Shri Murlidhar Soni, Indore V. The ACIT, Indore

ITA 342/IND/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 47851 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-06-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2004-2005
• Appeal Filed On: 28-05-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: PRADEEP KUMAR MITRA
• Assessee Lawyers: H P VERMA
• Keywords: Gift; Wrong claim; Corroborative evidences; Revised return
• Section: 142(1)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.342/IND/2010 A.Y. 2004-05 MURLIDHAR SONI, INDORE PAN AHCPS 6229 C APPELLANT VS ACIT-2(1), INDORE RESPONDENT APPELLANT BY : S/SHRI H.P. VERMA & ASHISH GOYAL RESPONDENT BY : SHRI PRADEEP KUMAR MITRA, SR. DR O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER THE ONLY GROUND RAISED BY THE ASSESSEE IN THIS APPE AL RELATES TO THE CONFIRMATION, BY THE LEARNED COMMISS IONER OF INCOME TAX (APPEALS), OF THE PENALTY OF RS. 1,80,00 0/- LEVIED U/S 271(1) OF THE ACT BY THE ASSESSING OFFICER. 2. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTI ES AND HAVE GONE THROUGH THE MATERIAL AVAILABLE ON THE FIL E. THE CRUX OF THE ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT GIFTS OF RS.6,20,000/- WERE GIVEN TO THE ASSESSEE FROM NRE A /C OF THE 2 DONOR AND TO BUY PEACE WITH THE DEPARTMENT, THE IMP UGNED AMOUNT WAS SURRENDERED AND THE BANK A/C OF THE DONO R COULD NOT BE PRODUCED, WHEN DEMANDED BY THE ASSESSING OFF ICER, AS THE SAME WAS NOT IN THE POSSESSION OF THE ASSESSEE. IT WAS PLEADED THAT PENALTY WAS WRONGLY LEVIED BY THE ASSE SSING OFFICER AND AFFIRMED BY THE LD. CIT(A). RELIANCE WA S PLACED UPON THE DECISION IN 251 ITR 373 (RAJ), 272 ITR 323 AND 270 ITR 156 (MP). ON THE OTHER HAND, THE LD. SR. DR STR ONGLY DEFENDED THE IMPOSITION/CONFIRMATION OF PENALTY BY SUBMITTING THAT EVEN TILL TODAY, THE BANK A/C OF THE DONOR WAS NOT PRODUCED BY THE ASSESSEE AND WHEN THE DEPARTMENT DETECTED TH E FAULT OF THE ASSESSEE, THE ASSESSEE SUO MOTO SURRENDERED THE IMPUGNED AMOUNT AND EVEN DID NOT PREFER ANY APPEAL. IT WAS STRONGLY CONTENDED THAT IN THE ABSENCE OF SUCH DETE CTION BY DEPARTMENT, THE IMPUGNED AMOUNT WOULD HAVE REMAINED UNTAXED, THEREFORE, THE ASSESSEE DELIBERATELY FURNI SHED INACCURATE PARTICULARS OF ITS INCOME, RESULTING INT O CONCEALMENT OF INCOME. RELIANCE WAS PLACED UPON THE DECISIONS I N 122 ITR 622 (MP), 232 ITR 115, 271 ITR 286, 242 ITR 29, 306 ITR 277 3 (SC), 251 ITR 99 (SC), 186 ITR 571 (SC). IT WAS ALS O SUBMITTED THAT ONUS IS ON THE ASSESSEE TO ESTABLISH HIS BONA FIDE AND TILL TODAY, NO SUPPORTING EVIDENCE WAS FILED BY THE ASSE SSEE. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. BRIEF FACTS ARE THAT THE ASSES SEE RECEIVED GIFTS OF RS.6,20,000/- FROM NRE A/C OF SHRI LEKHRAJ PYARELAL RAJOLIA AND SHRI CHOTELAL CHAWRE OF MHOW (MP) THROU GH DEMAND DRAFT FROM NRE A/C NO.106 & 01192083028, RESPECTIVELY. BEFORE THE LD. ASSESSING OFFICER, THE ASSESSEE FILED THE COPIES OF GIFT DEEDS, DEMAND DRAFTS, AND COPIES OF BANK CERTIFICATES EVIDENCING WITHDRAWAL OF AMOUNTS FROM THE A/C OF THE DONOR. IN ITS RETURN, THE ASSESSEE DECLARED TOTAL INCOME OF RS.74,100/- ON 21.9.2004. DURING ASSESSMENT PROC EEDINGS, IT WAS FOUND THAT THE ASSESSEE HAD CREDITED A SUM O F RS.6,20,000/- ON ACCOUNT OF NRE GIFTS RECEIVED FROM AFOREMENTIONED TWO PERSONS. THE ASSESSEE WAS ASKED TO FILE THE DETAILS FOR WHICH A QUESTIONNAIRE WAS ISSUED TO HIM. A NOTICE U/S 142(1) DATED 27.1.2006 WAS ALSO ISSUED T O FURNISH 4 THE DETAILS/QUERIES, SO RAISED. THE ASSESSEE FAIRLY ADMITTED THAT THERE WAS NO RELATION WITH THE DONORS AND ALSO NO O CCASION. IN RESPONSE TO THESE QUERIES, THE ASSESSEE REVISED ITS RETURN ON 30.11.2006, SURRENDERED THE IMPUGNED AMOUNTS WITH T HE REQUEST THAT THE SAME MAY BE TREATED AS INCOME UNDE R THE HEAD OTHER SOURCES AND PAID THE DUE TAX. ADMITTED LY, THE REVISED RETURN WAS FILED AFTER IT WAS DETECTED BY T HE DEPARTMENT AND NOT BEFORE DETECTION AS IS EVIDENT FROM THE FAC T THAT NOTICE U/S 143(2) WAS ISSUE ON 16.8.2005 AND NOTICE U/S 14 2(1) WAS ISSUED ON 27.1.2006 REQUIRING THE ASSESSEE TO FURNI SH THE DETAILS OF GIFTS UP TO 16.2.2006. HOWEVER, THE ASSE SSEE FILED THE REVISED RETURN ON 30.11.2006 I.E. AFTER 15 MONTHS F ROM THE ISSUANCE OF THE NOTICE U/S 143(2) AND ABOUT 10 MONT HS FROM THE NOTICE U/S 142(1). FROM THESE FACTS, ONE UNDISPUTED FACT IS OOZING OUT THAT THE ASSESSEE CONCEALED ITS PARTICUL ARS OF INCOME BY FURNISHING INACCURATE PARTICULARS. WHEN T HE ASSESSING OFFICER ASKED THE ASSESSEE ABOUT THE GENU INENESS OF THESE GIFTS AND TO FURNISH THE NECESSARY DETAILS , THE ASSESSEE INSTEAD OF FURNISHING SUCH DETAILS, SURRENDERED THE AMOUNTS, SO 5 RECEIVED, IN THE FORM OF NRE GIFTS BY FILING A REVI SED RETURN, MEANING THEREBY, THE ASSESSEE WAS AWARE THAT THE GI FTS WERE NOT GENUINE. THE LD. CIT(A) HAS ALREADY FOLLOWED TH E DECISION FROM THE HONBLE APEX COURT IN K.P. MADHUSUDAN VS. CIT, 251 ITR 99 AND AFFIRMED THE IMPOSITION OF PENALTY. THE HONBLE APEX COURT WHILE COMING TO A PARTICULAR CONCLUSION OVERRULED THE DECISION IN CIT VS. P.M. SHAH, 203 ITR 792 AND CIT VS. DHARAMCHAND L. SHAH, 204 ITR 464 (BOM) AND AFFIRMED THE DECISION FROM KERLA