Smt. Ashima Arora, New Delhi V. ITO, New Delhi

ITA 5100/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 98312 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 24-11-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 15-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Gift; Income from undisclosed sources; Onus to prove
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D , NEW DELHI BEFORE SHRI J. SUDHAKAR REDDY, ACCOUNTANT MEMBER AND SHRI C.M. GARG, JUDICIAL MEMBER ITA NO. 5100 /DEL/201 4 AY: 200 5 - 06 ASHIMA ARORA VS. ITO, WARD 25(3) 9 A, NORTH WEST AVENUE NEW DELHI PUNJABI BAGH NEW DELHI 110 026 PAN: ADRPA 0415 D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI K.SAMPATH, ADV. RESPONDENT BY : SH. ASHISH MOHANTY, SR.D.R. ORDER PER J.SUDHAKAR REDDY, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE LD.COMMISSIONER OF INCOME TAX (APPEALS) - XXIV, NEEW DELHI DATED 23.6.2014 PERTAINING TO THE ASSESSMENT YEAR (A.Y.) 2005 - 06, WHEREIN PENALTY LEVIED U/S 271(1)(C ) OF THE INCOME TAX ACT 1961 (THE ACT) WAS CONFIRMED. 2. FACTS IN BRIEF: - THE ASSESSEE IS AN INDIVIDUAL. THE A.O. IN ORDER PASSED U/S 143(3) OF THE ACT R.W.S. 148 OF THE ACT, HAS MADE AN ADDITION OF UNACCOUNTED INCOME, WHICH, AS PER THE A.O. WAS DISGUISED AS A GIFT. THIS ADDITION WAS CONFIRMED BY THE ITAT DE LHI BENCHES SMC - 2 IN ITA 5099/DEL/14 FOR THE A.Y. 2005 - 06 VIDE ORDER DT. 11.9.2015. THE A.O. LEVIED PENALTY U/S 271(1)(C ) OF THE INCOME TAX ACT 1961 ON 24.7.2013. THE LD.CIT(A) CONFIRMED THE SAME. 2 3. AGGRIEVED THE ASSESSEE IS IN APPEAL BEFORE US . 4. LD .COUNSEL FOR THE ASSESSEE SHRI K.SAMPATH SUBMITS THAT THE GIFT IS A GENUINE GIFT AND IT IS ONLY BECAUSE THE ASSESSEE COULD NOT DISCHARGE THE BURDEN OF PROOF THAT LAY ON HER TO PROVE THE TRANSACTION TO THE SATISFACTION OF THE REVENUE AUTHORITIES THAT THE A DDITION WAS MADE. HE SUBMITS THAT GIFTS WERE RECEIVED FROM SHRI RAMESH AGGARWAL AND SHRI DILIP ARORA AND THAT COPY OF GIFT DEED, AFFIDAVIT OF THE DONOR, INCOME TAX RETURNS OF THE DONOR, AND CONFIRMATIONS WERE FURNISHED IN SUPPORT OF THE GENUINENESS OF THE TRANSACTION. THUS HE SUBMITTED THAT THE ASSESSEE HAS NEITHER CONCEALED PARTICULARS OF INCOME NOR FURNISHED INACCURATE PARTICULARS OF INCOME. HE FURTHER SUBMITTED THAT THE A.O. IS NOT CLEAR O F THE CHARGE AGAINST HIM I.E. WHETHER IT IS CONCEALMENT OF IN COME OR WHETHER IT IS FURNISHING OF INACCURATE PARTICULARS OF INCOME AND UNDER THOSE CIRCUMSTANCES THE PENALTY CANNOT BE LEVIED. HE RELIED ON THE DECISION OF THE ITAT DELHI D BENCH IN THE CASE OF SHRI RATAN LAL CHAWLA VS I T O IN ITA NO.5454/DEL/2004 ORDER DT. 29 TH JULY,2005 AS WELL AS THE DECISION OF THE JAIPUR SMC BENCH IN THE CASE OF SUSHEEL KUMAR MODI VS ACIT (2013) 58 SOT 155 (JAIPUR TRIBUNAL). 5. THE LD.D.R. SUBMITTED THAT THERE ARE NO ADDITIONAL FACTS BROUGHT OUT BY THE ASSESSEE AND THAT THE GIFTS WERE HELD AS NON - GENUINE AND THAT THE ASSESSEE HAS CONCEALED INCOME BY INTRODUCING BOGUS GIFTS. ON MERITS, HE RELIED ON THE ORDER OF THE LOWER AUTHORITIES AND SUBMITTED THAT THE PENALTY HAS TO BE UPHELD. 6. AFTER HEARING RIVAL CONTENTI ONS WE FIND THAT THE LD.CIT(A) AT PAGE 6 OBSERVED THAT THE ASSESSEE HAS FURNISHED A COPY OF INCOME TAX RETURNS AND AFFIDAVITS OF THE DONOR IN SUPPORT OF HER CLAIM TO HAVE RECEIVED GIFTS OF RS.10 LAKHS. HE FURTHER OBSERVED THAT THE ASSESSEE DID NOT MAK E EFFORTS TO PRODUCE THE DONORS BEFORE THE A.O. FOR VERIFICATION. HE ALSO FOUND THAT THERE WERE CERTAIN DEFECTS IN THE GIFT DEED PRODUCED BY THE ASSESSEE AND ALSO THA T THE DONORS HAVE MEAGRE INCOME AND HENCE THE CAPACITY TO GIFT IS NOT PROVED. 6.1. I N O UR VIEW THIS IS A CASE WHERE, IN THE VIEW OF THE REVENUE AUTHORITIES, THE ASSESSEE COULD NOT DEMONSTRATE BEYOND DOUBT, THE 3 GENUINENESS OF THE TRANSACTION. ADDITION HAS BEEN MADE AS THE ASSESSEE COULD NOT PRODUCE THE DONORS BEFORE THE A.O. THE INCOME OF THE DONORS WERE EXAMINED BUT NOT THEIR ASSET BASE OR SOLVENCY. NOT BEING ABLE TO PROVE A CLAIM TO THE HILT IS DIFFERENT FROM MAKING A FALSE AND FAB RICATED CLAIM. BASIC DOCUMENTS LIKE CONFIRMATION LETTERS, I.T. DETAILS, AFFIDAVITS ETC. W ERE FILED. NO A DVERSE MATERIAL WAS COLLECTED BY THE A.O. THE EXPLANATION OF THE ASSESSEE WAS REJECTED AS NOT CONVINCING. UNDER THESE CIRCUMSTANCES WE ARE OF THE CONSIDERED VIEW THAT PENALTY U/S 271(1)(C ) OF THE INCOME TAX ACT 1961 CANNOT BE LEVIED ON THE GROUND THAT THERE WAS CONCEALMENT OF INCOME. NOT BEING ABLE TO PROVE A CLAIM TO THE SATISFACTION OF THE REVENUE CAN BE A GOOD CASE FOR ADDITION BUT NOT TO LEVY PENALTY. THUS WE DELETE THE PENALTY LEVIED U/S 271(1)(C ) OF THE INCOME TAX ACT 1961 AS CONFIRMED BY THE LD.CIT(A) AND ALLOW THE APPEAL OF THE ASSESSEE. 7. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST DECEMBER ,2015. SD/ - SD/ - (C.M.GARG) (J.SUDHAKAR REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: THE 31 ST DECEMBER, 2015 *MANGA 4 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT; 2.RESPONDENT; 3.CIT; 4.CIT(A); 5.DR; 6.GUARD FILE BY ORDER ASST. REGISTRAR