BHAGWAN RUYAL, Jaipur V. ITO, Sikar

ITA 376/JPR/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5050 (ITAT-JAIPUR)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2010-2011
• Appeal Filed On: 11-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P BHATEJA CIT DR DHK
• Assessee Lawyers: MOHAN LAL SARAN
• Keywords: Peak credit
• Section: 143(3)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPUN] YS[KK LNL; DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 376/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2010-11 SHRI SHIV BHAGWAN RUYAL C/O SHRI MAHENDRA SHARMA DO LIC OF INDIA, ASHOK VIHAR BRANCH, SIKAR CUKE VS. THE ITO WARD- 1 SIKAR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO .: AOCPR 0547 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY: SHRI MOHAN LAL SARAN, ADVOCATE JKTLO DH VKSJ LS@ REVENUE BY:SHRI O.P. BHATEJA, ADDL.CIT - DR LQUOKBZ DH RKJH[K@ DATE OF HEARING : 14/09/2016 ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 26 /09/2016 VKNS'K@ ORDER PER BHAGCHAND, AM THE ASSESSEE HAS FILED AN APPEAL AGAINST THE ORDER OF THE LD. CIT(A)-3, JAIPUR DATED 20-01-2016 FOR THE ASSESSM ENT YEAR 2010-11 WHEREIN THE ASSESSEE IS AGGRIEVED THAT THE LD. CIT (A) ERRED IN CONFIRMING THE PENALTY OF RS. 31,971/- U/S 271(1)(C) OF THE AC T LEVIED BY THE ASSESSING OFFICER. 2.1 BRIEF FACTS OF THE CASE ARE THAT THE ASSESSMENT IN THIS CASE WAS COMPLETED U/S 143(3) OF THE ACT ON 15-12-2012 AT A TOTAL INCOME OF ITA NO. 376/JP/2016 SHRI SHIV BHAGWAN RUYAL VS. ITO,WARD- 1, SIKAR . 2 RS. 3,85,200/- AS AGAINST THE RETURNED INCOME OF RS . 55,902/-. THE CASE OF THE ASSESSEE WAS SELECTED UNDER CASS FOR THE REASON THAT THE ASSESSEE HAD DEPOSITED A SUM OF RS. 15,65,310/- IN HIS SAVING BA NK ACCOUNT NO.763010100006422 WITH AXIC BANK LTD. DURING THE Y EAR UNDER CONSIDERATION. THE AO DURING THE ASSESSMENT PROCEED INGS FURTHER OBSERVED THAT ASSESSEE VOLUNTARILY SUBMITTED A COPY OF HIS SAVING BANK ACCOUNT WITH SBI WHEREIN CASH DEPOSIT OF RS.7,42,00 0/- WAS MADE BY THE ASSESSEE DURING THE RELEVANT PERIOD. THE AO MADE EN QUIRY FROM THE ASSESSEE AS TO THE SOURCE OF CASH DEPOSITS IN HIS S AVING BANK ACCOUNTS FOR WHICH THE ASSESSEE STATED THAT IT PERTAINED TO SOME OF HIS RELATIVE WHO LIVED AND WORKED IN GUWAHATI (ASSAM) AND THEY ARE N OT SO EDUCATED TO OPEN AN ACCOUNT IN THE BANK. THEREFORE, THEY USED T O DEPOSIT THEIR EARNINGS IN THE ASSESSEE'S BANK ACCOUNT AND THE ASS ESSEE WAS WITHDRAWING THE AMOUNTS AND HANDING OVER THEIR FAMILIES WHO WER E STAYING IN NEARBY VILLAGES OF SIKAR TOWN. THE ASSESSEE SUBMITTED THAT AROUND RS. 2.00 LACS WAS DEPOSITED BY HIS FATHER FOR HIS HIGHER STUDIES. THE ASSESSEE FURTHER SUBMITTED THAT THE INCOME OF ALL THESE PERSONS WAS BELOW TAXABLE LIMIT. IT IS NOTED THAT THE ASSESSEE GOT FILED THE AFFIDAVIT BY SMT. BIMLESH DEVI ON BEHALF OF HER HUSBAND SHRI KHUDA RAM. THE STATEMENT S OF THE RELATIVES WERE ALSO RECORDED AND THESE PERSONS AS MENTIONED I N THE ASSESSMENT ITA NO. 376/JP/2016 SHRI SHIV BHAGWAN RUYAL VS. ITO,WARD- 1, SIKAR . 3 ORDER HAD CONFIRMED THE CASH DEPOSITS IN ASSESSEE'S BANK ACCOUNT. THE AO HOWEVER, DOUBTED THE CREDITWORTHINESS OF THE SHRI M ANGAL CHAND, FATHER OF THE ASSESSEE AND SHRI BALBIR SINGH, UNCLE OF THE ASSESSEE. THE AO FURTHER NOTED THAT SOME OF THE PERSONS WERE WORKING AS TRUCK DRIVER, PLUMBER, ELECTRICIAN, WAGE-EARNER FROM MOTOR PART S HOP OR KIRANA SHOP OR WORKING AS SALESMAN. THUS THE ADDITION OF RS. 3,29, 300/- WAS MADE BY THE AO IN THE INCOME OF THE ASSESSEE AND PENALTY PR OCEEDINGS WERE INITIATED FOR FILING INACCURATE PARTICULARS OF INCO ME. THE AO THUS LEVIED THE PENALTY OF RS. 31,971/-. 