THE ITO 9(1)-2, MUMBAI V. M/S. CORAL GRAINITES PVT. LTD, MUMBAI

ITA 1829/MUM/2008

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 2682 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2009
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 14-10-2009
• Assessment Year: 2001-2002
• Appeal Filed On: 13-03-2008
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SUNIL K SINGH
• Keywords: Unexplained investment; Difference of opinion; Set aside
• Section: 271(1)(c); 40A(3); 133(6); 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: MUMBAI BEFORE SHRI R S SYAL, ACCOUNTANT MEMBER AND SHRI V DURGA RAO, JUDICIAL MEMBER ITA NO 1829/MUM/2008 (ASSESSMENT YEAR: 2001-02) ITO WARD 9(1)2, ROOM NO 226, 2ND FLOOR, AAYAKAR BHAVAN, M K ROAD, MUMBAI -400 020 VS M/S CORAL GRANITES PVT LTD, 12, HAPPY HOME NO. 244, WATERFIELD ROAD, BANDRA (W), MUMBAI -400 050 PAN: AABCC 5239 K APPELLANT RESPONDENT APPELLANT BY: SHRI SUNIL K SINGH RESPONDENT BY: SHRI NITESH JOSHI ORDER PER V DURGA RAO, JUDICIAL MEMBER THIS PENALTY APPEAL IS FILED BY THE REVENUE U/S 27 1(1)(C) OF THE INCOME TAX ACT. THE ONLY SUSTAINED GROUNDS IN THIS APPEAL IS COMMIS SION OF RS 70,000/- AND UNEXPLAINED INVESTMENT IN PURCHASE OF RS 91,612/-. IN SO FAR A S PENALTY PROCEEDING INITIATED BY ASSESSING OFFICER IN RESPECT OF DISALLOWANCE U/S 40 A(3) IS CONCERNED WHICH HAS BEEN DELETED BY THE TRIBUNAL IN THE QUANTUM PROCEEDINGS. IN SO FAR AS FOREIGN TRAVELS EXPENSES ARE CONCERNED, THE TRIBUNAL HAS SET ASIDE THE ORDER PASSED BY THE CIT (A) AND REMITTED MATTER BACK TO THE CIT (A) FOR CONSIDERING IT AFRESH. THEREFORE, THE PENALTY PROCEEDINGS CANNOT SURVIVE ON THE GROUND OF PENALTY IMPOSED U/S 40A(3) AND FOREIGN TRAVEL EXPENSES. 2. THE FACTS RELATING TO RS 70,000/- ON ACCOUNT OF COMMISSION PAID TO FIVE PARTIES. DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, TH E ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE HAS DEBITED COMMISSION PAID OF RS 70,000/- TO FIVE PERSONS. IN ORDER TO VERIFY THE GENUINENESS OF THE ABOVE PAYMENT, THE PURPOSE FOR WHICH THE COMMISSION WAS PAID, NOTICE U/S 133 (6) WAS ISSUED TO FIVE PER SONS. OUT OF FIVE PARTIES, FOUR PARTIES ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 2 DID NOT REPLY TO THE NOTICE. IN SO FAR AS NOTICE T O MADAN CHOUDHURY IS CONCERNED, THE SAME WAS RETURNED UNSERVED. SUBSEQUENTLY, THE ASSE SSING OFFICER HAS ASKED THE ASSESSEE TO PRODUCE FIVE PARTIES FOR EXAMINATION. THE ASSESSEE IN HIS SUBMISSION DATED 8.7.2003 STATED THAT THESE PARTIES ARE RESIDING AT DIFFERENT PLACES, TRANSACTION HAS BEEN TAKEN PLACE DURING THE YEAR 2000-01. IT IS NOT POS SIBLE TO PRODUCE THESE PARTIES FOR EXAMINATION AND PRODUCED XEROX COPIES OF VOUCHERS I N RESPECT OF PAYMENT MADE TO THE FIVE PARTIES. THE ASSESSING OFFICER HAS REJECTED T HE CLAIM OF THE ASSESSEE FOR THE FOLLOWING REASONS : (A) NOTICES U/S 133(6) WAS ISSUED TO ASCERTAIN NATU RE AND GENUINENESS OF THE