Krishan Kumar Dhull, Panchkula V. ITO, Chandigarh

ITA 32/CHANDI/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86215 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 30-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 08-01-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH A, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 32/CHD/2015 (ASSESSMENT YEAR : 2009-10) KRISHAN KUMAR DHULL, VS. THE INCOME TAX OFFICER, SCO 42, BASEMENT SWASTIK VIHAR WARD 4(1), SECTOR 5, PANCHKULA. CHANDIGARH. PAN: AILPD0282A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AJAY JAIN RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 30.03.2015 DATE OF PRONOUNCEMENT : 31.03.2015 O R D E R PER BHAVNESH SAINI, J.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX(APPEALS), CHANDIGARH DATED 3.11.2014 FOR ASSESS MENT YEAR 2009-10, CHALLENGING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASS ESSEE FILED RETURN DECLARING INCOME AT RS.8,79,190/- ON 30.9.2009 AND CLAIMED REFUND OF RS.3,36,360/-. THE CASE WAS SELECTED FOR SCRUTINY. STATUTORY NOTICES WERE ISSUED ON 14 .9.2010 AND 2 30.5.2011 BEFORE COMPLETION OF ASSESSMENT PROCEEDIN GS. THE PROCEEDINGS WERE ATTENDED BY THE ASSESSEES REPRES ENTATIVES AND BOOKS OF ACCOUNT AND VOUCHERS WERE PRODUCED. 3. IT WAS NOTICED BY THE ASSESSING OFFICER FROM FO RM NO.26AS DETAILS DOWNLOADED AND PRINTOUT TAKEN THAT THE ASSESSEE HAS INTEREST INCOME OF RS.1,58,924/- FROM DEPOSITS WITH THE UNION BANK OF INDIA AND BANK OF MAHARASHTR A, ON WHICH THE TDS OF RS.16,242/- HAS BEEN DEDUCTED. HO WEVER, THE CREDIT OF TDS OF RS.775/- ON ACCOUNT OF TDS MAD E BY THE BANK OF MAHARASHTRA ONLY HAS BEEN CLAIMED IN THE RE TURN OF INCOME BUT NEITHER THE INTEREST INCOME FROM BANK OF MAHARASHTRA, NOR FROM UNION BANK OF INDIA HAS BEEN DECLARED WHILE FILING THE RETURN OF INCOME AND ALSO CREDIT O F TDS BY UNION BANK OF INDIA HAS NOT BEEN CLAIMED. THE LEA RNED COUNSEL FOR ASSESSEE WAS CONFRONTED WITH THE EARNIN G OF INTEREST AND THE LEARNED COUNSEL FOR ASSESSEE HAS N O ALTERNATIVE BUT TO OFFER INTEREST INCOME FOR TAXATI ON VIDE REPLY DATED 9.12.2011. ACCORDINGLY, ADDITION OF RS.1,5 8,924/- WAS MADE AND CREDIT OF TDS WAS ALLOWED. THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)( C) OF THE ACT FOR NOT DISCLOSING THE INTEREST INCOME FROM THE BANKS AND THE ASSESSEE HAS CONCEALED PARTICULARS OF INCOME. VIDE SEPARATE ORDER PENALTY WAS IMPOSED BY THE ASSESSING OFFICER ON UNDISCLOSED INTEREST INCOME OF RS.1,58,924/-. 3 4. THE ASSESSEE CHALLENGED THE PENALTY ORDER BEFOR E THE LEARNED CIT (APPEALS) AND IT WAS SUBMITTED THAT THE BANKS HAD NOT INTIMATED THE ASSESSEE REGARDING THE INTERE ST WHICH LED TO NON-DISCLOSURE OF IMPUGNED INTEREST. IT WA S SUBMITTED THAT THE INTEREST WAS LOADED IN FORM NO.26AS ON 21. 10.2009 WHEREAS THE RETURN WAS FILED ON 30.9.2009 AND THAT IS WHY THE INTEREST WAS NOT DECLARED IN THE RETURN OF INCO ME. THE LEARNED CIT (APPEALS), HOWEVER, NOTED THAT THE ASSE SSEE WAS IN POSSESSION OF THE FIXED DEPOSITS OF SUBSTANTIAL AMOUNT OF MORE THAN RS.15 LACS, ON WHICH HE HAS EARNED INTERE ST OF MORE THAN RS.1.5 LACS. THEREFORE, THE AMOUNTS OF INTEREST SHOULD HAVE BEEN DECLARED IN THE RETURN OF INCOME. THE ACTION OF THE ASSESSEE IS NOT BONAFIDE. THEREFORE , THE LEVY OF PENALTY WAS CONFIRMED AND THE APPEAL OF THE ASSESSE E WAS DISMISSED. 5. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON R ECORD. THE LEARNED COUNSEL FOR ASSESSEE REITERATED THE SUB MISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FILED DETAILS OF INTEREST SHOWN BY THE BANKS. 6. ON THE OTHER HAND, THE LEARNED D.R FOR THE REVE NUE RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 7. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE DO NOT FIND ANY MERIT IN THE APPEAL OF THE ASSESSEE. IT IS ADMITTED FACT THAT THE ASSESSEE HAD FIXED DEPOSITS IN BOTH T HE BANKS OF 4 SUBSTANTIAL AMOUNT. THE ASSESSEE IS FOLLOWING MERC ANTILE SYSTEM OF ACCOUNTING AND IS MAINTAINING BOOKS OF AC COUNT ALSO. THE ASSESSEE WAS, THEREFORE, AWARE OF THE F ACT THAT ON FIXED DEPOSITS WITH TWO BANKS, THE ASSESSEE HAS EAR NED INTEREST BUT THE SAME WAS NOT DISCLOSED IN THE RETU RN OF INCOME SO FILED. EVEN IF THE INTEREST WAS LOADED I N FORM NO.26AS ON 21.10.2009, IT WAS THE DUTY OF THE ASSES SEE TO OBTAIN TDS CERTIFICATE FROM THE BANKS WITH REGARD T O THE DETAILS OF INTEREST CREDITED TO HIS ACCOUNT MAINTAI NED WITH RESPECT TO THE FIXED DEPOSITS. FORM NO.26AS IS ALW AYS LOADED LATER ON AFTER DEDUCTING TDS AND CREDITING THE INTE REST INCOME IN THE FIXED DEPOSITS ACCOUNT OF THE ASSESSEE. TH E ASSESSEE HAS CLAIMED CREDIT OF TDS IN RESPECT OF THE INTERES T EARNED FROM THE BANK OF MAHARASHTRA IN THE RETURN OF INCOM E WOULD CLEARLY REVEAL THAT THE ASSESSEE WAS AWARE OF THE F ACT THAT THE INTEREST IS EARNED AND CREDITED TO THE ASSESSEE ON THE END OF THE FINANCIAL YEAR. THEREFORE, THERE IS NO QUESTI ON OF NON INTIMATION OF INTEREST TO THE ASSESSEE BY THE BANKE RS. AT THE ASSESSMENT STAGE, THE ASSESSEE WAS GIVEN STATUTORY NOTICES TO EXPLAIN THE RETURN OF INCOME AND INCOME EARNED BUT THE ASSESSEE NEVER DISCLOSED ANY EARNING OF THE INTERES T ON THE FIXED DEPOSITS. THE EARNING OF INTEREST WAS ALSO NOT DISCLOSED IN THE RETURN OF INCOME AND IT IS ONLY WHEN THE ASS ESSEES COUNSEL WAS CONFRONTED TO THE FACT OF THE EARNING O F INTEREST ON FIXED DEPOSITS, THE ASSESSEE OFFERED THE INTERES T INCOME FOR TAXATION. 5 8. THE HON'BLE ALLAHABAD HIGH COURT IN THE CASE OF CIT VS. RAKESH SURI, 331 ITR 458 HELD AS UNDER : HELD, ALLOWING THE APPEAL, THAT THE ASSESSEE HAD CONCEALED THE MATERIAL FACTS AND GIVEN INCORRECT ST ATEMENT OF FACTS IN THE APPLICATION AND ALSO NOT PROVIDED INFORMATION REQUIRED BY THE ASSESSING OFFICER, AFTE R RECEIPT OF NOTICE. ACCORDINGLY, THE ACTION OF THE ASSESSEE WAS NEITHER BONA FIDE NOR VOLUNTARY. THE MANNER IN WHICH THE ASSESSEE HAD TRIED TO PROLONG THE CASE BEFORE T HE ASSESSING OFFICER BY NOT PROVIDING INFORMATION IMMEDIATELY AND BY NARRATING INCORRECT FACTS IN THE LETTER DATED DECEMBER 6,, 2006 SHOWED THAT THE ASSESSEE HA D CONCEALED THE INCOME AND DISCLOSURE WAS NOT VOLUNTA RY BUT UNDER COMPULSION BEING CORNERED BY THE ASSESSIN G OFFICER. PENALTY HAD TO BE IMPOSED. 9. CONSIDERING THE ABOVE FACTS, IT IS CLEAR THAT T HE ASSESSEE HAS OFFERED THE INTEREST INCOME FOR TAXATI ON ONLY WHEN THE ASSESSEE WAS CORNERED AND CONFRONTED BY TH E ASSESSING OFFICER AT THE ASSESSMENT STAGE ON EARNIN G OF INTEREST ON FIXED DEPOSITS. THERE IS NO BONAFIDE ACTION OF THE ASSESSEE FOR NOT DISCLOSING THE INTEREST INCOME ON FIXED DEPOSITS. THE ASSESSEE HAS DELIBERATELY CONCEALED THE PARTICULARS OF INTEREST INCOME IN THE RETURN OF INC OME AS WELL AS AT THE ASSESSMENT STAGE. HAD THE RETURN OF IN COME OF THE ASSESSEE WOULD NOT HAVE TAKEN UP FOR SCRUTINY ASSES SMENT, THE ASSESSEE WOULD NEVER DISCLOSE THE INTEREST INCO ME FOR THE PURPOSE OF TAXATION IN THE YEAR UNDER CONSIDERATION . WE, 6 THEREFORE, DO NOT FIND ANY MERIT IN THE APPEAL OF T HE ASSESSEE. THE SAME IS ACCORDINGLY DISMISSED. 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 31 ST DAY OF MARCH, 2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 31 ST MARCH, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH