Sh. Narendra Kumar Agarwal, New Delhi V. DCIT, New Delhi

ITA 4107/DEL/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 3978 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 27-04-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 22-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHEFALI SWROOP

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E NEW DELHI BEFORE SH. N.K.SAINI, ACCOUNTANT MEMBER AND SH.K.N.CHARY, JUDICIAL MEMBER ITA NO. 4107/DEL/2014 (ASSESSMENT YEAR: 2 009-10) ITA NO. 4108/DEL/2014 (ASSESSMENT YEAR: 2 009-10) ITA NO. 4109/DEL/2014 (ASSESSMENT YEAR: 2 009-10) APPELLANT BY SH. PANKAJ GARG, ADV. RESPONDENT BY M/S. SHEFALI SWROOP, CIT DR DATE OF HEARING 14 .0 9 .2017 DATE OF PRONOUNCEMENT .0 9 .2017 ORDER PER K.N.CHARY, JUDICIAL MEMBER ALL THESE THREE APPEALS RELATING TO AY 2009-10 ARE FILED CHALLENGING THE ORDERS DATED 19.05.2014 IN THE CASES OF THREE DIFFERENT AS SESSEES COVERED BY THE SEARCH OPERATIONS CARRIED OUT IN RAJDARBAR GROUP OF CASES ON 31.07.2008. FACTS ARE NARENDRA KUMAR AGARWAL, 5, CENTRAL AVENUE, 1 ST FLOOR, MAHARANI BAGH, NEW DELHI-110065. PAN-ADEPA3716G VS DCIT, CENTRAL CIRCLE-12, NEW DELHI-110055. (APPELLANT) (RESPONDENT) KISHORE KUMAR AGARWAL, B-308, NEW FRIENDS COLONY, NEW DELHI-110065. PAN-AFIPA5132Q VS DCIT, CENTRAL CIRCLE-12, NEW DELHI-110055. (APPELLANT) (RESPONDENT) HEMANT KUMAR AGARWAL, 70, NEHRU NAGAR, AGRA. PAN-ABHPA9867D VS DCIT, CENTRAL CIRCLE-12, NEW DELHI-110055. (APPELLANT) (RESPONDENT) ITA NO.4107- 4109/DEL/2015 PG. 2 IDENTICAL, AS SUCH WE PROCEED TO DISPOSE OF ALL THE SE THREE APPEALS BY WAY OF A COMMON ORDER. 2. BRIEFLY STATED FACTS ARE THAT PURSUANT TO THE SE ARCH AND SEIZURE OPERATION CARRIED OUT IN RAJDARBAR GROUP OF CASES ON 31.07.20 08 ALL THE THREE ASSESSEES INVOLVED IN THESE CASES FILED THEIR RETURN OF INCOM E AND THEY HAVE SURRENDERED A SUM OF RS.15 LACS EACH. LD. AO ACCEPTED THE SAME B UT PROCEEDED U/S 271AAA OF THE INCOME TAX ACT, 1961 (IN SHORT ACT) TO LEVY T HE PENALTY. THE ASSESSEES PREFERRED APPEALS BEFORE THE LD. COMMISSIONER OF IN COME TAX (APPEAL) [IN SHORT CIT(A)] AND BY WAY OF IMPUGNED ORDER, LD.CIT(A) D ISMISSED THE APPEALS. HENCE, THE ASSESSEES ARE BEFORE US IN THESE APPEALS PRAYIN G TO DELETE THE PENALTY. 3. IT IS THE ARGUMENT OF THE LD.AR THAT THE ASSESS EES MADE SURRENDER ONLY TO BUY PEACE OF MIND EVEN THOUGH NO INCRIMINATORY MATE RIAL WAS EVER FOUND DURING THE SEARCH AND ACCORDING TO HIM, THE ASSESSEES WERE ASSURED AT THE TIME OF SURRENDER THAT SUCH SURRENDER WILL NOT BE VISITED W ITH PENALTY. FURTHER, ACCORDING TO THE LD. AR, THE JEWELLERY SHOWN IN THE SURRENDER WAS NOT THE JEWELLERY FOUND DURING THE SEARCH BUT AS A MATTER OF FACT THOUGH TH ERE WAS NO NEED OF SURRENDER OF INCOME, THEY DISCLOSED THE INCOME ONLY TO BUY PEACE . THE ASSESSEE PAID TAX ON THE AMOUNT SURRENDERED AS SUCH THE PENALTY CANNOT BE LE VIED. LD.AR FURTHER ARGUED THAT NO QUERIES HAVE BEEN RAISED AS TO THE MANNER I N WHICH THE SURRENDERED AMOUNT WAS EARNED BY THE ASSESSEE AND THE AUTHORITI ES BELOW DID NOT STRAIN THEIR NERVE TO KNOW WHETHER REALLY THERE WAS ANY UNDISCLO SED INCOME AS SURRENDERED BY THE ASSESSEE, OR ONLY TO AVOID THE PROCEDURAL BATTL ES AND TO GAIN MENTAL PEACE, THE ASSESSEE MADE SUCH SURRENDER. ITA NO.4107- 4109/DEL/2015 PG. 3 4. PER CONTRA, IT IS THE SUBMISSION OF THE LD. DR T HAT AS RECORDED BY THE LD. CIT(A) VIDE PARAGRAPH NO.3.4 OF HIS ORDER, WHEN CAL LED UPON TO EXPLAIN THE MANNER IN WHICH THE UNDISCLOSED INCOME WAS DERIVED, THE AS SESSEE SIMPLY SUBMITTED A LETTER DATED 14.12.2010 WHEREBY MERELY GIVING THE B REAKUP FIGURES, THE ASSESSEE SURRENDERED RS.15,00,000/-. IT IS PLEADED THAT THE ASSESSEE IS ESTOPPED FROM CHANGING THE STAND AND SINCE HE HIMSELF INCLUDED RS .15,00,000/- IN THE RETURN OF INCOME, HE CANNOT TAKE A DIFFERENT PLEA. FOR THESE REASONS, LD. DR PRAYS TO DISMISS THE APPEAL. 5. FACTS BORNE OUT OF RECORD ARE ADMITTED. THE SEA RCH TOOK PLACE ON 31.07.2008 AND THE ASSESSEE SUBMITTED LETTERS DATED 14.12.2010 OFFERING RS.15,00,000/- TO TAX. RECORDS DOES NOT SPEAK THAT THE AUTHORITIES EVER QU ESTIONED THE ASSESSEE AS TO HOW THE SURRENDERED INCOME WAS DERIVED BY THE RESPECTIV E ASSESSEE. THE SURRENDER THROUGH LETTER DATED 14.12.2010 WAS ACCEPTED BY THE AO AS IT IS. 6. RELIANCE IS PLACED ON THE DECISION OF THE CO-ORD INATE BENCH OF THIS TRIBUNAL REPORTED IN THE DECISION OF DEVI DASS GARG VS DCIT, CENTRAL CIRCLE-12, NEW DELH I IN ITA NO.6122/DEL/2013 VIDE ORDER DATED 11.04.2016 WHICH IS ALSO A CASE R ELATING TO THE ASSESSEE COVERED BY THE SEARCH OPERATION CONDUC TED IN RAJDARBAR GROUP OF CASES WHEREIN THE PENALTY WAS DELETED ON THE GROUND THAT WHEN THE ASSESSEE FILED RETURN OF INCOME IN TERMS OF THE SURRENDER MADE AND WAS ACCEPTED BY THE AO WITHOUT RAISING ANY QUERIES, PENALTY U/S 271AAA IS NOT JUSTIFIED. FURTHER, RELIANCE WAS PLACED ON CIT VS SUDHIR JAIN [2014] 41 TAXMANN.COM 234 (DELHI HIGH COURT); NEERAT SINGHAL VS ACIT, CENTRAL CIRCLE, NEW DELHI [ 2013] 37 TAXMANN.COM 189 (ITAT, DELHI); PRAMOD KUMAR JAIN VS DCIT [2013] 33 TAXMANN .COM 651 (ITAT, CUTTACK); ACIT, CENTRAL CIRCLE VS MUNISH KUMAR GOYAL [ 2014] 45 TAXMANN.COM 563 (ITAT, ITA NO.4107- 4109/DEL/2015 PG. 4 CHANDIGARH); AND ACIT VS A.N.ANNAMALAISAMY (HUF) [2 013] 38 TAXMANN.COM 440 (ITAT, CHENNAI) F OR THE PRINCIPLE THAT WHERE THE ASSESSEE HAVING SUR RENDER CERTAIN INCOME IN THE COURSE OF SEARCH FILED RETURN WHEREIN THE SAID AMOUNT WAS DULY DISCLOSED AND THE TAXES WERE PAID ACCORDINGLY. FAC TS OF THE CASES ON HAND BEING SIMILAR, THE PRINCIPLE LAID DOWN IN THE ABOVE DECIS IONS IS APPLICABLE AND WHILE RESPECTFULLY FOLLOWING THE SAME, WE HOLD THE PENALT Y IN THIS MATTER U/S 271AAA OF THE ACT CANNOT BE SUSTAINED. WE, THEREFORE, DIRECT THE AO TO DELETE THE PENALTY. 7. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEE S ARE ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 09 TH OCTOBER, 2017. SD/- SD/- (N.K.SAINI) (K.N.CHAR Y) ACCOUNTANT MEMBER JUDICIAL MEMBER *AMIT KUMAR* DATE:-09.10.2017 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT AS SISTANT REGISTRAR ITAT NEW DELHI