Chetan Hasmukhbhai Vasa, Kolhapur V. Assistant Commissioner Of Income Tax, Central Circle, Kolhapur

ITA 206/PUN/2023

AI Insights

The case involves twin appeals by Chetan Hasmukhbhai Vasa against the penalties imposed for undisclosed income during the assessment years 2011-2012 and 2012-2013. The penalties were imposed under section 271AAA of the Income Tax Act, 1961, following a search operation where the assessee admitted to undisclosed income but failed to adequately explain its source and manner of acquisition. The CIT(A) upheld the penalties, which were contested in the appeals. The Tribunal found that the assessee did not meet the burden of substantiating the manner of earning the undisclosed income, leading to the dismissal of the appeals.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137293 (ITAT-PUNE)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-04-2023
• Appeal Filed By: Assessee
• Order Result: DismissedDismissed
• Bench Allotted: A
• Next Hearing Date: 26-04-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 15-02-2023
• Other Referred Cases: PCIT vs. Phoenix Mills Ltd., [2019] 307 CTR 700 (Bom.), PCIT vs. Mukeshbhai Ramanlal Prajapati [2017] 398 ITR 170 (Guj.)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI G.D. PADMAHSHALI, ACCOUNTANT MEMBER ITA Nos.205 & 206/PUN./2023 Assessment Years 2011-2012 & 2012-2013 Chetan Hasmukhbhai Vasa, Jyoti Banglow, Near Gadre Udyan Shivaji Park, Kolhapur – 416 001. Maharashtra. PAN AANPV4414C vs. The ACIT (Central) Circle, CS.No.622/623, 1 st Floor, Office Unit F-1/A&B, Shriram Heights Shahpuri Kolhapur. Maharashtra -416001. Appellant Respondent Assessee by : Shri S. N. Puranik Revenue by : MS. Deepali Kalbandhe Date of Hearing : 27.04.2023 Date of Pronouncement : 28.04.2023 आदेश / ORDER PER SATBEER SINGH GODARA, JM : These assessees’ twin appeals ITA.Nos.205 & 206/PUN./2013, for assessment years 2011-2012 and 2012- 2013, arise against the CIT(A), Pune-11, Pune's separate Din & Order Nos. ITBA/APL/S/250/2022-23/1048081831(1) & 1048081851(1), both dated 19.12.2022, involving proceedings u/s. 271AAA of the Income Tax Act, 1961 (in short “the Act”); respectively. Heard both the parties. Case files perused. 2 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. 2. It emerges during the course of hearing that the assessees’ identical sole substantive grievance that arises for our apt adjudication in both these appeals is that of correctness of the learned lower authorities action imposing penalties of Rs.3,20,000/- and Rs.1,80,100/-, case-wise respectively. The CIT(A)’s identical lower appellate discussion reads as under : 3 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. 4 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. 5 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. 6 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. 3. Learned counsel vehemently argued during the course of hearing that both the lower authorities have erred in law and on facts in imposing the impugned penalty(ies) despite the fact that the taxpayer had duly admitted the undisclosed income during the course of search after explaining the manner, substantiation thereof followed by payment of taxes thereupon. He quoted various judicial precedents i.e., PCIT vs. Phoenix Mills Ltd., [2019] 307 CTR 700 (Bom.) and PCIT vs. Mukeshbhai Ramanlal Prajapati [2017] 398 ITR 170 (Guj.) that it is incumbent on the part of the Authorised Officer during the course of search to specifically put the relevant questions to the searched party before the impugned penalty mechanism u/s.271AAA is sought to invoked at the department’s behest. 7 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. 4. The Revenue has placed strong reliance on the Ld. CIT(A)'s detailed discussion affirming the impugned penalties. 5. We have given our thoughtful consideration to the vehement rival stands and find no merit in assessee’s arguments. Suffice to say, we find from a perusal of the assessment discussion dated 28.03.2014 that the departmental authorities had indeed put specific question no.6 to the assessee regarding source of the foregoing undisclosed income wherein he could only reply that the same had been derived from land dealing business. Learned counsel could not throw any further light by producing before us the corresponding search statement(s) that the assessee had indeed filed all the relevant details regarding his land dealing business concerned. That being the case, we are constrained to conclude that he has very well fallen short of substantiating the manner of having derived his undisclosed income in question i.e., the second limb in sec.271AAA penalty proceedings and therefore, there is hardly any reason for us to disturb both the lower authorities findings. The case law quoted at the assessee’s behest (supra) supports the Revenue’s case rather wherein their lordships’ hold in identical terms that an assessee has to substantiate the manner after the Authorised Officer puts specific query(ies) to him regarding source and manner of the undisclosed income in issue. We 8 ITA.No.205 & 206/PUN./2023 Chetan Hasmukhbhai Vasa, Kolhapur. thus affirm CIT(A)'s findings extracted in the penalty proceedings upholding the Assessing Officer’s action imposing the impugned penalties in these twin assessment years. Ordered accordingly. 6. No other ground or argument has been pressed before us. 7. These assessees’ twin appeals ITA.Nos.205 & 206/PUN./2023 are dismissed in above terms. A copy of this common order be placed in the respective case files. Order pronounced in Open Court on this the 28 th day of April, 2023. Sd/- Sd/- (G.D. PADMAHSHALI) (SATBEER SINGH GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 28 th April, 2023 VBP/- Copy of the Order is forwarded to: 1. The Appellant; 2. The Respondent; 3. The CIT(A), Pune-11, Pune. 4. 5. 6. The Pr. CIT (Central), Pune The DR ‘A’, ITAT, Pune Guard File BY ORDER, // True Copy // Senior Private Secretary : ITAT : Pune