KUMAR V. VASANI, MUMBAI V. ITO 32(2)(2), MUMBAI

ITA 3119/MUM/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3301 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2016
• Appeal Filed By: Assessee
• Bench Allotted: SMC
• Next Hearing Date: 30-08-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 25-05-2015
• Court: TRIBUNAL
• Department Lawyers: MAHUA SARKARDR
• Assessee Lawyers: R N VASANI; V H VASANI
• Keywords: Depreciation; Reasonable cause; Revised return
• Section: 133A; 68; 148; 139

Judgement Text

, - , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES SMC, MUMBAI , ! ' , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, ITA NO.3119/MUM/2015 ASSESSMENT YEAR:2009-10 MR. KUMAR V. VASANI, A-303, 30 TH FLOOR, KALPATARU TOWERS, AKRULI CROSS ROAD, KANDIVALI (EAST), MUMBAI-400101 / VS. INCOME TAX OFFICER-32(2)(2), C-13, ROOM NO.305A, 3 RD FLOOR, PRATYAKSAKAR BHAVAN BANDRA KURLA COMPLEX BANDRA (EAST), MUMBAI-400051 / ASSESSEE / REVENUE P.A. NO . AABPV7219H $ % & / ASSESSEE BY SHRI R. N. VASANI & SHRI V.H. VASANI $ % & / REVENUE BY MS. MAHUA SARKAR-DR / DATE OF HEARING 30/08/2016 & / DATE OF ORDER: 01/09/2016 ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 2 & / O R D E R THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DATED 30/01/2015 OF THE LD. FIRST APPELLATE AUTHORI TY, MUMBAI. THE ONLY GROUND RAISED BY THE ASSESSEE PERT AINS TO CONFIRMING THE PENALTY OF RS.8,96,144/- IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER THE ACT). 2. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSEE, SHRI R. N. VASANI ALONG WITH SHRI V.H. VA SANI, CONTENDED THAT DUE TO ERROR OF THE ASSESSEE, THE AC COUNTS, BEING OPERATED BY THE ASSESSEE IN DIFFERENT BANKS C OULD NOT BE DISCLOSED, TO THE REVENUE, IN THE RETURN OF INCOME, FILED BY THE ASSESSEE. IT WAS EXPLAINED THAT QUANTU M ADDITION WAS ACCEPTED BY THE ASSESSEE AND NO FURTHE R APPEAL WAS FILED. RELIANCE WAS PLACED UPON THE DECI SION IN SIR SHADILAL SUGAR GENERAL MILLS & LTD. VS CIT (198 7) 168 ITR 705 (SC), CIT VS SOMANY EVERGREE KNITS LTD. (20 13) 352 ITR 592 (BOM.), CIT VS S.L.N. TRADERS (2)(2012) 341 ITR 235(KARNATAKA) AND CIT VS CAREERS EDUCATION & INFOTECH PVT. LTD. (2011) 336 ITR 257 (P & H). 2.1. ON THE OTHER HAND, THE LD. DR, MS. MAHUA SARKAR, STRONGLY DEFENDED THE PENALTY ORDER BY CONT ENDING THAT THE ASSESSEE DEPOSITED CASH IN THE ACCOUNTS, T HE SOURCE OF WHICH WAS NOT EXPLAINED BY THE ASSESSEE, THEREFORE, THERE IS CLEAR CUT CONCEALMENT OF INCOME/FURNISHING OF INACCURATE PARTICULARS OF INCO ME, THUS, THE PENALTY WAS RIGHTLY UPHELD BY THE LD. ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 3 COMMISSIONER OF INCOME TAX (APPEAL). RELIANCE WAS PLACED UPON THE DECISION IN MAK DATA P. LTD. VS. COMMISSIONER OF INCOME TAX (2013) 263 CTR (SC) 1 : (2013) 358 ITR 593 (SC) : (2013) 94 DTR (SC) 379. 2.2. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACTS , IN BRIEF, ARE THAT THERE WAS AN AIR INFORMATION WITH T HE ASSESSING OFFICER THAT THE ASSESSEE HAS DEPOSITED C ASH IN SAVING BANK ACCOUNTS MAINTAINED WITH AXIS BANK LTD. (RS.13,46,765/-), SARSWAT COOPERATIVE BANK LTD.(RS.15,01,233/-) AND STANDARD CHARTERED BANK (RS.18,87,750/-). IT WAS FURTHER NOTICE BY THE ASS ESSING OFFICER THAT NONE OF THESE ACCOUNTS WERE DISCLOSED TO THE DEPARTMENT IN THE RETURN FILED BY THE ASSESSEE. THE ASSESSEE WAS ASKED TO EXPLAIN THE SOURCE OF THESE D EPOSITS AND OTHER DEPOSITS MADE IN THESE BANK ACCOUNTS WITH DOCUMENTARY EVIDENCE. ON EXAMINATION OF THE SUBMISSIONS OF THE ASSESSEE AND ON VERIFICATION OF THE DAILY CASH SUMMARY, THE ASSESSING OFFICER FOUND THA T THE ASSESSEE HAD A NEGATIVE CASH BALANCE OF RS.22,79,79 3/-, WHICH COULD NOT BE EXPLAINED BY THE ASSESSEE, ACCOR DINGLY, THIS AMOUNT WAS CONSIDERED AS UNEXPLAINED CASH CRED IT U/S 68 OF THE ACT AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE. 2.3. ON APPEAL, BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEAL), THE FACTUAL MATRIX AND THE CAS E LAWS, RELIED UPON BY THE ASSESSEE, WERE CONSIDERED AND FI NALLY, ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 4 THE STAND TAKEN IN THE ASSESSMENT ORDER WAS AFFIRME D. THE ASSESSEE IS IN FURTHER APPEAL BEFORE THIS TRIBU NAL. 2.4. IF THE OBSERVATION MADE IN THE ASSESSMENT ORDER, LEADING TO ADDITION MADE TO THE TOTAL INCOME , CONCLUSION DRAWN IN THE IMPUGNED ORDER, MATERIAL AVAILABLE ON RECORD, ASSERTIONS MADE BY THE LD. RES PECTIVE COUNSEL, IF KEPT IN JUXTAPOSITION AND ANALYZED, THE RE IS NO DISPUTE TO THE FACT THAT THE SOURCE OF CASH DEPOSIT ED BY THE ASSESSEE COULD NOT BE EXPLAINED TO THIS EXTENT MENTIONED IN THE IMPUGNED ORDER, THEREFORE, TO THIS EXTENT, I AM OF THE VIEW THAT THE ASSESSEE CONCEALE D ITS INCOME/FURNISHED INACCURATE PARTICULARS OF SUCH INC OME, THEREFORE, THE PENALTY WAS RIGHTLY CONFIRMED. 2.4. SO FAR AS, THE CASES RELIED UPON BY THE ASSES SEE IS CONCERNED, I FIND THAT IN THE CASE OF SIR SHADIL AL SUGAR & GENERAL MILLS LTD. & ORS. (1987) 168 ITR 705 (SC) , THERE WAS FINDING OF FACTS BY THE TRIBUNAL THAT THERE WAS EXISTENCE OF EVIDENCE IN SUPPORT OF THE CLAIM OF TH E ASSESSEE AND IN THAT SITUATION, THE TRIBUNAL HELD T HAT THERE IS NO CONCEALMENT AS SUCH. IN THAT SITUATION, THE HON'BLE APEX COURT TOOK A PARTICULAR VIEW. HOWEVER, IN THE PRESENT APPEAL, THE ASSESSEE RIGHT FROM ASSESSMENT STAGE TILL THE STAGE OF THE TRIBUNAL, DID NOT ADDUCE ANY EVIDENCE EXPLAINING THE SOURCE OF CASH DEPOSITS, MADE IN THE BANKS AND MORE SO DID NOT DISCLOSE THESE ACCOUNTS IN THE RETURN OF INCOME, THEREFORE, IN MY HUMBLE OPINION, BEING O N ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 5 DIFFERENT FACTS THE CONCLUSION DRAWN BY HON'BLE APE X COURT IS NOT APPLICABLE TO THE FACTS OF THE PRESENT