Sri.K.V.Mathew, Cochin V. The ITO, Cochin

ITA 408/COCH/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86383 (ITAT-COCHIN)
• Duration Of Justice: 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2015
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 29-12-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 30-09-2014
• Court: TRIBUNAL
• Department Lawyers: K K JOHN
• Assessee Lawyers: C B M WARRIER
• Keywords: Gift; Source of fund; Corroborative evidences
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE S/SHRI N.R.S.GANESAN, JM AND CHANDRA POOJ ARI, AM I.T.A. NO.408/COCH/2014 ASSESSMENT YEAR : 2005-06 SHRI K.V. MATHEW, PHOENIX ENTERPRISES, MULLASSERY CANAL ROAD, KOCHI-682 011. [PAN: AEBPM 4915K] VS. THE INCOME TAX OFFICER, WARD- 2(3), ERNAKULAM. (ASSESSEE-APPELLANT) (REVENUE-RESPONDENT) ASSESSEE BY SHRI C.B.M. WARRIER, CA REVENUE BY SHRI K.K. JOHN, SR. DR DATE OF HEARING 29/12/2014 DATE OF PRONOUNCEMENT 09/01/2015 O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER DATED 27- 06-2014 PASSED BY THE CIT(A)-II, KOCHI, FOR THE ASS ESSMENT YEAR 2005-06. 2 THE GRIEVANCE OF THE ASSESSEE IN THIS APPEAL IS W ITH REGARD TO LEVY OF PENALTY OF RS.7,30,000/- U/S. 271(1)(C) OF THE I.T. ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASS ESSEE HAD DEPOSITED CASH IN EXCESS OF RS.10.00 LAKHS IN AN ACCOUNT MAINTAINED W ITH CITI BANK. ON ENQUIRY, IT WAS NOTICED THAT THE ASSESSEE DID NOT DISCLOSE THE SAID BANK ACCOUNT IN HIS I.T.A. NO.408/COCH/2014 2 INCOME TAX RECORD. IT WAS NOTICED THAT THE ASSESSE E HAD DEPOSITED RS.22,51,000/- IN THE SAVINGS BANK A/C WITH CITI BA NK FOR F.Y. 2004-05. HOWEVER, DURING THE ASSESSMENT PROCEEDINGS, THE ASS ESSING OFFICER REJECTED THE ASSESSEES CLAIM IN THE ABSENCE OF PROPER EVIDENCES . ACCORDING TO THE ASSESSING OFFICER, THE ASSESSEES CLAIM REGARDING THE AVAILAB ILITY OF FUNDS FROM HIS SISTER WHO IS AT ABROAD WAS NOT MAINTAINABLE. THE ASSESSE E COULD NOT PROVE THAT THE MONEY RECEIVED FROM HIS SISTER ROUTED THROUGH HIS B ROTHER HAS ACTUALLY BEEN MADE AVAILABLE TO HIM FOR MAKING DEPOSITS. ACCORDIN GLY, THE ASSESSING OFFICER TREATED THE CASH CREDITS AMOUNTING TO RS.22,51,000/ - AS UNEXPLAINED AND ADDED TO THE TOTAL INCOME U/S. 69 OF THE ACT. IN THIS CO NTEXT THE ASSESSING OFFICER RELIED ON THE JUDGMENT OF THE DELHI HIGH COURT IN THE CASE OF ACIT VS. RAJEEV TANDON REPORTED IN 294 ITR 435 WHEREIN IT WAS HELD THAT U NLESS THE BANK STATEMENTS ARE SUPPORTED BY ANY OTHER CORROBORATE EVIDENCE TO ESTABLISH THE FINANCIAL CAPACITY OF THE DONORS THE BANK STATEMENT DO NOT PR OVE THE CREDITWORTHINESS OF THE DONORS FOR SHOWING THAT THEY ARE FINANCIALLY SO UND FOR MAKING SUCH GIFTS BECAUSE THE BANK STATEMENTS MERELY INDICATE THE MOV EMENT OF THE FUNDS AND NOT THE CREDITWORTHINESS OF THE ACCOUNT HOLDER. IN THE ABOVE CIRCUMSTANCES OF THE CASE, THE ASSESSING