Dy.C.I.T., Circle-1, Aligarh V. Rama educational Welfare Society, Aligarh

ITA 254/AGR/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 72786 (ITAT-AGRA)
• Duration Of Justice: 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 04-02-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 19-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ATHESHAM ANSARI
• Assessee Lawyers: ANKIT GUPTA
• Keywords: Initiation of penalty proceedings; Onus to prove
• Section: 10B

Judgement Text

I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 1 OF 8 IN THE INCOME TAX APPELLATE TRIBUNAL, AGRA BENCH, AGRA [CORAM : BHAVNESH SAINI JM AND PRAMOD KUMAR AM] I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 1, ALIGARH .APPELLANT VS. RAMA EDUCATIONAL WELFARE SOCIETY .RESPONDE NT [PAN : AAATR8995B] APPEARANCES BY: ATHESHAM ANSARI, FOR THE APPELLANT ANKIT GUPTA, FOR THE RESPONDENT DATE OF HEARING : FEBRUARY 04, 2014 DATE OF PRONOUNCING THE ORDER : FEBRUARY 14, 201 4 ORDER PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL, THE ASSESSEE APPELLANT HA S CHALLENGED THE CORRECTNESS OF LEARNED COMMISSIONER (APPEALS)S ORD ER DATED 4 TH APRIL 2013, IN THE MATTER OF PENALTY UNDER SECTION 271(1)(C) OF TH E INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR THE ASS ESSMENT YEAR 2008-09. 2. GRIEVANCE RAISED BY THE ASSESSING OFFICER, IN SU BSTANCE, IS THAT, ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, LEARNED COMMISSIONER (APPEALS) ERRED IN DELETING THE IMPUGNED PENALTY OF RS 3,93,1 49. 3. THE MATERIAL FACTS ARE NOT IN DISPUTE. THE ASSES SEE BEFORE US IS A SOCIETY ASSESSED AS AN ASSOCIATION OF PERSONS (AOP). DURING THE COURSE OF ITS ASSESSMENT I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 2 OF 8 PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS PURCHASED BRICKS FOR RS 11,68,000 AND SINCE THE SALE BILLS OF THESE BRICKS ARE CAPTIONED CASH MEMOS, THE AO INFERRED THAT THESE BRICKS ARE PURCHASED IN CASH. THE ASSESSING OFFICER FURTHER INFERRED THAT THESE BRICK S ARE DONATIONS IN KIND WHICH ARE NOT DISCLOSED IN THE ACCOUNTS. IN REPLY TO THE SHOW CAUSE NOTICE REQUIRING THE ASSESSEE TO SHOW CAUSE AS TO WHY THIS AMOUNT OF RS 11,68,000 NOT BE ADDED TO ITS INCOME, IT WAS EXPLAINED BY THE ASSESSEE THAT THE BRICKS WERE PURCHASED ON CREDIT, AS DULY REFLECTED IN THE BOOKS OF ACCOUNTS, AND THE PAYMENT WAS MADE TO THE VENDOR, NAMELY BHISHMA GAMODYOG SANSTHAN, BY AC COUNT PAYEE CHEQUE ON 21 ST APRIL 2005. HOWEVER, SINCE THE SAID VENDOR COULD NOT BE PRODUCED BEFORE THE ASSESSING OFFICER, THE ASSESSING OFFICER REJECT ED THE EXPLANATION AND PROCEEDED