Joel Kirubakara Pandian , CHENNAI V. DCIT Non Corporate Circle 23(1), CHENNAI

ITA 1674/CHNY/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8741 (ITAT-CHENNAI)
• Duration Of Justice: 10 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2011-2012
• Appeal Filed On: 15-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M SRINIVASA RAO
• Assessee Lawyers: D ANAND
• Keywords: Business income; Income from undisclosed sources; Salary income; TDS
• Section: 271(1)(c); 143(3); 143(1); 2

Judgement Text

, , IN THE INCOME-TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . , . , BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY, JUDICIAL MEMBER ./ I T.A. NO. 1674/CHNY/2018 / ASSESSMENT YEAR:2011-12 SHRI JOEL KIRUBAKARA PANDIAN, NO. 29/30D, MARUTHI NAGAR, DR. RADHAKRISHNAN SALAI, OLD PERUNGALATHUR, CHENNAI 63. [PAN:AIKPP1327K] VS. THE DEPUTY COMMISSIONER OF INCOME TAX, NON CORPORATE CIRCLE 23(1), CHENNAI. ( /APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI D. ANAND, ADVOCATE / RESPONDENT BY : SHRI M. SRINIVASA RAO, CIT / DATE OF HEARING : 27.03.2019 /DATE OF PRONOUNCEMENT : 02.04.2019 / O R D E R PER DUVVURU RL REDDY, JUDICIAL MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 10, CHENNAI DATED 25.01.2018 RELEVANT TO THE ASSESSMENT YEAR 2011-12 IN CONFIRMING LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 [ACT IN SHORT]. 2. BRIEF FACTS OF THE CASE ARE THAT ASSESSEE IS AN INDIVIDUAL AND FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2011-12 ON 01.10.2011 ADMITTING A TOTAL INCOME OF .16,18,710/-. THE SAME WAS PROCESSED UNDER I.T.A. NO.1674/CHNY/18 2 SECTION 143(1) OF THE ACT ON 13.11.2011. SUBSEQUENTLY, THE CASE WAS SELECTED FOR SCRUTINY AND NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED. AFTER CONSIDERING THE DETAILS SUBMITTED BY THE ASSESSEE, THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE WAS EMPLOYED IN TWO ORGANIZATIONS, VIZ., MARG LTD. AND M/S. VGN INFRA LTD. DURING THE PREVIOUS YEAR 2010-11 AND HAD SHOWN THE INCOME FROM M/S. VGN INFRA ONLY IN THE RETURN OF INCOME. THE TDS REFLECTED IN 26AS SHOWS HIGHER AMOUNT THAN AND THAT OF THE RETURN. THE INCOMES FROM BOTH THE ABOVE CONCERNS WERE CONSIDERED FOR ASSESSMENT. THE INTEREST INCOME CREDITED IN THE BANK ACCOUNT OF THE ASSESSEE IS ALSO ADDED TO THE TOTAL INCOME OF ASSESSEE. THUS, THE ASSESSING OFFICER DETERMINED THE TOTAL INCOME OF THE ASSESSEE AT .21,98,843/-. IN VIEW OF THE ABOVE, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT ON THE GROUND THAT THE ASSESSEE HAS FURNISHED INCORRECT PARTICULARS/CONCEALMENT. DURING THE COURSE OF PENALTY PROCEEDINGS, SINCE THE ASSESSEE HAS NOT DISCLOSED THE SALARY INCOME OF .5,69,529/- AND INTEREST INCOME OF .5,352/- [SAVING BANK INTEREST] IN HIS ORIGINAL RETURN OF INCOME, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE ACT OF THE ASSESSEE AMOUNTS TO FURNISHING OF INACCURATE PARTICULARS AND LIABLE FOR LEVY OF PENALTY AND ACCORDINGLY, LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT. I.T.A. NO.1674/CHNY/18 3 3. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). BESIDES UPHOLDING LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT, THE LD. CIT(A) DIRECTED THE ASSESSING OFFICER TO DETERMINE CORRECT AMOUNT OF PENALTY AFTER GIVING AN OPPORTUNITY TO THE ASSESSEE. ACCORDINGLY, VIDE ORDER DATED 27.04.2018, THE ASSESSING OFFICER LEVIED PENALTY AT .1,77,637/-. 4. ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. BY REFERRING TO THE GROUNDS OF APPEAL, THE LD. COUNSEL FOR THE ASSESSEE PRAYED FOR DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. ON THE OTHER HAND, THE LD. DR STRONGLY SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 5. WE HAVE HEARD BOTH THE SIDES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CASE, IT WAS THE SUBMISSION OF THE LD. COUNSEL THAT THE ASSESSEE WAS EMPLOYED IN TWO ORGANIZATIONS I.E., MARG LIMITED AND VGN INFRA INDIA P. LTD. THE ASSESSEE FILED THE RETURN OF INCOME ON 01.10.2011 CONSIDERING VGN INFRA INDIA P. LTD. SALARY ONLY. SUBSEQUENTLY, THE ASSESSEE NOTICED THAT THE MARG LIMITED SALARY WAS INADVERTENTLY LEFT WHILE FILING RETURNS EVEN THOUGH TDS OF .91,149/- HAD BEEN DEDUCTED AND HENCE THE TAX REWORKING WERE MADE AND DIFFERENTIAL TAX ALONG WITH INTEREST OF .69,215/- WAS PAID ON 24.02.2012. THE CASE OF THE ASSESSE WAS SELECTED FOR SCRUTINY AND WAS I.T.A. NO.1674/CHNY/18 4 SERVED NOTICE DATED 08.08.2012 [SIX MONTHS AFTER THE REVISED WORKING AND TAX PAID]. THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT BY MAKING ADDITION OF .5,352/- [SAVING BANK INTEREST] AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. SUBSEQUENTLY, PENALTY PROCEEDINGS WERE INITIATED. IT WAS ARGUED BY THE LD. COUNSEL THAT THE PROVISION OF SECTION 271(1)(C) OF THE ACT SHALL BE INVOKED WHERE THERE IS ANY CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS WITH INTENTION TO EVADE TAX. AS THE ASSESSEE HAS ONLY SALARIED INCOME ON WHICH TAX HAS BEEN DULY DEDUCTED AND THERE IS NO BUSINESS INCOME. HE FURTHER SUBMITTED THAT THE ASSESSING OFFICER HAS NOT FOUND ANY UNACCOUNTED INCOME AND WHEN THERE WAS NO UNACCOUNTED INCOME FOUND, LEVY OF PENALTY IS NOT AS PER LAW. IT WAS ALSO SUBMITTED THAT THE ADDITION MADE AT THE TIME OF ASSESSMENT WILL NOT WARRANT LEVY OF PENALTY AND PRAYED FOR DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. WE FIND FORCE IN THE ARGUMENT OF THE LD. COUNSEL. ADMITTEDLY, THERE WAS NO SEARCH OR SURVEY IN THIS CASE OUT OF WHICH THE DEPARTMENT UNEARTHED ANY OTHER PARTICULARS OF INCOME, WHICH WAS NOT DISCLOSED BY THE ASSESSEE. IT WAS ALSO NOT IN DISPUTE THAT BEFORE SCRUTINY NOTICE UNDER SECTION 143(2) OF THE ACT IS ISSUED, THE ASSESSEE HAS RECALCULATED THE TAX LIABILITY AS PER THE 26AS AND PAID THE TAX DUE ALONG WITH INTEREST THEREON AND NOTHING WAS LEFT FOR TAX EVASION EXCEPT SAVING BANK INTEREST OF .5,352/-, WHICH WAS ALSO ACCEPTED AND PAID TAX WITHOUT I.T.A. NO.1674/CHNY/18 5 ANY DISPUTE. UNDER THE ABOVE FACTS AND CIRCUMSTANCES, THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT STANDS DELETED. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THE 02 ND APRIL, 2019 AT CHENNAI. SD/ - SD/ - (ABRAHAM P. GEORGE) ACCOUNTANT MEMBER (DUVVURU RL REDDY) JUDICIAL MEMBER CHENNAI, DATED, THE 02.04.2019 VM/- /COPY TO: 1. / APPELLANT, 2. / RESPONDENT, 3. ( ) /CIT(A), 4. /CIT, 5. /DR & 6. /GF.