TRANSACTION, SINCE THE PARTIES TO WHOM PURPORTED CO MMISSION WAS PAID, DID NOT REPLY TO THE NOTICES, IT IMPLIES THAT IT DID NOT RE CEIVE ANY COMMISSION FROM THE ASSESSEE; (B) THE ONUS WAS ON THE ASSESSEE TO PROVE THE GENUI NENESS OF THE TRANSACTION; (C) IT WAS DUTY OF THE ASSESSEE TO EXPLAIN HOW THE COMMISSION SO PAID WAS FOR THE PURPOSE OF THE BUSINESS; (D) MERE SUBMISSION OF THE VOUCHERS DOES NOT PROVE GENUINENESS OF THE TRANSACTION, VOUCHERS SO SUBMITTED NEITHER PROVES I DENTITY OF PARTY NOR NATURE NOR GENUINENESS OF TRANSACTION; (E) IN FURTHER REPLY ON THE DECISION IN THE CASE OF M/S RAMANAND SAGAR VS DCIT (256 ITR 134)(MUM) WHERE IT WAS HELD THAT IT WAS TH E DUTY OF THE ASSESSEE TO PROVE THE GENUINENESS OF THE EXPENSES FOR THE REASO NS GIVEN ABOVE. IN VIEW OF THE ABOVE, THE ASSESSING OFFICER HAS DIS ALLOWED COMMISSION OF RS 70,000/-. THE MATTER WAS CARRIED TO THE CIT (A) AND IT WAS AG ITATED BEFORE HIM THAT THE ASSESSEE HAS DISCHARGED HIS ONUS AND PROVED GENUINENESS OF T HE TRANSACTION. HOWEVER, THE CIT (A) NOT CONVINCED WITH THE SUBMISSIONS OF THE ASSES SEE CONFIRMED THE ORDER PASSED BY THE ASSESSING OFFICER. ON BEING AGGRIEVED, THE ASS ESSEE CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL. THE TRIBUNAL HAS DISALLOWED T HE COMMISSION PAYMENT ON THE GROUND THAT THERE IS NO EVIDENCE PRODUCED TO SUPPORT THE C LAIM OF THE ASSESSEE AND ALSO BY FOLLOWING THE JUDGMENT OF HONBLE SUPREME COURT IN CASE OF LAXMINARAYAN MANDANLAL VS ACIT (86 ITR 439). ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 3 3. THE ASSESSING OFFICER HAS INITIATED THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND CALLED EXPLANATION FROM THE ASSESSEE VIDE L ETTERS DATED 14.7.2005 AND 9.1.2006. THE ASSESSEE HAS FAILED TO EXPLAIN THE REASONS FOR HIS CLAIM BEFORE THE ASSESSING OFFICER. THEREFORE, THE ASSESSING OFFICER HAS DECIDED THE IS SUE ON MERITS AND HELD THAT THE ONUS LIES WITH THE ASSESSEE TO PROVE GENUINENESS OF THE TRANSACTION. THE ASSESSEE NEITHER PROVED THE GENUINENESS OF THE TRANSACTION NOR OFFER ED ANY EXPLANATION THEREFORE THE AO HAS INVOKED EXPLANATION 1(A) TO SECTION 271(1)(C) O F THE ACT AND IMPOSED THE PENALTY. 4. THE NEXT ISSUE RELATING TO UNEXPLAINED INVESTMEN T OF RS 91,612/-. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFF ICER HAS OBSERVED THAT THE ASSESSEE HAD PURCHASED GRANITE FROM M/S P R TRADERS FOR RS 9 1,962/- AND THE PAYMENT OF SAME WAS SHOWN BY THE ASSESSEE IN THE FINANCIAL YEAR 200 1-02 ON VARIOUS DATES IN CASH AS AN OUTSTANDING AT THE END OF THE YEAR. IN ORDER TO VE RIFY THE GENUINENESS OF THE TRANSACTION, NOTICE WAS ISSUED U/S 133(6) OF THE ACT. IN RESPON SE TO THE SAME, M/S P R TRADERS INFORMED THAT THEY HAD RECEIVED THE PAYMENT BY DEMA ND DRAFT NO.603596 DATED 15TH FEBRUARY 2001 I.E. BEFORE THE GOODS WERE ACTUALLY D ELIVERED TO THE ASSESSEE. THERE WAS NO OUTSTANDING BALANCE AS ON 31ST MARCH 2001. THE ASSESSEE WAS PROVIDED