TO MAKE AN ADDITION OF RS 11,68,000. AGGR IEVED, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) AND THIS TRIBUNA L, BUT WITHOUT ANY SUCCESS. WHILE CONFIRMING THIS ADDITION OF RS 11,68,000, THI S BENCH OF THE TRIBUNAL , INTER ALIA, OBSERVED AS FOLLOWS: 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL ON RECORD ALONGWITH THE ORDERS OF THE AUTH ORITIES BELOW. WE HAVE ALSO GONE THROUGH THE COPIES OF THE MINUTES BOOK AS WELL AS PAPERS AND DOCUMENTS RELIED ON BY THE LEARNED AR. THIS IS UNCO NTROVERTED FACT THAT THE BRICKS WERE PURCHASED AGAINST THE CASH MEMOS ISSUED BY M/S. BHISHMA GRAMODYOG SANSTHAN IN FAVOUR OF SOCIETY. THE CASH M EMO PRE-SUPPOSES THAT THE SELLER HAS RECEIVED THE CASH AGAINST THE SALE F ROM THE PURCHASER. THE ONUS IS ON THE ASSESSEE TO PROVE THAT THE ASSESSEE HAS NOT PAID THE CASH BUT HAS BOUGHT THE BRICKS ON CREDIT. THE ASSESSEE HAS N OT PRODUCED THE SUPPLIER OF THE BRICKS BEFORE THE ASSESSING OFFICER. EVEN TH E ASSESSEE HAS NOT PRODUCED ANY CONFIRMATION OR THE ASSESSEES ACCOUNT IN THE BOOKS OF SUPPLIERS OF THE BRICKS. THIS IS SETTLED LAW THAT A PPARENT IS REAL. THE ONUS TO PROVE IS ON THE PERSON WHO ALLEGES THAT APPARENT I S NOT REAL, AS LAID DOWN BY HONBLE SUPREME COURT IN THE CASE OF CIT VS. DAU LAT RAM RAWQTMULL, 87 ITR 349(SC). EVEN BEFORE US ALSO, NO SUCH EVIDENCE WAS FILED BY THE ASSESSEE TO PROVE THAT BHISHMA GRAMODYOG SANSTHAN WAS NOT PA ID CASH BY THE ASSESSEE AT THE TIME OF PURCHASE OF THE BRICKS AND THE BRICKS WERE PURCHASED ON CREDIT BASIS. FROM THE COPY OF THE MINUTES BOOK, THE COPIES OF WHICH ARE FORMING PART OF THE ASSESSMENT ORDER ALSO, IT IS AP PARENT THAT THE PRESIDENT OF THE SOCIETY HAS ARRANGED FOR THE BRICKS FOR CONS TRUCTION AND HE WILL TAKE THE PAYMENT WHEN LOAN WILL BE RECEIVED FROM THE BAN K. THIS ITSELF PROVES THAT THE PRESIDENT OF THE SOCIETY HAD MADE THE PAYM ENT FOR THE BRICKS ON BEHALF OF THE SOCIETY AND THE SOCIETY MIGHT HAVE RE CEIVED DONATIONS FROM THE PRESIDENT. WHEN THE BENCH ASKED THE LEARNED AR TO P RODUCE THE AUDITORS I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 3 OF 8 REPORT IN FORM 10B ALONGWITH ACCOUNTING POLICY, WHI CH FORMED THE PART OF THE BALANCE SHEET, HE PRODUCED PHOTOCOPY OF THE AUD IT REPORT WITHOUT CERTIFYING IT TO BE TRUE. THE BALANCE SHEET NOWHERE STATES THAT THE NOTES ON ACCOUNT WILL FORM THE PART OF THE AUDITED BALANCE S HEET. THE NOTES ON ACCOUNTS MUST FORM PART OF THE AUDITED BALANCE SHEE T AND PROFIT AND LOSS ACCOUNT. UNDER THESE FACTS, IT COULD NOT BE PROVED BY THE ASSESSEE WHAT SYSTEM OF ACCOUNTING IS BEING FOLLOWED BY ASSESSEE CONSISTENTLY. UNDER THESE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE CIT(A). THE CIT(A ) HAS RIGHTLY UPHELD THE ORDER OF THE ASSESSING OFFICER. THE ORDER OF THE CI T(A) IS EXHAUSTIVE AND HAS DEALT WITH ALL THE POINTS INVOLVED. IN OUR OPINION, NO INTERFERENCE IS CALLED FOR IN THE ORDER OF CIT(A) AND HE HAS RIGHTLY CONFIRMED THE ADDITION MADE BY THE ASSESSING OFFICER. THUS, GROUND NO. 1 STRANDS DISMI SSED. 4. THE MATTER DID NOT REST THERE. THE ASSESSING OFF ICER ALSO IMPOSED A PENALTY OF RS 3,93,149, UNDER SECTION 271(1)(C) OF THE ACT. WHILE DOING SO, THE ASSESSING OFFICER NOTED THAT THE TRIBUNAL HAS CONFI RMED THE QUANTUM ADDITION, EXTENSIVELY REPRODUCED SUBMISSIONS OF THE ASSESSEE AND, IN A VERY BRIEF OPERATIVE ORDER, OBSERVED AS FOLLOWS: LOOKING TO THE ABOVE FACTS AND CIRCUMSTANCES OF THE CASE AND ABOVE SUBMISSIONS, IT IS CLEAR THAT THE ASSESSEE HAS CONC EALED ITS PARTICULARS OF INCOME, SO AS TO EVADE TAX. THE CASE S CITED BY THE ASSESSEE ARE DISTINGUISHABLE ON FACTS AND ARE NOT A PPLICABLE IN THIS CASE. THE ARGUMENTS OF THE ASSESSEE ARE NOT ACCEPTA BLE AS THE AOS ORDER IS CONFIRMED BY THE ITAT VIDE ORDER DATED 29. 03.2011. ACCORDINGLY, I HOLD THAT THE ASSESSEE IS LIABLE TO PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 5. AGGRIEVED BY THE PENALTY SO LEVIED, ASSESSEE CAR RIED THE MATTER IN APPEAL BEFORE THE CIT(A). LEARNED CIT(A), IN A VERY DETAIL ED AND ERUDITE ORDER, DELETED THE IMPUGNED PENALTY. HIS REASONING FOR DOING SO WA S SET OUT AS BELOW: 5. AFTER CAREFUL CONSIDERATION OF ALL THE FACTS ON REC ORD AND RIVAL SUBMISSIONS AS CONTAINED IN PENALTY ORDER AND IN APPELLANT'S SU BMISSION , MY OBSERVATIONS/CONCLUSIONS ARE AS UNDER:- ALL THE GROUNDS OF APPEAL ARE RELATING TO THE LEVY OF PENALTY U/S 271(1)( C). THE VARIOUS ASPECTS OF APPELLANT'S SUBMISSIONS ARE CONS IDERED AND ADJUDICATED AS UNDER:- I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 4 OF 8 AS FAR AS REQUIREMENT OF 'SATISFACTION' OF THE A. O . GOES; THE APPELLANT ITSELF POINTS OUT THAT WITH THE INSERTION OF SUB SECTION IB OF SE CTION 271; THE SEPARATE RECORDING FOR 'SATISFACTION' IS NO LONGER NECESSARY. MERE DIRECTION FOR INITIATION OF PENALTY PROCEEDINGS IN THE ORDER OF ASSESSMENT SHALL BE DEE MED TO CONSTITUTE SUCH SATISFACTION. IN THE PRESENT CASE, SUCH DIRECTION IS APPARENT AND SO THESE OBJECTIONS OF THE APPELLANT HAS NO FORCE. HOWEVER, ON MERITS I DO FIND LOT OF MERITS IN APPEL LANT'S SUBMISSIONS WHICH ARE AS UNDER:- (I) IN THE PENALTY ORDER NO REQUISITE DISCUSSION H AS BEEN MADE BY THE A.O . AS TO HOW THE 'CONCEALMENT' OR 'FURNISHING OF INACCURATE PARTICULARS' IS PROVED. VIEWED DIFFERENTLY; THE A. O . HAS ALSO NOT DISCUSSED AS TO HOW THE ASSESSEE'S EXPLANATION FURNISHED IN RESPONSE TO PENALTY SHOW C AUSE NOTICE IS ENOUGH TO COUNTER THE PRESUMPTION OF CONCEALMENT. I FIND THAT A.O . HAS MERELY RELIED UPON THE FACT THAT QUANTUM ADDITION WAS CONFIRMED B Y BOTH THE APPELLATE AUTHORITIES VIZ . CIT(A) & ITAT. (II) IT IS AN IMPORTANT LEGAL DICTUM THAT PENALTY PR OCEEDING IS A SEPARATE PROCEEDING THAN THE ASSESSMENT PROCEEDINGS. ALTHOUGH THE FACTUA L INFERENCE CULLED OUT IN THE ASSESSMENT ORDER AND APPELLATE ORDER WOULD PLAY A SIGN IFICANT ROLE IN FINALIZATION OF PENALTY PROCEEDINGS; BUT ALL THE FACT AND INFERE NCES AND ALSO THE LEGAL AND FACTUAL SUBMISSIONS MADE BY THE ASSESSEE HAVE TO BE CONSIDE RED AFRESH. THE ADDITION CAN BE MADE IF THE ASSESSEE IS NOT ABLE TO SATISFACTORILY EXPLAIN THE TRANSACTIONS. BUT FOR IMPOSITION OF PENALTY U/S 271(1)( C) , IT HAS TO BE PROVED BEYOND ANY REASONABLE DOUBT THAT THE ASSESSE E HAS CONCEALED ITS INCOME OR HAS FURNISHED WRONG PARTICULARS WITH A VI EW TO CONCEAL ITS TRUE INCOME . THE QUANTUM APPEAL IS DISTINCT AND DIFFERENT FROM PENALTY PROCEEDINGS; HENCE MERE DISMISSAL OF QUANTUM APPEAL DOES NOT, BY ITSELF, JUSTIFY THE IMPOSITION OF PENALTY U / S 271(1)( C). (III) I FIND THAT DURING PENALTY PROCEEDINGS, THE APPELLA NT SUBMITTED A DETAILED EXPLANATION REGARDING THE IMPUGNED TRANSACTION OF R S.11,68,000/-. THE IMPORTANT POINTS, FROM THE POINT OF VIEW OF IMPOSIT ION OF PENALTY, ARE THAT THE CASH RECEIVED BY THE BRICK SELLER FROM THE HAND S OF PRESIDENT OF THE APPELLANT'S SOCIETY AND THE ALLEGATION OF BACK-DOOR TRANSFER OF THE SAME CASH FROM THE SOCIETY'S BOOKS TO THE PRESIDENT; HAVE NOT BEEN PROVED BEYOND DOUBT. THE ADDITION WAS INDEED MADE ON THE GROUND T HAT VOUCHER PRODUCED WAS A 'CASH MEMO' AND THAT BRICK SELLER WAS NOT PRO DUCED AND HENCE THE ASSESSEE WAS UNABLE TO PROVE ITS CONTENTION. BUT FOR PENALTY PURPOSES, THE ONUS HAD SHIFTED ON TO THE DEPARTMENT THAT SUCH SUS PICIOUS OR BACK DOOR CASH TRANSACTIONS HAD INDEED TAKEN PLACE. THERE IS FORCE IN APPELLANT'S CONTENTION THAT THE MINUTE BOOKS, AUDITED BALANCE S HEET AND BANKS I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 5 OF 8 STATEMENTS ETC. DO NOT REFLECT ANY SUCH TRANSACTION . THE APPELLANT HAS ALL ALONG PLEADED THAT THE SAID 'CASH MEMO' WAS ACTUALLY A ' CREDIT MEMO' . THE P RES IDENT IS ARRANGING THE BRICKS ON CREDIT BASIS FOR ASSESSEE'S SOCIETY AND THEREAFTER THE PAYMENT HAVE ACTUALLY BEEN MADE VIDE CHEQUE NO.9331 13 FROM CANARA BANK ACCOUNT. I ALSO FIND THAT THE CIT (A) WHILE CONFIRMING THE A DDITION RECORDED THE FINDING: .... THE COPIES OF CASH MEMOS HAVE BEEN FURNISHED DURING THE APPELLATE PROCEEDING ALSO AND A PERUSAL OF THE SAME CLEARLY C ONFIRMS THE SAME TO BE CASH MEMOS. IT IS ALSO RELEVANT TO NOTE THAT THE PARTY WHICH HA S ISSUED THE CASH MEMO IN RESPECT OF THE IMPUGNED PURCHASE HAS N OT BEEN PRODUCED BY THE APPELLANT EITHER AT ASSESSMENT STAGE OR AT APPE LLATE STAGE APPARENTLY BECAUSE THE EVIDENCE IS CLINCHING. THE ONLY ARGUMEN T WHICH THE LEARNED AR CAN TAKE IS REGARDING SUBSEQUENT CHEQUE TRANSACTIO N. HOWEVER, MERE CHEQUE TRANSACTION DOES NOT NEGATE THE CASH MEMO UN TIL AND UNLESS THERE ARE CORROBORATIVE EVIDENCE TO ESTABLISH THAT THE CA SH MEMOS REPRESENT CREDIT PURCHASE. IN ABSENCE OF SUCH EVIDENCE THE CH EQUE TRANSACTION COULD BE A POST- F ACTO ARRANGEMENT EMANATING FROM AFTER THOUGHT. .......................... THE ABOVE ITSELF INDICATES THAT THE CIT(A), ON THE BASIS OF PREPONDERANCE OF EVIDENCE, HELD THAT THE CHEQUE TRANSACTION 'COULD ' BE AN ARRANGEMENT AND HENCE HE HELD THAT SINCE THE APPELLANT'S ARGUMENTS WERE N OT FULLY PROVED, SO THE ADDITION WAS SUSTAINABLE. THE ABOVE IS CERTAINLY ENOUGH FOR CONFIRMING THE ADDITION AND HENCE THE SAME FOUND FAVOUR WITH THE HON'BLE ITAT A LSO. BUT, AGAIN, THE 'POSSIBILITY' OF THEIR BEING POST-FACTO ARRANGEMENT WOULD NOT BE SUFFICIENT TO PROVE THE CASE FROM VIEW POINT OF LEVY OF PENALTY. SUCH A RRANGEMENT HAS NOT BEEN PROVED BEYOND DOUBT. THERE IS ALWAYS A POSSIBILITY THAT THE BRICK-SELLER , BEING A SMALL TRADER, AND TRUSTING ON THE WORDS OF THE PRESIDENT THAT CASH WO ULD BE SENT TO HIM IN DUE TIME, ISSUED A CASH MEMO. IN SUCH A SITUATION, ALL OTHER LEGS OF TRANSACTIONS WOULD FIT IN THE THEORY/EXPLANATION BEING TENDERED BY THE APPELL ANT; AND, AT THE SAME TIME, NOT ISSUING A 'CREDIT MEMO' WOULD MERELY BE A TECHNICAL MISTAKE ON THE PART OF THE BRICK-SELLER AND ALSO THE PRESIDENT OF ASSESSEE SOC IETY; WITHOUT THERE BEING ANY UNEXPLAINED CASH IN THE HANDS OF ASSESSEE SOCIETY. THE ABOVE EXAMPLE/POSSIBILITY GOES A LONG WAY IN SU GGESTING THAT THE CASH TRANSACTIONS, ALLEGEDLY OCCURRED BETWEEN THE BRICK SELLER, THE PRESIDENT, AND THE APPELLANT'S SOCIETY ARE THOUGH SUSPECTED, BUT, NOT PROVED 'BEYOND DOUBT', AND I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 6 OF 8 HENCE, THOUGH FIT TO BE CONVERTED INTO AN 'ADDITION ', BUT NOT INTO A 'CONCEALED PENALTY' THE APPELLANT'S EXPLANATION GIVEN IN DETAIL I N THIS REGARD HAS NOT BEEN DISCUSSED BY A. O . SO AS TO BE HELD FALSE AND TO THAT EXTENT IT CANNOT BE SAID THAT APPELLANT HAS NOT BEEN ABLE TO COUNTER THE PRESUMPT ION OF CONCEALMENT. THE ASSESSEE'S EXPLANATION, SINCE THE VERY BEGINNING, H AS BEEN CONSISTENT VIZ (A) RESOLUTION PASSED BY ALL MEMBERS REGARDING THE PRES IDENT OF SOCIETY, SRI SUKHDEV GARG, TO ARRANGE THE BRICKS ON CREDIT . (B) IT WAS DECIDED THAT PAYMENT WOULD BE MET LATER WHEN FUNDS ARE ARRANGED ( C) A VOTE OF THANKS WAS ALSO GIVEN TO THE PRESIDENT ON ARRANGEMENT OF BRICKS ON CREDIT. (D) PURCHASE WAS D ULY ACCOUNTED IN THE BOOKS. (E) CORRESPONDING CREDIT BALANCE WAS DULY SHOWN IN THE BALANCE SHEET. (F) PROOF OF PAYMENT BY CHEQUE IN THE NEXT FINANCIAL YEAR. THUS, EXCEPT THAT 'CASH MEMO' WAS USED RATHER THAN 'CREDIT MEMO'; NONE OF THESE ASSES SEE'S EXPLANATION WAS ESTABLISHED TO BE FALSE. THE ASSESSEE COULD NOT PRO DUCE THE BRICK-OWNER, BUT AT THE SAME TIME, EVEN A O NEVER DID HIS PART BY SUMMONING THE BRICK OWNER AN D RECORDING ANY VERSION, DIRECTLY CONTRADICTING THE A PPE LLANTS VERSION. THUS, ALTHOUGH DEFICIENCIES WERE ENOUGH FOR ADDITI ON BUT THESE WERE NEVER ESTABLISHED TO BE 'FALSE EXPLANATIONS' FOR THE PURP OSE OF PENALTY U/S 271(1)(C). IN VIEW OF THE ABOVE, I HOLD THAT ALTHOUGH THE ADDI TIONS WERE CONFIRMED BY CIT(A) AND THE ITAT, THE SAME DON'T MEET THE STRICT YARDSTICKS OF SECTION 271(1)( C) R.W. EXP . I OF THE A CT AND HENCE T HE IMPUGNED PENALTY IS DELETED. 6. THE ASSESSING OFFICER IS NOT SATISFIED WITH THE RELIEF SO GRANTED BY THE CIT(A) AND IS IN APPEAL BEFORE US. 7. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTUAL MATRIX OF THE CASE AS ALSO THE APPLICABLE LEGAL POSITION. 8. WE FIND THAT AS LEARNED CIT(A) HAS RIGHTLY ANALY SED AND CONCLUDED, IT WAS INDEED NOT A FIT CASE FOR IMPOSITION OF PENALTY. W HATEVER WE MAY HAVE HELD IN THE QUANTUM PROCEEDINGS, IT IS A MATTER OF FACT THA T THE ASSESSEE HAD A REASONABLE, EVEN IF NOT ACCEPTABLE TO THE OUR DISTI NGUISHED COLLEAGUES, EXPLANATION FOR WHAT WAS PERCEIVED AS A DISCREPANCY . THE MERE FACT THAT THE SALE VOUCHERS WERE TITLED AS CASH MEMOS DOES NOT OB LITERATE THE FACT THAT THE VENDOR WAS PAID FOR THE BRICKS SUBSEQUENTLY AND IT IS THUS A REASONABLE I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 7 OF 8 EXPLANATION THAT PURCHASES WERE MADE ON CREDIT. THE RE IS NOTHING ON RECORD TO ESTABLISH, BEYOND A REASONABLE DOUBT, THAT ANY CASH PURCHASES DID TAKE PLACE. AS THIS TRIBUNAL HAS CONFIRMED THE QUANTUM ADDITION AND HONBLE HIGH COURT ARE NOW IN SEISIN OF THE MATTER IN APPELLATE PROCEEDINGS, WE REFRAIN FROM MAKING ANY OBSERVATIONS ON MERITS BEYOND SAYING THAT WHATE VER MAY HAVE BEEN THE JUSTIFICATION IN SUSTAINING THE IMPUGNED ADDITION, THE ASSESSEE HAS AN EXPLANATION AND THE EXPLANATION IS SUCH THAT IT CA NNOT BE REJECTED AS AN IMPROBABLE, UNACCEPTABLE OR UNREASONABLE EXPLANATIO N IN THE COURSE OF PENALTY PROCEEDINGS. IT IS ALSO IMPORTANT TO NOTE THAT THE ASSESSING OFFICER HAS NOT GIVEN ANY INDEPENDENT REASONS FOR IMPOSING THE PENALTY BU T HAS MERELY REFERRED TO AND RELIED UPON THE FACT THAT THIS TRIBUNAL HAS CON FIRMED THE QUANTUM ADDITION. THIS APPROACH PROCEEDS CAN ONLY APPROACH ON THE BAS IS THAT A CONCEALMENT PENALTY IS AN AUTOMATIC CONSEQUENCE OF THE QUANTUM ADDITION A PROPOSITION WHICH HAS BEEN UNEQUIVOCALLY REJECTED BY HONBLE CO URTS ABOVE TIME AND AGAIN. NO DOUBT FINDINGS IN THE QUANTUM PROCEEDINGS HAVE A N IMPORTANT ROLE TO PLAY IN PENALTY PROCEEDINGS AS WELL IN THE SENSE THAT THESE FINDINGS CAN BE REFERRED TO AND RELYING UPON IN THE PENALTY PROCEEDINGS AS WELL , BUT THEN CONFIRMATION OF QUANTUM ADDITION, BY ITSELF, CANNOT BE REASON ENOUG H FOR IMPOSING THE CONCEALMENT PENALTY UNDER SECTION 271(1)(C), AS HAS BEEN DONE IN THIS CASE. 9. WE HAVE ALSO NOTED THAT THE AO HAS REJECTED ALL THE SUBMISSIONS OF THE ASSESSEE SUMMARILY ON THE GROUND THAT T HE ARGUMENTS OF THE ASSESSEE ARE NOT ACCEPTABLE AS THE AOS ORDER IS CONFIRMED BY THE ITA T VIDE ORDER DATED 29.03.2011 . THIS APPROACH IS CLEARLY UNSUSTAINABLE IN LAW. PE NALTY IS, AND CANNOT BE, AN AUTOMATIC CONSEQUENCE OF QUANTUM ADDI TION AND BE JUSTIFIED ON THAT COUNT. THE AO HAS ALSO BRUSHED ASIDE ASSESSEE S RELIANCE ON JUDICIAL PRECEDENTS BY OBSERVING THAT THESE PRECEDENTS ARE D ISTINGUISHABLE ON FACTS AND NOT APPLICABLE TO THE FACTS OF THIS CASE, BUT THEN HE HAS TO SET OUT THE SPECIFIC REASONS FOR HOLDING SO. HE CANNOT SUMMARILY MAKE SU CH SWEEPING GENERALIZATIONS WITHOUT POINTING OUT IN WHAT MANNER THE CASES ARE DISTINGUISHABLE AND WHY THESE LEGAL PROPOSITIONS LA ID DOWN BY THESE JUDICIAL I.T.A. NO.: 254/AGR/2013 ASSESSMENT YEAR: 2005-06 PAGE 8 OF 8 PRECEDENTS DONOT APPLY TO THE FACTS OF THIS CASE. W E ARE UNABLE TO SEE ANY LEGALLY SUSTAINABLE MERITS IN THE APPROACH OF THE ASSESSING OFFICER. 10. IN VIEW OF THESE DISCUSSIONS AND BEARING IN MIN D ENTIRETY OF THE CASE, WE APPROVE VERY WELL REASONED ORDER OF THE LEARNED CIT (A) AND DECLINE TO INTERFERE IN THE MATTER. AS WE HAVE CONFIRMED THE FINDINGS O F THE LEARNED CIT(A) ON MERITS, WE ARE NOT INCLINED TO DEAL WITH OTHER ISS UES RAISED BY THE LEARNED COUNSEL. 11. IN THE RESULT, THE APPEAL IS DISMISSED. PRONOUN CED IN THE OPEN COURT TODAY ON 14 TH DAY OF FEBRUARY, 2014. SD/- SD/- BHAVNESH SAINI PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) AGRA, THE 14 TH DAY OF FEBRUARY, 2014 COPIES TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL AGRA BENCH, AGRA