Dinesh K Aggarwal, Mandi Gobindgarh V. ITO, Mandi Gobindgarh

ITA 366/CHANDI/2011

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9806 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-07-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 13-07-2015
• Assessment Year: 2002-2003
• Appeal Filed On: 08-04-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: RAJ KAMAL; SURJIT BHADU
• Keywords: Gift; Initiation of penalty proceedings; Accommodation entries
• Section: 147; 131; 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES SMC CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT ITA NO. 366/CHD/2011 ASSESSMENT YEAR: 2002-03 & ITA NO. 1103/CHD/2014 ASSESSMENT YEAR: 2004-05 SHRI DINESH K. AGGARWAL, VS. THE ITO, WARD-1, C/O M/S DHIMAN INDUSTRIES, MANDI GOBINDGARH MANDI GOBHINDGARH (PUNJAB) PAN NO. ABZPA4879K (APPELLANT) (RESPONDENT) APPELLANT BY : S/SHRI SURJIT BHADU, & RAJ KAMAL RESPONDENT BY : SHRI S.K. MITTAL DATE OF HEARING : 13.07.2015 DATE OF PRONOUNCEMENT : 27.07.2015 ORDER PER H.L.KARWA, VP THESE TWO APPEALS CONCERN THE SAME ASSESSEE AND, TH EREFORE, THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CO MMON ORDER FOR THE SAKE OF CONVENIENCE. 2. FIRSTLY, I WILL TAKE UP ITA NO. 366/CHD/2011 RELATING TO ASSESSMENT YEAR 2002-03. IN THIS APPEAL THE ASSESSEE HAS RAISED TH E FOLLOWING GROUNDS:- 1. THAT THE LEARNED CIT (APPEALS) PATIALA HAS ERRED IS NOT QUASHING THE RE-ASST. ORDER. NO FINDING HAS BEEN GI VEN ON LEGALITY OF RE-ASST. ORDER. SINCE NO NOTICE U/S 148 WAS SERVED ON THE APPELLANT AS SUCH THE RE-ASST. ORDER SHOULD HAVE BEEN ANNULLED. THUS RE-ASST. ORDER IS LIABLE TO BE QUASH ED. 2 2. WITHOUT PREJUDICE TO THE ABOVE CLAIM THE LEARNED CI T (A) HAS FURTHER ERRED IN NOT DELETING ADDITION OF RS. 50000 0/- . FACTS OF THE CASE HAVE NOT BEEN APPRECIATED PROPERLY. REA SONS FOR RE-OPENING THE ASST. ARE DIFFERENT FROM THE BASIS O N WHICH ADDITION WAS MADE BY THE A.O. COPY OF BANK ACCOUNT WAS FILLED DURING THE COURSE OF RE-ASST. PROCEEDINGS. EARLIER TO THAT THE DEPTT HAD NOTHING ON RECORD. NO ACCOMMODATION ENTR Y WAS RECEIVED OR PROVED TO HAVE BEEN RECEIVED. THUS THE ADDITION RETAINED IS LIABLE TO BE DELETED. 3. AT THE TIME OF HEARING OF THE APPEAL, SHRI SURJI T SINGH BHADU, LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS FOR GROUND NO.1 OF T HE APPEAL AND HENCE THE SAME IS DISMISSED AS NOT PRESSED. 4. VIDE GROUND NO. 2 THE ASSESSEE HAS CHALLENGED TH E ACTION OF THE CIT(A) IN CONFIRMING THE ADDITION OF RS. 5 LAKHS AND HAS ALSO CHALLENGED THE REOPENING OF THE ASSESSMENT ON THE GROUND THAT REASONS FOR REOPE NING ARE DIFFERENT FROM THE BASIS ON WHICH ADDITION WAS MADE BY THE ASSESSING O FFICER. 5. THE FACTS OF THE PRESENT CASE ARE THAT THE ASSES SEE FILED RETURN OF INCOME ON 30.07.2002 DECLARING TOTAL INCOME AT RS. 2,91,93 6/-. INFORMATION WAS RECEIVED BY THE ASSESSING OFFICER FROM THE INVESTIG ATION WING OF THE DEPARTMENT TO THE EFFECT THAT MR. ASHWAJIT AGARWAL AND MAR. SANJEET AGGARWAL WHO ARE MINOR SONS OF THE ASSESSEE HAD RECEIVED HAW ALA PAYMENT OF RS. 2,20,625/- EACH THROUGH DRAFT DATED 22.12.2001 FROM SHRI N.K. GARG, C.A. CHANDIGARH. AFTER RECORDING REASONS FOR REOPENING THE ASSESSING OFFICER ISSUED A NOTICE U/S 148 OF THE ACT TO THE ASSESSEE. THE AS SESSEE DEMANDED A COPY OF REASONS RECORDED BY THE ASSESSING OFFICER FOR REOPE NING OF THE ASSESSMENT WHICH WAS SUPPLIED TO HER BY THE ASSESSING OFFICER. THE REASONS RECORDED ARE REPRODUCED HEREINBELOW: ON VERIFICATION OF HAWALA PAYMENT, IT WAS FOUND TH AT THE ASSESSEE HAS RECEIVED THE FOLLOWING PAYMENT THROUGH DRAFT FROM T HE FOLLOWING PERSONS:- DATE AMOUNT PERSONS FROM WHOM PAYMENT HAS BEEN RECEIVED. 3 22.12.2001 2,50,625/- SHRI N.K. GARG, C.A. CH ANDIGARH THE ASSESSEE HAS CREDITED THE AFORESAID SUM IN ITS BOOKS OF ACCOUNTS FOR THE YEAR 2001-02 RELEVANT TO ASSESSMENT YEAR 2002-0 3. SHRI N.K. GARG FROM WHOM THESE ACCOMMODATION ENTRIES WERE OBTAINE D IN A CHARTERED ACCOUNTANT OF CHANDIGARH WHO WAS CLAIMING REFUND ON THE BASIS OF THE FAKE TDS CERTIFICATES AND WAS ALSO INDULGING IN GIV ING ENTRIES ON LARGE SCALE BY INTRODUCING UNACCOUNTED MONEY OF OTHER PER SONS IN DIFFERENT BANK ACCOUNTS IN HIS NAME OR IN THE NAME E OF HIS F AMILY MEMBERS, RESULTING INTO ESCAPEMENT OF INCOME CHARGEABLE TO T AX. THE ASSESSING OFFICER OBSERVED THAT AS PER THE BANK STATEMENT OF THE ASSESSEE IN SBOP, MANDI GOBINDGARH BRANCH BEARING ACCOUNT NO. 0 1190005885 CREDIT ENTRIES SHOWING AMOUNT OF RS. 2,50,000/- ON 27.12.2 001 AND BEARING ACCOUNT NO. 01190006228 A CREDIT ENTRY OF RS. 2,50,000 WERE DEPICTED. THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO PROVE THE IDENTITY , CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTIONS MADE. IN RESPONSE TO THE SAID QUERY, THE ASSESSEE SUBMITTED THAT PRESUMPTION OF THE REVENUE THAT AMOUNT OF RS. 2,50,625/- WAS ACCOMMODATION ENTRY OBTAINED FROM SH RI N.K. GARG, C.A. IS TOTALLY INCORRECT. IT WAS FURTHER EXPLAINED THAT TH ERE WERE ONLY TWO ENTRIES AS MENTIONED ABOVE IN THE BANK ACCOUNTS AND THESE AMOU NTS WERE NEVER RECEIVED FROM THE SAID PERSON. IT WAS STATED THAT THE AMOUN TS OF RS. 2,50,000/- EACH IN THE HANDS OF SHRI ASHWAJIT AND SHRI SANJEET WERE RE CEIVED AS GIFT FROM SHRI CHANDER BHAN RESIDENT OF H. NO. 153B, PARTAP VIHAR, GALI NO. 4, NITHARI, DELHI- 41 AND FROM SHRI KISHORI LAL GUPTA S/O SHRI MANGE R AM GUPTA RESIDENT OF NZ- NANGLOI, DELHI RESPECTIVELY. IT