A COPY OF THE LEDGER ACCOUNT IN THE CONTEXT OF P R TRADERS FOR HI S COMMENTS AND CALLED FOR EXPLANATION IN RESPECT OF PAYMENT MADE TO M/S P R TRADERS BY TH E AFORESAID DEMAND DRAFT. THE ASSESSEE HAS REPLIED THAT HE DID NOT MADE ANY PAYME NTS TO M/S P R TRADERS BY AFORESAID DEMAND DRAFT TO M/S P R TRADERS AND IT HAD SUFFICIE NT CASH IN HAND, MORE THAN AMOUNTS PAYABLE TO P R TRADERS, HENCE, IT IS NOT AN UNEXPLA INED INVESTMENT. FURTHER, THE ASSESSEE HAS SUBMITTED BY FILING AN AFFIDAVIT THAT THEY PURCHASED GRANITE BLOCKS FROM M/S P R TRADERS VIDE INVOICE NO 324 AMOUNTING TO RS 91, 612/- AND SAME WAS OUTSTANDING AS ON 31.3.2001. HOWEVER, THE ASSESSING OFFICER HAS N OT SATISFIED WITH THE SAID EXPLANATION, HE MADE AN ADDITION IN THE HANDS OF THE ASSESSEE. MATTER CARRIED IN APPEAL BEFORE THE CIT (A) AND CIT (A) CONFIRMED THE SAME. THE ASSESS EE CARRIED FURTHER APPEAL TO THE TRIBUNAL, THE TRIBUNAL CONFIRMED THE ORDER OF THE C IT (A) BY OBSERVING THAT THE AFFIDAVIT FILED BY THE ASSESSEE IS A SELF-SERVING DOCUMENT AN D THE COPY OF THE ASSESSEES ACCOUNT IN ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 4 THE BOOKS OF M/S P R TRADERS WAS PROVIDED TO THE AS SESSEE BUT NO REQUEST WAS MADE FOR EXAMINING THE PARTY. 5. THE ASSESSING OFFICER HAS INITIATED PENALTY PROC EEDINGS AND ISSUED A NOTICE TO THE ASSESSEE AND ASSESSEE HAS NOT OFFERED ANY EXPLANATI ON TO THE SAME. THEREFORE THE ASSESSING OFFICER HAS DECIDED THE ISSUES ON MERITS AND HELD THAT THE ASSESSEE HAS FAILED TO BRING ANY EVIDENCE TO SHOW THAT THE PAYMENTS MAD E TO M/S P R TRADERS BY D.D. NO 603596 DATED 15 TH FEBRUARY 2001 AS AN OUTSTANDING AT THE END OF THE YEAR AND THE PAYMENT WAS NOT UNEXPLAINED INVESTMENT AND IMPOSED THE PENALTY. AS AGAINST THE PENALTY ORDER PASSED BY THE ASSESSING OFFICER, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT (A). BEFORE THE CIT (A), THE ASSESS EE HAS SUBMITTED THAT ALL THE FACTS ARE DISCLOSED IN THE RETURN OF INCOME AND THEREFORE, TH E ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INACCURATE PARTICULARS AND SUBMITT ED THAT THE ASSESSING OFFICER HAS WRONGLY INVOKED SECTION 271(1)(C) OF THE ACT. THE LEARNED CIT (A) HAS DELETED THE PENALTY BY PASSING THE FOLLOWING ORDER, WHICH READ AS UNDER:- 2.5 I HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS, FACTS OF THE CASE AND THE AOS CONTENTION. I AGREE WITH THE CONTENTION OF TH E APPELLANT THAT THE DISALLOWANCE OF AN EXPENSE PER SE CANNOT MEAN THAT THE ASSESSEE HAS FURNISHED INCORRECT PARTICULARS OF ITS INCOME. CONCEALMENT I NVOLVES PENAL ACTION. IT HAS TO BE PROVED AS A CONSCIOUS ACT. THE ESSENTIAL PRE-CO NDITION FOR INVOKING EXPLANATION 1 TO SECTION 271(1)(C) OF THE INCOME-TAX ACT, 1961, IS THAT THE ASSESSEE FAILS TO OFFER AN EXPLANATION OR OFFERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER TO BE FALSE. IT IS ONLY IN SUCH A SITUATI ON THAT THE ASSESSING OFFICER CAN INVOKE THE EXPLANATION TO SECTION 271(1)(C) AND IMP OSE PENALTY. IN THE APPELLANTS CASE, IT IS ON RECORD THAT ALL THE FACTS WERE DISCL OSED BY THE APPELLANT IN ITS RETURN OF INCOME AND DISALLOWANCES WERE MADE ONLY BECAUSE OF DIFFERENCE OF OPINION. 2.6 BEFORE REACHING TO A CONCLUSION, IT NEEDS TO BE EXAMINED AS TO WHAT CONSTITUTE THE OFFENCE OF CONCEALING PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. AS ALREADY STATED IN THE AB OVE PARAGRAPH THAT THE APPELLANT HAS NEITHER CONCEALED THE PARTICULAR OF INCOME NOR HAS FURNISHED INACCURATE PARTICULARS OF INCOME. THE APPELLANTS CLAIM WAS M ERELY REJECTED BY THE AO AS HE WAS NOT AGREEABLE TO THE VIEW OF THE APPELLANT. TH E DISALLOWANCE WAS NOT BASED ON ANY INDEPENDENT EVIDENCE BROUGHT ON RECORD BY TH E AO. THE DISALLOWANCE WAS DUE TO THE DIFFERENCE IN OPINION OF THE AO AND NOT DUE TO CONCEALMENT OF PARTICULAR OF INCOME OR FURNISHING INACCURATE PARTICULARS OF I NCOME. THEREFORE, NO INFERENCE CAN BE DRAWN AS REGARDS THE LEVY OF PENALTY SOLELY BECAUSE THE ASSESSEES CLAIM ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 5 WAS REJECTED BY THE ASSESSING OFFICER. THEREFORE, I HOLD THAT THE AO WAS NOT JUSTIFIED IN LEVYING THE PENALTY. 6. ON BEING AGGRIEVED, THE REVENUE HAS CARRIED THE MATTER IN APPEAL BEFORE THE TRIBUNAL. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS SUBMITTED THAT THE ASSESSEE HAS CLAIMED COMMISSION PAYMENT OF RS 70,000/- TO THE FI VE PERSONS. NOTHING WAS PRODUCED BEFORE THE LOWER AUTHORITIES AND ALSO BEFORE THE TR IBUNAL TO SUBSTANTIATE HIS CLAIM EXCEPT XEROX COPIES OF VOUCHERS. HE FURTHER SUBMITTED THA T WHEN THE NOTICES ISSUED BY THE ASSESSING OFFICER, RETURNED UNSERVED, AN OPPORTUNIT Y WAS GIVEN TO THE ASSESSEE TO PRODUCE THE PARTIES BEFORE THE ASSESSING OFFICER AN D THE ASSESSEE REPLIED HIS INABILITY TO PRODUCE THE PARTIES. EVEN BEFORE THE PENALTY PROCE EDINGS NO EXPLANATION WAS GIVEN WITH REGARD TO HIS CLAIM. IN SO FAR AS UNEXPLAINED INVE STMENT IS CONCERNED, THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS SUBMITTED THAT THE ASSESSEE HAS CLAIMED THE ABOVE PAYMENT MADE TO M/S P R TRADERS, THE SAME AMOUNT WA S SHOWN AS OUTSTANDING AT THE END OF THE YEAR. M/S P R TRADERS HAS INFORMED TO T HE AO THAT THEY HAVE RECEIVED THE PAYMENT BY DEMAND DRAFT NO. 603596 DATED 15 TH FEBRUARY 2001 BEFORE THE GOODS ARE ACTUALLY DELIVERED TO THE ASSESSEE. AS PER M/S P R TRADERS THERE WAS NO OUTSTANDING BALANCE AS ON 31 ST MARCH 2001. WHEN THE ASSESSING OFFICER HAS BROUGH T THE SAME THING TO THE NOTICE OF THE ASSESSEE, THE ASSESSEE HAS NOT CROSS-EXAMINED M/S P R TRADERS SIMPLY HE HAS STATED THAT I HAVE SUFFICIENT FUNDS A ND BY FILING AN AFFIDAVIT STATED THAT I HAVE AN OUTSTANDING BALANCE AT THE END OF THE YEAR AND NOT MADE ANY PAYMENT TO P R TRADERS. THE ABOVE STATEMENT OF THE ASSESSEE IS NO T SUPPORTED BY ANY EVIDENCE AND AO HAS CALLED EXPLANATION IN THE COURSE OF THE PENALTY PROCEEDINGS NO EXPLANATION WAS OFFERED BY THE ASSESSEE AND THE ASSESSING OFFICER R IGHTLY INVOKED EXPLANATION 1(A) TO SECTION 271(1)(C) OF THE ACT. 7. ON THE OTHER HAND, THE LEARNED COUNSEL FOR THE A SSESSEE HAS SUBMITTED THAT ASSESSEE HAS PAID AMOUNTS DURING THE COURSE OF HIS BUSINESS AS A COMMISSION AND THE PARTIES ARE STAYING AT DIFFERENT PLACES. HE WAS NO T ABLE TO PRODUCE THE SAME BEFORE THE ASSESSING OFFICER. THE VOUCHERS RELATING TO THE CO MMISSION PAYMENT SUBMITTED BEFORE ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 6 THE ASSESSING OFFICER AND THEREFORE IT IS NOT A FIT CASE TO INVOKE SECTION 271(1)(C) OF THE IT ACT. IN SO FAR AS UNEXPLAINED INVESTMENT IS CON CERNED, THE AR FOR THE ASSESSEE HAS SUBMITTED THAT HE HAS SUFFICIENT FUNDS WITH HIM AND FILED AN AFFIDAVIT BEFORE THE ASSESSING OFFICER AND EXPLAINED THAT HE HAS HAVING SUFFICIENT FUNDS WITH HIM AND NO INVESTMENT WAS MADE FROM OUTSIDE THE BOOKS OF THE ACCOUNTS, THEREF ORE, THE LEARNED CIT (A) RIGHTLY DELETED THE PENALTY IMPOSED BY THE ASSESSING OFFICE R. HE FURTHER SUBMITTED THAT WHATEVER THE EVIDENCE AVAILABLE WITH ASSESSEE HAS B EEN FILED BEFORE THE ASSESSING OFFICER AND CIT (A) AND BOTH THE AUTHORITIES ARE NOT SATISF IED WITH THE EVIDENCE PRODUCED BY THE ASSESSEE. IT IS NOT THE CASE OF THE REVENUE THAT T HERE IS NO EVIDENCE PRODUCED BY THE ASSESSEE, THEREFORE IT IS NOT A FIT CASE TO IMPOSE PENALTY U/S 271(1)(C) OF THE ACT. THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INA CCURATE PARTICULARS BEFORE THE ASSESSING OFFICER. HE SUBMITTED THAT THE APPEAL FI LED BY THE REVENUE MAY BE DISMISSED. 8. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE RECO RDS AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. THE ISSUE FOR CONSIDERAT ION BEFORE US IS WHETHER THE AO IS JUSTIFIED IN INITIATING THE PROCEEDINGS U/S 271(1)( C) OF THE ACT?. IN SO FAR AS THE PENALTY IMPOSED IN RESPECT OF COMMISSION PAYMENT IS CONCERN ED, THE ASSESSEE HAS FAILED TO PROVE THE GENUINENESS OF THE CLAIM OF THE ASSESSEE BEFORE THE LOWER AUTHORITIES AND EVEN BEFORE THE TRIBUNAL AND THE TRIBUNAL HAS CONFIRMED THE ORDER OF THE AUTHORITIES BELOW ON THE GROUND THAT THE ASSESSEE HAS FAILED TO PROVE TH E GENUINENESS OF THE COMMISSIONS PAYMENT BY FOLLOWING THE JUDGMENT IN THE CASE OF LA XMINARAYAN MANDAL (SUPRA). EVEN DURING THE COURSE OF THE PENALTY PROCEEDINGS, THE A SSESSEE HAS NOT GIVEN ANY REPLY TO SUBSTANTIATE HIS CLAIM. EVEN BEFORE THE TRIBUNAL, DURING THE COURSE OF THE PENALTY PROCEEDINGS NO PROPER EXPLANATION WAS GIVEN TO SUBS TANTIATE THE CLAIM OF THE ASSESSEE. WE THEREFORE OF THE OPINION THAT THE AO HAS RIGHTLY INVOKED SECTION EXPLANATION 1(A) TO SECTION 271(1)(C). IN SO FAR THE COMMISSION PAYMEN T IS CONCERNED. IN SO FAR AS UNEXPLAINED INVESTMENT IS CONCERNED, THE CASE OF TH E ASSESSEE IS THAT HE PURCHASED GRANITE BLOCKS FROM M/S P R TRADERS FOR RS 91,612/- , M/S P R TRADERS HAS INFORMED TO THE ASSESSING OFFICER THAT THEY HAD RECEIVED