Smt. Urvashiben B. Pashubhaiwala, Surat V. The Income Tax Officer, Ward-5(4), Surat

ITA 2923/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9564 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 16-02-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 19-10-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI B.P. JAIN, ACCOUNTANT MEMBER ./ ITA.NO.2923/AHD/2015 / ASSTT. YEAR: 2011-2012 SMT.URVASHIBEN B. PASHUBHAIWALA PROP OF M/S.MUKESHCHANDRA MANSUKHLAL 4/4096, MAIN ROPAD ZAMPA BAZAR, SURAT. PAN : ABTPP 8251 E VS ITO, WARD-5(4) SURAT. ! / (APPELLANT) '# ! / (RESPONDENT) ASSESSEE BY : WRITTEN SUBMISSIONS REVENUE BY : PRAJNA PARAMITA, SR.DR / DATE OF HEARING : 16/02/2016 / DATE OF PRONOUNCEMENT: 17/02/2016 $%/ O R D E R THIS APPEAL OF THE ASSESSEE AROSE FROM ORDER OF THE LD.CIT(A)-1, SURAT DATED 24.8.2015 FOR THE ASSTT.YEAR 2011-2012. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE A S WELL AS LAW ON THE SUBJECT, THE LD.COMMISSIONER OF INCOME TAX (APP EALS) HAS ERRED IN CONFIRMING THE ACTION OF AO IN IMPOSING PENALTY OF RS.28,074/- U/S.271(1)(C) OF THE ACT ON THE ADDITION OF RS.85,3 88/- MADE ON ACCOUNT OF UNEXPLAINED DEPOSITS IN BANK ACCOUNT AND RS.5,45 7/- ON ACCOUNT OF SHORT TERM CAPITAL GAINS. 2. IT IS THEREFORE PRAYED THAT ABOVE PENALTY LEVIED BY AO AND CONFIRMED BY CIT(A) MAY PLEASE BE DELETED. ITA NO.2923/AHD/2015 2 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HA S FIELD HER RETURN OF INCOME AT RS.8,65,410/- AND THE ASSESSMENT WAS MADE UNDER SECTION 143(3) BY MAKING ADDITION OF RS.114501/- WHICH CONSISTED O F ADDITIONS VIZ. RS.85,388/- TOWARDS UNEXPLAINED DEPOSITS IN BANK AC COUNT, RS.5457/- ON ACCOUNT OF SHORT TERM CAPITAL GAIN AND RS.23,655/- FOR DISALLOWANCE OF EXCESS EXPENSES. THE LD.AO INITIATED PENALTY PROCEEDINGS AGAINST FIRST TWO ADDITIONS, WHICH WERE CONFIRMED BY THE LD.CIT(A). 4. NONE APPEARED ON BEHALF O THE ASSESSEE, BUT THE ASSESSEE HAS FILED WRITTEN SUBMISSIONS AND HAS REQUESTED TO DECIDE THE APPEAL ON THE BASIS OF THE WRITTEN SUBMISSIONS. ACCORDINGLY, TAKING INTO CONS IDERATION WRITTEN SUBMISSIONS PUT FORTH BY THE ASSESSEE AND ARGUMENTS OF THE LD.DR, AND MATERIAL AVAILABLE ON RECORD, I PROCEED TO DECIDE T HIS APPEAL. 5. I HAVE HEARD THE LD.DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD AND THE WRITTEN SUBMISSIONS FILED BY THE ASSESSEE. IT IS A FACT ON RECORD THAT THE ASSESSEE EXPLAINED THE SOURCE OF DEPOSITS MADE IN I CICI BANK IN RESPECT OF MAJORITY OF THE AMOUNT, WHICH CONSISTED OF SALE PRO CEEDS OF MUTUAL FUNDS, WHICH WERE ACQUIRED IN THE PAST BY ASSESSEE OUT OF HER SAVINGS. OUT OF THE TOTAL DEPOSIT OF RS.5,15,812/-, AMOUNT OF RS.4,29,4 25/- WAS EXPLAINED TO BE DEPOSITED ON ACCOUNT OF SALE PROCEEDS OF MUTUAL FUN DS AND MATURITY OF KVP FOR WHICH RELEVANT DOCUMENTARY EVIDENCE WERE ALSO S UBMITTED. THE BALANCE AMOUNT OF RS.86,388/- ALSO REPRESENTED THE SALE PRO CEEDS/MATURITY OF MUTUAL FUNDS/FDR WHICH WERE ACQUIRED BY THE ASSESSEE FEW Y EARS AGO. IN ORDER TO AVOID LITIGATION, THE ASSESSEE HAD AGREED FOR ADDIT ION, BUT IT DOES NOT REPRESENT CONCEALED INCOME OF THE ASSESSEE, BECAUSE, DUE TO P AUCITY OF TIME, THE ASSESSEE WAS UNABLE TO FIND RELEVANT DOCUMENTARY EV IDENCE. IT IS ON RECORD THAT NO OTHER UNACCOUNTED SOURCE OF INCOME WAS FOUN D BY THE DEPARTMENT DURING THE ASSESSMENT PROCEEDINGS AND IN THE ABSENC E OF ANY CONTRADICTORY ITA NO.2923/AHD/2015 3 FINDING ON RECORD, NO PENALTY UNDER SECTION 271(1)( C) OF THE ACT CAN BE IMPOSED ON THE ADDITION OF RS.85,388/-. THEREFORE, IN THE CIRCUMSTANCES AND FACTS OF THE CASE, IN THE ABSENCE OF ANY CONTRADICT ORY FINDING AND ALSO THE AMOUNT HAS BEEN USED IN TOTO FOR DEPOSITING THE SALE PROCEEDS OF MUTUAL FUNDS, KVP AND FDR, THERE CANNOT BE ANY OTHER SOURCE FOR D EPOSITS OF THE SAID MONEY. IT IS ONLY DUE TO PAUCITY OF TIME THE ASSES SEE COULD NOT PRODUCE DOCUMENTARY EVIDENCE. THE EXPLANATION OF THE ASSES SEE APPEARS TO BE COGENT EXPLANATION AND BONA FIDE ONE, AND THEREFORE, NO PENALTY UNDER SECTION 271(1)(C) OF THE ACT CAN BE LEVIED. 6. AS REGARDS, ADDITION OF RS.5,457/- ON ACCOUNT OF SHORT TERM CAPITAL GAIN, THE ASSESSEE COULD NOT OFFER THE ABOVE SHORT TERM C APITAL GAINS THROUGH INADVERTENCE, BECAUSE, ACCORDING TO HER SUCH MUTUAL FUNDS WERE ACQUIRED MORE THAN ONE YEAR AGO. HOWEVER, DURING THE ASSESS MENT PROCEEDINGS, THE ASSESSEE OFFERED THE SAME FOR TAXATION AND TAX ON T HE SAME HAS BEEN LEVIED. ACCORDINGLY, THE EXPLANATION OF THE ASSESSEE IS FOU ND TO BE SATISFACTORY AND NO PENALTY UNDER SECTION 271(1)(C) OF THE ACT CAN BE I MPOSED IN THE CIRCUMSTANCES AND FACTS OF THE CASE. ACCORDINGLY T HE PENALTY SO LEVIED IS CANCELLED AND THE IMPUGNED ORDER OF THE LD.CIT(A) I S REVERSED. THE SOLE GROUND OF APPEAL OF THE ASSESSEE IS ALLOWED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE COURT ON 17 TH FEBRUARY, 2016 AT AHMEDABAD. SD/- ( B.P. JAIN ) ACCOUNTANT MEMBER AHMEDABAD; DATED 17/02/2016