APPEAL. LIKEWISE IN THE CASE OF CIT VS SOMANI EVERGREE KNIT LTD. (2013) 352 ITR 592 (BOM.), THERE WAS EXCESS CL AIM OF DEPRECIATION. RECTIFICATION WAS MADE BY THE ASSESSE E DURING ASSESSMENT PROCEEDINGS AND THE MISTAKE WAS B ONA FIDE. IN THAT SITUATION, THE HON'BLE JURISDICTIONAL HIGH COURT TOOK A DECISION THAT PENALTY IS NOT LEVIABLE. HOWEVER, IN THE PRESENT APPEAL, AS DISCUSSED ABOVE, THERE IS CONSCIOUS CONCEALMENT OF INCOME BY THE ASSESSEE, THEREFORE, BEING ON DIFFERENT FACTS, THE DECISION R ELIED UPON IS NOT APPLICABLE TO THE FACTS OF THE PRESENT APPEA L. IN THE CASE OF CIT & ANORS. VS S.L. N. TRADERS (201 2) 341 ITR 235, THE EXPLANATION OF THE ASSESSEE WAS AC CEPTED BY THE CIT(A) AS WELL AS BY THE TRIBUNAL. WHEREAS, IN THE PRESENT APPEAL, THE LD. ASSESSING OFFICER, THE LD. COMMISSIONER OF INCOME TAX (APPEAL) AS WELL AS THE TRIBUNAL HAS NOT ACCEPTED THE EXPLANATION OF THE AS SESSEE. IN THAT CASE, THE ASSESSEE APPEARED BEFORE THE ASSE SSING OFFICER SUBMITTING THAT THE ASSESSEE COULD NOT PROD UCED THE CREDITORS OR CONFIRMATION LETTERS AND THERE WA S NO LACK OF BONA FIDE ON THE PART OF THE ASSESSEE, THUS , THE FACTS ARE DIFFERENT IN THE PRESENT APPEAL. LIKEWISE, IN THE CASE OF CIT VS CAREERS EDUCATION AND INFOTECH PVT. LTD. (SUPRA), THE ASSESSEE SURREN DERED ADDITIONAL INCOME, DURING SURVEY, TO BUY PEACE WITH THE ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 6 DEPARTMENT AND FILED A REVISED RETURN ACCORDINGLY. THERE IS A CATEGORICAL RECORDING OF THE TRIBUNAL THAT THE RE WAS NO MATERIAL TO INFER CONCEALMENT OF INCOME BUT THAT IS NO SO IN THE PRESENT APPEAL, THUS, THE CASES RELIED UPON BY THE ASSESSEE ARE NOT OF MUCH HELP TO THE ASSESSEE. 4. NOW, I SHALL DEAL WITH THE CASE, RELIED UPON BY THE LD. DR IN THE CASE OF MAK DATA P. LTD. VS. COMMISSIONER OF INCOME TAX (2013) 263 CTR (SC) 1: (2013) 358 ITR 593 (SC) : (2013) 94 DTR (SC) 379. T HE RELEVANT OBSERVATION/DECISION MADE BY HON'BLE APEX COURT IS REPRODUCED HEREUNDER FOR READY REFERENCE A ND ANALYSIS:- 6. WE HAVE HEARD COUNSEL ON EITHER SIDE. WE FULLY CONCUR WITH THE VIEW OF THE HIGH COURT THAT THE TRIBUNAL H AS NOT PROPERLY UNDERSTOOD OR APPRECIATED THE SCOPE OF EXPLANATION 1 TO SECTION 271(1) (C) OF THE ACT, WHI CH READS AS FOLLOWS : 'EXPLANATION 1 WHERE IN RESPECT OF ANY FACTS MATE RIAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON U NDER THIS ACT, - (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OF FERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMMISSIONER (APPEALS) OR THE COMMISSIONER TO BE FA LSE, OR (B)/- SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS NOT ABLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXPLANATION IS BONA FIDE AND THAT ALL THE FACTS REL ATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOT AL INCOME HAVE BEEN DISCLOSED BY HIM, THEN THE AMOUNT ADDED OR DISALLOWED IN COMPUTING THE TOTAL INCOME O F SUCH PERSON AS A RESULT THEREOF SHALL, FOR THE PURPOSES OF CLAUSE (C) OF THIS SUB-SECTION, BE DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED .' ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 7 THE AO, IN OUR VIEW, SHALL NOT BE CARRIED AWAY BY T HE PLEA OF THE ASSESSEE LIKE 'VOLUNTARY DISCLOSURE', 'BUY P EACE', 'AVOID LITIGATION', 'AMICABLE SETTLEMENT', ETC. TO EXPLAIN AWAY ITS CONDUCT. THE QUESTION IS WHETHER THE ASSES SEE HAS OFFERED ANY EXPLANATION FOR CONCEALMENT OF PART ICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF I NCOME. EXPLANATION TO SECTION 271(1) RAISES A PRESUMPTION OF CONCEALMENT, WHEN A DIFFERENCE IS NOTICED BY THE AO , BETWEEN REPORTED AND ASSESSED INCOME. THE BURDEN IS THEN ON THE ASSESSEE TO SHOW OTHERWISE, BY COGENT A ND RELIABLE EVIDENCE. WHEN THE INITIAL ONUS TAXPUNDIT. ORG PLACED BY THE EXPLANATION, HAS BEEN DISCHARGED BY H IM, THE ONUS SHIFTS ON THE REVENUE TO SHOW THAT THE AMO UNT IN QUESTION CONSTITUTED THE INCOME AND NOT OTHERWISE. ASSESSEE HAS ONLY STATED THAT HE HAD SURRENDERED TH E ADDITIONAL SUM OF RS.40,74,000/-WITH A VIEW TO AVOI D 7 LITIGATION, BUY PEACE AND TO CHANNELIZE THE ENERGY AND RESOURCES TOWARDS PRODUCTIVE WORK AND TO MAKE AMICA BLE SETTLEMENT WITH THE INCOME TAX DEPARTMENT. STATUTE DOES NOT RECOGNIZE THOSE TYPES OF DEFENCES UNDER THE EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT. IT I S TRITE LAW THAT THE VOLUNTARY DISCLOSURE DOES NOT RELEASE THE APPELLANT-ASSESSEE FROM THE MISCHIEF OF PENAL PROCEEDINGS. THE LAW DOES NOT PROVIDE THAT WHEN AN ASSESSEE MAKES A VOLUNTARY DISCLOSURE OF HIS CONCEA LED INCOME, HE HAD TO BE ABSOLVED FROM PENALTY. WE ARE OF THE VIEW THAT THE SURRENDER OF INCOME IN THIS CASE IS NOT VOLUNTARY IN THE SENSE THAT THE OFFER O F SURRENDER WAS MADE IN VIEW OF DETECTION MADE BY THE AO IN THE SEARCH CONDUCTED IN THE SISTER CONCERN OF TH E ASSESSEE. IN THAT SITUATION, IT CANNOT BE SAID THAT THE SURRENDER OF INCOME WAS VOLUNTARY. AO DURING THE CO URSE OF ASSESSMENT PROCEEDINGS HAS NOTICED THAT CERTAIN DOCUMENTS COMPRISING OF SHARE APPLICATION FORMS, BA NK STATEMENTS, MEMORANDUM OF ASSOCIATION OF COMPANIES, AFFIDAVITS, COPIES OF INCOME TAX RETURNS AND ASSESS MENT ORDERS AND BLANK SHARE TRANSFER 8 DEEDS DULY SIGNED , HAVE BEEN IMPOUNDED IN THE COURSE OF SURVEY PROCEEDINGS UNDER SECTION 133A CONDUCTED 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 F ILED ITS RETURN OF INCOME. HAD IT BEEN THE INTENTION OF THE ASSESSEE TO MAKE FULL AND TRUE DISCLOSURE OF ITS IN COME, IT WOULD HAVE FILED THE RETURN DECLARING AN INCOME INC LUSIVE OF THE AMOUNT WHICH WAS SURRENDERED LATER DURING TH E COURSE OF THE ASSESSMENT PROCEEDINGS. CONSEQUENTLY, IT IS CLEAR THAT THE ASSESSEE HAD NO INTENTION TO DECLARE ITS TRUE ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 8 INCOME. IT IS THE STATUTORY DUTY OF THE ASSESSEE TO RECORD ALL ITS TRANSACTIONS IN THE BOOKS OF ACCOUNT, TO EX PLAIN THE SOURCE OF PAYMENTS MADE BY IT AND TO DECLARE ITS TR UE INCOME IN THE RETURN OF INCOME FILED BY IT FROM YEA R TO YEAR. THE AO IN OUR VIEW, HAS RECORDED A CATEGORICAL FIND ING THAT HE WAS SATISFIED THAT THE ASSESSEE HAD CONCEAL ED TRUE PARTICULARS OF INCOME AND IS LIABLE FOR PENALTY PRO CEEDINGS UNDER SECTION 271 READ WITH SECTION 274 OF THE INCO ME TAX ACT, 1961. THE AO HAS TO SATISFY WHETHER THE PENALTY PROCEEDIN GS BE INITIATED OR NOT DURING THE COURSE OF THE ASSESSMEN T PROCEEDINGS AND THE AO IS NOT REQUIRED TO RECORD HI S SATISFACTION IN A PARTICULAR MANNER OR REDUCE IT IN TO WRITING. THE SCOPE OF SECTION 271(1)(C) HAS ALSO BEEN ELABOR ATELY DISCUSSED BY THIS COURT IN UNION OF INDIA VS. DHARM ENDRA TEXTILE PROCESSORS (2008) 13 SCC 369 AND CIT VS. AT UL MOHAN BINDAL (2009) 9 SCC 589. THE PRINCIPLE LAID DOWN BY THIS COURT, IN OUR VIEW, HAS BEEN CORRECTLY FOLLOWED BY THE REVENUE AND WE FIND NO ILLEGALITY IN THE DEPARTMENT INITIATING PENALTY PRO CEEDINGS IN THE INSTANT CASE. WE, THEREFORE, FULLY AGREE WITH T HE VIEW OF THE HIGH COURT. HENCE, THE APPEAL LACKS MERI AND IS DISMISSED. THERE SHALL BE NO ORDER AS TO COSTS. 4.2. IN THE LIGHT OF THE FOREGOING DISCUSSION AND THE JUDICIAL PRONOUNCEMENTS, MENTIONED HEREINABOVE, I A M REPRODUCING HEREUNDER THE RELEVANT PROVISION OF SEC TION 271(1)(C) OF THE ACT FOR READY REFERENCE AND ANALYS IS:- 271. (1) IF THE ASSESSING OFFICER OR THE COMMISSIONER (APPEALS) OR THE [PRINCIPAL COMMISSIONER OR] COMMISSIONER IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT, IS SATISFIED THAT ANY PERSON XXXXXXXXXXXXXXXXXXXXX ( C ) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME, OR XXXXXXXXXXXXXXXXXXXXXXXXXX EXPLANATION 1. WHERE IN RESPECT OF ANY FACTS MATERIAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT, ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 9 ( A ) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OFFE RS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMM ISSIONER (APPEALS) OR THE 48 [PRINCIPAL COMMISSIONER OR] COMMISSIONER TO BE FALSE, OR ( B ) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS NOT ABLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXPLANATI ON IS BONA FIDE AND THAT ALL THE FACTS RELATING TO THE SAME AND MA TERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM, THEN, THE AMOUNT ADDED OR DISALLOWED IN COMPUTING T HE TOTAL 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 I NCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. XXXXXXXXXXXXXXXXXXX EXPLANATION 2. WHERE THE SOURCE OF ANY RECEIPT, DEPOSIT, OUTGOING OR INVESTMENT IN ANY ASSESSMENT YEAR IS CLAIMED BY ANY PERSON TO BE AN AMOUNT WHICH HAD BEEN ADDED IN COMPUTING THE INCOME OR DEDUCTED IN COMPUTING THE LOSS IN THE ASSESSMENT OF SUCH PERSON FOR ANY EARLIER ASSESSMENT YEAR OR YEARS BUT IN RESPECT OF WHICH NO PENALTY UNDER CLAUSE ( III ) OF THIS SUB-SECTION HAD BEEN LEVIED, THAT PART OF THE AMOUNT SO ADDED OR DEDUCTED IN SUCH EAR LIER ASSESSMENT YEAR IMMEDIATELY PRECEDING THE YEAR IN WHICH THE RE CEIPT, DEPOSIT, OUTGOING OR INVESTMENT APPEARS (SUCH EARLIER ASSESS MENT YEAR HEREAFTER IN THIS EXPLANATION REFERRED TO AS THE FIRST PRECEDING YEAR) WHICH IS SUFFICIENT TO COVER THE AMOUNT REPRESENTED BY SUCH RECEIPT, DEPOSIT OR OUTGOING OR VALUE OF SUCH INVESTMENT (SU CH AMOUNT OR VALUE HEREAFTER IN THIS EXPLANATION REFERRED TO AS THE UTILISED AMOUNT) SHALL BE TREATED AS THE INCOME OF THE ASSES SEE, PARTICULARS OF WHICH HAD BEEN CONCEALED OR INACCURATE PARTICULA RS OF WHICH HAD BEEN FURNISHED FOR THE FIRST PRECEDING YEAR; AND WH ERE THE AMOUNT SO ADDED OR DEDUCTED IN THE FIRST PRECEDING YEAR IS NOT SUFFICIENT TO COVER THE UTILISED AMOUNT, THAT PART OF THE AMOUNT SO ADDED OR DEDUCTED IN THE YEAR IMMEDIATELY PRECEDING THE FIRS T PRECEDING YEAR WHICH IS SUFFICIENT TO COVER SUCH PART OF THE UTILI SED AMOUNT AS IS NOT SO COVERED SHALL BE TREATED TO BE THE INCOME OF THE ASSESSEE, PARTICULARS OF WHICH HAD BEEN CONCEALED OR INACCURA TE PARTICULARS OF WHICH HAD BEEN FURNISHED FOR THE YEAR IMMEDIATELY P RECEDING THE FIRST PRECEDING YEAR AND SO ON, UNTIL THE ENTIRE UT ILISED AMOUNT IS COVERED BY THE AMOUNTS SO ADDED OR DEDUCTED IN SUCH EARLIER ASSESSMENT YEARS. EXPLANATION 3. WHERE ANY PERSON FAILS, WITHOUT REASONABLE CAUSE, TO FURNISH WITHIN THE PERIOD SPECIFIED IN SUB-SECTI ON (1) OF SECTION 153 A RETURN OF HIS INCOME WHICH HE IS REQUIRED TO FUR NISH UNDER SECTION 139 IN RESPECT OF ANY ASSESSMENT YEAR COMMENCING ON OR AFTER THE 1ST DAY OF APRIL, 1989, AND UNTIL THE EXPIRY OF THE PERIOD AFORESAID, NO NOTICE HAS BEEN ISSUED TO HIM UNDER C LAUSE ( I ) OF SUB- SECTION (1) OF SECTION 142 OR SECTION 148 AND THE ASSESSING OFFICER OR THE COMMISSIONER (APPEALS) IS SATISFIED THAT IN RESPECT OF SUCH ASSESSMENT YEAR SUCH PERSON HAS TAXABLE INCOME, THE N, SUCH PERSON ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 10 SHALL, FOR THE PURPOSES OF CLAUSE ( C ) OF THIS SUB-SECTION, BE DEEMED TO HAVE CONCEALED THE PARTICULARS OF HIS INCOME IN RESPECT OF SUCH ASSESSMENT YEAR, NOTWITHSTANDING THAT SUCH PERSON F URNISHES A RETURN OF HIS INCOME AT ANY TIME AFTER THE EXPIRY O F THE PERIOD AFORESAID IN PURSUANCE OF A NOTICE UNDER SECTION 148 . XXXXXXXXXXXXXXXXXXX (5) THE PROVISIONS OF THIS SECTION AS THEY STOOD IMMEDIATELY BEFORE THEIR AMENDMENT BY THE DIRECT TA X LAWS (AMENDMENT) ACT, 1989 SHALL APPLY TO AND IN RELATION TO ANY ASSESSMENT FOR THE ASSESSMENT YEAR COMMENCING ON THE 1ST DAY OF APRIL, 1988, OR ANY EA RLIER ASSESSMENT YEAR AND REFERENCES IN THIS SECTION TO T HE OTHER PROVISIONS OF THIS ACT SHALL BE CONSTRUED AS REFERENCES TO THOSE