Shri Asifhusen J.Male, Anand V. The Dy.CIT.,Kheda Circle, Nadiad

ITA 3129/AHD/2011

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9663 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-04-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 08-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROOP CHAND
• Section: 40A(3); 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD (BEFORE SHRI SHAILENDRA KR. YADAV, J.M. & SHRI ANI L CHATURVEDI, A.M.) I.T. A. NO. 3129/AHD/2011 (ASSES SMENT YEAR: 2005-06) SHRI ASIFHUSEN J. MALEK PROP: GIRIRAJ TRANSPORT, STATE HIGHWAY, PO: SEVXALIA- 388240 V/S DY. COMMISSIONER OF INCOME TAX, KHEDA CIRCLE, NADIAD. (APPELLANT) (RESPONDENT) PAN: ACWPM4166B APPELLANT BY : SHRI ASEEM THAKKAR, A.R. RESPONDENT BY : SHRI ROOP CHAND, SR. D.R. ( )/ ORDER DATE OF HEARING : 10-04-2015 DATE OF PRONOUNCEMENT : 17 -04-2015 PER SHRI ANIL CHATURVEDI,A.M. 1. THIS APPEAL FILED BY THE ASSESSEE IS AGAINST THE OR DER OF CIT(A)-IV, BARODA DATED 14.09.2011 FOR A.Y. 2005-06. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER. 3. ASSESSEE IS AN INDIVIDUAL STATED TO BE ENGAGED IN T HE BUSINESS OF TRANSPORTATION. ASSESSEE FILED HIS RETURN OF INCOME FOR A.Y. 2005-06 ON 30.11.2005 DECLARING TOTAL INCOME OF RS. 1,59,770/- . THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE ASSESSMENT WAS FRAM ED UNDER SECTION 143(3) ITA NO 3129/ AHD/2011 . A.Y. 2005-06 2 VIDE ORDER DATED 28.12.2007 AND THE TOTAL INCOME WA S DETERMINED AT RS. 9,61,480/- BY INTERALIA DISALLOWING THE CLAIM OF BA D DEBTS (RS. 5,69,606/-), DISALLOWANCE U/S 40A(3) (RS. 1,03,712/-) AND AGRICU LTURAL INCOME TREATED AS INCOME FROM OTHER SOURCE U/S.68 OF (RS. 1,00,000/-) . AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT (A) WHO VIDE ORDER DATED 11.05.2009 DELETED THE ADDITION ON ACCOUNT OF BAD D EBTS BUT SUSTAINED THE ADDITION MADE U/S. 40A(3) AND AGRICULTURAL INCOME. ON THE ADDITIONS THAT WERE CONFIRMED BY LD. CIT(A), A.O VIDE ORDER DATED 25.03.2010 LEVIED PENALTY OF RS. 62,330/- U/S. 271(1)(C) OF THE ACT. AGGRIEVED BY THE ORDER OF A.O., ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A) WHO VIDE ORDER DATED 14.09.2013 DELETED THE PENALTY ON THE DISALLOWANCE MADE U/S. 40A(3) BUT UPHELD THE PENALTY ON THE ADDITION OF AGRICULTURAL INCOME TREATED AS INCOME OF OTHER SOURCES RS. 1,00,000/- BY HOLDING AS UNDER :- 4. WITH REGARD TO THE ADDITION OF RS. 1,00,000/- , THE A.O. IN MY OPINION HAS CORRECTLY LEVIED THE PENALTY ON SUCH ADDITION . THE UNDISPUTE D FACT IS THAT THE APPELLANT HAS CREDITED RS.1,00,000/- AS AGRICULTURAL INCOME IN HIS CAPITAL ACCOUNT AND THEREFORE ONUS WAS ON HIM TO PROVE GENUINENESS OF SUCH INCOME BY FILING C OGENT EVIDENCES . HOWEVER THE APPELLANT HAS FAILED TO PROVE THAT THE ABOVE INCOME OF RS. 1,00,000/- WAS ON ACCOUNT OF AGRICULTURAL ACTIVITIES CARRIED ON BY HIM DURING TH E YEAR UNDER CONSIDERATION. THE APPELLANT COULD NOT FURNISH THE DETAILS OF EXACT AR EA OF LAND CULTIVATED, AGRICULTURAL CROPS PRODUCED AND SALE BILLS OF SUCH AGRICULTURAL CROPS SOLD. THE APPELLANT HAD MERELY FURNISHED THE PHOTOCOPY OF 7/12 AND 8 A 'UTARA' AND THE SAME WERE NOT SUFFICIENT TO ESTABLISH THAT THERE WAS ACTUALLY AGRICULTURAL ACTI VITIES CARRIED OUT BY THE APPELLANT AND AS A RESULT OF THE SAME, THE ABOVE AMOUNT OF RS. 1, 00,000/- WAS EARNED BY HIM. THUS THE APPELLANT HAD FILED INACCURATE PARTICULARS OF INCOM E IN RESPECT OF ABOVE INCOME OF RS. 1,00,000/- AND THEREFORE PENALTY LEVIED BY THE A.O. U/S 271(1) ( C) ON SUCH ADDITION IS HEREBY CONFIRMED. 4. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), AS SESSEE IS NOW IN APPEAL BEFORE US. 5. BEFORE US, LD. A.R. REITERATED THE SUBMISSIONS MADE BEFORE A.O AND LD. CIT(A) AND FURTHER SUBMITTED THAT DURING THE COURSE OF ASSESSMENT ITA NO 3129/ AHD/2011 . A.Y. 2005-06 3 PROCEEDINGS, ASSESSEE HAD SUBMITTED THE PROOF OF AG RICULTURAL LAND HOLDING, CERTIFICATE FROM GOVERNMENT OFFICER THAT HE HAD INC OME FROM AGRICULTURE AND THE HOLDING OF AGRICULTURAL LAND HAS NOT BEEN D OUBTED BY A.O. HE FURTHER SUBMITTED THAT ASSESSEE HAD ALSO FURNISHED THE PHOT O COPIES OF 7/12 AND 8A UTARA EVIDENCING THE HOLDING OF AGRICULTURAL LAND AND THE AGRICULTURAL ACTIVITIES. HE THEREFORE SUBMITTED THAT MERELY BECA USE THE SUBMISSIONS OF THE ASSESSEE HAVE NOT BEEN ACCEPTED AND THE ADDITIONS H AVE BEEN MADE U/S. 68, IT IS NOT NECESSARY THAT PENALTY U/S. 271(1)(C) BE LEVIED. HE FURTHER SUBMITTED THAT ASSESSEE HAS NOT CONCEALED ANY PARTICULARS OF INCOME NOR HAS FURNISHED INACCURATE PARTICULARS OF INCOME. HE THEREFORE SUBM ITTED THAT PENALTY BE DELETED. THE LD. D.R. ON THE OTHER HAND SUPPORTED T HE ORDER OF A.O AND LD. CIT(A). 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. IN THE PRESENT CASE, THE ISSUE IS WITH RESPECT TO LEVY OF PENALTY U/S. 271(1)(C) ON THE ADDITION OF RS. 1,00,000/- WHICH WAS SHOWN BY T HE ASSESSEE AS AGRICULTURAL INCOME AND WHICH WAS NOT ACCEPTED BY T HE A.O AND WAS THEREFORE TREATED BY HIM AS INCOME FROM OTHER SOURC ES. IT IS AN UNDISPUTED FACT THAT ASSESSEE HAD FURNISHED THE COPY OF 7/12 A ND 8A UTARA EVIDENCING THE HOLDING OF LAND AND THE HOLDING OF LAND HAS NOT BEEN DOUBTED BY THE A.O. IT IS ALSO NOT A CASE WHERE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME OR CONCEALED THE PARTICULAR OF INCOME. FURTH ER, FOR LEVY OF PENALTY THERE HAS TO BE EVIDENCE OR MATERIAL TO SHOW THAT T HE ASSESSEE HAS DELIBERATELY FURNISHED INACCURATE PARTICULARS OF IN COME. IT ALSO A SETTLED LAW THAT PENALTY PROCEEDINGS ARE ENTIRELY DISTINCT FROM ASSESSMENT PROCEEDINGS AND HOWSOEVER RELEVANT AND GOOD THE FINDINGS IN ASS ESSMENT PROCEEDINGS MAY BE, THEY ARE NOT CONCLUSIVE AS FAR AS PENALTY P ROCEEDINGS ARE CONSIDERED. ITA NO 3129/ AHD/2011 . A.Y. 2005-06 4 IT IS ALSO WELL SETTLED THAT THE PARAMETERS OF JUDG ING THE JUSTIFICATION FOR ADDITION MADE IN ASSESSMENT CASE OF AN ASSESSEE IS DIFFERENT FROM THE PENALTY IMPOSED ON ACCOUNT OF CONCEALMENT OF INCOME OR FILI NG INACCURATE PARTICULAR OF INCOME AND THAT CERTAIN DISALLOWANCES/ADDITIONS COULD LEGALLY BE MADE IN ASSESSMENT PROCEEDINGS ON THE PREPONDERANCE OF PROB ABILITIES BUT NO PENALTY COULD BE IMPOSED U/S. 271(1)(C) OF THE ACT ON THE P REPONDERANCE OF PROBABILITIES AND THE REVENUE HAS TO PROVE THAT THE CLAIM MADE BY THE ASSESSEE WAS NOT GENUINE. CONSIDERING THE TOTALITY OF FACTS, WE ARE OF THE VIEW THAT THE PRESENT CASE IS NOT A FIT CASE FOR LE VY OF PENALTY AND WE THEREFORE DIRECT ITS DELETION. THUS THE GROUND OF A SSESSEE IS ALLOWED. 7. IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 17 - 04 - 2015. SD/- SD/- (SHAILENDRA KR. YADAV) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD. TRUE COPY RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHM EDABAD