HIGH COURT PRONOUNCED IN 246 IT R 218. IN THE PRESENT APPEAL ALSO, THE REQUIRED NOTICE WAS GI VEN TO THE ASSESSEE, IN RESPONSE TO WHICH, THE NECESSARY INFOR MATION WERE NOT FURNISHED BY THE ASSESSEE RATHER THE IMPUG NED AMOUNTS TAKEN IN THE FORM OF GIFTS WAS OFFERED FOR TAXATION, CONSEQUENTLY, AS PER THE EXPLANATION TO SEC. 271(1) (C), THERE IS FAILURE ON THE PART OF THE ASSESSEE TO RETURN HIS C ORRECT INCOME, CONSEQUENTLY, IT CAN BE SAID THAT THE ASSESSEE CONC EALED ITS INCOME OR FURNISHED INACCURATE PARTICULARS THEREOF, THEREFORE, THE PENALTY WAS RIGHTLY IMPOSED. IT IS NOT THE CASE THAT THE ASSESSEE SUO MOTO REVISED THE RETURN BEFORE THE SAM E IS 6 DETECTED BY THE DEPARTMENT. THE RATIO LAID DOWN IN CHUHARMAL VS. CIT (172 ITR 250) (SC), ADDL. CIT VS. BHARTIYA BHANDAR (122 ITR 622), BADRIPRASAD OMPRAKASH VS. CIT (163 I TR 440) (RAJ), CIT VS. K. MAHIM (232 ITR 115) (KER), RAVI & CO. VS. ACIT (271 ITR 276) (MAD), G.C. AGRAWAL VS. CIT (186 ITR 571) FURTHER SUPPORTS THE CASE OF THE REVENUE. DURING HE ARING, THE LD. COUNSEL FOR THE ASSESSEE RELIED UPON THE DECISI ON FROM HONBLE JURISDICTIONAL HIGH COURT IN CIT VS. BETA N EPHTHOL LTD. (272 ITR 323) (MP) WHEREIN THE LD. CIT(A) AND ALSO THE APPELLATE TRIBUNAL FOUND THAT THERE WAS NO CASE OF CONCEALMENT, WHATSOEVER, WAS MADE OUT THE FACTS OF THAT CASE BECAUSE THE EXPLANATION OFFERED BY THE ASSESSEE WAS ACCEPTED BY THE ASSESSING OFFICER AND THE PENALTY WAS CONFIR MED IN RESPECT OF SOME OTHER ITEMS. HOWEVER, IN THE PRESEN T APPEAL, IT IS A CLEAR-CUT CASE OF CONCEALMENT OR FURNISHING IN ACCURATE PARTICULARS BECAUSE IN THE ABSENCE OF DETECTION BY THE DEPARTMENT, THE SAME WAS LIKELY TO BE REMAINED UNTA XED. EVEN ON QUANTUM ASSESSMENT, NO APPEAL WAS FILED BY THE A SSESSEE RATHER THE ASSESSEE AGREED TO OFFER THE SAME FOR TA XATION, 7 THEREFORE, THE AFORESAID DECISION FROM HONBLE JURI SDICTIONAL HIGH COURT MAY NOT HELP THE ASSESSEE. AS FAR AS THE DECISION FROM HONBLE RAJASTHAN HIGH COURT IN SHIVLAL TAK VS . CIT (251 ITR 373) IS CONCERNED, WHERE THE EXPLANATION OF THE ASSESSEE WAS NOT FALSE RATHER THE SAME WAS NOT ACCEPTED BECA USE THE ASSESSEE FAILED TO SUBSTANTIATE, THEREFORE, THIS JU DICIAL PRONOUNCEMENT ALSO MAY NOT HELP THE ASSESSEE. SIMIL AR IS THE SITUATION IN THE CASE OF CIT VS. S.P.K. STEELS P. L TD. (270 ITR 156) (MP) WHEREIN THERE WAS A FINDING THAT THERE WA S NO CONCEALMENT OF INCOME, THEREFORE, CANCELLATION OF P ENALTY WAS HELD TO BE VALID. IT IS AN ESTABLISHED FACT THAT IF THERE IS CONCEALMENT OF INCOME/FURNISHING OF INACCURATE PART ICULARS, CONSEQUENTLY, THE PENALTY CAN BE IMPOSED BECAUSE AN ORDER IMPOSING PENALTY FOR FAILURE TO CARRY OUT A STATUTO RY OBLIGATION AND THE PENALTY WILL NOT AUTOMATICALLY IMPOSED UNLE SS THE PARTY OBLIGED EITHER ACTED DELIBERATELY IN DEFIANCE OF LA W. CONCEALMENT REFERS TO A DELIBERATE ACT ON THE PART OF THE ASSESSEE. THE EXPRESSION HAS CONCEALED THE PARTICU LARS OF INCOME AND HAS FURNISHED INACCURATE PARTICULARS O F INCOME 8 HAVE NOT BEEN DEFINED EITHER IN SEC. 271(1)(C) OR E LSEWHERE IN THE ACT. ONE THING IS CERTAIN THAT THESE TWO CIRCUM STANCES ARE NOT IDENTICAL IN DETAILS ALTHOUGH THEY MAY LEAD TO THE SAME EFFECT, NAMELY, KEEPING OFF A CERTAIN PORTION OF IN COME. THE FORMER IS DIRECT AND THE LATER MAY BE INDIRECT IN I TS EXECUTION. THE WORD CONCEAL IS DERIVED FROM LATIN WORD CONC OLARE WHICH IMPLIES TO HIDE. THE OFFENCE OF CONCEALMENT IS TH US A DIRECT ATTEMPT TO HIDE AN ITEM OF INCOME OR A PORTION THER EOF FROM THE KNOWLEDGE OF THE INCOME-TAX AUTHORITIES. ANY CONCEA LMENT OR INACCURACY IN THE PARTICULARS OF INCOME IN THE RETU RN OCCURRING AT ANY STAGE UP TO AND INCLUSIVE OF THE ULTIMATE STAGE OF WORKING OUT OF THE TOTAL INCOME WOULD ATTRACT THE PENALTY P ROVISIONS OF SEC. 271(1). THE WORD INACCURATE PARTICULARS WOU LD COVER FALSITY IN THE FINAL FIGURE AS ALSO THE CONSEQUENT ELEMENT OR ITEMS. THEY SIMPLY WOULD MEAN INACCURATE IN SOME SP ECIFIC OR DEFINITE RESPECT WHETHER IN THE CONSTITUENT OR SUB- ORDINATE ITEMS OF THE INCOME OR THE END RESULT. EVEN IT WAS NOT A BONA FIDE MISTAKE BECAUSE THE ASSESSEE WAS AWARE THAT HE MADE A WRONG CLAIM IN THE FORM OF NRE GIFTS WHICH WAS FURT HER FORTIFIED 9 BY OFFERING THE SAME AS TAXABLE INCOME WHEN DETECTE D BY THE DEPARTMENT AND EVEN THE REQUIRED DOCUMENTS WERE NOT FURNISHED BY THE ASSESSEE. AS FAR AS THE CONTENTION OF THE ASSESSEE THAT SUCH DOCUMENTS WERE NOT WITHIN THE CO NTROL OF THE ASSESSEE IS ALSO AN AFTERTHOUGHT BECAUSE A PERS ON WHO ALLEGEDLY GIFTED RS.6,20,000/- TO THE ASSESSEE SUDD ENLY CLAIMED TO BE OUT OF REACH. EVEN THE DONOR WAS NOT PRODUCED BY THE ASSESSEE FOR EXAMINATION BY THE ASSESSING OF FICER, THEREFORE, ALL THESE FACTS CLEARLY LEAD TO THIS CON CLUSION THAT THE ASSESSEE FURNISHED INACCURATE PARTICULARS OR CONCEA LED ITS INCOME, CONSEQUENTLY, THE PENALTY WAS RIGHTLY IMPOS ED BY THE ASSESSING OFFICER AND CONFIRMED BY THE LD. CIT(A). WE FIND NO INFIRMITY IN THE SAME, THEREFORE, THE PENALTY IS AF FIRMED. FINALLY, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JUNE, 2011. (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 15.6.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE VYAS!