M/s. Rajesh Kumar Aggarwal (HUF), New Delhi V. ITO, New Delhi

ITA 1801/DEL/2012

• Counselvise Citation: 180120114 RSA 2012
• Duration Of Justice: 3 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 08-07-2015
• Assessment Year: 2000-2001
• Appeal Filed On: 18-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: MOHIT PAREKH
• Keywords: Gift; Opportunity of being heard; Accommodation entries
• Section: 147; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI G. C. GUPTA, HON BLE VICE - PRESIDENT AND SHRI J. S. REDDY, HON BLE ACCOUNTANT MEMBER I.T.A. NO. 1801 /DEL/201 2 ASSESSMENT YEAR: 200 0 - 0 1 M/S RAJE SH KUMAR AGGARWAL (HUF) , VS. IT O FD - 42, VISHAKHA ENCLAVE, WARD - 25(1), 3 RD FLOOR PITAMPURA, D BLOCK, VIKAS BHAWAN, DELHI. I.P. ESTATE, NEW DELHI. PAN: AAHHR0816C (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI. MOHIT PAREKH , CA. REVENUE BY : SHRI VIKRAM SAHAY , SR . DR. DATE OF HEARING: 08 /0 7 /2015 DA TE OF PRONOUNCEMENT: 15 /07 /2015 ORDER PER J. S. REDDY, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF LD. CIT (APPEALS) - XXIV, NEW DELHI, DATED 31.01.2012 FOR THE ASSESSMENT YEAR 200 0 - 0 1, O N THE FOLLOWING GROUNDS: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) - XXIV, NEW DELHI HAS ERRED IN CONFIRMING THE PENALTY OF RS.1,44,625/ - LEVIED BY THE AO U/S 271(1) (C) OF THE INCOME TAX ACT IN AN ARBITRARY, UN CALLED FOR AND ILLEGAL MANNER AND, AS SUCH, LIABLE TO BE QUASHED. 2. THE LD. CIT(A) - XXIV, NEW DELHI HAS NOT ADJUDICATED GROUND NO.2 OF THE APPEAL AND, AS SUCH, IT IS PRAYED THAT SUITABLE I.T.A. NO.1801/DEL/2012 2 DIRECTION MAY BE ISSUED TO ADJUDICATE THE SAME ON MERITS AFTER CONSI DERING THE PAPERS/DOCUMENTS AS WELL AS WRITTEN SUBMISSIONS MADE BEFORE HIM AFTER PROVIDING AN OPPORTUNITY OF BEING HEARD TO THE APPELLANT FAMILY. FACTS OF THE CASE : 2. ASSESSMENT WAS COMPLETED U/S 147/143(3) OF THE ACT ON 18.12.2007 AT A TOTAL INCOME OF RS.5,44,769/ - , MAKING AN ADDITION OF RS.4 LAC BEING UNDISCLOSED INCOME U/S 68 OF THE ACT. PENALTY PROCEEDINGS WERE INTIAITED U/S 271(1) (C) AND SHOW CAUSE NOTICE DATED 18 .12.2007 FIXING THE CASE FOR 16.01.2008 WAS SERVED UPON THE APPELLANT. THE FACTS OF THE CASE ARE THAT INFORMATION IN THIS CASE WAS RECEIVED FROM ADDL. DIT (INV.), GHAZIABAD THAT ONE SH. SANJAY MOHAN AGGARWAL WAS INVOLVED IN GIVING ACCOMMODATION ENTRIES OF BOGUS GIFTS/LOANS TO NUMEROUS PERSONS FROM HIS VARIOUS BANK ACCOUNTS AND THE APPELLANT HAD ALSO TAKEN A BOGUS GIFT OF RS.4 LAC DURING THE YEAR UNDER CONSIDERATION FROM SAID SH. SANJAY MOHAN AGGARWAL. ACCORDINGLY, THE CASE WAS REOPENED U/S 147 AND IN THE AS SESSMENT ORDER ITSELF, THE AO NOTED THAT THE SAID SH. SANJAY MOHAN AGGARWAL HAD NOT ONLY GIVEN A GIFT OF RS.4 LAC TO THE APPELLANT, BUT THAT HE HAD ALSO GIVEN GIFTS TO NINE DIFFERENT ASSESSEES OF RANGE - 25, NEW DELHI AMOUNTING TO RS.53 LACS. AFTER DETAILED INVESTIGATIONS AND DISCUSSIONS , IN THE LIGHT OF EVIDENCES PLACED ON RECORD BY THE APPELLANT, THE AO MADE AN ADDITION OF RS.4 LACS TO THE INCOME OF THE APPELLANT U/S 68 OF THE ACT. THE APPELLANT SUBMITTED AN APPEAL BEFORE CIT(A) - XXIV, WHO VIDE HIS APPELLAT E ORDER DATED 26.03.2009 I.T.A. NO.1801/DEL/2012 3 IN APPEAL NO. 307/07 - 08 UPHELD THE ADDITION OF RS.4LACS. THEREAFTER, THE AO ISSUED A SHOW CAUSE NOTICE DATED 18.03.2010 TO THE APPELLANT REQUIRING HIM TO EXPLAIN AS TO WHY PENALTY U/S 271(1)(C) OF T HE ACT SHOULD NOT BE IMPOSED ON H IM. THE EXPLANATIONS GIVEN BY THE APPELLANT WERE REJECTED BY THE AO AND A MINIMUM PENALTY OF RS.1,44,625/ - WAS IMPOSED ON HIM. IN THE MEANWHILE, ON APPEAL THE ITAT DELHI BENCH UPHELD THE ORDER OF THE LD. AO. 3. WE HAVE HEARD SHRI MOHIT PAREKH, THE LD. COU NSEL FOR THE ASSESSEE AND SHRI VIKRAM SAHAY THE LD. SR. DR ON BEHALF OF THE REVENUE. 4. ON CAREFUL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND PERUSAL OF THE PAPER S ON RECORD AND CAS E LAW CITED, WE HOLD AS FOLLOWS; 5. THE F BENCH OF ITA T DELHI, IN THE QUANTUM PROCEEDINGS IN ITA NO. 2947/DEL/2010 ORDER DATED 4 TH NOVEMBER 2010 HAS , AT PAGES 25 TO 29 , PARA 33 TO 36 DEALT WITH THIS ISSUE OF GIFT OF RS.4 LAKHS. THE BASIS ON WHICH THE BENCH CONFIRMED THE ADDITION WAS PREPONDERANCE PROBABILITIES AND SURROUNDING CIRCUMSTANCES . THE ASSESSEE IN THIS CASE HAD FILED A GIFT DEED, AN AFFIDAVIT FROM THE DONOR AND CERTAIN OTHER DOCUMENTS IN SUPPORT OF ITS CLAIM . T HE SORT OF LOVE AND AFFECTION THAT THE DONOR HAD FOR THE ASSESSEE , HAD NOT BEEN MENTIONED IN THE AFFIDAVIT, THE TRIBUNAL HELD THAT, THE SURROUNDING CIRCUMSTANCES AND HUMAN PROBABILITIES AND REALITY OF HUMAN AND SOCIAL LIFE HAD TO BE TAKEN INTO CONSIDERATION AND CONFIRMED THE ADDITION. IT IS NOT A CASE OF LACK OF EVIDENCE . I.T.A. NO.1801/DEL/2012 4 6. WHEN AN ADDITION IS C ONFIRMED BY INVOKING HUMAN PROBABILITIES AND SURROUNDING CIRCUMSTANCES , WE ARE OF THE CONSIDERED OPINION THAT PENALTY U/S 271(1)(C) CANNOT BE LEVIED ON THE ASSESSEE ON THE GROUND OF CONCEALMENT . IN OUR VIEW THE EXPLANATION GIVEN BY THE ASSESSEE IS BONA FID E. THUS WE DELETE THE PENALTY CONFIRMED BY THE FIRST APPELLATE AUTHORITY AND ALLOW THIS APPEAL OF THE ASSESSEE. 7 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH /07/2015. SD/ - SD/ - ( G. C. GUPTA ) (J. S. REDDY) VICE - PRESIDENT ACCOUNTANT MEMBER DATED: 15 /07/2015 *AK VERMA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR