Nand Lal Popli, Shimla V. DCIT, Chandigarh

ITA 49/CHANDI/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 5672 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 11-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RITISH PARMAR

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B, CHANDIGARH . . , , BEFORE SHRI N.K. SAINI, VICE PRESIDENT & SHRI SANJAY GARG, JUDICIAL MEMBER ./ ITA NO. 49/CHD/2019 ! / ASSESSMENT YEAR : 2010-11 SHRI NAND LAL POPLI, HEMANT LODGE, MURRAY, FIELD ESTATE, NAV BAHAR, SHIMLA '# THE DCIT, CENTRAL CIRCLE-II, CHANDIGARH $ % ./PAN NO: ABLPP3524A $&/ APPELLANT ()$& /RESPONDENT *+ , - /ASSESSEE BY : SH. VISHAL MOHAN, ADVOCATE , - / REVENUE BY : SH. RITISH PARMAR, SR DR . / , +0% /DATE OF HEARING : 23.09.2019 12! , +0% / DATE OF PRONOUNCEMENT : 30.09. 2019 / ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE ASSESS EE AGAINST THE ORDER DATED 25.10.2018 OF THE COMMISSIONER OF INCOM E TAX (APPEALS)-3, GURGAON [HEREINAFTER REFERRED TO AS CIT(A)] AGI TATING THE LEVY AND CONFIRMATION OF THE PENALTY U/S 271 (1)(C) OF THE I NCOME TAX ACT, 1961 (IN SHORT 'THE ACT'). 2 ITA NO.49/CHD/2019- SHRI NAND LAL POPLI, SHIMLA 2. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE ASSESSMENT PROCEEDINGS, ASSESSING OFFICER NOTICED THAT DURING THE YEAR UNDER CONSIDERATION A SUM OF RS. 2 LACS WAS CREDITED INTO THE ACCOUNT OF THE ASSESSEE. ON BEING ASKED TO EXPLAIN IN THIS RESPECT , THE ASSESSEE EXPLAINED THAT THE SAID AMOUNT WAS RECEIVED BY THE ASSESSEE A S RETURN OF LOAN AMOUNT FROM THE NEPHEW OF HIS WIFE SHRI VIJAY WADHWA. THE ASSESSEE ALSO FILED THE CONFIRMATION FROM THE SAID SHRI VIJAY WADHWA IN THIS RESPECT AND ALSO FURNISHED HIS PAN NUMBER. HOWEVER, THE ASSESSING OF FICER INSISTED FOR FILING OF THE BANK ACCOUNT STATEMENT AND INCOME-TAX RETURN OF SHRI VIJAY WADHWA BUT THE ASSESSEE COULD NOT PRODUCE THE AFORE SAID DOCUMENTS. THE ASSESSING OFFICER, THEREFORE, HELD THAT THE ASSESSE E COULD NOT PROVE THE GENUINENESS OF THE TRANSACTIONS AND ACCORDINGLY ADD ED THE SAID AMOUNT OF RS. 2 LACS INTO THE INCOME OF THE ASSESSEE AS UNEXP LAINED CREDITS. HE ALSO INITIATED PENALTY PROCEEDINGS AND IMPOSED THE IMPUG NED PENALTY OF RS. 61,800/-. THE ASSESSEE IN THE QUANTUM PROCEEDINGS REMAINED UNSUCCESSFUL AS THE ADDITION WAS CONFIRMED UPTO THE LEVEL OF THE INCOME TAX APPELLATE TRIBUNAL. THE ASSESSEE ALSO CHALLENGED THE IMPOSITI ON OF THE AFORESAID PENALTY AMOUNT BEFORE THE LD. CIT(A) BUT REMAINED U NSUCCESSFUL. HENCE, THE PRESENT APPEAL HAS BEEN FILED BEFORE THIS TRIBU NAL. 3 ITA NO.49/CHD/2019- SHRI NAND LAL POPLI, SHIMLA 3. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND HAV E ALSO GONE THROUGH THE RECORD. THE CASE OF THE ASSESSEE IS THAT THE SA ID AMOUNT OF RS. 2 LACS WAS RECEIVED BY THE ASSESSEE FROM SHRI VIJAY WADHWA AS RETURN OF LOAN. TO PROVE THE IDENTITY OF THE CREDITOR AND GENUINENE SS OF THE TRANSACTIONS, THE ASSESSEE FILED CONFIRMATION FROM SHRI VIJAY WAD HA, WHEREIN, HIS PAN NUMBER WAS ALSO MENTIONED. HOWEVER, THE ASSESSEE CO ULD NOT CONVINCE SHRI VIJAY WADHWA TO SUPPLY HIS BANK ACCOUNT STATEM ENT AND INCOME-TAX RETURN, THEREFORE, THE ADDITION OF THE AFORESAID AM OUNT OF RS. 2 LACS WAS MADE BY THE ASSESSING OFFICER INTO THE INCOME OF TH E ASSESSEE WHICH WAS FURTHER CONFIRMED BY THE ITAT ALSO. HOWEVER, IN TH IS APPEAL AGAINST THE LEVY OF PENALTY U/S 271 (1)(C) OF THE ACT, THE COUN SEL FOR THE ASSESSEE HAS SUBMITTED THAT THOUGH THE ASSESSEE COULD NOT PROVE TO THE SATISFACTION OF THE INCOME-TAX AUTHORITIES ABOUT THE AFORESAID RECE IPT OF RS. 2 LACS FROM SHRI VIJAY WADHWA AS RETURN OF LOAN AMOUNT, HOWEVER , THE CASE OF THE ASSESSEE HAS ALSO NOT BEEN DISAPPROVED BY THE ASSES SING OFFICER. THE SMALL AMOUNT OF RS. 2 LACS WAS CREDITED INTO THE AC COUNT OF THE ASSESSEE BY WAY OF TWO TRANSACTIONS OF DEPOSIT OF RS. 1 LACS EA CH. THE ASSESSEE HAD FILED CONFIRMATION FROM SHRI VIJAY WADHWA AS WELL A S HIS PAN NUMBER. HOWEVER, THE FURTHER DOCUMENTS / DETAILS SOUGHT BY THE ASSESSING OFFICER WERE NOT IN THE POSSESSION OF THE ASSESSEE. THE ASS ESSEE COULD ONLY REQUEST SHRI VIJAY WADHWA TO SUPPLY THE REQUIRED DOCUMENTS I.E. HIS BANK ACCOUNT 4 ITA NO.49/CHD/2019- SHRI NAND LAL POPLI, SHIMLA STATEMENT AND INCOME-TAX RETURN. HOWEVER, THE ASSES SING OFFICER HAD GOT POWERS UNDER THE INCOME TAX ACT TO SUMMON SHRI VIJA Y WADHWA AND PROCURE THE NECESSARY DETAILS. THE ASSESSING OFFICE R FOR THE REASONS BEST KNOWN TO HIM DID NOT EXERCISE HIS POWERS TO DO SO B UT ADDED THE SAID AMOUNT OF RS. 2 LACS AS UNEXPLAINED INCOME OF THE A SSESSEE. UNDER THE CIRCUMSTANCES, THOUGH THE AMOUNT OF RS. 2 LACS WAS ADDED INTO THE INCOME OF THE ASSESSEE ON PRESUMPTION BASIS AS THE ASSESSE E COULD NOT FURNISH THE REQUISITE DOCUMENTS TO THE SATISFACTION OF THE ASSE SSING OFFICER, HOWEVER, THE CASE OF THE ASSESSEE WAS NOT DISAPPROVED BY THE ASSESSING OFFICER BY SUMMONING SHRI VIJAY WADHWA OR OTHERWISE PRODUCING ANY EVIDENCE FROM WHICH IT COULD BE INFERRED THAT THE ASSESSEES CASE WAS FALSE. IT IS ALSO NOT A CASE WHERE THE ASSESSEE HAD NOT PRODUCED ANY EVIDEN CE AT ALL TO PROVE THE GENUINENESS OF THE TRANSACTIONS, RATHER, THE ASSESS EE FILED CONFIRMATION FROM SHRI VIJAY WADHWA AND ALSO HIS PAN NUMBER. 4. IN OUR VIEW, THE CIRCUMSTANCES DO NOT WARRANT LE VY OF PENALTY U/S 271 (1)(C) OF THE ACT IN THIS CASE. THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS UPENDRA V MITHANI, ITA (L) NO. 1860 OF 2009 ORDER DATED 5.08.2009 HELD THAT IF THE ASSESSEE GIVES AN EXPLAN ATION WHICH IS UNPROVED BUT NOT DISPROVED, I.E. IT IS NOT ACCEPTED BUT CIRC UMSTANCES DO NOT LEAD TO THE REASONABLE AND POSITIVE INFERENCE THAT THE ASSE SSEES CASE IS FALSE, THE 5 ITA NO.49/CHD/2019- SHRI NAND LAL POPLI, SHIMLA VIEW TAKEN BY THE TRIBUNAL AS NOT A FIT CASE OF LE VY OF PENALTY U/S 271 (1)(C) OF THE ACT WAS A REASONABLE AND POSITIVE. IN VIEW OF THE ABOVE, TAKING INTO ACCOUNT THE PECUL IAR FACTS AND CIRCUMSTANCES OF THIS CASE, WE DO NOT FIND IT A FIT CASE OF LEVY OF PENALTY U/S 271 (1)(C) OF THE ACT AND THE PENALTY SO LEVIED IS ACCORDINGLY ORDERED TO BE DELETED. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS HEREBY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30.09.2019. SD/- SD/- ( . . / N.K. SAINI) ( !' # / SANJAY GARG) $%& / VICE PRESIDENT '( / JUDICIAL MEMBER DATED : 30. 09.2019 .. 3 , (+45 65!+ / COPY OF THE ORDER FORWARDED TO : 1. $& / THE APPELLANT 2. ()$& / THE RESPONDENT 3. . 7+ / CIT 4. . 7+ ( )/ THE CIT(A) 5. 58 (+9 , 0 9 , :;<= / DR, ITAT, CHANDIGARH 6. < >/ / GUARD FILE 3 . / BY ORDER, ? / ASSISTANT REGISTRAR 6 ITA NO.49/CHD/2019- SHRI NAND LAL POPLI, SHIMLA