MEENA BAJAJ, Jaipur V. ITO, Jaipur

ITA 241/JPR/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2006 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 14-03-2016
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Assessee Lawyers: RAJEEV SAGONI
• Keywords: Opportunity of being heard; Corroborative evidences; Onus to prove
• Section: 133A; 131; 246; 27

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH HKKXPAN] YS[KK L NL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI BHAGCHAND, A M VK;DJ VIHY LA- @ ITA NO. 241/JP/2016 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2005-06 SMT. MEENA BAJAJ 211, PINK CITY TOWER, JHOTWARA ROAD, BANI PARK, JAIPUR. CUKE VS. THE ITO, WARD-3(2) JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AGQPB 9442 F VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDEN T FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI RAJEEV SAGONI (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SHRI R.A. VERMA (ADDL.CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 16/01/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 15/03/2018 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 08.12.2015 OF CIT(A), JAIPUR ARISING FROM THE PENAL TY ORDER U/S 271(1)(C) OF THE ACT FOR THE ASSESSMENT YEAR 2005-0 6. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND:- 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LD. AO WHO HAS IMPOSED THE PENALTY OF RS. 4,48,335/- UNDER SECTION 271(1)(C) OF ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 2 THE INCOME TAX ACT, 1961 CONTRARY TO THE LAW AND WI THOUT FOLLOWING THE DIRECTIONS OF HONBLE ITAT. THE ACTIO N OF THE LD. CIT(A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAIN ST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY QUASHING THE PENALTY AMOUNTING TO RS. 4,48,335/- IMPOSED UNDER SECTION 2 71(1)(C). 2. THE ASSESSEE CRAVES HER RIGHT TO ADD, AMEND OR A LTER ANY OF THE GROUNDS ON OR BEFORE THE HEARING. 2. THE ASSESSEE HAS RAISED TWO ADDITIONAL GROUNDS A S UNDER:- 1. PENALTY ORDER DATED 06.03.2013 PASSED IN PURSUA NCE OF HONBLE ITAT ORDER IN MA DATED 09.01.2012 IS BARRED BY LIMITATION U/S 275 OF THE INCOME TAX ACT, 1961. THEREFORE THE ORDER DESERVES TO BE QUASHED IN TOTO. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LD. AO HAS ERRED IN IMPOSING PENALTY U/S 271(1)(C) WITH OUT SPECIFICALLY POINTING OUT IN THE SHOW CAUSE NOTICE, WHETHER THE PENALTY WAS PROPOSED ON CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME. TH E ACTION OF THE LD. AO IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAIN ST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY QUASHING THE PENALTY AMOUNTING TO RS. 4,48,335/- IMPOSED U/S 271(1)(C). 3. THE ADDITIONAL GROUND NO. 1 IS REGARDING VALIDIT Y OF ORDER PASSED BY THE ASSESSING OFFICER IN PURSUANT TO THE DIRECTI ON OF THIS TRIBUNAL BEING BARRED BY LIMITATION. THIS IS SECOND ROUND OF APPEAL, IN THE FIRST ROUND, THE LD. CIT(A) DELETED THE PENALTY AND ON FU RTHER APPEAL BY THE REVENUE, THIS TRIBUNAL VIDE ORDER DATED 09.01.2012 IN MA NO. 23/JP/2011 REMANDED THE MATTER TO THE RECORD OF THE AO FOR ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 3 CONSIDERATION OF MATTER FRESH AFTER ALLOWING THE OP PORTUNITY TO THE ASSESSEE. 4. ON THE ADMISSION OF ADDITIONAL GROUND NO. 1 THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT THE ABOVE GROUND IS A LEGAL GROUND AND ALL RELEVANT FACTS ARE AVAILABLE ON RECORD AS THEY ARE EMERGING FROM THE ORDER PASSED BY THE AO HIMSELF U/S 271(1)(C) OF THE INCOME TAX ACT. HE HAS THUS CONTENDED THAT NO NEW FACTS ARE REQUIRE D TO BE EXAMINED OR ANY FURTHER ENQUIRY IS NEEDED. ONLY THE PROVISIO NS OF LAW ARE TO BE APPLIED ON THE FACTS ALREADY AVAILABLE ON RECORD. T HE OMISSION OF THIS GROUND IN THE MEMO OF APPEAL IS DUE TO INADVERTENT MISTAKE. THE LD. AR HAS RELIED UPON THE ORDER OF THE HONBLE SUPREME CO URT IN CASE OF NATIONAL THERMAL POWER CO. LTD. VS. CIT 229 ITR 383 . 5. ON THE OTHER HAND, LD. DR HAS OBJECTED TO THE AD DITIONAL GROUND RAISED BY THE ASSESSEE AND SUBMITTED THAT THE ASSES SEE DID NOT RAISE THIS ISSUE BEFORE THE AUTHORITIES BELOW. THEREFORE, THE ASSESSEE CANNOT BE PERMITTED TO RAISE A FRESH GROUND WITHOUT EXPLAI NING SATISFACTORILY THE REASONS FOR NOT RAISING BEFORE THE AUTHORITIES BELO W. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. THE ADDITIONAL GROUND IS REGARD ING VALIDITY THE ORDER PASSED BY THE AO DATED 06.03.2013 IN PURSUANT TO TH E ORDER OF THIS ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 4 TRIBUNAL DATED 09.01.2012 BEING BARRED BY LIMITATIO N U/S 275 OF THE I.T. ACT. WE FIND THAT THE ISSUE RAISED BY THE ASSESSEE IN THE ADDITIONAL GROUND IS PURELY LEGAL IN NATURE AND DOES NOT REQUI RE CONSIDERATION OF ANY NEW FACTS OR ANY INQUIRY FOR ADJUDICATION OF TH E SAME. ALL THE FACTS NEEDED FOR ADJUDICATION ARE ON RECORD AND THEREFORE , IN VIEW OF THE DECISION OF HONBLE SUPREME COURT IN CASE OF NATION AL THERMAL POWER CORPORATION VS. CIT (SUPRA) WE ADMIT THE ADDITIONAL GROUND NO. 1 FOR ADJUDICATION ON MERITS. 7. ON MERITS OF THE ADDITIONAL GROUND 1 THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT AS PER THE PROVISIONS OF SECTION 275 OF THE ACT THE ASSESSING OFFICER WAS REQUIRED TO PASS THE ORDER WI THIN A PERIOD OF 6 MONTH FROM THE DATE OF RECEIPT OF THE ORDER OF THIS TRIBUNAL DATED 09.01.2012 HOWEVER, THE ASSESSING OFFICER HAS PASSE D THE ORDER ONLY ON 06.03.2013 WHICH IS BARRED BY LIMITATION. THUS, THE LD. AR HAS SUBMITTED THAT THE IMPUGNED ORDER PASSED BY THE AO IN PURSUANT TO THE DIRECTIONS OF THIS TRIBUNAL IS NOT SUSTAINABLE BEIN G BARRED BY LIMITATION. 8. ON THE OTHER HAND, LD. DR HAS SUBMITTED THAT THE PROVISIONS OF SECTION 275 ARE NOT APPLICABLE FOR THE PURPOSE OF L IMITATION FOR PASSING THE ORDER BY THE AO IN PURSUANT TO THE DIRECTIONS O F THIS TRIBUNAL. HE HAS FURTHER CONTENDED THAT THE PROVISIONS OF SECTIO N 275 ARE APPLICABLE ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 5 ON THE CASES WHERE THE PENALTY IS TO BE IMPOSED FOR THE FIRST TIME WHEREAS IN THE CASE IN HAND, THE PENALTY U/S 271(1) (C) OF THE ACT WAS IMPOSED ON 30.05.2008 WHICH WAS WELL WITHIN THE PE RIOD OF LIMITATION AS PROVIDED U/S 275 OF THE ACT. THE ORDER PASSED BY THE AO DATED 06.03.2013 IS IN THE SECOND ROUND OF PENALTY PROCEE DINGS AS PER THE REMAND ORDER OF THIS TRIBUNAL AND THEREFORE, THE PR OVISIONS OF SECTION 153 OF THE ACT IF AT ALL ARE ATTRACTED IN THE SECO ND ROUND OF PROCEEDINGS BEFORE THE AO FOR THE PURPOSE OF LIMITATION. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD. THE TRIBUNAL REMAND MATTER TO T HE RECORD OF THE AO VIDE ORDER DATED 09.01.2012 IN MA NO. 23/JP/2011 AS HELD IN PARA 5.1 AS UNDER:- 5.1 THE LD. COUNSEL OF THE ASSESSEE HAS ALSO FILED AN AFFIDAVIT THAT IN FACT HE COULD NOT UNDERSTAND THE FACTUM THA T HE WAS ALLOWED OPPORTUNITY TO FILE ANY DETAILS. THEREFORE, UNDER MISCONCEPTION IT WAS STATED THAT HE IS READY TO ARG UE THE CASE. TAKING INTO CONSIDERATION ALL THESE FACTS, WE MODIF Y OUR ORDER IN THE FOLLOWING MANNER:- AFTER CONSIDERING THE ORDERS OF THE AO AND LD. CIT (A) AND THE SUBMISSIONS OF THE ASSESSEE AND ALSO OF THE LD. D/R , WE HOLD THAT LD. CIT(A) WAS NOT JUSTIFIED IN CANCELLING THE LEVY OF PENALTY ON THE GROUND THAT NO PROPER OPPORTUNITY WAS GIVEN. IN OUR VIEW, THE LD. CIT(A) SHOULD HAVE REMANDED THE MATTER BACK TO THE FILE OF AO FOR ALLOWING OPPORTUNITY TO THE ASSESSEE INST EAD OF CANCELLING THE LEVY OF PENALTY. ACCORDINGLY, WE SET ASIDE THE ORDER OF LD. CIT(A) AND REMAND THE MATTER BACK TO THE FIL E OF AO TO ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 6 CONSIDER THE LEVY OF PENALTY AFRESH AFTER AFFORDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSE, AS THE P ENALTY PROCEEDINGS ARE SEPARATE AND DISTINCT FROM THE ASSE SSMENT PROCEEDINGS. THE AO HAS IMPOSED PENALTY MERELY PLAC ING RELIANCE ON THE ASSESSMENT ORDER WHEREAS HE SHOULD HAVE ALLO WED PROPER OPPORTUNITY TO EXPLAIN WHETHER PENALTY IS LEVIABLE OR NOT, SINCE PENALTY PROCEEDING ARE SEPARATE AND DISTINCT AND AS SESSEE CAN FILE ANY EVIDENCE WHICH COULD NOT HAVE BEEN FILED D URING THE ASSESSMENT PROCEEDING. IN VIEW OF THESE FACTS AND C IRCUMSTANCES WE DIRECT THE AO TO CONSIDER THE LEVY OF PENALTY AF RESH. IN THE RESULT, APPEAL OF THE DEPARTMENT IS TREATED AS ALLOWED FOR STATISTICAL PURPOSES. THE AO PASSED THE FRESH ORDER U/S 271(1)(C) R.W.S. 254 OF THE ACT ON 06.03.2013. THE ASSESSEE HAS NOW RAISED THE ISSUE O F LIMITATION AND CONTENDED THAT THE IMPUGNED ORDER IS BARRED BY LIMI TATION AS PROVIDED U/S 275(1)(A) OF THE ACT. FOR READY REFERENCE WE RE PRODUCE U/S 275(1)(A) AS UNDER:- 275. 37 [(1)] NO ORDER IMPOSING A PENALTY UNDER THIS CHAPTE R SHALL BE PASSED 38 [(A ) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTHER OR DER IS THE SUBJECT-MATTER OF AN APPEAL TO THE 39 [***] COMMISSIONER (APPEALS) UNDER SECTION 246 40 [OR SECTION 246A ] OR AN APPEAL TO THE APPELLATE TRIBUNAL UNDER SECTION 253 , AFTER THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COU RSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITI ATED, ARE COMPLETED 41 , OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE 42 [***] COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE APPELLATE TRIBUNAL IS RECEIVED BY THE 43 [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR 43 [PRINCIPAL ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 7 COMMISSIONER OR] COMMISSIONER, WHICHEVER PERIOD EXP IRES LATER : 44 [ PROVIDED THAT IN A C ASE WHERE THE RELEVANT ASSESSMENT OR OTHER ORDER IS THE SUBJECT- MATTER OF AN APPEAL TO THE COMMISSIONER (APPEALS) UNDER SECTION 246 OR SECTION 246A , AND THE COMMISSIONER (APPEALS) PASSES THE ORDER ON OR A FTER THE 1ST DAY OF JUNE, 2003 DISPOSING OF SUCH APPEAL, AN ORDE R IMPOSING PENALTY SHALL BE PASSED BEFORE THE EXPI RY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTIO N FOR IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPL ETED, OR WITHIN ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORDER OF THE COMMISSIONER (APPEALS) IS RECEIVED BY THE 43 [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONE R OR 43 [PRINCIPAL COMMISSIONER OR] COMMISSIONER, WHICHEVER IS LATER;] FROM THE PLAIN READING OF SECTION 275(1)(A) IT REVE ALS THAT THE LIMITATION PROVIDED UNDER THIS SECTION RECKONS EITHER FROM TH E DATE OF COMPLETION OF ASSESSMENT PROCEEDINGS OR FROM THE ORDER OF THE APPELLATE AUTHORITY RECEIVED BY THE CHIEF COMMISSIONER. THEREFORE, SECT ION 275(1)(A) STIPULATES THE LIMITATION FOR LEVY OF PENALTY INITI ATED IN PURSUANT TO THE ASSESSMENT PROCEEDINGS OR SUBSEQUENT APPEAL ORDER B Y LD. CIT(A) OR BY THIS TRIBUNAL. THUS, THE LIMITATION PROVIDED U/S 27 5(1)(A) IS FOR LEVY OF PENALTY ORIGINALLY AND NOT IN SET ASIDE THE PROCEED INGS OF LEVY OF PENALTY U/S 271(1)(A) BY THE APPELLATE AUTHORITY. THE REFER ENCE OF ORDER OF APPELLATE AUTHORITY IN THIS SECTION IS MADE WITH RE SPECT TO THE ASSESSMENT/QUANTUM PROCEEDINGS AND NOT PENALTY PROC EEDINGS. ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 8 THEREFORE, RELIANCE PLACED BY THE LD. AR ON THE PRO VISIONS OF SECTION 275(1)(A) IS MISCONCEIVED. HENCE, WE DO NOT FIND AN Y MERIT OR SUBSTANCE IN THE ADDITIONAL GROUND NO. 1 OF THE ASS ESSEE. 10. NOW ADDITIONAL GROUND NO. 2 IS REGARDING VALIDI TY OF NOTICE ISSUED U/S 274 OF THE INCOME TAX ACT. THE LD. AR OF THE AS SESSEE HAS SUBMITTED THAT THIS GROUND IS A LEGAL GROUND AND AL L RELEVANT FACTS ARE AVAILABLE ON RECORD AS THEY ARE EMERGING OUT OF THE NOTICE ISSUED BY THE AO U/S 274 R.W.S. 271(1)(C) OF THE INCOME TAX ACT. HE HAS FURTHER SUBMITTED THAT NO NEW FACTS ARE REQUIRED TO BE EVAL UATED OR ANY FURTHER ENQUIRY IS NEEDED FOR ADJUDICATION OF THE ADDITIONA L GROUND. THUS HE HAS PLEADED THAT THE ADDITIONAL GROUND RAISED BY THE AS SESSEE MAY BE ADMITTED FOR ADJUDICATION ON MERITS. IN SUPPORT OF HIS CONTENTION, HE HAS RELIED UPON THE HONBLE SUPREME COURT IN CASE OF NA TIONAL THERMAL POWER CO. LTD. VS. CIT 229 ITR 383. 11. ON THE OTHER HAND, LD. DR HAS VEHEMENTLY OPPOSE D TO THE ADDITIONAL GROUND RAISED BY THE ASSESSEE AND SUBMIT TED THAT THIS IS THE SECOND ROUND OF APPEAL AND WHEN THIS ISSUE WAS NOT INVOLVED IN THE FIRST ROUND OF LITIGATION AND THE TRIBUNAL HAS SET ASIDE ARE REMANDED THE MATTER TO THE RECORD OF THE AO ONLY FOR CONSIDERATI ON OF EXPLANATION OF ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 9 THE ASSESSEE IS AGAINST LEVY OF PENALTY THEN, THE A SSESSEE CANNOT BE ALLOWED TO RAISE THIS GROUND AT THIS STAGE. 12. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIAL ON RECORD. THERE IS NO DISPUTE THAT IN THE APPEAL AGAINST THE ORIGINAL ORDER OF LEVY OF PENALTY U/S 271(1)(C) THE ASSESSEE DID NOT RAISE THIS ISSUE EITHER BEFORE THE LD. CIT(A) OR BEFORE T HIS TRIBUNAL. THIS TRIBUNAL THOUGH INITIALLY REVERSED THE ORDER OF THE LD. CIT(A) AND CONFIRMED THE PENALTY LEVIED U/S 271(1)(C) VIDE OR DER DATED 10.03.2011 IN ITA NO. 298/JP/2010 AS HELD IN PARAS 7 TO 12.1 A S UNDER:- 7. WE HAVE HEARD RIVAL SUBMISSIONS AND CONSIDERED THEM CAREFULLY. AFTER CONSIDERING THE SUBMISSIONS AND P ERUSING THE MATERIAL ON RECORD, WE FIND THAT DEPARTMENT DESERVE S TO SUCCEED IN ITS APPEAL. IT IS SEEN THAT DURING ASSESSMENT PR OCEEDINGS, THE AO MADE A SPECIFIC QUERY IN RESPECT TO CASH CREDIT TO THE TUNE OF RS. 12.25 LACS IN PERSONAL CAPITAL ACCOUNT OF THE A SSESSEE AS WELL AS IN ACCOUNT OF SHRI MANOJ NOPANI. THE AO HAS MAD E AN OBSERVATION IN THE ASSESSMENT ORDER THAT A/R OF THE ASSESSEE TO EXPLAIN THE CASH DEPOSIT IN THE NAME OF SHRI MANOJ NOPANI. ON PERUSAL OF CASH BOOK LEDGER FOLIO MENTIONED IN THE ASSESSMENT ORDER, IT IS NOTICED THAT THE DAYS WHEN CASH IS SHO WN IN RECEIPT FROM MANOJ NOPANI, THE ASSESSEE WAS IN NEED OF CASH . IF THE CASH IS NOT SHOWN IN RECEIPT IN THESE DAYS, THE CASH BAL ANCE CAME NEGATIVE. IN VIEW OF THIS FACT, THE AO OBSERVED THA T THE ASSESSEE HAS SHOWN UNACCOUNTED CASH IN THE NAME OF MANOJ NOP ANI. AS PER ORDER OF AO, THE LD. A/R OF THE ASSESSEE FAILED TO EXPLAIN THE CASH DEPOSITS IN THE NAME OF SHRI MANOJ NOPANI OF R S. 8,20,000/-. THE CASH BOOK AND LEDGER PRODUCED FOR EXAMINATION W ERE IMPOUNDED AFTER RECORDING REASONS. THEREAFTER, ASS ESSEE WAS ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 10 ASKED TO EXPLAIN THE CASH DEPOSIT IN THE NAME OF MO NOJ NOPANI AND IN THE NAME OF ASSESSEE TOTALING TO RS. 12,25,0 00/-. THE LD. COUNSEL OF THE ASSESSEE ALONG WITH THE HUSBAND OF T HE ASSESSEE ATTENDED THE ASSESSMENT PROCEEDINGS ON 31.10.2007 A ND BY WHICH IT WAS SUBMITTED THAT THE ASSESSEE HAS ENTERE D INTO SALE AGREEMENT OF PLOT NO. F-975, ROAD NO. 14, VKI AREA, JAIPUR WITH SMT. SANTRA DEVI AGARWAL FOR RS. 40,00,000/- AND RS . 12,21,000/- HAS BEEN SHOWN RECEIVED AS ADVANCE. COPY OF AGREEME NT WAS ALSO FILED ON 17.10.2007. THE ASSESSEE WAS REQUIRE D TO PRODUCE SMT. SANTRA DEVI. HOWEVER, BY LETTER DATED 2.11.200 7 IT WAS SUBMITTED THAT SINCE THEY ARE NOT ABLE TO PRODUCE S MT. SANTRA DEVI, THEREFORE, THEY ARE OFFERING THIS AMOUNT FOR TAXATION AND THE TAX HAS ALREADY BEEN PAID ON THIS ACCOUNT. IN VIEW OF THESE FACTS, THE ADDITION OF RS. 12,25,000/- WAS MADE BY THE AO IN THE ASSESSMENT ORDER AND PENALTY PROCEEDINGS UNDER SECT ION 271(1)(C) WERE INITIATED. 8. A SHOW CAUSE NOTICE WAS ISSUED. AS PER ORDER OF AO, NO EXPLANATION WAS OFFERED. THEREFORE, THE AO DREW AN INFERENCE THAT ASSESSEE HAS NO EXPLANATION. HE FURTHER OBSER VED THAT WHEN THE ASSESSEE WAS CORNERED IN RESPECT TO CASH CREDIT IN CAPITAL ACCOUNT OF THE ASSESSEE AND IN THE NAME OF HUSBAND OF THE ASSESSEE, THEN ONLY THE AMOUNT WAS SURRENDERED. TH EREFORE, IN VIEW OF THE AO, THE ASSESSEE HAS CONCEALED PARTICUL ARS OF INCOME. ACCORDINGLY, HE LEVIED PENALTY OF RS. 4,48,335/- UN DER SECTION 271(1)(C). VARIOUS DECISIONS WERE ALSO TAKEN INTO CONSIDERATION BY THE AO WHILE IMPOSING PENALTY ON THE ASSESSEE. THE LD. CIT (A) CANCELLED THE LEVY OF PENALTY BY OBSERVING THAT NO PROPER OPPORTUNITY WAS GIVEN TO THE ASSESSEE BEFORE LEVY O F IMPUGNED PENALTY. IT WAS FURTHER NOTED THAT NO ENQUIRY APPE ARS TO HAVE BEEN MADE BY THE AO TO SHOW THAT THE SURRENDERED AM OUNT REPRESENTED THE CONCEALED INCOME OF THE ASSESSEE. MERELY BECAUSE THE ASSESSEE HAD SURRENDERED THE AMOUNT IN QUESTION, COULD NOT BE BASIS FOR LEVY OF PENALTY WHEN SUCH SU RRENDER WAS ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 11 VOLUNTARY AND ON THE CONDITION THAT NO PENALTY WOUL D BE LEVIED. ACCORDINGLY LEVY OF PENALTY WAS CANCELLED. 9. AFTER CONSIDERING THE ORDERS OF THE AO AND LD. C IT (A) AND WRITTEN SUBMISSIONS FILED ON BEHALF OF THE ASSESSEE WHICH IS PLACED ON RECORD, WE FIND THAT THE AO WAS CORRECT I N LEVYING THE PENALTY ON THE FACTS OF PRESENT CASE. THE CONTENTIO N RAISED BEFORE LD. CIT (A) ALMOST ARE THE SAME CONTENTIONS RAISED HERE BEFORE US THROUGH WRITTEN SUBMISSIONS. IN THIS SUBMISSION IT HAS BEEN STATED THAT BECAUSE ASSESSEE WAS NOT ABLE TO PRODUC E SMT. SANTRA DEVI, THEREFORE, FOR THIS REASON THE PENALTY WAS LEVIED. RELIANCE HAS BEEN PLACED ON VARIOUS CASE LAWS. IN OUR CONSIDERED VIEW, THIS IS NOT MERELY A VOLUNTARY DIS CLOSURE OF THE AMOUNT AS ASSESSEE WAS REQUIRED TO EXPLAIN THE CASH DEPOSITS IN THE CAPITAL ACCOUNT OF THE ASSESSEE AS WELL AS CASH TRANSFERRED FROM THE CAPITAL ACCOUNT OF HUSBAND OF THE ASSESSEE IN THE BOOKS OF ACCOUNT OF THE ASSESSEE. HOWEVER, NO EXPLANATION WAS FILED AT FIRST STAGE. THEREAFTER ANOTHER OPPORTUNITY WAS GIV EN TO THE ASSESSEE. THEN THE ASSESSEE OFFERED AN EXPLANATION THAT ASSESSEE HAS ENTERED INTO AN AGREEMENT OF SALE OF P LOT WITH HER MOTHER FOR A CONSIDERATION OF RS. 40,00,000/- AND R S. 12,21,000/- HAS BEEN RECEIVED IN ADVANCE. NEITHER THE DATE OF ADVANCE IS DISCLOSED NOR THE REASON HAS BEEN GIVEN THAT ONCE T HE ADVANCE WAS RECEIVED IN ONE GO, THEN WHY THE ASSESSEE HAS C REDITED THE AMOUNT ON VARIOUS DIFFERENT DATES AMOUNTING TO RS. 20,000/-, RS. 20,000/-, 50,000/- OR SO. ON 20 OCCASIONS IN THE C ASE OF MANOJ NOPANI THE CASH HAS BEEN INTRODUCED AT RS. 8,20,000 /-. SIMILARLY, IN CASE OF ASSESSEE THE CASH HAS BEEN INTRODUCED ON 9 DIFFERENT DATES AMOUNTING TO RS. 4,05,000/-. NO REASON HAS B EEN ASSIGNED THAT WHY THE CASH HAS BEEN INTRODUCED ON SO MANY DA TES WHEN THE ADVANCE WAS RECEIVED IN ONE GO. IT IS FURTHER SEEN THAT ON A LATER STAGE EVEN THE AGREEMENT OF SALE OF PLOT WAS CANCELLED. IT IS ALSO NOT KNOWN HOW THE AMOUNT OF RS. 12,21,000/- RECEIVED FROM THE MOTHER OF THE ASSESSEE ON ACCOUNT OF SALE AGREEMENT HAS BEEN RETURNED. NEITHER ANY REASON HAS BEEN GIVE N WHY THE ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 12 SALE AGREEMENT IS CANCELLED. IT IS SURPRISING TO N OTE THAT THE AGREEMENT OF SALE WAS ENTERED WITH THE MOTHER OF TH E ASSESSEE AND MOTHER WAS NOT WILLING TO APPEAR TO CONFIRM THE SALE AGREEMENT. FROM ALL THESE EVENTS/FACTS IT EMERGES T HAT ASSESSEE TRIED TO EXPLAIN THE SOURCE OF CASH DEPOSITS UNDER THE GARB OF SALE AGREEMENT. THE ASSESSEE WAS REQUIRED TO PRODUCE SM T. SANTRA DEVI AGARWAL WHO HAPPENED TO BE THE MOTHER OF THE A SSESSEE. HOWEVER, AT THIS POINT OF TIME THE ASSESSEE CAME FO RWARD THAT THEY ARE SURRENDERING THIS AMOUNT AND TAX HAS ALREA DY BEEN PAID. IN OUR CONSIDERED VIEW, THIS SURRENDER IS NOT A VOL UNTARY SURRENDER. WHEN THE ASSESSEE WAS CORNERED IN RESPEC T TO CASH DEPOSIT IN THE BOOKS OF ASSESSEE, THEN ONLY SHE CAM E FORWARD TO SURRENDER THE AMOUNT. EXPLANATION FILED ON BEHALF OF THE ASSESSEE DOES NOT PROVE THE BONA FIDE OF THE ASSESS EE. SUPPOSING AT THE TIME OF ASSESSMENT PROCEEDINGS THE ASSESSEE WAS NOT ABLE TO PRODUCE SMT. SANTRA DEVI, BUT THEY COULD HAVE FILED FURTHER CONFIRMATION AND DETAILS DURING THE A PPELLATE PROCEEDINGS AS THE PENALTY PROCEEDINGS ARE DISTINCT AND SEPARATE FROM THE ASSESSMENT PROCEEDINGS. THE ASSESSEE IS FR EE TO LEAD ANY EVIDENCED IN HER SUPPORT. HOWEVER, NOTHING HAS BEEN BROUGHT ON RECORD. ON A SPECIFIC QUERY BY THE BENCH , THE LD. COUNSEL OF THE ASSESSEE WAS NOT ABLE TO BRING ANY F URTHER SUPPORTING EVIDENCE EXCEPT THE COPY OF AGREEMENT OF SALE OF LAND AND THE SURRENDER MADE DURING THE ASSESSMENT PROCEE DINGS. THEREFORE, IN OUR CONSIDERED VIEW THE ASSESSEE MISE RABLY FAILED TO EXPLAIN THE SOURCE OF CASH DEPOSIT IN HER CAPITAL A CCOUNT AS WELL AS IN HUSBANDS ACCOUNT WHICH WAS LATER ON TRANSFER RED TO ASSESSEES ACCOUNT. ACCORDINGLY, WE HOLD THAT THIS SURRENDER CANNOT BE TREATED AS VOLUNTARY SURRENDER OR TO AVOI D LITIGATION AS THE SAME WAS SURRENDERED WHEN THE ASSESSEE WAS CORN ERED. THEREFORE, WE FIND THAT THE CASES ON WHICH RELIANCE WAS PLACED DOES NOT HELP THE CASE OF THE ASSESSEE. 10. RELIANCE HAS BEEN PLACED IN CASE OF GARGI DIN J WALA PRASAD VS. CIT, 96 ITR 97 (ALL.) WHEREIN PRINCIPLES OF NAT URAL JUSTICE ARE ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 13 DISCUSSED. HOW THE RATIO OF THIS DECISION IS APPLI CABLE IN THE FACTS OF THE PRESENT CASE WAS NOT EXPLAINED. FACTS ARE EN TIRE DIFFERENT. 11. RELIANCE WAS PLACED IN THE CASE OF TIN BOX CO. VS. CIT, 116 TAXMAN 491 (SC) IN WHICH IT IS HELD THAT WHERE OPPO RTUNITY OF HEARING WAS NOT PROPERLY GIVEN, THEN THE TRIBUNAL W AS NOT JUSTIFIED IN SETTING ASIDE THE ASSESSMENT AND REMAN DING THE MATTER TO THE AO FOR A FRESH CONSIDERATION AGAIN, W E DO NOT FIND HOW THIS RATIO IS APPLICABLE IN THE FACTS OF THE PR ESENT CASE. SUPPOSING NO OPPORTUNITY WAS GIVEN BY THE AO, THEN OPPORTUNITY WAS GIVEN BY LD. CIT (A) AND NOTHING CONCRETE EVIDE NCE WAS FILED BEFORE LD. CIT (A), EVEN HERE BEFORE THE TRIBUNAL. THE LD. COUNSEL HAS ALSO NOT SOUGHT ADJOURNMENT TO FILE ANY OTHER DETAILS AS HE ALSO STATED THAT THERE IS NO EVIDENCE EXCEPT THE AGREEMENT ENTERED BETWEEN ASSESSEE AND SMT. SANTRA DEVI AGARW AL AND VOLUNTARY SURRENDER OF THE SAME AMOUNT. 12. RELIANCE WAS PLACED IN THE CASE OF DWIJENDRA KU MAR BHATTACHARJEE VS. SUPERINTENDENT OF TAXES, 78 STC 3 93 (GAU.). IN THIS CASE ALSO THE ISSUE WAS OF OPPORTUNITY AND IT WAS SUBMITTED THAT THE OPPORTUNITY MUST BE REAL AND EFF ECTIVE. AS STATED ABOVE, NOTHING HAS BEEN STATED IN RESPECT TO OPPORTUNITY HERE BEFORE THE TRIBUNAL. LD. CIT (A) THOUGH MENTIO NED IN HIS ORDER THAT NO OPPORTUNITY WAS GIVEN BY THE AO BUT H E HAS CONSIDERED THE SUBMISSIONS AND CANCELLED THE PENALT Y. IF, IN THE MIND OF LD. CIT (A) NO OPPORTUNITY WAS GIVEN BY THE AO, THEN THE MATTER SHOULD HAVE BEEN REMANDED BACK TO THE FILE O F AO BUT HE HAS DECIDED THE ISSUE ON HIS OWN. HERE, BEFORE THE TRIBUNAL NOTHING HAS BEEN STATED BY LD. A/R THAT THE OPPORTU NITY WAS NOT GIVEN BY THE AO. IF THE OPPORTUNITY WAS NOT GIVEN B Y THE AO, THEN OPPORTUNITY WAS GIVEN BY LD. CIT (A) WHERE NO FRESH EVIDENCE WAS FILED EXCEPT THOSE EVIDENCE WHICH WERE ALREADY FILED BEFORE THE AO. AS STATED ABOVE, EVEN NO MATERIAL W AS BROUGHT ON RECORD HERE BEFORE THE TRIBUNAL WHICH CAN BE SAI D THAT THIS NEEDS TO BE VERIFIED. THEREFORE, IN OUR CONSIDERED VIEW, THE ABOVE CASE LAW IS ALSO NOT APPLICABLE. ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 14 12.1. RELIANCE HAS ALSO BEEN PLACED ON VARIOUS CASE S MENTIONED IN THE WRITTEN SUBMISSION AND WE HAVE GONE THROUGH THOSE CASE LAWS AND FOUND THAT THEY ARE NOT APPLICABLE ON THE FACTS OF THE PRESENT CASE. ALMOST IN ALL CASES IT HAS BEEN HELD THAT IF THE ASSESSMENT IS MADE ON AGREED AMOUNT, THEN PENALTY I S NOT LEVIABLE. HOWEVER, IN OUR CONSIDERED VIEW, AS STATE D ABOVE, THE ASSESSMENT WAS NOT COMPLETED IN THIS CASE ON AGREED BASIS AS THE ASSESSEE SURRENDERED THE AMOUNT OF CASH CREDIT WHEN THE ASSESSEE WAS CORNERED. THEREFORE, THE DECISION IN THE CASE OF K.P. MADHUSUDANAN VS. CIT, 251 ITR 99 (SC) ON WHICH RELIANCE HAS BEEN PLACED BY AO IS SQUARELY APPLICABLE IN THE FACTS OF THE PRESENT CASE. IN VIEW OF THESE FACTS AND CIRCUMSTA NCES WE REVERSE THE ORDER OF LD. CIT (A) AND RESTORE THE OR DER OF AO WHO LEVIED THE PENALTY. HOWEVER, IN MA NO. 23/JP/2011 FILED BY THE ASSESSEE , THIS TRIBUNAL VIDE ORDER DATED 09.01.2012 REMANDED THE MATTER TO THE R ECORD OF THE AO FOR FRESH CONSIDERATION AND THE ASSESSEE WAS TO BE GIVEN AN OPPORTUNITY OF HEARING AND ALSO TO PRODUCE EVIDENCE IF ANY IN S UPPORT OF THE EXPLANATION AS TO WHY THE PENALTY SHOULD NOT BE LEV IED U/S 271(1)(C)OF THE ACT. THE SCOPE OF REMAND WAS TO GIVE AN OPPORT UNITY TO THE ASSESSEE TO PRODUCE THE EVIDENCE AND PARTICULARLY THE WITNESS FROM WHOM THE AMOUNT WAS CLAIMED TO HAVE RECEIVED BY THE HUSBAND OF THE ASSESSEE. THE ASSESSEE NEVER RAISED THE ISSUE OF VA LIDITY OF NOTICE U/S 274 OF THE ACT ON THE GROUND THAT NO SPECIFIC DEFAU LT OR NATURE OF DEFAULT ON THE PART OF THE ASSESSEE WAS POINTED OUT BY THE AO. THEREFORE, THE ISSUE WHICH DID NOT EMANATE EITHER FROM THE LD. CIT (A) IN THE FIRST ROUND ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 15 OF APPEAL OR FROM THE ORDER OF THE TRIBUNAL DATED 1 0.03.2011, THE SAME CANNOT BE AGITATED IN MA IN WHICH THE MATTER WAS RE MANDED TO THE RECORD OF THE AO. IT IS PERTINENT TO NOTE THAT THE SCOPE OF MA U/S 254(2) IS VERY LIMITED AND CIRCUMSCRIBED AND THE PARTIES T O THE APPEAL CANNOT BE ALLOWED TO RAISE ANY ISSUE IN THE PROCEEDINGS U/ S 254(2) TO SET UP A NEW CASE NOT ARISING FROM THE PROCEEDINGS COMPLETED TILL THEN. THEREFORE WHEN THIS ISSUE WAS NEITHER ARISEN FROM T HE ORDER PASSED BY THE AO OR LD. CIT(A) ORIGINALLY NOR FROM THE ORDER PASSED BY THE TRIBUNAL THEN THE SAID ISSUE CANNOT BE RAISED IN THE APPEAL FILED AGAINST THE ORDER PASSED IN THE REMAND PROCEEDINGS. THE SUBJECT MATTE R AND SCOPE OF REMAND PROCEEDING IS LIMITED TO THE ISSUE REMAND BY THE TRIBUNAL AND THEREFORE, NO NEW ISSUE CAN BE A SUBJECT MATTER OF REMAND PROCEEDINGS. HENCE, THE ISSUE WHICH WAS NOT A SUBJECT MATTER OF FIRST ROUND OF APPEAL CANNOT BE ALLOWED TO RAISE IN THE SUBSEQUENT PROCEE DINGS ARISING FROM SET ASIDE ORDER OF THIS TRIBUNAL AND THAT TOO AT T HIS STAGE. HENCE, WE DECLINE TO ADMIT THE ADDITIONAL GROUND NO. 2 RAISED BY THE ASSESSEE, THE SAME IS DISMISSED IN LIMINE. 13. THE ISSUE RAISED IN THE ORIGINAL GROUND IS REGA RDING THE LEVY OF PENALTY U/S 271(1)(C) AGAINST THE ADDITION/INCOME S URRENDERED BY THE ASSESSEE. THE LD. AR OF THE ASSESSEE HAS SUBMITTED THAT DURING THE ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 16 ASSESSMENT PROCEEDINGS THE ASSESSEE SURRENDERED AMO UNT OF RS. 12,25,000/- AFTER DULY EXPLAINING THE SAME AS UNDIS CLOSED INCOME AND DEPOSITED THE TAX THEREON. THIS ACTION WAS TAKEN BY THE ASSESSEE JUST TO BUY PEACE OF MIND AS THE ASSESSEE AT THAT POINT OF TIME, WAS UNABLE TO PRODUCE SMT. SANTRA DEVI MOTHER-IN-LAW OF THE ASSES SEE FROM WHOM THE SAID SUM WAS RECEIVED AND THEREAFTER USED IN THE B USINESS. HE HAS FURTHER SUBMITTED THAT THE ASSESSING OFFICER WAS HA VING STATUTORY POWER FOR CONDUCTING ENQUIRIES AND ENFORCING ATTENDANCE O F WITNESS. BUT THE AO DID NOT EXERCISE SUCH POWERS BY ISSUING NOTICES U/S 131 EVEN IN THE PENALTY PROCEEDINGS. THE LD. AR HAS FURTHER SUBMITT ED THAT THE ASSESSEE HAS PROVIDED NAME, ADDRESS, AGREEMENT ENTERED INTO AND AFFIDAVIT OF SMT. SANTRA DEVI ESTABLISHING THAT THE SHE HAD ADVA NCED MONEY TO THE ASSESSEE. HENCE, IT IS CLEAR THAT THE ASSESSEE HAS DISCHARGED HER ONUS TO PROVE THE IDENTITY OF THE PERSONS AND GENUINENESS O F THE TRANSACTION. THE ASSESSEE COULD NOT BE EXCEPTED TO DO ANY FURTHE R. HE HAS REFERRED TO THE EXPLANATION1 TO SECTION 271(1)(C) OF THE ACT AND SUBMITTED THAT EVEN IF THE EXPLANATION OFFERED BY THE ASSESSEE WAS NOT FOUND SATISFACTORY BUT IF THE SAME IS BONAFIDE THEN NO PE NALTY OUGHT TO HAVE BEEN LEVIED U/S 271(1)(C) OF THE INCOME TAX ACT. E VEN OTHERWISE THE SURRENDERED ON BEHALF OF THE ASSESSEE WAS TO BUY PE ACE OF MIND AND ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 17 THEREFORE, THE PENALTY CANNOT BE LEVIED U/S 271(1)( C) OF THE ACT. HE HAS RELIED UPON THE DECISION OF HONBLE SUPREME COURT I N CASE OF SHRI SHADI LAL SUGAR & GENERAL MILLS LTD. VS. CIT 168 ITR 705. 14. ON THE OTHER HAND, LD. DR HAS SUBMITTED THAT TH IS IS NOT A VOLUNTARY SURRENDER BY THE ASSESSEE BUT IT WAS OFFE RED TO TAX ONLY WHEN THE AO ISSUED A SHOW CAUSE NOTICE TO THE ASSESSEE. FURTHER, THE AO ASKED THE ASSESSEE TO PRODUCE CREDITOR IN SUPPORT O F THE CLAIM, THE ASSESSEE CAME OUT WITH SURRENDER OF INCOME AND THER EFORE, THE INCOME WAS DISCLOSED BY THE ASSESSEE WHEN IT WAS DETECTED BY THE AO. HE HAS RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 15. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIAL ON RECORD WE FIND IT IS NOT VOLUNTARY DISC LOSER AND SURRENDER OF INCOME BY THE ASSESSEE BUT IT WAS IN RESPONSE TO TH E SHOW CAUSE NOTICE GIVEN BY THE AO AS TO WHY THE CASH CREDIT IS NOT TR EATED AS UNEXPLAINED INCOME OF THE ASSESSEE. THUS, INSTEAD OF ALLOWING T HE AO TO EXAMINE AND CARRY OUT A PROPER INVESTIGATION, THE ASSESSEE OFFERED THE SAID AMOUNT OF RS. 12,25,000/- AS UNDISCLOSED INCOME. TH ERE IS NO DISPUTE THAT THE PENALTY PROCEEDING ARE SEPARATE AND INDEPE NDENT FROM ASSESSMENT PROCEEDINGS HOWEVER, THE SCOPE OF ENQUIR Y IN THE PENALTY PROCEEDINGS IS LIMITED ONLY ON THE POINT TO SEE WHE THER THE EXPLANATION ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 18 OF THE ASSESSEE THOUGH MAY NOT BE FOUND BE ACCEPTED BUT IT IS A BONAFIDE ONE. IN THE CASE OF THE ASSESSEE THE EXPLA NATION OF THE ASSESSEE WAS THAT THE HUSBAND OF THE ASSESSEE RECEI VED THIS CASH OF RS. 12,25,000/- FROM HIS MOTHER AGAINST THE AGREEMENT T O SALE OF LAND. THE SAID AGREEMENT WAS SUBSEQUENTLY CANCELLED AND THERE FORE, THE EXPLANATION OF THE ASSESSEE WAS FAR FROM ANY REAL T RANSACTION AND CANNOT BE CONSIDERED AS BONAFIDE ONE. THE TRIBUNAL HAS REMAND THE MATTER TO THE RECORD OF THE ASSESSING OFFICER TO GI VE AN OPPORTUNITY TO THE ASSESSEE TO PRODUCE THE EVIDENCE AND THE CREDIT OR HOWEVER, THE ASSESSEE AGAIN FAILED TO PRODUCE THE CREDITOR BEFOR E THE AO THOUGH DUE TO THE REASON THAT THE MOTHER OF THE HUSBAND OF THE ASSESSEE BY THE TIME EXPIRED. THEREFORE, THE REMAND PROCEEDINGS WER E MEANT TO GRANT AN OPPORTUNITY TO THE ASSESSEE TO FURNISH THE EXPLA NATION BUT THE ASSESSEE FAILED TO DO AND HENCE THE ONUS CANNOT BE SHIFTED FROM ASSESSEE TO AO WHEN THE ASSESSEE HERSELF HAS FAILED TO DISCHARGE THE INITIAL BURDEN OF FURNISHING THE EXPLANATION. 16. AS REGARDS THE SURRENDERED BEING VOLUNTARILY IN NATURE THE HONBLE SUPREME COURT IN CASE OF MAK DATA PVT. LTD. VS. CIT 358 ITR 593 AS HELD IN PARAS 6 TO 11 AS UNDER:- 6. WE HAVE HEARD COUNSEL ON EITHER SIDE. WE FULLY CON CUR WITH THE VIEW OF THE HIGH COURT THAT THE TRIBUNAL HAS NO T PROPERLY ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 19 UNDERSTOOD OR APPRECIATED THE SCOPE OF EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT, WHICH READS AS FOLLOWS :- 'EXPLANATION 1 - WHERE IN RESPECT OF ANY FACTS MATE RIAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT, - (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OFFERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMM ISSIONER (APPEALS) OR THE COMMISSIONER TO BE FALSE, OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS NOT A BLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXP LANATION IS BONA FIDE AND THAT ALL THE FACTS RELATING TO THE SAME AND MAT ERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM, THEN THE AMOUNT ADDED OR DISALLOWED IN COMPUTING THE TOT AL INCOME OF SUCH PERSON AS A RESULT THEREOF SHALL, FO R THE PURPOSES OF CLAUSE (C) OF THIS SUB- SECTION, BE DEEMED TO REPRESENT THE INCOME IN RESPE CT OF WHICH PARTICULARS HAVE BEEN CONCEALED.' 7. THE AO, IN OUR VIEW, SHALL NOT BE CARRIED AWAY BY THE PLEA OF THE ASSESSEE LIKE 'VOLUNTARY DISCLOSURE', 'BUY PEAC E', 'AVOID LITIGATION', 'AMICABLE SETTLEMENT', ETC. TO EXPLAIN AWAY ITS CONDUCT. THE QUESTION IS WHETHER THE ASSESSEE HAS O FFERED ANY EXPLANATION FOR CONCEALMENT OF PARTICULARS OF INCOM E OR FURNISHING INACCURATE PARTICULARS OF INCOME. EXPLANATION TO SE CTION 271(1) RAISES A PRESUMPTION OF CONCEALMENT, WHEN A DIFFERE NCE IS NOTICED BY THE AO, BETWEEN REPORTED AND ASSESSED IN COME. THE BURDEN IS THEN ON THE ASSESSEE TO SHOW OTHERWISE, B Y COGENT AND RELIABLE EVIDENCE. WHEN THE INITIAL ONUS PLACED BY THE EXPLANATION, HAS BEEN DISCHARGED BY HIM, THE ONUS S HIFTS ON THE REVENUE TO SHOW THAT THE AMOUNT IN QUESTION CONSTIT UTED THE INCOME AND NOT OTHERWISE. 8. ASSESSEE HAS ONLY STATED THAT HE HAD SURRENDERED T HE ADDITIONAL SUM OF RS.40,74,000/- WITH A VIEW TO AVO ID LITIGATION, BUY PEACE AND TO CHANNELIZE THE ENERGY AND RESOURCE S TOWARDS PRODUCTIVE WORK AND TO MAKE AMICABLE SETTLEMENT WIT H THE ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 20 INCOME TAX DEPARTMENT. STATUTE DOES NOT RECOGNIZE T HOSE TYPES OF DEFENCES UNDER THE EXPLANATION 1 TO SECTION 271( L)(C) OF THE ACT. IT IS TRITE LAW THAT THE VOLUNTARY DISCLOSURE DOES NOT RELEASE THE APPELLANT-ASSESSEE FROM THE MISCHIEF OF PENAL P ROCEEDINGS. THE LAW DOES NOT PROVIDE THAT WHEN AN ASSESSEE MAKE S A VOLUNTARY DISCLOSURE OF HIS CONCEALED INCOME, HE HA D TO BE ABSOLVED FROM PENALTY. 9. WE ARE OF THE VIEW THAT THE SURRENDER OF INCOME IN THIS CASE IS NOT VOLUNTARY IN THE SENSE THAT THE OFFER OF SURREN DER WAS MADE IN VIEW OF DETECTION MADE BY THE AO IN THE SEARCH C ONDUCTED IN THE SISTER CONCERN OF THE ASSESSEE. IN THAT SITUATI ON, IT CANNOT BE SAID THAT THE SURRENDER OF INCOME WAS VOLUNTARY. AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS NOTICED THAT C ERTAIN DOCUMENTS COMPRISING OF SHARE APPLICATION FORMS, BA NK STATEMENTS, MEMORANDUM OF ASSOCIATION OF COMPANIES, AFFIDAVITS, COPIES OF INCOME TAX RETURNS AND ASSESSMENT ORDERS AND BLANK SHARE TRANSFER DEEDS DULY SIGNED, HAVE BEEN IMPOUND ED IN THE COURSE OF SURVEY PROCEEDINGS UNDER SECTION 133A CON DUCTED ON 16.12.2003, IN THE CASE OF A SISTER CONCERN OF THE ASSESSEE. THE SURVEY WAS CONDUCTED MORE THAN 10 MONTHS BEFORE THE ASSESSEE FILED ITS RETURN OF INCOME. HAD IT BEEN THE INTENTI ON OF THE ASSESSEE TO MAKE FULL AND TRUE DISCLOSURE OF ITS IN COME, IT WOULD HAVE FILED THE RETURN DECLARING AN INCOME INCLUSIVE OF THE AMOUNT WHICH WAS SURRENDERED LATER DURING THE COURSE OF TH E ASSESSMENT PROCEEDINGS. CONSEQUENTLY, IT IS CLEAR THAT THE ASS ESSEE HAD NO INTENTION TO DECLARE ITS TRUE INCOME. IT IS THE STA TUTORY DUTY OF THE ASSESSEE TO RECORD ALL ITS TRANSACTIONS IN THE BOOK S OF ACCOUNT, TO EXPLAIN THE SOURCE OF PAYMENTS MADE BY IT AND TO DE CLARE ITS TRUE INCOME IN THE RETURN OF INCOME FILED BY IT FROM YEA R TO YEAR. THE AO, IN OUR VIEW, HAS RECORDED A CATEGORICAL FINDING THAT HE WAS SATISFIED THAT THE ASSESSEE HAD CONCEALED TRUE PART ICULARS OF INCOME AND IS LIABLE FOR PENALTY PROCEEDINGS UNDER SECTION 271 READ WITH SECTION 274 OF THE INCOME TAX ACT, 1961. ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 21 10. THE AO HAS TO SATISFY WHETHER THE PENALTY PROCEEDI NGS BE INITIATED OR NOT DURING THE COURSE OF THE ASSESSMEN T PROCEEDINGS AND THE AO IS NOT REQUIRED TO RECORD HIS SATISFACTI ON IN A PARTICULAR MANNER OR REDUCE IT INTO WRITING. THE SCOPE OF SECT ION 271(L)(C) HAS ALSO BEEN ELABORATELY DISCUSSED BY THIS COURT I N UNION OF INDIA V. DHARMENDRA TEXTILE PROCESSORS [2008] 13 SC C 369 AND CIT V. ATUL MOHAN BINDAL [2009] 9 SCC 589. 11. THE PRINCIPLE LAID DOWN BY THIS COURT, IN OUR VIEW , HAS BEEN CORRECTLY FOLLOWED BY THE REVENUE AND WE FIND NO IL LEGALITY IN THE DEPARTMENT INITIATING PENALTY PROCEEDINGS IN THE IN STANT CASE. WE, THEREFORE, FULLY AGREE WITH THE VIEW OF THE HIGH CO URT. HENCE, THE APPEAL LACKS MERIT AND IS DISMISSED. THERE SHALL BE NO ORDER AS TO COSTS. THE PRINCIPLE LAID DOWN BY THE HONBLE SUPREME COUR T IN CASE OF MAK DATA PVT. LTD. VS. CIT (SUPRA) IS CLEARLY APPLICABL E IN THE FACTS OF THE CASE OF THE ASSESSEE AND ACCORDINGLY BY FOLLOWING T HE DECISION OF HONBLE SUPREME COURT, WE DO NOT FIND ERROR OR ILLE GALITY IN THE ORDER OF THE AUTHORITIES BELOW LEVY THE PENALTY U/S 271(1)(C ) OF THE ACT. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMI SSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15/03/2018. SD/- SD/- HKKXPAN FOT; IKY JKO (BHAGCHAND) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 15/03/2018. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: ITA NO. 241/JP/2016 SMT. MEENA BAJAJ VS. ITO 22 1. VIHYKFKHZ@ THE APPELLANT- SMT. MEENA BAJAJ, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT - ITO, WARD-3(2),JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 241/JP/2016} VKNS'KKUQLKJ@ BY ORDER,