2.2 BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATT ER BEFORE THE LD. CIT(A) WHO HAD CONFIRMED THE ACTION OF THE AO BY OB SERVING AS UNDER:- 4.3 I HAVE CONSIDERED THE FACTS OF THE CASE, PENA TY ORDER AND APPELLANTS WRITTEN SUBMISSION. AS THE DE POSITS HAVE BEEN MADE IN THE BANK ACCOUNT OF THE ASSESSEE, THE SOURCE OF WHICH COULD NOT BE EXPLAINED BEFORE THE O R ME, THIS TANTAMOUNTS TO CONCEALMENT OF INCOME. THEREFORE, I AM IN AGREEMENT WITH THE AO THAT THERE IS A CONCEALMENT O F PARTICULARS OF INCOME. THE PEAK THEORY BY THE A.R. AND TAKEN BY THE AO IN HIS ORDER IS NOT ESTIMATION BUT A METHOD OF CALCULA TION TO ARRIVE AT THE INCOME CONCEALED AND NOT DECLARED FOR TAXATION. SINCE A METHOD HAS BEEN APPLIED, IT CANNOT BE CALLE D ESTIMATION. THE AMOUNT OF CONCEALMENT HAS BEEN AMPL Y PROVED BY THE AO. THE CASE LAWS CITED ARE NOT APPLI CABLE AS THE FACTS DIFFERENT THEREIN. THEREFORE, THE PENALTY U/S 271(1) IMPOSED BY THE AO IS SUSTAINED. ITA NO. 376/JP/2016 SHRI SHIV BHAGWAN RUYAL VS. ITO,WARD- 1, SIKAR . 4 2.3 DURING THE COURSE OF HEARING, THE LD. AR OF THE ASSESSEE PRAYED THAT LD. CIT(A) HAD WRONGLY CONFIRMED THE PENALTY WHICH SHOULD NOT BE IMPOSED ON THE ASSESSEE. THUS THE SAME SHOULD BE DE LETED. THE ASSESSEE FILED THE WRITTEN SUBMISSION TO THIS EFFECT WHICH H AS ALSO BEEN TAKEN INTO CONSIDERATION. 2.4 THE LD. DR RELIED ON THE ORDERS OF THE LOWER AU THORITIES. 2.5 I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS NOTED THAT THE AO HAD AC CEPTED THE MAJORITY OF THE CASH DEPOSITS AS GENUINE RATHER ACCEPTING THE P EAK CREDIT IN THE BANK ACCOUNT OF THE ASSESSEE. THUS THE ASSESSEE HAS NOT BEEN GIVEN CREDIT FOR CASH WITHDRAWAL FROM THE BANK ACCOUNT FOR EXPLAININ G THE DEPOSITS ON VARIOUS DATES. THE ONLY ADDITION WAS MADE ON PEAK A MOUNT. THE ASSESSEE HAD SUBMITTED AN EXPLANATION THAT HIS ILLITERATE RE LATIVES ARE LIVING IN GAUHATI (ASSAM) AND THEY ARE ENGAGED IN PETTY ACTIV ITIES FOR EARNING INCOME AND THEY WERE DEPOSITING THE AMOUNTS IN ASSE SSEE'S ACCOUNT. THEY HAD ALSO CONFIRMED THE SAME IN THEIR STATEMENTS REC ORDED DURING ASSESSMENT PROCEEDINGS. TAKING INTO CONSIDERATION A LL THE FACTS AND CIRCUMSTANCES OF THE CASE, IT IS NOTED THAT THE REV ENUE HAS FAILED TO ESTABLISH THAT THE EXPLANATIONS PROVIDED BY THE ASS ESSEE WAS NEITHER ITA NO. 376/JP/2016 SHRI SHIV BHAGWAN RUYAL VS. ITO,WARD- 1, SIKAR . 5 GENUINE NOR BONA FIDE. THEREFORE, I DIRECT TO DELET E THE PENALTY CONFIRMED BY THE LD. CIT(A). THUS THE SOLITARY GROUND OF THE ASSESSEE IS ALLOWED. 3.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED ORDER PRONOUNCED IN THE OPEN COURT ON 26 /09 /2016. SD/- HKKXPUN ( BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 26 /09/ 2016 *MISHRA VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI SHIV BHAGWAN RUYAL, SIKAR 2. IZR;FKHZ@ THE RESPONDENT- THE ITO, WARD- 1, SIKAR 3. VK;DJ VK;QDRVIHY@ CIT(A). 4. VK;DJ VK;QDR@ CIT, 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 376/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ @ ASSISTANT. REGISTRAR