WAS ALSO STATED THA T THE AMOUNTS GIVEN IN THE REASONS RECORDED FOR REOPENING U/S 148 DID NOT TALL Y WITH THE AMOUNTS GIVEN IN THE NOTICE DATED 26.03.2009. THE ASSESSING OFFICER DID NOT ACCEPT THE EXPLANATION GIVEN BY THE ASSESSEE AND HELD THAT TWO AMOUNTS MENTIONED (SUPRA) WERE GIFTS FROM SHRI CHANDER BHAN AND KISHORI LAL G UPTA BOTH RESIDENTS OF DELHI. COPIES OF THE GIFT DEEDS EXECUTED WERE FURNI SHED AND ADDRESSES OF DONOR WERE MENTIONED IN THE SAID DEED. THE ASSESSEE FAILE D TO PRODUCE THE DONORS FOR VERIFICATION AND SUMMONS WERE RECEIVED BACK UNSERV ED. WHEN ASKED TO FILE 4 CONFIRMATION FROM THE DONORS AND PRODUCED THEM FOR VERIFICATION, THE ASSESSEE SHOWN HER INABILITY TO PRODUCE THE DONORS AS WELL A S FILE THEIR CONFIRMATIONS. ADMITTEDLY, THERE WAS NO DIRECT OR INDIRECT RELATIO N OF THE DONEE WITH THE DONORS. THERE WAS NO OCCASION FOR MAKING THE GIFTS. THE ASSESSING OFFICER RELYING ON THE JUDGEMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF JASPAL SINGH V CIT (2007) 290 ITR 306 (P&H) HELD TH AT ONUS IS ON THE ASSESSEE TO PROVE THE IDENTITY OF THE DONOR AND HIS CAPACITY TO MAKE GIFT WHICH THE ASSESSEE HAS FAILED TO PROVE. THE ASSESSING OFFICE R ALSO RELIED ON THE JUDGEMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN T HE CASE OF LAL CHAND KALRA V CIT (1981) 22 CTR (P&H)135. THE ASSESSING OFFICER C ONCLUDED THAT WHY A STRANGER WOULD GIFT TO A PERSON WHEN THERE IS NO OC CASION TO MAKE THE GIFT. HE, THEREFORE, MADE THE ADDITION OF RS. 5 LAKHS TREATIN G THE SAME AS INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES. 6. ON APPEAL, THE CIT(A) CONFIRMED THE ADDITION FOR THE REASONS STATED IN PARA 5.1 OF THE IMPUGNED ORDER. 7. AFTER HEARING LD. REPRESENTATIVES OF BOTH THE PA RTIES AT LENGTH I FIND THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE REVE NUE AND AGAINST THE ASSESSEE BY THE DECISION OF HON'BLE JURISDICTIONAL HIGH COUR T IN THE CASE OF JASPAL SINGH VS CIT (2007) 290 ITR 306 (P&H), WHEREIN IT HAS BEE N HELD THAT MERE IDENTIFICATION OF THE DONOR AND SHOWING THE MOVEMEN T OF THE GIFT AMOUNT THROUGH BANKING CHANNEL IS NOT ENOUGH TO PROVE GENU INENESS OF THE GIFT. THE ASSESSEE IS REQUIRED TO ESTABLISH THAT THE DONOR HA D THE MEANS AND THE GIFT WAS GENUINE, FOR NATURAL LOVE AND AFFECTION. THE FACTS OF THE PRESENT CASE ARE ALMOST SIMILAR TO THE FACTS OF THE CASE OF JASPAL SINGH VS . CIT REFERRED TO ABOVE. RESPECTFULLY FOLLOWING THE JUDGEMENTS OF THE JURISD ICTIONAL HIGH COURT IN THE CASE OF JASPAL SINGH V CIT AND IN THE CASE OF LAL C HAND KALRA V CIT (SUPRA), I DO NOT FIND ANY INFIRMITY IN THE FINDINGS OF THE LO WER AUTHORITIES ON THIS ISSUE. 5 8. THE NEXT LIMB OF THE GROUND NO.2 OF THE APPEAL IS THAT REASONS FOR REOPENING OF THE ASSESSMENT ARE DIFFERENT FROM TH E BASIS ON WHICH ADDITION WAS MADE BY THE ASSESSING OFFICER. SHRI SURJIT SINGH B HADU, LD. COUNSEL SUBMITTED THAT ASSESSING OFFICER HAD REOPENED THE ASSESSMENT BY ISSUING NOTICE U/S 148 OF THE ACT ON THE GROUND THAT THE ASSESSEE HAD RECEIVE D HAWALA PAYMENT OF RS. 2,50,625/- FROM SHRI N.K. GARG, C.A. AND THEREON HA D ESCAPED ASSESSMENT. THE COUNSEL FOR THE ASSESSEE STATED THAT ASSESSING OFFI CER, HOWEVER, WHILE PASSING REASSESSMENT ORDER HAD MADE THE ADDITION OF ANOTHER AMOUNT I.E. RS. 2.5 LAKHS EACH AS APPEARING THE BANK ACCOUNT OF THE ASSESSEE WITHOUT ANY ADDITION HAVING MADE ON THE GROUND ON THE BASIS OF WHICH REASSESSME NT HAVE BEEN INITIATED. IT IS OBSERVED THAT THE ISSUE IS SQUARELY COVERED IN F AVOUR OF THE REVENUE AND AGAINST THE ASSESSEE BY THE DECISION OF HON'BLE JUR ISDICTIONAL HIGH COURT IN THE CASE OF MAJINDER SINGH KANG V CIT AND ANOTHER (2012 ) 344 ITR 358 (P&H) WHEREIN ON SIMILAR FACTS AND CIRCUMSTANCES THE HON' BLE HIGH COURT HELD AS UNDER:- WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO THE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE AND DO NOT FIND ANY MERIT IN THE SAME. EXPLANATION 3 TO SECTION 147 HAS BEEN INSERTED BY T HE FINANCE (NO. 2) ACT, 2009, RETROSPECTIVELY WITH EFFECT FROM APRIL 1, 1989. IT READS THUS : '147. INCOME ESCAPING ASSESSMENT.. . . EXPLANATION 3.FOR THE PURPOSE OF ASSESSMENT OR REASSESSMENT UNDER THIS SECTION, THE ASSESSING OFFI CER MAY ASSESS OR REASSESS THE INCOME IN RESPECT OF ANY ISS UE, WHICH HAS ESCAPED ASSESSMENT, AND SUCH ISSUE COMES TO HIS NOTICE SUBSEQUENTLY IN THE COURSE OF THE PRO CEEDINGS UNDE R THIS SECTION, NOTWITHSTANDING THAT THE REASONS FOR SUCH ISSUE HAVE NOT BEEN INCLUDED IN THE REASONS RECORDED UNDER SUB - SECTION (2) OF SECTION 148.' A PLAIN READING OF EXPLANATION 3 TO SECTION 147 CL EARLY DEPICTS THAT THE ASSESSING OFFICER HAS POWER TO MAK E ADDITIONS EVEN ON THE GROUND ON WHICH REASSESSMENT NOTICE MIG HT NOT HAVE BEEN ISSUED IN CASE DURING THE REASSESSMENT PR OCEEDINGS, HE ARRIVES AT A CONCLUSION THAT SOME OTHER INCOME H AS ESCAPED ASSESSMENT WHICH COMES TO HIS NOTICE DURING THE COU RSE OF PROCEEDINGS FOR REASSESSMENT UNDER SECTION 148 OF T HE ACT. THE PROVISION NOWHERE POSTULATES OR CONTEMPLATES TH AT IT IS 6 ONLY WHEN THERE IS SOME ADDITION ON THE GROUND ON W HICH REASSESSMENT HAD BEEN INITIATED, THAT THE ASSESSING OFFICER CAN MAKE ADDITIONS ON ANY OTHER GROUND ON THE BASIS OF WHICH INCOME MAY HAVE ESCAPED ASSESSMENT. THE REASSESSMEN T PROCEEDINGS, THUS, IN THE PRESENT CASE CANNOT BE HE LD TO BE VITIATED. 13. REFERRING TO THE JUDGMENT OF THIS COURT IN ATLA S CYCLE INDUSTRIES' CASE [1989] 180 ITR 319 (P&H) AND THE RAJASTHAN HIGH COURT IN SHRI RAM SINGH'S CASE [2008] 306 ITR 343 , IT MAY BE NOTICED THAT THESE WERE THE JUDGMENTS RENDER ED BY THE COURTS PRIOR TO THE INSERTION OF EXPLANATION 3 TO S ECTION 147 OF THE ACT. IN VIEW OF THE INSERTION OF EXPLANATION 3 TO SECTION 147 BY THE FINANCE (NO. 2) ACT, 2009, WITH EFFECT F ROM APRIL 1, 1989, THE AFORESAID JUDGMENTS DO NOT ADVANCE THE CA SE OF THE ASSESSEE ANY LONGER. 9. IN THE ABOVE DECISION THE HON'BLE HIGH COURT HEL D THAT ASSESSING OFFICER HAS POWER TO MAKE ADDITIONS EVEN ON THE GROUND ON W HICH REASSESSMENT NOTICE MIGHT NOT HAVE BEEN ISSUED IN CASE DURING REASSESSM ENT PROCEEDINGS, HE ARRIVES AT A CONCLUSION THAT SOME OTHER INCOME HAS ESCAPED ASSESSMENT WHICH COMES TO HIS NOTICE DURING THE COURSE OF PROCEEDINGS FOR REA SSESSMENT UNDER SECTION 148 OF THE ACT. RESPECTFULLY FOLLOWING THE RATIO LAID DOWN BY THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF MAJINDER S INGH KANG VS CIT (SUPRA), I HOLD THAT REOPENING OF THE ASSESSMENT WAS VALID AND , THEREFORE, GROUND RAISED BY THE ASSESSEE IN THIS APPEAL DESERVES TO BE REJECTED . 10. IN VIEW OF THE ABOVE, I DO NOT SEE ANY MERIT IN THE APPEAL FILED BY THE ASSESSEE AND THEREFORE, THE SAME IS DISMISSED. ITA NO. 1103/CHD/2014 (ASSESSMENT YEAR 2002-03) 11. THE APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT(A), PATIALA DATED 29.9.2014 RELATING TO ASSESSMENT YEAR 2002-0 3. 12. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOL LOWING GROUNDS:- 1. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) H AS ERRED BOTH IN FACTS AND IN LAW WHILE PASSING THE ORDER. 7 2. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) H AS ERRED IN APPLYING PROVISIONS OF SECTION 271(1)(C), WHICH IS CLEARLY NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. 3. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) H AS ERRED IN HOLDING THAT ASSESSEE HAS CONCEALED THE INCOME AND HAS FILED IN ACCURATE PARTICULARS. 4. THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) H AS FAILED TO RECORD SATISFACTION DURING THE COURSE OF ASSESSMENT PROCEEDINGS EITHER IN RESPECT OF CONCEALMENT OF ANY INCOME OR F URNISHING OF INACCURATE PARTICULARS OF SUCH INCOME WHICH IS MAND ATORY UNDER THE LAW. 5. THAT THE LD. A.O. HAS ERRED IN IMPOSING PENALTY OF RS. 1,53,000/- U/S 271(1)(C) WITHOUT APPRECIATING THE FACTS AND DE SPITE THE COMPLETE DETAILS OF IDENTITY AND GENIUSES OF CREDIT S ARE VERIFIABLE FROM INCOME TAX AND WEALTH TAX RETURNS. 6. THAT APART FROM REJECTING THE EXPLANATION RENDERED BY THE ASSESSEE APPELLANT, NO OTHER POSITIVE MATERIAL HAS BEEN BROUGHT ON RECORD TO HOLD THAT THERE IS ANY CONCEAL THIS AC TION OF IDENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME WARR ANTING IMPOSITION OF PENALTY U/S 271(1)(C) OF THE ACT. 13. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT ASSESSEE HAD SHOWN GIFTS OF RS. 2,50,000/- EACH RECEIVED BY THE MINOR SONS FROM SHRI CHANDER BHAN AND SHRI KISHORI LAL GUPTA RESPECTIVELY BUT ASSESSEE HAS FA ILED TO FILE THE CONFIRMATION FROM THE DONORS AND ALSO COULD NOT PRODUCED THEM. T HERE WAS NO DIRECT OR INDIRECT RELATIONSHIP OF THE ASSESSEE WITH THE DONO RS. FURTHER, SUMMONS ISSUED TO BOTH THE DONORS U/S 131 OF THE ACT WERE RECEIVED BACK UNSERVED. ACCORDINGLY, THE ASSESSING OFFICER ADDED GIFTS AS U NEXPLAINED INCOME OF THE ASSESSEE RELYING ON THE JUDGEMENT OF JURISDICTIONA L HIGH COURT IN THE CASES OF JASPAL SINGH V CIT IN (2007) 290 ITR 306 (P&H) AND LAL CHAND KALRA V CIT (1981) 22 CTR (P&H)135. THE ASSESSING OFFICER IMPO SED A PENALTY OF RS. 1,43,032/- U/S 271(1)(C) OF THE ACT AND THE CIT(A) UPHELD THE ORDER OF ASSESSING OFFICER. 8 14. I HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALS O PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED THAT IDENTICAL ISSUE IN THE CASE OF THE WIFE OF THE ASSESSEE HAS BEEN DECIDED BY SMC CHANDIGARH BENCH OF THE TRIBUNAL VIDE ORDER DATED 27.7.2015 IN PARAS 19 TO 21, WHEREIN IT WAS HELD THAT ISSUE IS SQUARELY COVERED IN FAVOUR OF THE REVENUE AND AGAIN ST THE ASSESSEE BY REPLYING ON THE DECISION OF HON'BLE JURISDICTIONAL HIGH COUR T IN THE CASE OF CIT VS. DEEP CHAND (2011) 336 ITR 292 (P&H). THE RELEVANT PARAS I.E. 19 TO 21 OF THE ORDER OF THE TRIBUNAL DATED 27.7.2015 ARE REPRODUCED BELO W:- 19. I HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE AL SO PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED THAT THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE REVENUE AND AGAINST THE AS SESSEE BY THE DECISION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. DEEP CHAND (2011) 336 ITR 292 (P&H) WHEREIN THE FACTS STATED B Y THE HON'BLE COURT ARE AS FOLLOWS (PAGE 293):- THE FACTS, IN BRIEF, NECESSARY FOR ADJUDICATION AS NARRATED IN THE APPEAL, ARE THAT DURING THE ASSESSMENT YEAR UND ER CONSIDERATION, THE ASSESSEE HAD RECEIVED A GIFT AMO UNTING TO RS. 1,75,000 ON PAYMENT OF AN EQUAL AMOUNT IN CASH, ALONG WITH PREMIUM FOR ARRANGING THAT GIFT. DURING PROCEE DINGS UNDER SECTION 148 OF THE ACT INITIATED AGAINST THE ASSESSEE, THE AMOUNT EQUAL TO THE AMOUNT OF THE GIFT, I.E., R S. 1,75,000 AND RS. 17,500 ON ACCOUNT OF PREMIUM AT THE RATE OF 10 PER CENT. WERE ADDED TO THE INCOME OF THE ASSESSEE. THE COMMISSIONER OF INCOME-TAX (APPEALS) (IN SHORT 'THE CIT(A)'), CONFIRMED THE ORDER OF THE ASSESSING OFFI CER WHEREAS THE TRIBUNAL ACCEPTED THE APPEAL OF THE ASS ESSEE AND DELETED THE PENALTY, VIDE ORDER DATED SEPTEMBER 22, 2005. MEANWHILE PROCEEDINGS UNDER SECTION 271(1)(C) OF TH E ACT WERE ALSO INITIATED AGAINST THE ASSESSEE WHEREBY A PENALTY OF RS. 82,000 WAS IMPOSED ON THE ASSESSEE. THE ASSESSE E PREFERRED APPEAL AGAINST IMPOSITION OF PENALTY. THE COMMISSIONER OF INCOME-TAX (APPEALS) CANCELLED THE PENALTY IMPOSED, VIDE ORDER DATED OCTOBER 26, 2005. THE APP EAL CARRIED BY THE REVENUE WAS DISMISSED BY THE TRIBUNA L VIDE ORDER UNDER APPEAL AND IT WAS OBSERVED THAT SINCE T HE ASSESSING OFFICER HAD NOT RECORDED HIS SATISFACTION BEFORE INITIATING THE PENALTY PROCEEDINGS, THE ORDER OF PE NALTY COULD NOT BE SUSTAINED. THE HON'BLE JURISDICTIONAL HIGH COURT HAS HELD AS U NDER:- THE POINT FOR CONSIDERATION IN THIS CASE IS, WHETH ER THE TRIBUNAL WAS JUSTIFIED IN DELETING THE PENALTY LEVI ED AGAINST THE ASSESSEE UNDER SECTION 271(1)(C) OF THE ACT. 9 7. THE GIFT AMOUNTING TO RS. 1,75,000 SAID TO HAVE BEEN RECEIVED BY THE ASSESSEE WAS HELD TO BE BOGUS. ONCE THAT IS SO, THE ONLY CONCLUSION IS THAT THE ASSESSEE HAD FU RNISHED INACCURATE PARTICULARS OF HIS INCOME AND THE ORDER OF THE TRIBUNAL DELETING THE PENALTY IS UNSUSTAINABLE IN L AW. ACCORDINGLY, IT IS HELD THAT THE ASSESSEE HAD CONCE ALED THE PARTICULARS OF INCOME AND, THUS, PENALTY WAS LIABLE TO BE LEVIED AGAINST HIM UNDER SECTION 271(1)(C) OF THE A CT. FURTHER, THE ISSUE REGARDING RECORDING OF SATISFACT ION FOR INITIATION OF PENALTY PROCEEDINGS IN THE COURSE OF ASSESSMENT PROCEEDINGS STANDS CONCLUDED AGAINST THE ASSESSEE I N THE JUDGMENT OF THIS COURT REPORTED IN CIT V. PEAREY LA L AND SONS (EP) LTD. [2009] 308 ITR 438 (P&H). 8. IN VIEW OF THE ABOVE, THE SUBSTANTIAL QUESTION O F LAW IS ANSWERED IN FAVOUR OF THE REVENUE AND THE APPEAL IS ALLOWED ACCORDINGLY. 20. IN VIEW OF THE DIRECT JUDGEMENT OF THE JURISDIC TIONAL HIGH COURT ON THE ISSUE AT HAND, I DO NOT FIND ANY MERIT IN THE S UBMISSIONS MADE ON BEHALF OF THE ASSESSEE BY SHRI SHRI SURJIT SINGH BH ADU, LD. COUNSEL. THE JUDGEMENT OF THE JURISDICTIONAL HIGH COURT IS BINDI NG UPON THIS BENCH OF THE TRIBUNAL. RESPECTFULLY FOLLOWING THE JUDGEMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V DEE P CHAND (SUPRA), I UPHOLD THE ORDER OF LD. CIT(A) AND THE APPEAL OF TH E ASSESSEE IS DISMISSED. 21. IN THE RESULT, APPEAL IS DISMISSED. RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL (S UPRA) FOR ASSESSMENT YEAR 2002-03 IN ITA NO. 1104/CHD/2014 ORDER DATED 27.7 .2015, THE APPEAL OF THE ASSESSEE IS DISMISSED. 15. IN THE RESULT, APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 27.07.2015 SD/- (H.L.KARWA) VICE PRESIDENT DATED : 27 TH JULY, 2015 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 10