THE PAYMEN T BY DEMAND DRAFT DATED 15.1.2001 I.E. BEFORE THE GOODS WERE ACTUALLY DELIVERED TO TH E ASSESSEE AND THERE IS NO OUTSTANDING ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 7 BALANCE AS ON 31ST MARCH 2001. WHEN IT WAS BROUGHT TO THE NOTICE OF THE ASSESSEE, ASSESSEE NOT CHOSE TO CROSS-EXAMINE THE PARTIES, SI MPLY HE HAS FILED AN AFFIDAVIT BY SAYING THERE IS OUTSTANDING AS ON 31ST MARCH 2001. THIS AFFIDAVIT FILED BY THE ASSESSEE IS SELF-SERVING DOCUMENT, THEREFORE, THE SAME CANNOT B E ACCEPTED AS A GENUINE EXPLANATION WHEN THE ASSESSEE WAS GIVEN AN OPPORTUNITY TO CROSS -EXAMINE M/S P R TRADERS, HE WAS NOT CROSS EXAMINED TO BRING THE CORRECT FACTS THE R EASONS BEST KNOWN TO ASSESSEE. THEREFORE, THE FILING OF THE AFFIDAVIT CANNOT SUBST ANTIATE THE CLAIM OF THE ASSESSEE. THE SIMPLE REASON THAT THE OTHER PARTY DENIED THAT THER E IS OUTSTANDING AS ON 31 ST MARCH 2001. WHEN THE AO HAS CALLED EXPLANATION FROM THE ASSESSEE TO SUBSTANTIATE HIS CLAIM HE HAS NOT FILED ANY REPLY. THEREFORE, THE AO IN S O FAR AS UNEXPLAINED INVESTMENT IS CONCERNED, RIGHTLY IMPOSED THE PENALTY BY INVOKING EXPLANATION 1(A) TO SECTION 271(1)(C) OF THE ACT. 9. IN SO FAR AS THE ORDER PASSED BY THE LEARNED CIT (A) BY DELETING THE PENALTY IS CONCERNED, THE LEARNED CIT (A) HAS OBSERVED IN HIS ORDER THAT THE ASSESSEE NEITHER CONCEALED THE INCOME NOR FILED INACCURATE PARTICULA RS. THE ASSESSEE HAS SUBMITTED ALL THE DETAILS ALONG WITH THE RETURN OF INCOME AND DISALLO WANCE ONLY BECAUSE OF A DIFFERENCE IN OPINION. AFTER CAREFUL CONSIDERATION OF THE CIT (A ) ORDER, WE FOUND THAT HE HAS FAILED TO APPRECIATE THE FACTS PROPERLY, PARTICULARLY IN RESP ECT OF EXPLANATION 1(A) OF SECTION 271(1)(C) OF THE ACT. THEREFORE, WE ARE OF THE OPI NION THAT THE ORDER PASSED BY THE LEARNED CIT (A) DESERVED TO BE REVERSED. ACCORDING LY, THE PENALTY ORDER PASSED BY THE CIT (A) IS SET ASIDE AND PENALTY ORDER PASSED BY TH E ASSESSING OFFICER IS RESTORED. ACCORDINGLY, GROUND RAISED BY THE REVENUE IS ALLOWE D. 10. IN THE RESULT, APPEAL FILED BY THE REVENUE IS A LLOWED PARTLY. ORDER PRONOUNCED ON 11 TH DAY OF DECEMBER 2009. SD/- (R S SYAL) ACCOUNTANT MEMBER SD/- (V DURGA RAO) JUDICIAL MEMBER MUMBAI, DATE: 11 TH DECEMBER 2009 ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 8 COPY TO:- 1) THE APPELLANT. 2) THE RESPONDENT. 3) THE CIT (A) XXVIII, MUMBAI. 4) THE CIT-3, MUMBAI. 5) THE D.R. C BENCH, ITAT, MUMBAI. BY ORDER / / TRUE COPY / / ASSTT. REGISTRAR CHAVAN* I.T.A.T., MUMBAI ITA 1829/M/2008 M/S CORAL GRANITES PVT LTD 9 SR.N. EPISODE OF AN ORDER DATE INITIALS CONCERNED 1 DRAFT DICTATED ON 10.12.09 SR.PS 2 DRAFT PLACED BEFORE AUTHOR 10.12.09 SR.PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5 APPROVED DRAFT COMES TO THE SR.PS SR.PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS 7 FILE SENT TO THE BENCH CLERK SR.PS 8 DATE ON WHICH FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER