN WHICH SUCH INCOME HAS BEEN DERIVED. 3. HE SUBSTANTIATES THE MANNER IN WHICH THE UNDISC LOSED INCOME WAS DERIVED. 4. HE PAYS THE TAX TOGETHER WITH INTEREST, IF ANY, IN RESPECT OF THE UNDISCLOSED INCOME. 4. THE COMMISSIONER OF INCOME-TAX(APPEALS) FOUND TH AT THE ASSESSEE HAS ADMITTED THE INCOME IN THE COURSE OF S EARCH; HE HAS RETURNED THE UNDISCLOSED INCOME BY WAY OF REVIS ED RETURN; HE HAS EXPLAINED THE NATURE OF SOURCES OF UNDISCLOSED INCOME AND THE ASSESSEE HAD PAID THE TAX TOGETHER WITH INTERES T. THEREFORE, HE HELD THAT THE ASSESSEE HAS COMPLIED ALL THE COND ITIONS AND THE PENALTY CANNOT BE LEVIED. 5. WE HEARD BOTH SIDES IN DETAIL. 6. THE LEARNED CHARTERED ACCOUNTANT APPEARING FOR T HE ASSESSEE SUBMITTED THAT THE TOTAL CASH WITHDRAWALS OF THE FAMILY FOR THE PERIOD COVERED UNDER SEARCH AROUND WAS ` 40 LAKHS AND THAT AMOUNT ITSELF IS SUFFICIENT TO ACQUIRE THE JEW ELLERY FOUND IN THE COURSE OF SEARCH. THEREFORE, HE STATED THAT THERE CANNOT BE A ITA 1634/12 :- 4 -: CASE OF THAT MUCH UNDISCLOSED AMOUNT IN THE HANDS O F THE ASSESSEE, AS ADMITTED IN THE COURSE OF SEARCH. HE ALSO STATED THAT IN SPITE OF ALL THESE THINGS, HE OFFERED THE E NTIRE ADMITTED INCOME THROUGH A REVISED RETURN. ACCORDING TO HIM, ALL THE CONDITIONS LAID DOWN IN SEC.271AAA HAVE BEEN COMPLI ED WITH BY THE ASSESSEE AND, THEREFORE, THE COMMISSIONER OF IN COME- TAX(APPEALS) HAS RIGHTLY DELETED THE PENALTY. 7. WE FIND THAT THE ASSESSING OFFICER WAS CARRIED A WAY BY THE ORIGINAL RETURN FILED BY THE ASSESSEE, WHEREIN ORIG INALLY THE INCOME ADMITTED IN THE COURSE OF SEARCH WAS NOT RETURNED B Y IT. BUT THE FACT IS THAT THE ASSESSEE HAD FILED A REVISED RETUR N BEFORE COMPLETING THE ASSESSMENT. WHEN THAT IS THE CASE, THE FIRST RETURN FILED BY THE ASSESSEE IS A NON EST. THE ONL Y VALID RETURN IS THE REVISED RETURN FILED BY THE ASSESSEE. IN THAT RETURN, THE AMOUNT ADMITTED BY THE ASSESSEE AT THE TIME OF SEAR CH WAS OFFERED FOR TAXATION. THE ASSESSEE HAS PAID THE TA X; HE HAS PAID THE INTEREST. HE HAS NOT PREFERRED ANY QUANTUM APP EAL. HE HAS ALSO EXPLAINED ABOUT THE BUSINESS AND STATED THAT T HE JEWELLERY WAS ACQUIRED OVER A PERIOD OF TIME. WHEN ALL THE P IECES ARE PUT TOGETHER, WE FIND THAT THE COMMISSIONER OF INCOME-T AX(APPEALS) ITA 1634/12 :- 5 -: IS JUSTIFIED IN HOLDING THAT THERE IS NO GROUND TO LEVY PENALTY IN THE PRESENT CASE UNDER SEC.271AAA. ACCORDINGLY, THE OR DER PASSED BY THE COMMISSIONER OF INCOME-TAX(APPEALS) IS UPHE LD. 8. IN RESULT, THIS APPEAL FILED BY THE REVENUE IS D ISMISSED. ORDER PRONOUNCED ON TUESDAY, THE 5 TH OF FEBRUARY, 2013 AT CHENNAI. SD/ SD/- (VIKAS AWASTHY) (DR.O.K. NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 5 TH FEBRUARY, 2013 MPO* COPY TO : APPELLANT/RESPONDENT/CIT/CIT(A)/DR