Appeal details
Counselvise Citation
187523514 RSA 2009
Assessee PAN
Bench
Appeal Number
Duration Of Justice
6 year(s) 20 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
30-11-2015
Appeal Filed By
Department
Bench Allotted
B
Assessment Year
2002-2003
Appeal Filed On
09-11-2009
Judgement Text
ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 1 IN THE INCME TAX APPELLATE TRIBUNAL, B BENCH, KO LKATA BEFORE : SHRI BALAGANESH, ACCOUNTANT MEMBER, AND S HRI S.S VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO. 1875 / KOL/2009 ASST YEAR 2002-03 ITA NO. 1876 /KOL/ 2009 ASST YEAR 2003-04 ITA NO. 1877 /KOL/ 2009 ASST YEAR 2004-05 ITA NO. 1878 /KOL/ 2009 ASST YEAR 2005-06 D.C.I.T, CC-I, KOLKATA VS. DEEPAK CHOUDHURY PAN: ACSPC8549C (APPELLANT) (RESPONDENT) FOR THE APPELLANT/: SHRI KALYAN NATH, JCIT, SR.D R FOR THE RESPONDENT/ : SHRI A.K.TIBREWAL, FCA , LD.AR DATE OF HEARING: 30-10-2015 DATE OF PRONOUNCEMENT: 30- 11- 2015 ORDER SHRI M.BALAGANESH, AM THESE APPEALS OF THE REVENUE ARISE OUT OF THE COMM ON ORDER PASSED BY THE LEARNED CITA IN APPEAL NOS. 187 TO 190/CC-I/CIT(A) C-III/08-09 FOR THE ASST YEARS 2002-03 TO 2005-06 RESPECTIVELY DATED 31.8.2009 AGA INST THE ORDER OF PENALTY OF THE LEARNED AO PASSED U/S 271(1)(C ) OF THE INCOME TAX ACT , 1961 (HEREINAFTER REFERRED TO AS THE ACT). 2. THE ONLY ISSUE INVOLVED IN ALL THESE APPEALS I S THAT WHETHER THE ASSESSEE IS ENTITLED FOR IMMUNITY FROM LEVY OF PENALTY ON ACCOU NT OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT IN RESPECT OF INCOME OFFERED AFTER THE SEARCH BUT IN THE RETURN FILED U/S 153A OF THE ACT. SINCE IDENTICAL ISSUE IS INVOLVED IN ALL THE APPEALS, THEY ARE TAKEN UP TOGETHER AND DISPOSED OFF BY THIS COMMON O RDER FOR THE SAKE OF CONVENIENCE. ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 2 3. THE BRIEF FACTS OF THIS ISSUE IS THAT A SEARCH AND SEIZURE OPERATION WAS CONDUCTED ON 23.8.2006 U/S 132 OF THE ACT IN THE BUILDER GROU P OF CASES. THE ASSESSEE IS ONE OF THE INDIVIDUALS BELONGING TO THIS GROUP. IN THE C OURSE OF SEARCH, THE ASSESSEE WAS FOUND TO BE IN POSSESSION OF UNDISCLOSED INCOME AND ACCORDINGLY THE ASSESSEE GAVE DISCLOSURE STATEMENT U/S 132(4) OF THE ACT OFFERING SUBSTANTIAL INCOME AS BELOW:- ASSESSMENT YEAR DISCLOSURE AMOUNT 2001-02 NIL 2002-03 1,65,00,000 2003-04 66,000 2004-05 22,72,000 2005-06 1,96,65,528 2006-07 2,63,99,447 2007-08 1,36,13,543 ------------------- 7,85,16,518 ------------------- 3.1. THE DETAILS OF INCOME DECLARED IN THE RETURN FILED U/S 139(1) OF THE ACT FOR EACH ASSESSMENT YEAR , INCOME OFFERED IN DISCLOSURE STAT EMENT U/S 132(4) OF THE ACT FOR EACH ASSESSMENT YEAR PURSUANT TO THE SEARCH , INCOME DEC LARED IN THE RETURN FILED U/S 153A OF THE ACT FOR EACH ASSESSMENT YEAR AND ASSESSED IN COME THEREON ARE TABULATED AS BELOW:- ASSESSMENT YEARS PARTICULARS 2002-03 2003-04 2004-05 2005-06 INCOME ADMITTED U/S 139(1) 1,78,230 36,500 4,43,350 6,58,510 DISCLOSURE MADE U/S 132(4) 1,65,00,000 66,000 2 2,72,000 1,96,65,528 INCOME DISCLOSED U/S 153A 1,66,72,770 66,000 22 ,72,000 1,96,65,528 INCOME ASSESSED U/S 153A 1,66,72,770 1,01,300 27, 15,540 2,28,24,040 ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 3 4. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE DISCLOSED FURTHER INCOME OF RS. 25,00,000/- FOR THE ASST YEAR 2005-06. THE LEA RNED AO LEVIED PENALTY U/S 271(1)(C ) OF THE ACT FOR THE ASST YEARS 2002-03 TO 2005-06 ON THE GROUND THAT BUT FOR THE SEARCH, THE ASSESSEE WOULD NOT HAVE COME FORWAR D WITH THE DISCLOSURE OF UNDISCLOSED INCOME. ON FIRST APPEAL, THE LEARNED CITA DELETED THE PENALTY FOR ALL THE ASSESSMENT YEARS STATING THAT THE ASSESSEE HAD SATI SFIED ALL THE CONDITIONS STIPULATED IN CLAUSE 2 TO EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT AND ACCORDINGLY IS ENTITLED FOR IMMUNITY FROM LEVY OF PENALTY AS THE ASSESSEE H AD, MADE DISCLOSURE STATEMENT U/S 132(4) OF THE ACT AND HAD DISCLOSED THE SAME IN THE RETURN FILED IN RESPONSE TO NOTICE U/S 153A OF THE ACT , HAD SPECIFIED THE MANNER IN W HICH SUCH UNDISCLOSED INCOME HAS BEEN EARNED AND PAID TAXES DUE THEREON. AGGRIEVE D, THE REVENUE IS IN APPEAL BEFORE US. THE REVENUE HAS RAISED THE SIMILAR GROUND FOR ALL THE ASSESSMENT YEARS ON THE FOLLOWING GROUND:- ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE L D.CIT(A) HAS ERRED IN LAW AS WELL AS IN FACTS BY DELETING TH E PENALTY LEVIDED U/S. 271(1)( C) ON THE GROUND THAT THE ASSE SSEES CASE IS IMMUNIZED FROM PENALTY ON ACCOUNT OF EXPLANATION-5 TO SECTION 271(1) WHEN THE ASSESSEES CASE DOES NOT COME UNDER THE PURVIEW OF THE EXCEPTIONS PROVIDED THEREIN. 5. THE LEARNED DR ARGUED THAT BUT FOR THE SEARCH, THE ASSESSEE WOULD NOT HAVE COME FORWARD TO DISCLOSE THESE UNDISCLOSED INCOMES AND H ENCE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME AND ARGUED THAT PENALTY IS LE VIABLE IN TERMS OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT. HOWEVER, HE DID NOT PUT FORTH ANY OF HIS ARGUMENTS ON THE IMMUNITY PROVIDED IN CLAUSE 2 OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT. 5.1. IN RESPONSE TO THIS, THE LEARNED AR VEHEMENT LY SUPPORTED THE ORDER OF THE LEARNED CITA AND ARGUED THAT THE ASSESSEE HAD CUMUL ATIVELY SATISFIED ALL THE CONDITIONS STIPULATED IN CLAUSE 2 OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT AND HENCE IS ACCORDINGLY ELIGBLE FOR IMMUNITY FROM LEVY OF PENALTY THEREON. IN SUPPORT OF HIS ARGUMENTS, HE RELIED ON VARIOUS CASE LAWS THAT WERE FILED IN THE PAPER BOOK BY HIM. ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 4 HE ALSO ARGUED THAT THE PROVISIONS OF CLAUSE 2 OF E XPLANATION 5 TO SECTION 271(1)(C ) IS APPLICABLE FOR ALL THE ASSESSMENT YEARS PRIOR TO TH E YEAR OF SEARCH. HE ALSO ARGUED THAT EVEN THE ADDITIONAL DISCLOSURE OF RS. 25,00,000/-WA S MADE FOR ASST YEAR 2005-06 VOLUNTARILY BEFORE ANY DETECTION BY THE DEPARTMENT. HE FURTHER ARGUED THAT NOTHING IN THE SECTION 271(1)(C ) ORDER OF THE LEARNED AO SUGG ESTS THAT THE ADDITIONAL INCOME WAS DETECTED BY THE DEPARTMENT. WITH REGARD TO ARGUMEN TS OF LEARNED DR THAT BUT FOR THE SEARCH THIS UNDISCLOSED INCOME COULD NOT HAVE BEEN UNEARTHED, THE LEARNED AR ARGUED THAT THIS ISSUE IS SQUARELY COVERED IN FAVOUR OF TH E ASSESSEE BY THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN CIT VS AMARDEEP SING H DHANJAL IN ITA NO. 39 OF 2010 DATED 11.1.2013 . HE FURTHER ARGUED THAT THE EXPRESSION TO BE FURNISHED BEFORE THE EXPIRY OF TIME SPECIFIED IN SUBSECTION (1) OF S ECTION 139 USED IN CLAUSE 2 OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT MIGH T CREATE SOME DIFFICULTY FOR CLAIMING IMMUNITY AND HE ARGUED THAT THIS VERY QUES TION HAS BEEN ANSWERED IN FAVOUR OF THE ASSESSEE BY THE JURISDICTIONAL CALCUTTA HIGH COURT IN THE CASE OF C IT VS BRIJENDRA GUPTA IN ITA NO. 330 OF 2009 DATED 8.6.20 15 AND TOOK US TO THE RELEVANT OPERATIVE PORTION OF THE SAID JUDGEMENT. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD INCLUDING THE DETAILED PAPER BOOK FILED BY THE LEAR NED AR NUMBERING FROM PAGES 1 TO 134 CONTAINING THE VARIOUS PANCHANAMAS , STATEMENT RECORDED U/S 132(4) OF THE ACT , DISCLOSURE PETITION U/S 132(4) OF THE ACT, COPY OF RETURNS AND CORRESPONDENCE DATED 24.10.2007 ADDRESSED TO DCIT FOR OFFER OF ADDITIONA L INCOME OF RS. 25,00,000/- FOR ASST YEAR 2005-06. WE ALSO FIND THAT THE LEARNED A R HAD FILED SOME MORE PAPER BOOKS CONTAINING COMPILATION OF CASE LAWS ON THE IM PUGNED ISSUE. IT IS RELEVANT TO REPRODUCE EXPLANATION 5 TO SECTION 271(1)(C ) OF TH E ACT AT THIS JUNCTURE :- WHERE IN THE COURSE OF A [ SEARCH INITIATED UNDE R SECTION 132 BEFORE THE 1 ST DAY OF JUNE, 2007], THE ASSESSEE IS FOUND TO BE T HE OWNER OF ANY MONEY, BULLION, JEWELLERY OR OTHER VAL UABLE ARTICLE OR THING (HEREAFTER IN THIS EXPLANATION REFERRED TO AS ASSETS) AND THE ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 5 ASSESSEE CLAIMS THAT SUCH ASSETS HAVE BEEN ACQUIRED BY HIM BY UTILIZING (WHOLLY OR IN PART) HIS INCOME- 6.1. WE FIND THAT THE LEARNED CITA HAD STATED THAT SEARCH AND SEIZURE OPERATION WAS STARTED ON 23.8.2006, THE STATEMENT OF DISCLOSURE H AD BEEN FILED ON 20.10.2006 DURING THE COURSE OF STATEMENT GIVEN U/S 132(4) OF THE ACT , THE NOTICES U/S 153A WERE ISSUED ON 6.6.2007, RETURNS WERE FILED ON 12.7.2007 AND TH E ASSESSMENT OF THE CASES WERE COMPLETED ON 20.6.2008. AT THE TIME OF FILING OF T HE DISCLOSURE STATEMENT, AS WELL AS IN COURSE OF THE ASSESSMENT PROCEEDINGS, DETAILED CASH FLOW CHARTS AND EXPLANATIONS WERE FILED SUBSTANTIATING THE DISCLOSURE MADE PURSUANT T O SEARCH. THE ASSESSING OFFICER DID NOT INDEPENDENTLY WORK OUT THE QUANTUM OF UNDISCLOS ED INCOME WHICH WAS DIFFERENT FROM OR IN EXCESS OF WHAT WAS PROMISED IN THE STATE MENT GIVEN U/S 132(4) OF THE ACT. 6.2. WE FIND LOT OF FORCE IN THE ARGUMENTS OF THE LEARNED AR THAT THE ADDITIONAL DISCLOSURE OF RS. 25,00,000/- FOR THE ASST YEAR 200 5-06 WAS MADE BEFORE ANY DETECTION BY THE DEPARTMENT AND WAS MADE VOLUNTARILY AND HENC E THE SAME HAS TO BE CONSTRUED ONLY AS A REVISION OF THE DISCLOSURE STATEMENT U/S 132(4) OF THE ACT AS THERE WAS NOTHING CONTRARY THAT WAS SUGGESTED IN THE PENALTY ORDER U/ S 271(1)(C ) OF THE ACT WITH REGARD TO THE SAME. IN THIS REGARD, IT IS RELEVANT TO PLACE RELIANCE ON THE DECISION OF COORDINATE BENCH DECISION OF THIS TRIBUNAL IN THE CASE OF DCIT VS SHAYAM SUNDER BERIWAL (KOLKATA TRIBUNAL) IN ITA NOS. 1061 , 1062 & 1063 / KOL / 20 08 DATED 31.10.2008 FOR THE ASST YEARS 2003-04 , 2004-05 & 2005-06 , WHEREIN IT WAS HELD THAT :- IN THE PRESENT CASE, THIS IS ALSO NOT A CASE OF R EVENUE THAT THE HIGHER INCOME DECLARED BY THE ASSESSEE DURING THE COURSE O F RE-ASSESSMENT PROCEEDINGS ONLY AFTER BEING APPRAISED BY THE DEPAR TMENT SINCE THE ASSESSEE PAID TAX OF SUCH HIGHER INCOME WHICH WAS D ISCLOSED VIDE FILING THE RETURN IN RESPONSE TO NOTICE UNDER SECTION 153C AND SUCH HIGHER INCOME HAS BEEN FILED BY THE ASSESSEE SUO MOTU AND BEFORE ANY SPECIFIC FINDING BY THE DEPARTMENT THE SAME CANNOT TANTAMOUNT TO CONCEA LMENT. WE ALSO FIND THAT SUCH HIGHER INCOME SHOWN BY THE ASSESSEE HAS A LSO BEEN FOUND TO BE CORRECT BY THE DEPARTMENT, THEREFORE, IN OUR CONSID ERED OPINION AND ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 6 FOLLOWING THE RATIO LAID DOWN BY THE VARIOUS LEGAL PRONOUNCEMENT THE SAME CANNOT BE TERMED TO BE CONCEALMENT AND IS BEYOND TH E SCOPE OF PENALTY UNDER SECTION 271(1)(C ) AND , THEREFORE, IN THESE CIRCUMSTANCES, IN OUR CONSIDERED OPINION, THE LEARNED CITA WSA JUSTIFIED IN DELETING THE ADDITION IN CASE OF ALL THE ABOVE FOUR YEARS AND WE, THEREFO RE, DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF LD. CIT(A) AND UPHOL D THE SAME AND REJECT THE GROUNDS RAISED BY THE REVENUE IN CASE OF ALL THE FO UR YEARS. 6.2.1. IT WILL BE RELEVANT TO DISCUSS THE FOLLOWIN G CASE LAW AT THIS JUNCTURE I.E THE DECISION OF ITAT DELHI BENCH IN THE CASE OF PREM ARORA VS DCIT REPORTED IN (2012) 24 TAXMANN.COM 260 (DELHI) WHEREIN THE HEAD NOTES ARE REPRODUCED HEREIN BELOW: - SECTION 271(1)(C ), READ WITH SECTION 153A, OF THE INCOME TAX ACT, 1961 PENALTY FOR CONCEALMENTOF INCOME ASSESSMENT YEA R 2004-05 WHETHER FOR PURPOSE OF IMPOSITION OF PENALTY UNDER SECTION 271(1)(C ) RESULTING AS A RESULT OF SEARCH ASSESSMENTS MADE UN DER SECTION 153A, ORIGINAL RETURN OF INCOME FILED UNDER SECTION 139 C ANNOT BE CONSIDERED HELD, YES WHETHER CONCEALMENT OF INCOME HAS TO BE SEEN WITH REFERENCE TO ADDITIONAL INCOME BROUGHT TO TAX OVER AND ABOVE INCOME RETURNED BY ASSESSEE IN RESPONSE TO NOTICE ISSUED UNDER SECTION 153A AND, THEREFORE, ONCE RETURNED INCOME UNDER SECTION 153A IS ACCEPTED BY ASSESSING OFFICER, IT CAN NEITHER BE A CASE OF CONCEALMENT OF INCOME N OR FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME HELD, YES SEARCH WAS CONDUCTED ON 22-11-2006 AND CASH WAS FOUND FROM POSSESSION OF ASSESSEE ASSESSEE HAD DRAWN CASH FLOW STATEMENT FOR ENTIRE PERIOD OF SIX YEARS IN ORDER TO DETERMINE UNDISCLOSED INCOME BASED ON SEIZED MATERI AL FOR EACH OF SIX ASSESSMENT YEARS WHETHER PENALTY UNDER SECTION 27 1(1)(C ) CANNOT BE IMPOSED BY INVOKING EXPLANATION 5 IN ASSESSMENT YEA R 2004-05 IN RESPECT OF CASH FOUND IN PREVIOUS YEAR RELEVANT TO ASSESSME NT YEAR 2007-08 , MERELY ON PRESUMPTION THAT ASSESSEE MIGHT HAVE BEEN IN POSSESSION OF CASH THROUGHOUT PERIOD COVERED BY SEARCH ASSESSMENTS H ELD, YES [ IN FAVOUR OF ASSESSEE] 6.2.2. WE FIND THAT THIS DECISION OF DELHI TRIBUNA L HAS BEEN FOLLOWED BY THIS TRIBUNAL IN THE CASE OF DCWT VS VIVEK KR. KATHOTIA IN WTA NOS. 02 TO 08 / KOL / 2013 DATED 15.5.2015, WHEREIN IT WAS HELD THAT :- ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 7 THAT THE CONCEPT OF A VOLUNTARY RETURN OF INCOME M AY BE IMPORTANT IN PENALTY PROCEEDINGS INITIATED IN THE NORMAL ASSESSM ENT PROCEEDINGS U/S 143(3) OR 147 OF THE ACT BUT NOT U/S 153A OF THE AC T. WHEN ACCEPTED BY THE AO THEN THERE IS NO CONCEALMENT OF INCOME AND CONSE QUENTLY PENALTY U/S 271(1)(C ) OF THE ACT CANNOT BE IMPOSED. THE CONCE ALMENT OF INCOME IS TO BE DETERMINED WITH REGARD TO THE RETURN OF INCOME I N RESPONSE TO NOTICE U/S 153A OF THE ACT. THEREFORE, IN THE PRESENT CIRCUMSTANCES AND FACT S OF THE CASE ONCE THE RETURNED WEALTH IS ACCEPTED BY THE AO U/S 153A OF THE ACT THEN THERE CANNOT BE A CASE OF CONCEALMENT OF INCO ME OR FURNISHING INACCURATE PARTICULARS OF INCOME. IN THE CIRCUMSTA NCES AND FACTS OF THE CASE THE DECISION IN THE CASE OF PREM ARORA VS DCIT (24 TAXMANN.COM 260) (DELHI TRIBUNAL) IS SQUARELY APPLICABLE IN THE PRES ENT CASE, SINCE IN THE PRESENT CASE THE ASSESSEE HAS DISCLOSED GOLD AND DI AMOND IN THE STATEMENT RECORDED U/S 132(4) OF THE ACT DURING THE SEARCH OP ERATION ITSELF, IN THE WEALTH TAX RETURN THE TRIBUNAL HAS APPROVED THE FIN DINGS IN QUANTUM WITH REGARD TO THE GENUINENESS OF THE DECLARATION OF GOL D AND DIAMONDS. ACCORDINGLY THE ASSESSEE IS NOT LIABLE TO HAVE PENA LTY U/S 271(1)(C ) OF THE ACT. 6.3. WE FIND THAT THE ASSESSEE HAD MADE A DISCLOSU RE STATEMENT U/S 132(4) OF THE ACT AFTER THE SEARCH OFFERING UNDISCLOSED INCOME, EXPLA INING THE MANNER IN WHICH SUCH INCOME WAS DERIVED AND PAID TAXES THEREON TOGETHER WITH INTEREST. THE ASSESSEE ALSO DULY OFFERED THE SAID UNDISCLOSED INCOME IN THE RET URNS FILED IN RESPONSE TO NOTICE UNDER SECTION 153A OF THE ACT AND ASSESSMENTS COMPL ETED ACCORDINGLY. WE HOLD THAT THE EXPRESSION TO BE FURNISHED IN CLAUSE 2 OF EXP LANATION 5 TO SECTION 271(1)(C ) OF THE ACT HAS TO BE UNDERSTOOD AS REQUIRED TO BE FU RNISHED WHICH IN TURN HAS TO BE UNDERSTOOD AS A RETURN REQUIRED TO BE FURNISHED IN RESPONSE TO NOTICE U/S 153A OF THE ACT. IN THIS REGARD, WE PLACE RELIANCE ON THE DECI SION OF THE JURISDICTIONAL CALCUTTA HIGH COURT IN THE CASE OF CIT VS BRIJENDRA GUPTA IN ITA NO. 330 OF 2009 DATED 8.6.2015 , WHEREIN THE QUESTION RAISED BEFORE THEIR LORDSHIP S AND THEIR DECISION RENDERED THEREON IS AS UNDER:- THE FOLLOWING QUESTION OF LAW WAS SUGGESTED BY THE REVENUE:- WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LEARNED TRIBUNAL WAS JUSTIFIED IN LAW IN CONFIRMING THE ORDER OF THE CIT(A) IN DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C ) OF THE INCO ME TAX ACT, 1961 ON THE ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 8 GROUND THAT THE ASSESSEE IS ENTITLED TO IMMUNITY FR OM PENALTY ON ACCOUNT OF EXPLANATION 5 TO SECTION 271(1)(C ) WHEN THE ASSESS EES CASE DOES NOT COME UNDER THE PURVIEW OF THE EXCEPTIONS PROVIDED THEREI N. HELD THAT : CLAUSE (A) OF EXPLANATION 5 TO SECTION 271(1)(C ) C ONTEMPLATES INCOME FOR ANY PREVIOUS YEAR FOR WHICH RETURNS HAS BEEN FURNIS HED BUT THE INCOME SINCE DISCLOSED HAD NOT BEEN SHOWN. IT IS AXIOMATI C THAT IF SUCH INCOME HAD BEEN DISCLOSED IN THE RETURNS FILED UNDER SECTION 1 39, THE QUESTION OF UNDISCLOSED INCOME WOULD NOT HAVE ARISEN. WHEN THE RETURN HAD BEEN FILED BUT THE INCOME SINCE DISCOVERED WAS NOT DISCLOSED, THE QUESTION OF CONCEALMENT NATURALLY ARISES. THE LEGISLATURE, HOW EVER, MADE A CONSCIOUS DEPARTURE BY CARVING OUT AN EXCEPTION PROVIDED THE CONDITIONS LAID DOWN IN CLAUSE (I) OR CLAUSE (II) THEREOF HAVE BEEN COMPLI ED WITH. WE ARE, IN THIS CASE, CONCERNED WITH CLAUSE (II). ONE OF THE CONDITIONS IS THAT THE ASSESSEE MAKES A STATEMENT UNDER SECTION 1 32(4) THAT THE ASSETS UNEARTHED HAVE BEEN ACQUIRED OUT OF HIS INCOME WHIC H HAS NOT BEEN DISLOSED SO FAR IN HIS RETURNS OF INCOME ALREADY FI LED. THE DIFFICULTY ARISES BY THE USE OF THE EXPRESSION TO BE FURNISHED BEFOR E THE EXPIRY OF TIME SPECIFIED IN SUB-SECTION (1) OF SECTION 139. A CO NFUSION IS LIKELY TO ARISE AS TO WHETHER THE DEPARTURE HAS BEEN SOUGHT TO BE M ADE BY THE LEGISLATURE ONLY FOR THOSE CASES WHERE THE STATEMENT AS REGARDS UNDISCLOSED INCOME WAS MADE PERTAINING TO A PREVIOUS YEAR FOR WHICH TI ME TO FILE RETURN UNDER SECTION 139 HAD NOT EXPIRED. BUT THAT WAS NOT THE INTENTION BECAUSE THE EXPRESSION UNLESS APPEARS AFTER CLAUSES (A) AND ( B) OF EXPLANATION WHICH PROVIDES FOR IMPOSITION OF PENALTY. THEREFOR E, UNLESS HAS TO APPLY TO THE PROVISION FOR IMPOSITION OF PENALTY. THEREF ORE, THE AFORESAID EXPRESSION TO BE FURNISHED HAS TO BE INTERPRETED AS REQUIRED TO BE FURNISHED. ONLY IN THAT CASE THE SECTION WILL MAK E A MEANING OTHERWISE THE SECTION DOES NOT MAKE ANY MEANING. WE ARE SUPPORTED IN OUR VIEW BY THE JUDGEMENT OF TH E MADRAS HIGH COURT IN THE CASE OF CIT VS S.D.CHANDRU REPORTED IN (2004 ) 266 ITR 175 (MAD)WHEREIN A DIVISION BENCH OPINED THAT THE ADDI TIONAL WORDS WHICH REFER TO THE TIME SPECIFIED IN SECTION 139(1) ARE O NLY A REITERATION OF THE LEGAL REQUIREMENT REGARDING THE TIME WITHIN WHICH R ETURNS SHOULD NORMALLY BE FILED. IN THAT VIEW OF THE MATTER, THE QUESTION PROPOSED B Y REVENUE IS ANSWERED IN THE AFFIRMATIVE AND IN FAVOUR OF THE ASSESSEE. THE APPEAL IS THUS DISPOSED OF. ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 9 6.4. WE HOLD THAT THE IMMUNITY PROVIDED IN CLAUSE 2 OF EXPLANATION 5 TO SECTION 271(1)(C ) OF THE ACT IS AVAILABLE TO ALL THE ASSES SMENT YEARS PRIOR TO THE YEAR OF SEARCH IF THE CONDITIONS STIPULATED THEREON ARE SAT ISFIED. RELIANCE IN THIS REGARD IS PLACED ON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS RAMESH CHAND GOYAL IN G.A.NO. 2347 OF 2010 IN ITAT NO. 181 OF 2010 DATED 11.8.2010 , WHEREIN THE QUESTION RAISED BEFORE THEIR LORDSHI PS AND DECISION RENDERED THEREON IS AS BELOW:- (A) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED TRIBUNAL WAS JUSTIFIED IN LAW IN CANCELLING THE ORD ER OF PENALTIES FOR RS. 3,99,476/- , RS. 5,24,169/-, RS. 5,96,020/-, RS. 4, 86,030/- AND RS. 25,12,525/- FOR THE ASSESSMENT YEARS 2002-03 , 2003 -04, 2004-05, 2005-06 AND 2006-07 RESPECTIVELY ON THE GROUND THAT THE EXP LANATION 5 TO SECTION 271(1)( C) PROTECTS THE ASSESSEE FROM PENALTY ON AD MITTED UNDISCLOSED INCOME UNDER SECTION 132(4) OF THE ACT WITHOUT APPR ECIATING THAT THE ASSESSEE HAS MADE THE DISCLOSURE IN THE ASSESSMENT YEARS 2006-07 AND THE IMMUNITY UNDER EXPLANATION 5 TO SECTION 271(1)( C) IS AVAILABLE FOR THE YEARS FOR WHICH THE RETURN IS YET TO BE FURNISHED B EFORE THE EXPIRY OF TIME LIMIT UNDER SECTION 139(1) OF THE ACT WHEREAS THE D UE DATE FOR FILING OF RETURN UNDER SECTION 139(1) OF THE ACT FOR THE ASSE SSMENT YEARS 2001-02 TO 2005-06 HAD ALREADY EXPIRED AND RETURNS FILED PRIOR TO THE DATE OF SEARCH AND FOR THE ASSESSMENT YEARS 2006-07 ALSO THE RETUR N WAS NOT FILED ON THE DUE DATE. WE HAVE HEARD MR.SINHA EXTENSIVELY AND GONE THROUGH THE IMPUGNED JUDGEMENT AND ORDER OF THE LEARNED TRIBUNAL. THE L EARNED TRIBUNAL HAS RECORDED THE FACT THAT THE RECORD DOES NOT SHOW THA T THE ASSESSING OFFICER HAD DETECTED THE ADDITIONAL INCOME IN THE ASSESSMEN T PROCEEDINGS. IT FURTHER RECORDED UPON PERUSAL OF THE RECORDS THAT S MALL VARIATION IN INCOME WAS DUE TO BONA FIDE MISTAKES AND DIFFICULTIES IN W ORKING OUT THE UNDISCLOSED INCOME. IT IS FURTHER RECORDED THAT TH E VOLUNTARY ACTION ON THE PART OF THE ASSESSEE TO SETTLE THE TAX ISSUES FOR P EACE OF MIND APPEARS FROM THE CONDUCT OF THE ASSESSEE. WHILE RECORDING THE A FORESAID FACT, THE LEARNED TRIBUNAL ULTIMATELY RELIED ON A DECISION OF THE TRIBUNAL RENDERED IN THE CASE OF ADDITIONAL CIT VS PREM CHAND GARG. MR. SINHA, HOWEVER, IS UNABLE TO SAY WHETHER THE EARLIER DECISION OF THE T RIBUNAL IN THE CASE OF ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 10 PREM CHAND GARG HAS BEEN CHALLENGED OR NOT. MOREOV ER, THE LEARNED TRIBUNAL HAS ALSO RELIED ON A LARGE NUMBER OF DECIS IONS OF THE VARIOUS COURT ON THE SAME POINT. HENCE WHEN THE POINT IS COVERED , WE DO NOT FIND ANY MERIT IN THIS APPEAL FOR ADMISSION. ACCORDINGLY, T HE SAME IS DISMISSED. 6.5. WE WOULD LIKE TO PLACE RELIANCE ON THE FOLLOW ING DECISIONS ON THE IMPUGNED ISSUE BEFORE US : - A) JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS SHRI SAMIT ROY IN ITA 354 OF 2009 DATED 3.9.2015, WHEREIN THE QUESTIONS RAISED BEFORE THEIR LORDSHIPS AND THEIR DECISION RENDERED THEREON IS AS BELOW:- (A) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE INCOME TAX APPELLATE TRIBUNAL ERRED IN LAW IN UPHOL DING THE ORDER OF COMMISSIONER OF INCOME TAX (APPEAL) HOLDING THEIR A MOUNTS DISCLOSING AFTER SEARCH, WHICH WAS NOT PREVIOUSLY OFFERED TO T AX IS NOT A CONCEALMENT ON THE PART OF THE RESPONDENT / ASSESSEE ? (B) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE THE INCOME TAX APPELLATE TRIBUNAL ERRED IN LAW IN UPHOLDING TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEAL) HOLDING THE ASS ESSING OFFICER WAS NOT JUSTIFIED IN LEVYING PENALTY UNDER SECTION 271( 1)(C ) OF THE INCOME TAX ACT, 1961 FOR THE ASSESSMENT YEARS 2003-04 TO 2005- 06 ? SINCE BOTH THE QUESTIONS ARE COVERED BY THE JUDGEME NTS PASSED BY THIS COURT IN ITA 39 OF 2010 (COMMISSIONER OF INCOME TA X , CENTRAL I, KOLKATA VS AMARDEEP SINGH DHANJAL) AND IN ITA 330 O F 2009 (COMMISSIONER OF INCOME TAX, CENTRAL III, KOLKATA VS BRIJENDRA GUPTA), BOTH THE QUESTIONS ARE ANSWERED IN THE NEGATIVE, AG AINST THE REVENUE AND IN FAVOUR OF THE ASSESSEE. THE APPEAL IS DISMISSED. B) JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS TAP AN KUMAR GHOSH IN ITA 6 OF 2010 DATED 3.9.2015, WHEREIN THE QUESTIONS RAISED BEFORE THEIR LORDSHIPS AND THEIR DECISION RENDERED THEREON IS AS BELOW:- WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED TRIBUNAL HAS COMMITTED ERROR IN APPLYING THE PROVIS IONS OF THE EXPLANATION 5 OF SECTION 271(1)(C ) OF THE INCOME TAX ACT, 1961 AND THEREBY COMMITTED ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 11 ERROR IN LAW IN MODIFYING THE ORDER OF PENALTY OF R S. 4,17,926/- IN RELATION TO THE ASSESSMENT YEARS 2003-04 AND 2005-06 SINCE WE FIND THAT THE ISSUE STANDS COVERED BY THE JUDGEMENTS DELIVERED IN ITA 39 OF 2010 (COMMISSIONER OF INCOME TAX , CENTR AL I, KOLKATA VS AMARDEEP SINGH DHANJAL) AND IN ITA 330 OF 2009 (COM MISSIONER OF INCOME TAX, CENTRAL III, KOLKATA VS BRIJENDRA GUPT A), IN FAVOUR OF THE ASSESSEE, THE QUESTION IS ANSWERED IN THE NEGATIVE, AGAINST THE REVENUE AND IN FAVOUR OF THE ASSESSEE. THE APPEAL IS DISMISSED. C) GUJARAT HIGH COURT IN THE CASE OF KIRIT DAHYABHAI P ATEL VS ACIT IN TAX APPEAL NO. 1181 OF 2010 WITH TAX APPEAL NO. 1182 TO 1185 OF 2010 DATED 3.12.2014 , WHEREIN THE QUESTION RAISED BEFORE THEIR LORDSHIPS AND THEIR DECISION RENDERED THEREON IS AS BELOW:- WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THE INCOME TAX APPELLATE TRIBUNAL WAS RIGHT IN LAW IN RESTORING TH E PENALTY IMPOSED UNDER SECTION 271(1)(C ) OF THE ACT HOLDING THAT BENEFIT UNDER EXPLANATION 5 TO SECTION 271(1)( C) OF THE ACT WOULD BE AVAILABLE ON LY FOR PERIOD WHERE DUE DATE FOR FILING THE RETURN UNDER SECTION 139(1) OF THE ACT HAD NOT EXPIRED ? 13. CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO CONSIDERING THE DECISIONS RELIED UPON BY LEARNED SE NIOR ADVOCATE FOR THE APPELLANT, WE ARE OF THE CONSIDERED OPINION THAT TH E VIEW TAKEN BY THE TRIBUNAL IS ERRONEOUS. THE CIT(A) RIGHTLY HELD THA T IT IS NOT RELEVANT WHETHER ANY RETURN OF INCOME WAS FILED BY THE ASSES SEE PRIOR TO THE DATE OF SEARCH AND WHETHER ANY INCOME WAS UNDISCLOSED IN TH AT RETURN OF INCOME. IN VIEW OF SPECIFIC PROVISION OF SECTION 153A OF TH E I.T.ACT, THE RETURN OF INCOME FILED IN RESPONSE TO NOTICE UNDER SECTION 15 3A OF THE I.T.A ACT IS TO BE CONSIDERED AS RETURN FILED UNDER SECTION 139 OF THE ACT, AS THE ASSESSING OFFICER HAS MADE ASSESSMENT ON THE SAID RETURN AND THEREFORE, THE RETURN IS TO BE CONSIDERED FOR THE PURPOSE OF PENALTY UNDER S ECTION 271(1)(C ) OF THE I.T.ACT AND THE PENALTY IS TO BE LEVIED ON THE INCO ME ASSESSED OVER AND ABOVE THE INCOME RETURNED UNDER SECTION 153A, IF AN Y. 14. FURTHER, IN THE PRESENT CASE, IT APPEARS FROM T HE RECORD THAT THE ASSESSES HAD SATISFIED ALL THE CONDITIONS WHICH ARE REQUIRED FOR CLAIMING IMMUNITY FROM PAYMENT OF PENALTY UNDER SECTION 271( 1)(C )OF THE ACT. THE PROVSION DOES NOT SPECIFY ANY TIME LIMIT DURING WHI CH THE AFORESAID AMOUNT I.E THE AMOUNT OF PENALTY WITH INTEREST HAS TO BE P AID. ADMITTEDLY WHEN THE ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 12 ASSESSEE HEREIN HAVE PAID THE ENTIRE AMOUNT WITH IN TEREST, THE ASSESSING OFFICER OUGHT TO HAVE GRANTED THEM IMMUNITY AVAILAB LE UNDER SECTION 271(1)(C ) OF THE INCOME TAX ACT. 18. FOR THE FOREGOING REAONS, THE PRESENT APPEALS S TAND ALLOWED. THE ORDER OF THE TRIBUNAL IS QUASHED AND SET ASIDE. CONSEQUE NTLY, THE ORDER OF THE CIT(A) IS RESTORED. THE QUESTION OF LAW INVOLVED I N THIS APPEALS IS ANSWERED IN FAVOUR OF THE ASSESEE AND AGAINST THE R EVENUE. D. GUJARAT HIGH COURT IN THE CASE OF CIT VS MAHEND RA C SHAH REPORTED IN (2008) 299 ITR 305 (GUJ) , IT WAS HELD THAT :- THE ASSESSEE HAVING MADE A DECLARATION U/S 132(4) A ND PAID TAXES THEREON HAD FULFILLED ALL THE CONDITIONS FOR AVAILING OF TH E BENEFIT OF IMMUNITY FROM LEVY OF PENALTY AS PROVIDED UNDER EXPLANATION 5 TO SECTION 271(1)( C) OF THE ACT. E. RAJASTHAN HIGH COURT IN THE CASE OF CIT VS KANH AIALAL REPORTED IN (2008) 299 ITR 19 (RAJ) , IT WAS HELD THAT :- WHERE THE ASSESSING OFFICER HAD FOUND THE INCOME TO RELATE TO DIFFERENT ASSESSMENT YEARS, IN DIFFERENT VOLUMES, AS CONTRA D ISTINGUISHED TO THE ONE SUBMITTED BY THE ASSESSEE, AND HAD ACCORDINGLY MADE THE ASSESSMENTS, WHICH ASSESSMENTS HAD BECOME FINAL AND WERE NOT THE SUBJECT MATTER OF CHALLENGE, PENALTY U/S 271(1)(C ) COULD NOT BE IMPO SED BY VIRTUE OF EXPLANATION 5. F. MADRAS HIGH COURT IN THE CASE OF CIT VS S.D.CHA NDRU REPORTED IN (2004) 266 ITR 175 (MAD) , IT WAS HELD THAT :- PENALTY U/S 271(1)( C) WAS NOT LEVIABLE BY OPERATIO N OF EXPLANATION 5 IN A CASE WHERE A STATEMENT U/S 132(4) WAS FILED IN COUR SE OF A SEARCH AND SEIZURE AND THEREFORE, ADMITTED A LARGER INCOME FOR THE EARLIER YEARS ON WHICH TAX WITH INTEREST HAD BEEN PAID. G. RAJASTHAN HIGH COURT IN THE CASE OF ACIT VS GEB ILAL KANHAIALAL REPORTED IN (2004) 270 ITR 523 (RAJ) , IT WAS HELD THAT:- ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 13 PENALTY U/S 271(1)(C ) WAS NOT LEVIABLE BY OPERATIO N OF EXPLANATION 5 IN A CASE WHERE A STATEMENT U/S 132(4) WAS FILED IN COUR SE OF A SEARCH AND SEIZURE AND THEREAFTER THE ASSESSEE HAS DISCLOSED A PARTICULAR CONCEALED INCOME AND SURRENDERED IT FOR TAX AND TAX HAD BEEN TOGETHER WITH INTEREST. 6.6. IN VIEW OF THE AFORESAID FACTS AND CIRCUMSTAN CES OF THE CASE AND IN VIEW OF THE VARIOUS JUDICIAL PRECEDENTS RELIED UPON HEREINA BOVE INCLUDING THAT OF THE JURISDICTIONAL HIGH COURT AND OTHER HIGH COURTS, WE ARE OF THE CONSIDERED OPINION THAT : - THE ASSESSEE HAS CUMULATIVELY SATISFIED ALL THE C ONDITIONS STIPULATED IN CLAUSE 2 OF EXPLANATION 5 TO SECTION 271(1)( C) OF THE ACT AND HENCE ENTITLED FOR IMMUNITY FROM LEVY OF PENALTY FOR ALL THE ASSESSMENT YEARS U NDER APPEAL; - THE ASSESSEE HAD MADE VOLUNTARY DISCLOSURE OF RS. 25,00,000/- FOR THE ASST YEAR 2005-06 DURING THE COURSE OF SEARCH ASSESSMENT PROC EEDINGS AFTER FILING THE RETURN U/S 153A OF THE ACT BUT BEFORE ANY DETECTION BY THE DEPARTMENT; - THE EXPRESSION TO BE FURNISHED MENTIONED IN CLA USE 2 OF EXPLANATION 5 TO SECTION 271(1)(C ) HAS TO BE CONSTRUED AS REQUIRED TO BE FURNISHED U/S 153A OF THE ACT ACCORDINGLY, THE GROUNDS RAISED BY THE REVENUE FO R ALL THE ASSESSMENT YEARS ARE DISMISSED. 7. IN THE RESULT, THE APPEALS OF THE REVENUE ARE D ISMISSED. THIS ORDER IS PRONOUNCED IN OPEN COURT ON 30 /11/2 015 SD/- ( S.S. VISWANETHRA RAVI, JUDICIAL MEMBER ) SD/- (M. BALAGANESH, ACCOUNTANT MEMBER) DATE 30 /11 /2015 ITA NOS 1875- 1878/KOL/09-B-A M DEEPAK CHOUDHURY 14 COPY OF THE ORDER FORWARDED TO: 1.. THE APPELLANT : THE DCIT,CC-1, 18 RABINDRA SAR ANI, KOL-1. 2 THE RESPONDENT- SHREE DEEPAK CHOUDHURY 403/404 S URYA KIRAN 4 ASHOKA ROAD, KOL-27. 3 4.. THE CIT, THE CIT(A) 5. DR, KOLKATA BENCH 6. GUARD FILE. TRUE COPY, BY ORDER, ASSTT REGISTRAR ** PRADIP SPS