OFFICER HELD THAT THE ASSES SEE HAS CONCEALED INCOME TO THE EXTENT OF RS.22,51,000/- IN THE AGGREGATE WITHI N THE MEANING OF SECTION 271(1)(C) AND EXPLANATION 1 THERETO. ACCORDINGLY, HE LEVIED A PENALTY OF RS.7,30,000/- U/S. 271(1)(C) OF THE I.T. ACT. I.T.A. NO.408/COCH/2014 3 4. ON APPEAL, THE CIT(A) UPHELD THE FINDINGS OF THE ASSESSING OFFICER BY OBSERVING THAT SINCE THE QUANTUM ADDITIONS HAVE ALS O BEEN CONFIRMED BY THE TRIBUNAL VIDE ORDER IN I.T.A. NO.48/COCH/2010 DATED 06/01/2012, IT IS EVIDENT THAT ALTHOUGH THE ASSESSEE CONTENDED THAT CASH CRED ITS AMOUNTING TO RS.22,51,000/- WERE GIVEN BY HIS SISTER BUT NEITHER AT ASSESSMENT AND APPELLATE STAGES NOR DURING THE PENALTY PROCEEDINGS, THE ASSE SSEE COULD SUBSTANTIATE HIS PLEA BY FURNISHING ANY SUPPORTING EVIDENCE TOWARDS SOURCE OF THESE CASH CREDITS. ACCORDING TO THE CIT(A), TO THIS EXTENT THE ASSESSE E HAS FURNISHED INACCURATE PARTICULARS OF INCOME AND HAS CONCEALED HIS INCOME. HENCE, THE CIT(A) CONFIRMED THE PENALTY OF RS.7,30,000/- LEVIED BY TH E ASSESSING OFFICER U/S. 271(1)(C) OF THE ACT. THUS, BOTH THE TAX AUTHORIT IES WERE NOT CONVINCED WITH THE EXPLANATION OF THE ASSESSEE. AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 5.1 WITH REGARD TO THE AVAILABILITY OF SOURCES FOR MAKING DEPOSITS IN THE ACCOUNT MAINTAINED WITH CITI BANK, THE LD. AR SUBMI TTED THAT THE SAID FUNDS WERE OBTAINED FROM HIS SISTER, WHO IS RESIDING IN ROME I N ITALY. IT WAS FURTHER SUBMITTED THAT THE SAID FUNDS WERE INITIALLY RECEIV ED BY THE BROTHER OF THE ASSESSEE WHO HAD EARLIER TAKEN MONEY FROM THE ASSES SEE. IT WAS CLAIMED THAT THE BROTHER OF THE ASSESSEE RETURNED THE FUNDS OUT OF THE AMOUNT RECEIVED FROM THEIR SISTER. WITH REGARD TO THE OCCASION FOR MAKI NG THE IMPUGNED PAYMENT, THE ASSESSEE EXPLAINED THAT HIS SISTER HAD AGREED TO SP ONSOR THE MEDICAL EDUCATIONAL EXPENSES OF THE ASSESSEES DAUGHTER, WHO IS PURSUIN G THE COURSE IN CZECK REPUBLIC. THE LD. AR SUBMITTED THAT THE ASSESSEE H AS FILED A COPY OF BANK I.T.A. NO.408/COCH/2014 4 STATEMENT OF SB A/C. NO. 5-000552-463 WITH CITI BAN K, KOCHI, STATING THAT MOST OF THE AMOUNTS HAVE BEEN DEPOSITED IN THE FORM OF C HEQUES AND THE TRANSACTIONS WERE GENUINE. THE LD. AR ALSO FILED A COPY OF BANK ACCOUNT WHEREIN THE ASSESSEE HAS WITHDRAWN MONEY ON TWO OCCASIONS IN CO NNECTION WITH EDUCATIONAL EXPENSES OF HIS DAUGHTER. 5.2 THE LD. AR SUBMITTED THAT THE AMOUNT RECEIVED F ROM THE ASSESSEES SISTER OR BROTHER CANNOT BE REASON FOR LEVY OF PENALTY U/S . 271(1)(C) OF THE ACT. FURTHER, THE LD. AR SUBMITTED THAT BECAUSE QUANTUM ADDITION WAS CONFIRMED BY THE HIGHER FORUM, IT CANNOT BE REASON FOR SUSTAININ G THE PENALTY. ACCORDING TO THE LD. AR, THE QUANTUM ADDITION AND PENALTY MATTERS ST AND ON DIFFERENT FOOTING. ACCORDING TO HIM, BOTH THE PROCEEDINGS REQUIRE TO B E EXAMINED INDEPENDENTLY AND IT SHOULD STAND ON ITS OWN MERIT. HE SUBMITTED THAT THE ASSESSING OFFICER MADE ADDITION U/S. 69A OF THE I.T. ACT. HOWEVER, T HE LD. AR SUBMITTED THAT IN THE PENALTY ORDER, THE ASSESSING OFFICER HAS STATED THAT THE ADDITION WAS MADE TO THE TOTAL INCOME OF THE ASSESSEE U/S. 69 OF THE I.T . ACT. ACCORDING TO HIM, THE ASSESSING OFFICER WAS NOT SURE WHETHER THE ADDITION WAS MADE U/S. 69A OR 69 OF THE I.T. ACT. ACCORDING TO THE LD. AR, IF THERE IS CONFUSION IN THE MIND OF THE ASSESSING OFFICER, PENALTY CANNOT BE LEVIED. I.T.A. NO.408/COCH/2014 5 6.. ON THE OTHER HAND, THE LD D.R SUBMITTED THAT THE CO NFIRMATION LETTERS ARE SELF SERVING DOCUMENTS AND FURTHER THE ASSESSEE HAS FAILED TO MAKE PROPER RECONCILIATION OF THE RECEIPTS VIS--VIS THE AMOUNT CLAIMED TO HAVE BEEN TRANSACTED BETWEEN THE BROTHER AND SISTER OF THE AS SESSEE. 6.1 THE LD. DR SUBMITTED THAT THERE IS CONCEALMENT OF INCOME AS WELL AS FURNISHING OF INACCURATE PARTICULARS OF INCOME ON T HE PART OF THE ASSESSEE AND THE ADDITION IS ALSO CONFIRMED AT THE LEVEL OF THE HIGH COURT AND HENCE, THE LEVY OF PENALTY SHOULD BE CONFIRMED. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ECORD. THERE WAS A DEPOSIT OF RS.22,51,000/- INTO THE ASSESSEES BANK ACCOUNT. HOWEVER, THE ASSESSEE HAS FAILED TO ESTABLISH THE NEXUS BETWEEN EACH INDIVIDUAL DEPOSIT INTO THE ASSESSEES BANK ACCOUNT WITH RECEIPT OF THAT AM OUNT FROM THE ASSESSEES SISTER. IT IS THE DUTY OF THE ASSESSEE TO EXPLAIN T HE SOURCE FROM WHOM IT WAS RECEIVED BY THE ASSESSEE. THE ASSESSEE HAS FAILED TO PRODUCE ANY EVIDENCE TO PROVE THAT THE ABOVE AMOUNT WAS RECEIVED FROM HIS S ISTER. THE ASSESSEE HAS TAKEN THE PLEA THAT THE FUNDS HAVE BEEN ROUTED THRO UGH ONE OF HIS BROTHER. IT WAS STATED BY THE ASSESSEE IN HIS LETTER DATED 14/1 2/2007 THAT THE FUNDS WERE WITHDRAWN FROM THE SAVINGS BANK ACCOUNT TO ADVANCE TO HIS BROTHER AND WHEN SUCH AMOUNTS WERE RETURNED BY HIS BROTHER, THE SAME WERE DEPOSITED INTO HIS ACCOUNT. HOWEVER, NO EVIDENCE WAS SHOWN REGARDING THE ORIGINAL SOURCE FROM I.T.A. NO.408/COCH/2014 6 WHERE IT WAS RECEIVED INSPITE OF GIVING ENOUGH OPPO RTUNITY TO THE ASSESSEE TO PROVE THE SOURCE OF FUNDS, EXCEPT STATING THAT HIS BROTHER MR. THOMAS K. GEORGE HAD RECEIVED AMOUNTS FROM HIS SISTER IN ITALY THROU GH WESTERN UNION MONEY TRANSFER WHICH WAS CREDITED TO THE POST OFFICE SAVI NG BANK ACCOUNT OF MR. THOMAS GEORGE AND RAJI THOMAS. THE AMOUNTS THAT WER E RECEIVED BY THEM FROM HIS SISTER IN 2003-04 WERE USED AS TEMPORARY FUND A DJUSTMENTS WHICH GOT ROUTED IN HIS SAVINGS BANK ACCOUNT. THE ASSESSEE DID NOT F URNISH ANY PROOF REGARDING HIS CLAIM OTHER THAN PRODUCING A COPY OF THE POST O FFICE SAVINGS BANK ACCOUNTS PASS BOOK BEFORE THE ASSESSING OFFICER. IN VIEW OF THIS, THE ASSESSING OFFICER FOUND THAT THERE WAS NO PROOF TO SUBSTANTIATE SUCH CONTENTION. WHEN THE AMOUNTS IN THE SAVINGS BANK ACCOUNT OF THE ASSESSEE REMAINED UNEXPLAINED, DEFINITELY, THE ASSESSING OFFICER WAS JUSTIFIED IN PASSING THE IMPUGNED ORDER. 7.1 EVEN THOUGH THE ONUS OF THE ASSESSEE DURING THE ASSESSMENT PROCEEDINGS IS CONFINED TO SUBMITTING EVIDENCE REGARDING IDENTI TY OF THE CREDITOR, CREDITWORTHINESS OF THE CREDITOR AND GENUINENESS OF THE TRANSACTION, HOWEVER, IN PENALTY PROCEEDINGS, IT IS NOT THE CASE THAT ENTIRE BURDEN IS ON THE DEPARTMENT TO SHOW THAT WHAT WAS ADDED WAS IN FACT CONCEALED I NCOME OF THE ASSESSEE. EXPLANATION TO S. 271(1)(C) PROVIDES FOR DEEMING ADD ITION AS CONCEALED INCOME OR INCOME IN RESPECT OF WHICH INACCURATE PARTICULARS H AVE BEEN FURNISHED PROVIDED CONDITIONS LAID DOWN IN EITHER OF THE CLAUSES ARE S ATISFIED. IF THE ASSESSEE DOES NOT FURNISH ANY EXPLANATION, IN RESPECT OF ADDITION MADE, OR EXPLANATION I.T.A. NO.408/COCH/2014 7 FURNISHED IS FOUND FALSE, THEN CLAUSE (A) OF EXPLAN ATION 1 CAN BE INVOKED. WHERE THE ASSESSEE FURNISHES AN EXPLANATION IN RESPECT OF ADDITION MADE, THEN AS PER CLAUSE (B) OF EXPLANATION 1, THE ADDITION WOULD BE D EEMED AS CONCEALED INCOME OR INCOME IN RESPECT OF WHICH INACCURATE PARTICULAR S HAVE BEEN FURNISHED, PROVIDED FOLLOWING THREE CONDITIONS ARE SATISFIED: (I) ASSESSEE IS NOT ABLE TO SUBSTANTIATE HIS EXPLAN ATION. (II) EXPLANATION FURNISHED BY HIM IS NOT BONA FIDE. (III) ALL THE MATERIAL FACTS, NECESSARY FOR ASSESSM ENT, OR IN RESPECT OF EXPLANATION, ARE NOT FURNISHED BY HIM. IF ASSESSEE IS ABLE TO S HOW PRIMA FACIE THAT HE IS NEITHER HIT BY CLAUSE (A) OR BY CLAUSE (B) OF EXPLAN ATION 1, THEN ONUS WILL SHIFT TO THE ASSESSING OFFICER THAT CONDITIONS LAID DOWN THE REIN ARE SATISFIED. FOR THE SAKE OF CONVENIENCE WE PRODUCE SEC. 271(1)( C) AS UNDER: 271. (1) IF THE ASSESSING OFFICER OR THE CIT(A) OR THE CIT IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT, IS SATISFIED THAT ANY P ERSON (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME, HE MAY DIRECT THAT SUCH PERSON SHAL L PAY BY WAY OF PENALTY: (I) ******** (II) ******** (III) IN THE CASES, REFERRED TO IN CLAUSE (C), IN A DDITION TO ANY TAX PAYABLE BY HIM, A SUM WHICH SHALL NOT BE LESS THAN, BUT WHICH SHALL NOT EXCEED THREE TIMES, THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF THE CONCEALMENT OF PARTICULARS OF HIS INCOME OR THE FURNISHING OF INACCURATE PARTI CULARS OF SUCH INCOME. EXPLANATION 1. WHERE IN RESPECT OF ANY FACTS MATER IAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION WHICH HE IS NOT ABLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXPLANATION IS BONA FI DE AND THAT ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN I.T.A. NO.408/COCH/2014 8 DISCLOSED BY HIM, THEN, THE AMOUNT ADDED OR DISALLO WED IN COMPUTING THE TOTAL INCOME OF SUCH PERSON AS A RESULT THEREOF SHALL, FO R THE PURPOSE OF CLAUSE (C) OF THIS SUB-SECTION, BE DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. 7.2 IN RESPECT OF EXPLANATION 1 THE DEEMING FICTION IS RAISED AND ADDED/DISALLOWED AMOUNT IS TREATED AS THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. EXPLANATION 1(B) WILL NOT APPLY IF THE EXPLANATION, GIVEN BY THE ASSESSEE IN THE QUANTUM PROCEEDINGS WHICH HE CO ULD NOT SUBSTANTIATE IN THOSE PROCEEDINGS WAS (I) BONA FIDE AND (II) HE HAD DISCLOSED ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME. IN CASES WHERE EXPLANATION WAS OFFERED, BUT WAS REJECTED AS IT COU LD NOT BE SUBSTANTIATED BY THE ASSESSEE, THERE WOULD ARISE NO PRESUMPTION OF CONCE ALMENT OF THE PARTICULARS OF INCOME THAT WAS ADDED OR DISALLOWED IF SUCH ASSESSE E CAN SHOW THAT THE SAID EXPLANATION OFFERED BY HIM WAS A BONA FIDE ONE AND THAT HE HAD DISCLOSED ALL FACTS RELATING TO SUCH EXPLANATION AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME DURING THE QUANTUM PROCEEDINGS. FOR BRINGIN G THE CASE UNDER THE MAIN PROVISION THE ONUS IS PUT ON THE DEPARTMENT TO PROV E THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHE D INACCURATE PARTICULARS THEREOF. TO BRING THE CASE OF THE ASSESSEE WITHIN I TS MISCHIEF, MERE REJECTION OF ASSESSEES CLAIM WOULD NOT BE SUFFICIENT AND THE AS SESSEE CANNOT BE HELD GUILTY OF CONCEALMENT. IT IS BY VIRTUE OF EXPLANATION THAT THE ASSESSING OFFICER CAN RAISE THE PRESUMPTION ABOUT ADDITIONS MADE TO THE TOTAL I NCOME OR DEDUCTION DISALLOWED THAT IT REPRESENTS ASSESSEES CONCEALED INCOME OR THE INCOME IN I.T.A. NO.408/COCH/2014 9 RESPECT OF WHICH ASSESSEE HAS FURNISHED INACCURATE PARTICULARS. WHEN WE EXAMINE PART-B OF EXPLANATION 1 CAREFULLY THEN WE AR E OF THE VIEW THAT THE WORDS NOT SUBSTANTIATE IS OPPOSITE TO THE WORD VAGUE OR FANCIFUL OR WITHOUT ANY FOUNDATION OR BASIS. THE PHRASE TO PROVE THAT SU CH EXPLANATION IS BONA FIDE MEANS THAT THE ASSESSEE HAS TO SHOW THAT CIRCUMSTAN CES EXISTED WHEREBY HE HAS MADE THE CLAIM, OR THAT, AS IN THE PRESENT CASE, HE HAD IN FACT RECEIVED THE AMOUNT FROM HIS SISTER BUT HER CREDENTIALS CANNOT B E ESTABLISHED. IT HAS TO BE PROVED THAT FAILURE OF THE ASSESSEE TO FURNISH EVID ENCE IN SUPPORT OF THE CLAIM WAS BEYOND HIS CONTROL. THE ASSESSEE HAS TO PROVE O R FURNISH EVIDENCE THAT CIRCUMSTANCES EXISTED WHICH DISABLED HIM TO FURNISH EVIDENCE IN SUPPORT OF HIS CLAIM. THE THIRD CONDITION IS THAT ALL THE FACTS R ELATING TO THE CLAIM AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAS BEEN DIS CLOSED BY HIM. IT MEANS THAT ALL THE MATERIAL FACTS WHICH ARE RELEVANT FOR COMPU TATION OF INCOME OF THE ASSESSEE HAVE BEEN DISCLOSED TO THE DEPARTMENT NOT MERELY DURING THE ASSESSMENT PROCEEDINGS BUT IN THE RETURN OF INCOME. 7.3 WHEN WE EXAMINE THE FACTS OF THE PRESENT CASE, WE NOTICE THAT THE ASSESSEE DID NOT FURNISH ANY EVIDENCE ABOUT THE SOU RCE OF DEPOSIT. THE EXPLANATION FURNISHED BY THE ASSESSEE CANNOT BE SAI D TO BE SUBSTANTIATED. IT IS APPARENTLY VAGUE, FANCIFUL AND WITHOUT ANY FOUNDATI ON OR BASIS. IN RESPECT OF SECOND CONDITION, IN EXPLANATION 1(B), WE ARE OF THE VIEW THAT EXPLANATION FURNISHED BY THE ASSESSEE IS NOT BONA FIDE IN RESPE CT OF FUNDS RECEIVED FROM HIS I.T.A. NO.408/COCH/2014 10 SISTER TOWARDS HIS DAUGHTERS MEDICAL EDUCATION ROU TED THROUGH HIS BROTHERS BANK ACCOUNT. THIS EXPLANATION IS IN THE NATURE OF CONTRADICTION LEADING TO THE BELIEF THAT IT IS FALSE. THERE IS NO EVIDENCE THAT THE ASSESSEE REALLY MADE ANY ATTEMPT TO OBTAIN NECESSARY CONFIRMATION TO ESTABLI SH THAT THE FUNDS WERE RECEIVED FROM THE ASSESSEES SISTER OR BROTHER . T HERE ARE NO DETAILS ABOUT THE FUNDS WHETHER THEY WERE RECEIVED FROM THE ASSESSEE S SISTER OR BROTHER. THE ASSESSEE HAS TO FURNISH NECESSARY EVIDENCE TO PROVE THE IDENTITY OF HIS SISTER OR HER CAPACITY TO MAKE SUCH AN ADVANCE TO THE ASSESSE E. THE INGREDIENT ABOUT A BONA FIDE CLAIM IS THAT THE ASSESSEE SHOULD BE ABLE TO SHOW OR PROVE SOME INTERMEDIATE STEPS IN THE WHOLE PROCESS OF TRANSACT ION. IF IT IS NOT ABLE TO GIVE EVIDENCE IN RESPECT OF ANY STEP IN THE WHOLE PROCES S OF TRANSACTION THEN IT CAN BE SAID THAT EXPLANATION FURNISHED BY THE ASSESSEE IS NOT BONA FIDE. IT IS NOTHING BUT BALD CLAIM. THERE IS NOTHING TO SHOW THAT THE DETAILS OF FUNDS AS CLAIMED BY THE ASSESSEE HAVE ACTUALLY COME FROM THE ASSESSEES SISTER. THE ALLEGED FAILURE ON THE PART OF THE ASSESSEE TO PROVE THE TRANSACTIO N AS ACTUAL TRANSACTION WOULD ATTRACT PENALTY U/S. 271(1)(C) OF THE ACT. THUS, T HE EXPLANATION FURNISHED BY THE ASSESSEE CANNOT BE TREATED AS BONA FIDE. 7.4. REGARDING THE THIRD CONDITION THAT ALL THE FAC TS RELATING TO THE EXPLANATION AND COMPUTATION OF INCOME HAS BEEN DISCLOSED BY THE ASSESSEE, WE ARE OF THE VIEW THAT IN THE PRESENT CASE, DETAILS OF THE IDENT ITY OF THE CREDITOR AND THE TERMS AND CONDITIONS UNDER WHICH THE FUNDS HAVE BEEN RECE IVED BY THE ASSESSEE FROM I.T.A. NO.408/COCH/2014 11 HIS SISTER HAVE NOT BEEN PROVIDED. IN VIEW OF THIS , ALL THE THREE INGREDIENTS LAID DOWN IN EXPLANATION 1(B) ARE FULLY SATISFIED, AND TH EREFORE THE LOWER AUTHORITIES CAN DEEM THE ADDITION AS INCOME IN RESPECT OF WHICH THE ASSESSEE HAS CONCEALED THE INCOME OR FURNISHED INACCURATE PARTICULARS OF I NCOME. BEING SO, THE PENALTY LEVIED U/S. 271(1)(C) IS JUSTIFIED. 8.. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 09-01-2015 SD/- SD/- (N.R.S.GANESAN) (CHANDRA POOJARI) JUDICIAL MEMBER ACC OUNTANT MEMBER PLACE: KOCHI DATED: 9TH JANUARY, 2015 GJ COPY TO: 1. SHRI K.V. MATHEW, PHOENIX ENTERPRISES, MULLASSERY CANAL ROAD, KOCHI-682 011. 2. THE INCOME TAX OFFICER, WARD-2(3), ERNAKULAM. 3. THE COMMISSIONER OF INCOME-TAX(APPEALS)-II, KOCH I, 4. THE COMMISSIONER OF INCOME-TAX, KOCHI 5. D.R., I.T.A.T., COCHIN BENCH, COCHIN. 6. GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COC HIN