Shri Hirabhai Arjanbhai Bharvad, Himatnagar V. The Dy.CIT.,S.K.Circle, Himatnagar

ITA 346/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1566 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 05-05-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 06-02-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V K SINGH
• Assessee Lawyers: K C THAKAR
• Keywords: Unexplained cash credit; Wrong claim
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD B BENCH BEFORE: S H RI ANIL CHATURVEDI , ACCOUNTANT MEMBER AND SHR I S. S. GODARA , JUDICIAL MEMBER HIRABHAI ARJANBHAI BHARVAD, 32, RADHIKA SOCIETY, GOKULNAGAR, MAHAVIRNAGAR, HIMATNAGAR - 383001 PAN: AFQP5236E (APPELLANT) VS THE DCIT, SABARKANTHA CIRCLE, HIMATNAGAR (RESPONDENT) REVENUE BY : S H RI V.K. SINGH , SR . D . R. ASSESSEE BY: S H RI K.C. THAKAR , A.R. DATE OF HEARING : 05 - 05 - 2 016 DATE OF PRONOUNCEMENT : 30 - 05 - 2 016 / ORDER P ER : S. S. GODARA , JUDICIAL MEMBER : - THIS ASSESSEE S APPEAL FOR A.Y. 2007 - 08 , AR ISES FROM ORDER OF THE CIT(A) - VIII, AHMEDABAD DATED 18 - 11 - 2011 IN APPEAL NO. CIT(A) - VIII/D C IT/S.K.CIR./160/10 - 11 , IN PROCEEDI NGS UNDER SECTION 271(1 ) (C) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT . I T A NO . 346 / A HD/20 12 A SSESSMENT YEAR 200 7 - 08 I.T.A NO. 346 /AHD /2012 A.Y. 2007 - 08 PAGE NO HIRABHAI ARJAN BHAI BHARVAD VS. ACIT 2 2. TH E ASSESSEE S SOLE SUBSTANTIVE GROUND CHALLENGES SECTION 271(1)(C) OF RS. 1,20,360/ - IMPOSED BY THE ASSESSING OFFICER IN PENALTY ORDER DATED 30 - 04 - 2010 AND AFFIRMED IN T H E LOWER APPELLATE PROCEEDINGS . 3. FACTS OF THE CASE ARE IN A VERY NARROW COMPASS. TH IS ASSESSEE IS IN CIVIL CONSTRUCTION BUSINESS. THE DEPARTMENT CONDUCTED A SU RVEY ON 22 - 02 - 2007. IT CAME ACROS S CERTAIN LOOSE PAPER S . TH E ASSESSEE DISCLOSES INCOME OF R S. 26,33,266/ - FOR THE IMPUGNED ASSESSMENT YEAR. THE ABOVE STATED LOOS E PAPERS REVEAL ED COMPUTATION OF CAPITAL INVESTMENT A ND NET PROFITS IN THE NAMES OF T HREE PERSONS S/SH . RAJUBHAI, NAYANBHAI AND GOKULBHAI TO THE TUNE OF RS. 7,86,684/ - AND RS. 6,70,726/ - , RS. 3,93,342/ - AND RS. 3,35,363/ - AND RS. 5,24,456/ - AND RS. 447,151/ - ; RESPECTIVEL Y. THE ASSESSING OFFICER SOUGHT TO VERIFY THE SAME. THE ASSESSEE PROVED DURING REGULAR ASSESSMENT FRAMED ON 29 - 12 - 2009 THAT FIRST AND THIRD PARTIES WERE GENUINE CASES BY PLACING ON RECORD THEIR ALL NECESSARY DETAILS. THE DISPUTE LEFT WAS ONLY QUA SHRI N AYANBHAI. THE ASSESSEE STATED THAT THIS PERSON WAS NOT TRACEABLE. HE HIMSELF SOUGHT TO DECLARE THE RELEVANT FIGURES AS HIS OWN INCOME. THE ASSESSING OFFICER ACCORDINGLY ADDED THE SUM IN QUESTION OF RS. 3,93,342/ - AS UNEXPLAINED CASH CREDIT. THE ASSESSE DID NOT FILE ANY APPEAL. 4. IT TRANSPIRES FROM THE CASE FILE THAT BOTH THE LOWER AUTHORITIES TREAT THE ABOVE STA T ED SECTION 68 ADDITION OF RS. 3,93,342/ - AS AN I.T.A NO. 346 /AHD /2012 A.Y. 2007 - 08 PAGE NO HIRABHAI ARJAN BHAI BHARVAD VS. ACIT 3 INSTANCE OF CONCEALMENT OF PARTICULARS OF INCOME LEAVING THE ASSESSEE AGGRIEVED. 5 WE HAVE HEARD BOTH PARTIES. LEARNED REPRESENTATI VES REITERATE THEIR RESPECTIVE PLEADINGS. WE REITERATE THAT THE IMPUGNED PENALTY HAS BEEN IMPOSED IN ASSESSEE S CASE ON ACCOUNT OF HIS FAILURE IN PRODUCING SHRI NAYANBHAI TO VERIFY THE IMPUGNED CAPITAL INVESTMENT. THERE IS NO DISPUTE THAT THE ASSESSEE PROVED TWO OUT OF THREE CAPITAL INVESTMENTS AND NET PROFITS . WE OBSERVE IN THESE PECULIAR FACTS AND CIRCUMSTANCES THAT THE IMPUGNED SECTION 68 ADDITION HAS ARISEN ON ACCOUNT OF ASSESSEE S FAILURE IN PROVING IDENTITY OF THE CREDITOR. IT I S NOT A CASE INVOLVING ALTOGETHER A BOGUS CLAIM OR INVESTMENT IN PECULIAR FAC T S AND CIRCUMSTANCES . WE REPEAT THE SETTLE LAW THAT QUANTUM AND PENALTY PROCEEDINGS ARE SEPARATE AND EACH AND EVERY DISALLOWANCE /ADDITION DOES NOT NECESSARI LY RESULT IN IMPOSITION OF CONCEALMENT PENALTY U/S. 271(1)(C) OF THE ACT AS HELD BY HON BLE APEX COURT IN CIT VS. REL IANCE PETRO 322 ITR 158(SC). WE DELETE THE IMPUGNED PENALTY ACCORDINGLY. 6. THIS ASSESSEE S APPEAL IS ALLOWED. O RDER PR ONOUNCED IN THE OPEN C OURT ON 30 - 05 - 201 6 SD/ - SD/ - ( ANIL CHATURVEDI ) ( S. S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD : DATED 30 /05 /2016 AK I.T.A NO. 346 /AHD /2012 A.Y. 2007 - 08 PAGE NO HIRABHAI ARJAN BHAI BHARVAD VS. ACIT 4 / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,