PROVISIONS AS FOR THE TIME BEIN G IN FORCE AND APPLICABLE TO THE RELEVANT ASSESSMENT YEA R. CONSIDERING THE PROVISION OF THE ACT, MATERIAL FACT S AVAILABLE ON RECORD, AND THE RATIO LAID DOWN IN FOL LOWING CASES, IT CAN BE CONCLUDED THAT IT WAS A CONSCIOUS ACT OF THE ASSESSEE TO HIDE SOMETHING FROM THE DEPARTMENT. I. CIT VS SATISH MEDICAL AGENCIES 277 ITR 394 (ALL.) II. JYOTI LAXMAN KONKAR VS CIT 292 ITR 163 (BOM.), III. DEEPAK CONSTRUCTION COMPANY VS CIT 293 ITR 285(GUJ.) IV. CIT VS MAHAVIR PRASAD BAJAJ 298 ITR 109(JHAR.) V. D & H SECHERON ELECTRODS PVT. LTD. VS CIT 281 ITR 421 (MP.) VI. SHRI NITHYAKALYANI TEXTILES LTD. VS DCIT 282 ITR 154 (MAD.) VII. LMP PRECISION ENGINEERING COMPANY LTD. VS DCIT (330 ITR 93) (GUJ.) VIII. CIT VS DEEP CHAND 336 ITR 292 (P & H) IX. SETHY INDUSTRIES CORPORATION VS DCIT 338 ITR 243 (P &H) X. B.DAMODAR V.B. JEWELLERS VS JCIT 353 ITR 206 (KARNA.) ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 11 XI. STANDARD HIND COMPANY VS CIT (2014) 361 ITR 370 (ALL.) XII. BAJRANG GLASS EMPORIUM VS CIT (2014) 361 ITR 376 (ALL.) XIII. INDUS ENGINEERING COMPANY VS ACIT (2010) 323 ITR 302 (BOM.), IN THE LIGHT OF THE FOREGOING DISCUSSION AND THE RA TIO LAID DOWN IN THE AFOREMENTIONED CASES, I FIND THAT THE ASSESSEE WAS WELL AWARE THAT HE WAS HAVING THREE BA NK ACCOUNTS AND DEPOSITED CASH THEREIN, DID NOT DISCLO SED THE AMOUNTS AND ALSO THE ACCOUNTS TO THE DEPARTMENT , THEREFORE, IT WAS A CONSCIOUS AND DELIBERATE ACT ON THE PART OF THE ASSESSEE TO HIDE SOMETHING, CONSEQUENTL Y, THE PENALTY WAS RIGHTLY IMPOSED. IT IS ALSO NOTED THAT THE ADDITION MADE BY THE ASSESSING OFFICER ON THIS COUN T WAS ACCEPTED BY THE ASSESSEE AND NO APPEAL WAS FILED ON QUANTUM ADDITION KNOWING-FULLY WELL THAT THERE IS CONSCIOUS CONCEALMENT OF FACTS BY THE ASSESSEE. FOR IMPOSING PENALTY U/S 271(1)(C) OF THE ACT, EITHER T HERE SHOULD BE CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME. THE MATERIAL FACTS, AVAILABLE ON RECORD CLEARLY INDICATES THAT THE ASSE SSEE DELIBERATELY CONCEALED HIS INCOME/FURNISHED INACCUR ATE PARTICULARS OF SUCH INCOME, THEREFORE, IN MY VIEW, THE PENALTY WAS RIGHTLY IMPOSED BY THE ASSESSING OFFICE R AND CONFIRMED BY THE LD. COMMISSIONER OF INCOME TAX (APPEAL). ITA NO.3119/MUM/2015 MR. KUMAR V. VASANI 12 FINALLY, THE APPEAL OF THE ASSESSEE IS DISMISSED. THIS ORDER WAS PRONOUNCED IN THE OPEN IN THE PRESENCE OF LD. REPRESENTATIVE FROM BOTH SIDES AT T HE CONCLUSION OF THE HEARING ON 30/08/2016. SD/- (JOGINDER SINGH) ! ' / JUDICIAL MEMBER MUMBAI; DATED : 01/09/2016 F{X~{T? P.S / ! & $ )!*+ ,&+-* / COPY OF THE ORDER FORWARDED TO : 1. '#$%& / THE APPELLANT 2. '(%& / THE RESPONDENT. 3. ) ) * / THE CIT, MUMBAI. 4. ) ) * / CIT- , MUMBAI 5. +,- ' , ) '#$ ' / , / DR, ITAT, MUMBAI 6. -0 1$ / GUARD FILE. & / BY ORDER, (+# ' //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI