MURLIDHAR P.SUTRAVE, MUMBAI V. DCIT CEN CIR 24& 26, MUMBAI

ITA 2276/MUM/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 8952 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: I
• Next Hearing Date: 06-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 20-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Search and seizure; Salary income
• Section: 153A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL I BENCH, MUMBAI BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI AMARJIT SINGH, JM / I.T.A. NO.2276/MUM/15 ( / ASSESSMENT YEAR: 2011-12) SHRI MURLIDHAR P. SUTRAVE E- 1603, XCLUSIVE, AKURIL ROAD, LOKHANDWALA COMPLEX, KANDIVALI (E), MUMBAI - 400101 / VS. DCIT, CENTRAL CIRCLE 24 & 26 AAYAKAR BHAVAN, MUMBAI ./ ./ PAN/GIR NO. : ARRPS1295H ( / APPELLANT ) .. ( / RESPONDENT ) / DATE OF HEARING: 06.01.2017 /DATE OF PRONOUNCEMENT: 11.01.2017 / O R D E R PER AMARJIT SINGH, JM: THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER DATED 14.01.2015 PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) 51, MUMBAI [HEREINAFTER REFERRED TO AS THE CIT(A)] RELEVANT TO THE A.Y.2011-12 IN WHICH THE PENALTY LEVIED BY THE ASSESSING OFFICER TO THE TUNE OF RS.3,68,861/- HAS BEEN UPHELD BY CIT(A). 2. THE ASSESSEE HAS RAISED THE FOLLOWING ISSUES: ASSESSEE BY: SHRI PRAKASH VAKHARIA DEPARTMENT BY: SHRI NAVIN GUPTA ITA NO.2276/M/15 A.Y. 2011-12 2 1.1 THE LD. CIT(A) ERRED IN CONFIRMING PENALTY OF RS.3,68,861/- LEVIED BY THE AO U/S.271(1)(C) OF THE ACT. 1.2 THE LEARNED CIT(A) COMMITTED GRAVE ERROR IN NOT APPRECIATING THE SUBMISSION OF THE APPELLANT THAT: 1.2.1 THE ASSESSMENT UNDER CONSIDERATION WAS NOT PURSUANT TO RETURN FILED UNDER SECTION 153A OF THE ACT; AND 1.2.2 THE APPELLANT HAD FILED THE RETURN OF INCOME U/S.139(1) OF THE ACT; AND 1.2.3 THERE WAS NO ADDITION OF INCOME MADE IN THE ASSESSMENT I.E. THE RETURNED INCOME HAD BEEN ACCEPTED AS THE ASSESSED INCOME; AND 1.2.4 IN SUCH CIRCUMSTANCES THERE IS NO QUESTION OF CONCEALMENT OF INCOME U/S.271(1)(C) OF THE ACT OR UNDER ANY PROVISIONS OF THE ACT. 1.3 THE LEARNED CIT(A) ERRED IN NOT APPRECIATING THE CONTENTION OF YOUR APPELLANT THAT IN VIEW OF PROVISIONS OF SECTION 271AAA THE PENALTY WAS WRONGLY INITIATED AND LEVIED BY THE AO U/S.271(1)(C) OF THE ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SEARCH OPERATION U/S.132 OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT) WAS CONDUCTED ON 11.02.2011 UPON TRANSWORLD FURTICHEM PVT. LTD. GROUP CASES. THE ASSESSEE WAS, INTER ALIA, COVERED IN THE SEARCH OPERATIONS. THE ASSESSEE FILED THE RETURN OF INCOME FOR THE A.Y.2011-12 ON 07.11.2012 DECLARING TOTAL INCOME TO THE TUNE OF RS.37,93,220/-. THE ASSESSEE IS THE DIRECTOR OF PENTAGON WATERLINES PVT. LTD. AND PGA SHIPPING & LOGISTICS PVT. LTD. AND EARN SALARY INCOME. THE ASSESSEE HAS SHOWN OTHER INCOME TO THE TUNE OF RS.19,59,615/- IN THEIR COMPUTATION OF TOTAL INCOME UNDER THE HEAD OF INCOME FROM OTHER SOURCES. ITA NO.2276/M/15 A.Y. 2011-12 3 SINCE THE SOURCE OF INCOME WAS NOT DISCLOSED PROPERLY, THEREFORE NOTICE DATED 04.12.2012 WAS ISSUED AND AFTER RECEIPT OF THE REPLY AND FINDING THE SAME NOT SATISFACTORY, THE ASSESSING OFFICER TREATED THE INCOME FROM OTHER SOURCES TO THE TUNE OF RS.19,59,615/- AS UNEXPLAINED AND INITIATED THE PENALTY U/S.271(1)(C) OF THE ACT TO THE TUNE OF RS.3,68,861/-. AGGRIEVED BY VIRTUE OF ORDER DATED 03.09.2013, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A) WHO UPHOLD THE PENALTY ORDER, THEREFORE, THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE US. ISSUE NO.1.1 TO 1.3:- 4. ALL THESE ISSUES ARE INTERCONNECTED, THEREFORE ARE BEING TAKEN UP TOGETHER FOR ADJUDICATION. UNDER THESE ISSUES THE BASIC CONTENTION OF THE ASSESSEE IS THAT THE CIT(A) HAS WRONGLY UPHELD THE PENALTY ORDER OF THE ASSESSING OFFICER IN WHICH THE ASSESSING OFFICER HAS LEVIED THE PENALTY TO THE TUNE OF RS.3,68,861/-, THEREFORE THE ORDER OF THE CIT(A) IS WRONG AGAINST LAW AND FACTS AND IS LIABLE TO BE SET ASIDE. ON THE OTHER HAND, THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS PLACED RELIANCE ON THE ORDER PASSED BY THE CIT(A) IN QUESTION. KEEPING IN VIEW OF THE ARGUMENT ADVANCED BY THE LEARNED REPRESENTATIVE OF THE PARTIES AND PERUSED THE RECORD CAREFULLY IT CAME INTO THE NOTICE THAT THE ASSESSING OFFICER LEVIED THE PENALTY ON THE GROUND OF THAT THE ASSESSEE HAS SHOWN THE INCOME FROM OTHER SOURCES TO THE TUNE OF RS.19,59,615/-. THE ASSESSING OFFICER ISSUED THE NOTICE REGARDING THE EXPLANATION OF THE SOURCES, THEREFORE, THE ASSESSING OFFICER LEVIED THE PENALTY TO THE TUNE OF RS.3,68,861/-. IN APPEAL THE CIT(A) HAS CONFIRMED THE ORDER OF THE ASSESSING OFFICER BY VIRTUE OF ORDER DATED 14.01.2015. IT IS TO ITA NO.2276/M/15 A.Y. 2011-12 4 BE SEEN IF THE ASSESSEE FAILED TO EXPLAIN THE SOURCE OF INCOME TO THE TUNE OF RS.19,59,615/- ATTRACT THE PENALTY OR NOT. IN THE RETURN, THE ASSESSEE HAS SHOWN INCOME TO THE TUNE OF RS.19,59,615/- AS INCOME FROM OTHER SOURCES. ON ASKING THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAS DISCLOSED THE SAID INCOME VOLUNTARILY AND THE SAID AMOUNT WAS GIVEN BY HIS LATE FATHER MR. PRAKASH SUTRAVE WHO WAS SETTLED IN BAHRAIN AND TRANSFERRED THE AMOUNT AS GIFT AND CONTRIBUTION TO THE FAMILY EXPENDITURE OUT OF NATURAL LOVE AND AFFECTION. HIS FATHER PASSED AWAY ON 08.10.2011, THEREFORE, THE RELEVANT INFORMATION COULD NOT GIVEN. HOWEVER, HE VOLUNTARILY DECLARED THE INCOME TO THE TUNE OF RS.19,59,615/- FROM THE INCOME FROM OTHER SOURCES. THE ASSESSEE HAS ALSO GIVEN THE EXPLANATION THAT THE SEARCH AND SEIZURE ACTION U/S.132 OF THE ACT WAS CARRY OUT BUT NOTHING WAS RECOVERED, THEREFORE, NO PENALTY COULD BE LEVIED U/S.271(1)(C) OF THE ACT. HOWEVER THE PENALTY COULD BE LEVIED IF ANY PROVISION OF SECTION 271AAA OF THE ACT. IT IS ALSO CONTENDED THAT THE ACTION WAS NOT TAKEN UNDER THE PROVISION OF SECTION 271(1)(AAA), THEREFORE THE PENALTY LEVIED U/S.271(1)(C) OF THE ACT IS JUSTIFIABLE, HENCE LIABLE TO BE SET ASIDE IN ACCORDANCE WITH LAW. IT IS NOT IN DISPUTE THAT THE ASSESSEE VOLUNTARILY ACCORDINGLY. MERELY NON-SUBMISSION OF EXPLANATION ON ACCOUNT OF THE DEATH OF HIS FATHER DOES NOT ATTRACT THE PENALTY U/S.271(1)(C) OF THE ACT. NOTHING CAME INTO THE NOTICE THAT WOULD HAS BEEN CONCEALED AND WHICH PARTICULARS HAVE BEEN FURNISHED INACCURATE. ASSESSEE HAS FURNISHED THE TAX ON THE SAID AMOUNT, THEREFORE, NOTHING CAME INTO THE NOTICE THAT WHICH AMOUNT OF TAX SOUGHT TO BE EVADED BY THE ASSESSEE. NO NEW MATERIAL WAS SEARCHED AND BROUGHT INTO THE NOTICE BY THE ASSESSING OFFICER BY CONDUCTING ANY ENQUIRY ON RECORD. ANYHOW KEEPING IN VIEW OF ITA NO.2276/M/15 A.Y. 2011-12 5 THE FACTS AND CIRCUMSTANCES OF THE CASE IN WHICH THE ASSESSEE VOLUNTARILY DECLARED THE INCOME FROM OTHER SOURCES. NO INCOME OF THE ASSESSEE CAME INTO THE NOTICE IN THE OPERATION OF SEARCH AND SEIZURE ACTION AND NO MATERIAL OF ANY KIND WAS FOUND TO WHICH IT CAN BE ASSUMED THAT THE ASSESSEE HAS TRIED TO EVADE THE TAX BY CONCEALING ANY PARTICULARS OF HIS INCOME AND BY FURNISHING THE INACCURATE PARTICULARS. THEREFORE, WE ARE OF THE VIEW THAT THE CIT(A) HAS WRONGLY CONFIRMED THE PENALTY LEVIED BY THE ASSESSING OFFICER, THEREFORE, IN THE SAID CIRCUMSTANCES WE SET ASIDE THE FINDING OF THE CIT(A) ON THIS ISSUE AND ACCORDINGLY THIS ISSUE IS DECIDED IN FAVOUR OF THE ASSESSEE AGAINST THE REVENUE. THE PENALTY IS HEREBY ORDERED TO BE DELETED. ISSUE NO.2:- 5. SINCE THE ISSUE NO.1.1 TO 1.3 HAVE BEEN DECIDED IN FAVOUR OF THE ASSESSEE, THEREFORE THIS ISSUE IS NOWHERE REQUIRED ANY ADJUDICATION BEING ACADEMIC IN NATURE 6. IN THE RESULT THE APPEAL FILED BY THE ASSESSEE IS HEREBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH JANUARY, 2017 . SD/- SD/- (D.KARUNAKARA RAO) (AMARJIT SINGH) / ACCOUNTANT MEMBER /JUDICIAL MEMBER MUMBAI; DATED : 11 TH JANUARY, 2017 MP ITA NO.2276/M/15 A.Y. 2011-12 6 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A)- 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE. / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI