Shri Shailesh Hiralal Bhatt, Ahmedabad V. The Income tax Officer, Ward-3(4), Ahmedabad

ITA 249/AHD/2014

• Counselvise Citation: 24920514 RSA 2014
• Duration Of Justice: 1 year(s) 10 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 09-09-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 24-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANITA HARDASANI
• Assessee Lawyers: A C SHAH
• Section: 68

Judgement Text

ITA NO . 249 /AHD/ 20 1 4 ASSESSMENT YEAR: 2002 - 03 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH, AHMEDABAD [CORAM: PRAMOD KUMAR AM AND S S GODARA JM] ITA NO. 249 / AHD / 2 0 1 4 ASSESSMENT YEAR: 20 0 2 - 0 3 SHAILESH HIRALAL BHATT ....... .. . ..... APPELLANT B - 8, SOMNATH COMPLEX, OPP. GANESH A PARTMENT, NARODA AHMEDABAD - 380025. [PAN AEJPB 9702 P ] VS. THE INCOME TAX OFFICER .... .................. .... .. RESPONDENT WARD - 3(4), AHMEDABAD APPEARANCES BY: AC SHAH FOR THE APPELLANT ANITA HARDASANI FOR THE RESPONDENT DATE OF CONCLUDING THE HEA RING : SEPTEMBER 9 TH , 201 5 DATE OF PRONOUNCING THE ORDER : DECEMBER 7 TH , 2015 O R D E R PER PRAMOD KUMAR AM: 1. THE SHORT ISSUE THAT WE ARE REQUIRED TO ADJUDICATE IN THIS APPEAL IS WHETHER OR NOT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, L EARNED CIT(A) WAS JUSTIFIED IN UPHOLDING THE IMPUGNED PENALTY OF RS.86,766/ - IMPOSED ON THE ASSESSEE UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961. THE ASSESSMENT YEAR INVOLVED IS 2002 - 03 AND THE IMPUGNED CIT(A) S ORDER WAS PASSED ON 05.12.2013. 2 . THE MATERIAL FACTS, TO THE EXTENT RELEVANT FOR PRESENT ADJUDICATION, ARE LIKE THIS. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT WHILE THE ASSESSEE HAD SHOWN A WITHDRAWAL OF RS.1,00,000/ - ON 31.03.2002 AND CORRESPONDIN G PAYMENTS OF THIS AMOUNT TO SIX DIFFERENT PERSONS, AGGREGATE OF WHICH CAME TO RS.1,00,000/ - , ITA NO . 249 /AHD/ 20 1 4 ASSESSMENT YEAR: 2002 - 03 PAGE 2 OF 3 NO SUCH AMOUNT WAS WITHDRAWN FROM BANK ON THAT DAY. ACCORDINGLY, THE ASSESSING OFFICER TREATED THIS AMOUNT AS UNEXPLAINED INCOME. THE ASSESSEE S EXPLANATION TH AT BOTH THE ENTRIES, I.E., OF BANK WITHDRAWAL AND CORRESPONDING PAYMENTS, HAVING BEEN REVERSED ON THE VERY NEXT DAY, I.E., 1 ST APRIL 2002, WAS NOTED AND REJECTED AS AN AFTERTHOUGHT. THE MATTER TRAVELLED UPTO THIS TRIBUNAL BUT WITHOUT ANY SUCCESS. THE MAT TER, HOWEVER, DID NOT REST WITH THIS QUANTUM ADDITION ALONE. THE ASSESSING OFFICER ALSO IMPOSED A PENALTY BY OBSERVING, INTER ALIA, THAT THE ASSESSEE HAS NOT FURNISHED FULL AND TRUE PARTICULARS OF INCOME SO FAR AS ADDITION OF RS.1,00,000/ - MADE UNDER SEC TION 68 . AGGRIEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) BUT WITHOUT ANY SUCCESS. LEARNED CIT(A) JUSTIFIED THE PENALTY BY OBSERVING AS FOLLOWS: - I HAVE CAREFULLY PERUSED THE ASSESSMENT ORDER, PENALTY ORDER, WRITTEN SUBMISSIONS MADE B Y THE AR AND OTHER MATERIAL ON RECORD. IT IS OBSERVED THAT THERE HAVE BEEN SEVERAL ROUNDS OF DISCUSSIONS ON THE ISSUE OF RS.1.00 LAC REGARDING WHICH ENTRY WAS MADE ON 31.3.2002. THE VERSION OF ASSESSING OFFICER WAS CONFIRMED BY CIT(APPEALS) AS WELL AS I. T.A.T. WHO HAVE GIVEN THEIR DETAILED FINDINGS AS CONTAINED IN THEIR ORDERS AS REFERRED TO ABOVE. FROM THE FACTS OF THE CASE, IT IS CLEAR THAT NO PLAUSIBLE EXPLANATION WAS GIVEN BY THE APPELLANT BEFORE THE CONCERNED AUTHORITIES REGARDING THE SAID RS.1.00 L AC INTRODUCED IN THE BOOKS OF ACCOUNT. IN APPEAL BEFORE ME, IT HAS BEEN SUBMITTED THAT MISTAKE OF PASSING ENTRY ON 31 ST MARCH WAS RECTIFIED BY REVERSING THE SAME AS ON 01.04.2002 AND HENCE, THERE WAS NO QUESTION OF ANY CASH CREDIT. HOWEVER, IN MY CONSID ERED VIEW, THE APPELLANT HAS FAILED TO SUBSTANTIATE ITS STAND BY WAY OF ANY SUPPORTING PROOF OR DOCUMENTARY EVIDENCE. THE FACTS ON RECORD CLEARLY REVEAL THAT THERE WAS FURNISHING OF INADEQUATE PARTICULARS OF ITS INCOME REGARDING RS.1.00 LAC REGARDING WHIC H ENTRY WAS MADE IN THE BOOKS OF ACCOUNT ON 31.03.2002. THE ORDER OF THE HON BLE I.T.A.T. DT. 19.02.2011 CLEARLY SPEAKS OF THE DEFAULT COMMITTED BY THE APPELLANT ON VARIOUS COUNTS. IN MY VIEW, THE LEVY OF PENALTY WAS JUSTIFIED. HOWEVER, TAKING INTO ACCOUN T, THE TOTALITY OF FACTS AND CIRCUMSTANCES, THE SAME IS REDUCED FROM 300% TO 200% I.E. THE APPLE GETS PART RELIEF TO THAT EXTENT. 3. THE ASSESSEE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 4. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RE CORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLICABLE LEGAL POSITION. ITA NO . 249 /AHD/ 20 1 4 ASSESSMENT YEAR: 2002 - 03 PAGE 3 OF 3 5. WE FIND THAT THE ASSESSEE HAD ALL ALONG TAKEN THE STAND THAT THE SAID ENTRY OF WITHDRAWING RS.1,00,000/ - FROM THE BANK AND CORRESPONDING PAYMENTS, AGGREGATING TO RS.1, 00,000/ - , WERE REVERSED ON THE VERY NEXT DAY. THIS CONTENTION HAS BEEN DULY NOTED AT ALL STAGES, THOUGH IT WAS NOT ACCEPTED IN THE QUANTUM PROCEEDINGS. IN OUR CONSIDERED VIEW, THE EXPLANATION SO GIVEN BY THE ASSESSEE IS A REASONABLE EXPLANATION AT LEAST TO THE EXTENT ADJUDICATION IN PENALTY PROCEEDINGS IS CONCERNED. WHEN THE ENTRIES ARE REVERSED ON THE VERY NEXT DAY, WHICH WAS OBVIOUSLY MUCH MUCH BEFORE THE MISTAKE WAS DETECTED BY THE ASSESSING OFFICER, THE EXPLANATION OF THE ASSESSEE THAT THERE WAS NO A CTUAL CORRESPONDING PAYMENT CANNOT BE SIMPLY BRUSHED ASIDE AS IMPROBABLE. WE ACCEPT THIS EXPLANATION SO FAR AS PENALTY PROCEEDINGS ARE CONCERNED. 6. IN VIEW OF THE ABOVE DISCUSSIONS, WE UPHOLD THE GRIEVANCE OF THE ASSESSEE. ACCORDINGLY, THE IMPUGNED P ENALTY OF RS.86,766/ - STANDS DELETED. 7. IN THE RESULT, THE APPEAL IS ALLOWED . P RONOUNCED IN THE OPEN COURT ON THIS 7TH D AY OF DECEMBER , 2015. / - SD/ - SD/ - S S GODARA PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AHMEDABAD , THE 7 TH DAY OF DECEMBER , 201 5 BT * COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FIL E BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD