ACIT, CHENNAI V. Shri M.K.Rajagopalan, CHENNAI

ITA 2039/CHNY/2011

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61125 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 09-05-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 13-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHAJI P JACOB IRS
• Section: 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ITA NOS.2039, 2040 & 2041(MDS)/2011 ASSESSMENT YEARS : 2005-06, 2006-07 & 2008-09 THE ASSISTANT COMMISSIONER OF INCOME-TAX, CENTRAL CIRCLE III(4), CHENNAI. VS. SHRI M.K.RAJAGOPALAN, 34, ARCH BISHOP MATHIAS AVENUE, RAJA ANNAMALAIPURAM, CHENNAI. PIN 600 028. PAN AAEPR4969B. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SHAJI P JACO B, IRS, CIT. RESPONDENT BY : NONE DATE OF HEARING : 9 TH MAY, 2012 DATE OF PRONOUNCEMENT : 9 TH MAY, 2012 O R D E R PER DR.O.K.NARAYANAN, VICE PRESIDENT THESE THREE APPEALS ARE FILED BY THE REVENUE. TH E RELEVANT ASSESSMENT YEARS ARE 2005-06, 2006-07 AND 2008-09. THESE APPEALS ARE DIRECTED AGAINST THE ORDERS OF TH E COMMISSIONER OF INCOME-TAX(APPEALS)-II AT CHENNAI, DATED - - ITA 2039 TO 2041 OF 2011 2 14-9-2011. THE APPEALS FOR THE ASSESSMENT YEARS 20 05-06 AND 2006-07 ARISE OUT OF THE PENALTY ORDERS PASSED UNDE R SECTION 271(1)(C) OF THE INCOME-TAX ACT, 1961. THE APPEAL FOR THE ASSESSMENT YEAR 2008-09 ARISES OUT OF THE ORDER PAS SED UNDER SECTION 271AAA OF THE ACT. 2. FOR THE ASSESSMENT YEARS 2005-06 AND 2006-07 THE PENALTY HAS BEEN LEVIED BY THE ASSESSING AUTHOR ITY ON THE GROUND THAT THE ASSESSEE HAD CONCEALED PARTICULARS OF INCOME OF ` 35 LAKHS FOR THE ASSESSMENT YEAR 2005-06 AND PARTI CULARS OF INCOME OF ` 15 LAKHS FOR THE ASSESSMENT YEAR 2006-07. BUT THE COMMISSIONER OF INCOME-TAX(APPEALS) FOUND THAT THE ASSESSEE HAS OFFERED THE ABOVE AMOUNTS AS INCOME FOR THE RES PECTIVE ASSESSMENT YEARS 2005-06 AND 2006-07. ALONGWITH T HE DETAILS AND PARTICULARS OF INCOME IN RESPECT OF THE ASSESSM ENT YEAR 2005-06, THE NAMES OF UNSECURED LOANS AND ADVANCES AND DETAILS OF PROPERTY WERE FURNISHED WHILE OFFERING T HE INCOME OF ` 35 LAKHS. LIKEWISE, FOR THE ASSESSMENT YEAR 2006- 07, THE INCOME OF ` 15 LAKHS WAS OFFERED AS COST OF IMPROVEMENT TO THE PROPERTY. WHEN THE ASSESSEE HAS FURNISHED THESE AM OUNTS AS - - ITA 2039 TO 2041 OF 2011 3 HIS INCOME IN THE RETURNS FILED BEFORE THE ASSESSIN G OFFICER, THERE CANNOT BE A CASE OF NON FURNISHING OF PARTICULARS O R CONCEALMENT OF INCOME. THE ENQUIRY REGARDING NON FURNISHING OF PARTICULARS AND CONCEALMENT OF INCOME STARTS WITH THE FILING OF THE RETURN BY AN ASSESSEE. WHEN THE AMOUNTS ARE OFFERED AS INCOM E IN THE RETURN AS SUCH WITH NECESSARY PARTICULARS, THEN THE RE IS NO FURTHER SCOPE FOR HOLDING THOSE AMOUNTS AS CASES OF NON FUR NISHING OF PARTICULARS. THEREFORE, WE FIND THAT THE COMMISSIO NER OF INCOME- TAX(APPEALS) IS JUSTIFIED IN DELETING THE PENALTIES LEVIED UNDER SECTION 271(1)(C) OF THE ACT. 3. IN RESPECT OF THE ASSESSMENT YEAR 2008-09 THE PENALTY HAS BEEN LEVIED UNDER SECTION 271AAA OF THE INCOME-TAX ACT, 1961. THE AMOUNT OF PENALTY LEVIED WAS ` 30 LAKHS. IN FIRST APPEAL THE COMMISSIONER OF INCOME-TAX(APPEALS) FOUN D THAT THE ASSESSEE IS LIABLE TO PENALTY ONLY IN RESPECT OF TH E CASH FOUND AND THE GOLD JEWELLERY FOUND IN THE COURSE OF SEARC H AND IN RESPECT OF OTHER ITEMS PENALTY CANNOT BE LEVIED. T HE REVENUE HAS COME IN APPEAL AGAINST THE ABOVE RELIEF GRANTED BY THE COMMISSIONER OF INCOME-TAX(APPEALS). - - ITA 2039 TO 2041 OF 2011 4 4. IN THIS REGARD THE GROUNDS RAISED BY THE REVENU E ARE EXTRACTED BELOW:- 1.A. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN GRANTING PART IAL RELIEF TOWARDS THE PENALTY LEVIED U/S 271AAA AT ` 22,20,660/-. 1.B. THE LEARNED CIT(A) HAS FAILED TO NOTE THAT THE ASSESSEE HAS NOT SATISFIED THE CONDITIONS STIPULATE D IN CLAUSE II) AND III) OF SECTION 271AAA(2) OF THE ACT 1961 FOR THE FOLLOWING REASONS. I) SUB-CLAUSE(II) IS NOT SATISFIED SINCE THE ASSESS EE HAS NOT SUBSTANTIATED THE MANNER IN WHICH THE UNDISCLOS ED INCOME WAS DERIVED WHICH FACT WAS ALSO CONFIRMED BY THE LEARNED CIT(A) AT PARA 12 OF THE APPELLATE ORDE R. II) SUB-CLAUSE(III) IS NOT SATISFIED SINCE THE ASSE SSEE HAS NOT PAID THE TAX TOGETHER WITH INTEREST IN RESP ECT OF UNDISCLOSED INCOME AS IS EVIDENT FROM ORDER U/S 154 DATED 5-2-2010. THE ASSESSEE HAS TO PAY ` . 65,17,975/-. - - ITA 2039 TO 2041 OF 2011 5 THE RELIEF WAS GRANTED BY THE COMMISSIONER OF INCOM E- TAX(APPEALS) WITH REFERENCE TO THE UNDISCLOSED INCO ME OF ` 3 CRORES. AFTER GOING THROUGH THE DETAILS IN A DE TAILED MANNER, THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS HELD TH AT THE DISCLOSURE OF ` 2 CRORES AND ` 1 CRORE MADE BY THE ASSESSEE WAS IN RESPONSE TO QUESTIONS ABOUT CASH, JEWELLERY, DEP OSITS IN BANKS, ETC. FOUND DURING THE SEARCH AND THE ASSESSE E HIMSELF HAD OFFERED MUCH MORE THAN THE CASH AND JEWELLERY. THE ASSESSEE HAS OFFERED ` 3 CRORES BY HIMSELF. IT IS IN THESE CIRCUMSTANCES THAT THE COMMISSIONER OF INCOME-TAX(A PPEALS) HAS HELD THAT THE CHARACTER OF UNDISCLOSED INCOME S HOULD BE CONFINED TO THE CASH OF ` 44,62,925/- AND JEWELLERY OF 4012.50 GRAMS. THE FINDING OF THE COMMISSIONER OF INCOME-T AX(APPEALS) IS AMPLY SUPPORTED BY THE FACTS OF THE CASE THEMSEL VES AND THE REASONING IS EVIDENT FROM HIS ORDER AND, THEREFORE, WE ARE NOT INCLINED TO INTERFERE WITH THE ORDER PASSED BY THE COMMISSIONER OF INCOME-TAX(APPEALS). - - ITA 2039 TO 2041 OF 2011 6 5. IN RESULT THESE THREE APPEALS FILED BY THE REVE NUE ARE DISMISSED. ORDERS PRONOUNCED IN THE OPEN COURT AT THE TIME O F HEARING ON WEDNESDAY, THE 9 TH OF MAY, 2012 AT CHENNAI. SD/- SD/- (CHALLA NAGENDRA PRASAD) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED, THE 9 TH MAY, 2012. V.A.P. COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GF.