Deputy Commissioner of Income-tax, V. Shri Mallikarjun B. Patil, Aurangabad

ITA 2000/PUN/2013

• Counselvise Citation: 200024514 RSA 2013
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-11-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 13-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained expenditure; Agreed addition; Tax effect
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO.2000/PN/2013 (ASSESSMENT YEAR : 2008-09) DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, AURANGABAD. . APPELLANT VS. SHRI MALLIKARJUN B. PATIL, SFS COMPLEX 115-116, JALNA ROAD, AURANGABAD. PAN : ABFPP5818F . RESPONDENT DEPARTMENT BY : SHRI RAJESH DAMOR ASSESSEE BY : NONE DATE OF HEARING : 13-10-2014 DATE OF PRONOUNCEMENT : 26-11-2014 ORDER PER G. S. PANNU, AM THE CAPTIONED APPEAL BY THE REVENUE IS DIRECTED AGA INST AN ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), AURANGABA D DATED 27.08.2013 WHICH, IN TURN, HAS ARISEN FROM AN ORDER DATED 10.0 5.2011 PASSED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE INCOME-TAX A CT, 1961 (IN SHORT THE ACT), PERTAINING TO THE ASSESSMENT YEAR 2008-09. 2. IN THIS APPEAL, REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE PENALTY OF RS. 3,00,234/-, IMPOSED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C ) OF THE I NCOME-TAX ACT, 1961, ON THE ADDITION OF UNEXPLAINED EXPENDITURE OF RS.8,83, 303/-. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT EXPENDITURE PE RTAINED TO GROUP AND NOT THE ASSESSEE ONLY. IN FACT, THE ADDITION OF RS.8,8 3,303/- MADE BY THE ASSESSING OFFICER, WAS ACCEPTED BY THE ASSESSEE, WH ICH CLEARLY SHOWS THAT THE EXPENDITURE PERTAINED TO THE ASSESSEE ONLY. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT THE ASSESSING OFFICER DID NOT BRING OUT ITA NO.2000/PN/2013 ANY CORROBORATIVE EVIDENCE TO PROVE THAT THE SAID E XPENDITURE WAS ACTUALLY INCURRED. IN FACT, IMPOUNDED DOCUMENTS ITSELF, ON THE BASIS OF WHICH THE ADDITION WAS MADE, WAS THE EVIDENCE. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN NOT APPRECIATING THE FACT T HAT IN RESPECT OF UNEXPLAINED EXPENDITURE, THERE COULD NOT HAVE BEEN ANY FURTHER EVIDENCE. IN THIS REGARD, RELIANCE IS PLACED ON THE DECISION OF THE HON'BLE D ELHI HIGH COURT IN THE CASE OF CIT VS. NARESHKUMAR AGGRAWALA (INCOME-TAX ACT, 1 961 NO.225 OF 2004). 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD. CIT(A) ERRED IN HOLDING THAT THE PENALTY IS NOT IMPOSABLE ON AGREED ADDITIONS. ON THE CONTRARY, PENALTY IS IMPOSABLE ON AGREED ADDITIONS, AND ALSO NO FURTHER EVIDENCE IS REQUIRED IN VIEW OF THE DECISIONS IN THE CASES OF CIT VS. DR. R.C. GUPTA & CO. (122 ITR 567) OF RAJAS THAN HIGH COURT AND CIT VS. KRISHNA & CO. (120 ITR 144) OF MADRAS HIGH COUR T. 3. IT WAS NOTICED AT THE TIME OF HEARING THAT NO AP PEARANCE WAS PUT BY OR ON BEHALF OF THE RESPONDENT-ASSESSEE INSPITE OF SER VICE OF NOTICE BY WAY OF A REGISTERED AD. THEREFORE, THE APPEAL IS BEING DISP OSED-OFF EX-PARTE QUA THE RESPONDENT AFTER HEARING THE APPELLANT-REVENUE ON M ERITS FOLLOWING RULE 25 OF THE APPELLATE TRIBUNAL RULES, 1963. 4. IN BRIEF, THE RELEVANT FACTS ARE THAT ASSESSEE I S AN INDIVIDUAL ENGAGED IN THE BUSINESS OF CIVIL CONTRACTING. A SURVEY ACTION U/S 133A OF THE ACT WAS CONDUCTED IN THE BUSINESS PREMISES OF THE ASSESSEE ON 22.12.2008 AND ON 08.04.2009 ASSESSEE FILED A RETURN OF INCOME FOR TH E ASSESSMENT YEAR 2008-09 DECLARING AN INCOME OF RS.6,46,06,420/-. T HE RETURN FILED BY THE ASSESSEE WAS SUBJECT TO A SCRUTINY ASSESSMENT U/S 1 43(3) DATED 30.12.2010 WHEREIN THE TOTAL INCOME WAS ASSESSED AT RS.7,76,53 ,290/- AFTER MAKING ADDITIONS OF RS.1,30,46,870/-. THE ABOVE ADDITION MADE TO THE RETURNED INCOME, INCLUDED RS.8,83,303/- ON ACCOUNT OF UNEXPL AINED EXPENDITURE NOT ACCOUNTED IN THE ACCOUNT BOOKS OF THE GROUP CONCERN S; AND, RS.19,85,248/- ON ACCOUNT OF 12 CREDITORS WHICH WERE OUTSTANDING FOR MORE THAN TWO YEARS AS INFRUCTUOUS CREDIT BALANCES I.E. LIABILITY NO LONGE R PAYABLE. SUBSEQUENTLY, THE ASSESSING OFFICER HELD THE ASSESSEE GUILTY OF FURNI SHING INACCURATE PARTICULARS OF INCOME QUA THE AFORESAID TWO ADDITIONS WITHIN TH E MEANING OF SECTION ITA NO.2000/PN/2013 271(1)(C) OF THE ACT. ACCORDINGLY, IN AN ORDER PAS SED U/S 271(1)(C) OF THE ACT DATED 10.05.2011, PENALTY EQUIVALENT TO 100% OF THE TAX SOUGHT TO BE EVADED ON THE ABOVE TWO ADDITIONS WAS LEVIED, WHICH AMOUNT ED TO RS.9,72,885/-. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CI T(A), WHO BY WAY OF THE IMPUGNED ORDER HAS DELETED THE PENALTY LEVIED WITH RESPECT TO THE AFORESAID TWO ADDITIONS. THE PRESENT APPEAL OF THE REVENUE I S DIRECTED AGAINST THE AFORESAID DECISION OF THE CIT(A), SO HOWEVER, THE O NLY GROUND RAISED BY THE REVENUE BEFORE US IS CHALLENGING THE PENALTY OF RS. 3,00,234/- CORRESPONDING TO THE ADDITION ON ACCOUNT OF UNEXPLAINED EXPENDITU RE OF RS.8,83,303/- ONLY. IN THE GROUNDS OF APPEAL, WHICH WE HAVE ENUMERATED ABOVE, THERE IS NO CHALLENGE TO THE PENALTY DELETED WITH RESPECT TO TH E OTHER ADDITION OF RS.19,85,248/- MADE ON ACCOUNT OF LIABILITIES NO LO NGER PAYABLE. 5. UNDER THESE CIRCUMSTANCES, THE TAX EFFECT OF THE DISPUTE IN THE IMPUGNED CAPTIONED PROCEEDINGS AMOUNTING TO RS.3,00 ,234/- IS BELOW THE TAX LIMIT PRESCRIBED BY CBDT IN ITS INSTRUCTION NO.5 O F 2014 DATED 10.07.2014 FOR FILING OF APPEALS BEFORE THE TRIBUNAL. 6. IN VIEW OF THE AFORESAID FACTUAL POSITION, IT IS EVIDENT THAT THE CAPTIONED APPEAL IS NOT MAINTAINABLE AND IS HIT BY THE MONETA RY LIMITS PRESCRIBED BY THE CBDT VIDE INSTRUCTION NO.5 OF 2014 (SUPRA) FOR FILI NG OF APPEALS BEFORE THE TRIBUNAL. NOTABLY, AS PER THE CBDT INSTRUCTION NO. 5 OF 2014 (SUPRA) APPEAL BEFORE THE TRIBUNAL SHALL NOT BE FILED IN CASES WHE RE THE TAX EFFECT IN RESPECT OF THE ISSUES RAISED IS BELOW RUPEES FOUR LACS. AS A RESULT OF THE AFORESAID DISCUSSION, IN OUR VIEW, THE PRESENT APPEAL OF THE REVENUE IS NOT MAINTAINABLE. ACCORDINGLY, THE CAPTIONED APPEAL OF THE REVENUE IS DISMISSED ON THE AFORESAID GROUND ITSELF, WITHOUT DELIBERATING ON TH E MERITS OF THE DECISION OF THE CIT(A). ITA NO.2000/PN/2013 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 26 TH NOVEMBER, 2014. SD/- SD/- (R.S. PADVEKAR) (G.S. PANNU) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE, DATED: 26 TH NOVEMBER, 2014. SUJEET COPY OF THE ORDER IS FORWARDED TO : - 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A), AURANGABAD; 4) THE CIT, AURANGABAD; 5) THE DR A BENCH, I.T.A.T., PUNE; 6) GUARD FILE. BY ORDER //TRUE COPY// ASSISTANT REGISTRAR I.T.A.T., PUNE