Prakash Madhubhai Patel, Ahmedabad V. Income Tax Officer., Ward 6(1)(3), Ahmedabad

ITA 2181/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 9882 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2013-2014
• Appeal Filed On: 29-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Agreed addition; Bonafide mistake
• Section: 271(1)(c)

Judgement Text

SMC-ITA NO. 2181/ AHD/2017 PRAKASH MADHUBHAI PATEL VS. ITO ASSESSMENT YEAR: 2013-14 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD [ BEFORE SHRI PRAMOD KUMAR, VICE PRESIDENT ] ITA NO. 2181/AHD/2017 ASSESSMENT YEAR : 2013-14 PRAKASH MADHUBHAI PATEL ............A PPELLANT UNITY ESTATE, NR. RASANA RESTAURANT, BEHIND DENA BANK, MANINAGAR CHAR RASTA, AHMEDABAD [PAN: AASPP 9502 C] VS. INCOME-TAX OFFICER .......................RESPONDENT WARD 6(1)(3), AHMEDABAD APPEARANCES BY: URVASHI SHODHAN FOR THE APPELLANT JAMES KURIAN FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : 18.02.2019 DATE OF PRONOUNCING THE ORDER : 10.05.2019 O R D E R 1. BY WAY OF THIS APPEAL, THE ASSESSEE-APPELLANT HA S CHALLENGED CORRECTNESS OF THE ORDER DATED 30 TH AUGUST 2017 PASSED BY THE CIT(A)-6, AHMEDABAD, IN THE MATTER OF PENALTY UNDER SECTION 271(1)(C) OF THE INCOME-TA X ACT, 1961, FOR THE ASSESSMENT YEAR 2013-14. 2. GRIEVANCE OF THE ASSESSEE, IN SUBSTANCE, IS AGAI NST LEARNED CIT(A)S CONFIRMING THE PENALTY OF RS.2,16,300/- IMPOSED ON THE ASSESSEE UNDER SECTION 271(1)(C) OF THE INCOME-TAX ACT, 1961. 3. TO ADJUDICATE ON THIS APPEAL, ONLY A FEW MATERIA L FACTS NEED TO BE TAKEN NOTE OF. DURING THE COURSE OF SCRUTINY ASSESSMENT PROCE EDINGS, THE ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD MADE CASH DEPOSITS AGGR EGATING TO RS.13,76,500/- IN HIS BANK ACCOUNTS AND THESE DEPOSITS ARE OUT OF HIS DRAWINGS FROM THE PARTNERSHIP FIRMS ISHWAR PETROLEUM AND UNITY PRINTERS. WHILE T HE ASSESSEE HAD MADE CONSIDERABLE WITHDRAWALS FROM THESE CONCERNS, HE CO ULD NOT CORRELATE THE DRAWINGS AND DEPOSITS. THE DEPOSITS WERE UNEXPLAINED TO THE EXTENT OF RS.4,65,500/-. IT WAS IN THIS BACKDROP AND DUE TO ASSESSEES INABILITY TO CORRELATE THE CASH WITHDRAWALS AND CASH DEPOSITS THAT HE OFFERED RS.7 LAKHS AS INC OME, PAID TAXES THEREON AND THE ASSESSMENT WAS CONCLUDED. THE MATTER, HOWEVER, DID NOT REST AT THAT. THE ASSESSING OFFICER ALSO IMPOSED PENALTY OF RS.2,16,3 00/- BEING TAX ON INCOME SOUGHT SMC-ITA NO. 2181/ AHD/2017 PRAKASH MADHUBHAI PATEL VS. ITO ASSESSMENT YEAR: 2013-14 PAGE 2 OF 3 TO BE EVADED. AGGRIEVED, ASSESSEE CARRIED THE MATT ER IN APPEAL BUT WITHOUT ANY SUCCESS. NOT SATISFIED, THE ASSESSEE IS IN FURTHER APPEAL BEFORE THE TRIBUNAL. 4. I HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE AP PLICABLE LEGAL POSITION. 5. AS I FIND, ON A PERUSAL OF MATERIAL ON RECORD, T HIS AGREED ADDITION WAS MADE ON ACCOUNT OF ASSESSEES INABILITY TO CORRELATE THE DRAWINGS AND DEPOSITS, AND, THUS, FOR INABILITY TO RECONCILE THE ACCOUNTS TO THAT EXT ENT. THE ASSESSEES EXPLANATION IS THAT THIS LAPSE OCCURRED DUE TO BONAFIDE MISTAKE ON THE PART OF EMPLOYEES AND THEIR LACKING THE REQUISITE SKILLS. THE ASSESSEE HAS, IN ANY WAY, PAID THE REQUISITE TAXES IMMEDIATELY UPON NOTICING THE MISTAKE AND OFFERED M ORE THAN UNRECONCILED AMOUNT TO TAX. CONSIDERING ALL THESE FACTS IN TOTALITY, I DO NOT THINK IT IS A FIT CASE FOR IMPOSITION OF PENALTY. THE EXPLANATION GIVEN BY TH E ASSESSEE, IN MY CONSIDERED VIEW, MERITS ACCEPTANCE. 6. IN THE LIGHT OF ABOVE DISCUSSIONS AND BEARING IN MIND ENTIRETY OF THE CASE, I DEEM IT FIT AND PROPER TO DELETE THE IMPUGNED PENAL TY OF RS. 2,16,300/-. ORDERED, ACCORDINGLY. 7. IN THE RESULT, THE APPEAL IS ALLOWED. PRONOUNCED IN THE OPEN COURT TODAY ON THE 10 TH MAY, 2019. SD/- PRAMOD KUMAR (VICE PRES IDENT) AHMEDABAD, THE 10 TH DAY OF MAY, 2019 **BT COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ....ORDER PREPARED AS PER 4 PAGES MANUSCRIPTS OF HONBLE VP (ATTACHED)....10.05.2019... 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .... 10.05.2019..... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: ...... 10.05.2019.... . 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 10.05.2019... 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : ............ 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER: