N.Venkatachalam, CHENNAI V. ITO, Namakkal

ITA 566/CHNY/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8883 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 4 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-08-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 09-06-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 19-03-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SULOCHANA
• Assessee Lawyers: A S SRIRAMAN
• Keywords: Unexplained cash credit; Difference of opinion
• Section: 143(3); 133A; 147

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , D B ENCH, CHENNAI . . . , . , & BEFORE SHRI N.R.S.GANESAN, JUDICIAL MEMBER AND SHRI A.MOHAN ALANKAMONY, ACCOUNTANT MEMBER ./ I.T.A.NO.566/MDS/2015 ( / ASSESSMENT YEAR: 2004-05) MR. N.VENKATACHALAM, 87B, THURAIYUR ROAD, NAMAKKAL-638 004. VS THE ASSISTANT COMMISSIONER OF INCOME TAX, WARD-I(1) NAMAKKAL . PAN:AEAPV1594E ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR.A.S.SRIRAMAN, ADVOCATE /RESPONDENT BY : MS.SULOCHANA, JCIT /DATE OF HEARING : 9 TH JUNE,, 2016 /DATE OF PRONOUNCEMENT : 16 TH AUGUST, 2016 / O R D E R PER A. MOHAN ALANKAMONY, AM: THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS),SALEM DATED 30.12.2014 IN ITA NO.40/200 9-10 PASSED UNDER SECTION 271(1)(C) OF THE ACT. 2. THE ASSESSEE HAS RAISED SEVERAL GROUNDS IN ITS APPEALS, HOWEVER, THE CRUX OF THE ISSUE IS AS FOLLO WS:- THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN SUSTAINING THE PENALTY LEVIED BY THE LEARNED ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE ACT WITH RESPECT TO THE ADDITION MADE FOR RS. 20,78,873/- TOWARDS 2 ITA NO.566/MDS/2015 INTRODUCTION OF CAPITAL IN PARTNERS ACCOUNT, RS.1,50,000/- AND RS.6,79,000/- TOWARDS UNEXPLAINED CREDIT 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL ENGAGED IN BUSINESS IN THE CAPACITY AS M ANAGING PARTNER OF M/S. ANDAVAR & CO. ALONG WITH FOUR PARTN ERS FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2004-0 5. A SURVEY UNDER SECTION 133A OF THE ACT WAS CONDUCTED IN THE BUSINESS PREMISES OF M/S. ANDAVAR & CO. ON 04.08.20 05 AND BOOKS OF ACCOUNTS AND OTHER DOCUMENTS WERE IMPOUNDE D AND SWORN STATEMENTS WERE RECORDED FROM THE ASSESSE E. THEREAFTER THE ASSESSMENT WAS COMPLETED UNDER SECTI ON 147 R.W.S 143(3) OF THE ACT ON 16.12.2008, WHEREIN THE LEARNED ASSESSING OFFICER MADE THE FOLLOWING ADDITIONS AFTE R ELABORATELY DISCUSSING THE ISSUES IN HIS ORDER:- I) UNEXPLAINED CREDIT BALANCE IN THE PARTNERS CURR ENT ACCOUNT RS.20,78,873/- II) UNEXPLAINED CASH CREDIT RS. 6,79,000/- 4. FROM THE MATERIALS PRODUCED BEFORE US, IT APPEAR S THAT THE ASSESSEE HAS NOT PREFERRED ANY APPEAL AGAINST T HE ORDERS OF THE LEARNED ASSESSING OFFICER. SUBSEQUENTLY, THE LEARNED 3 ITA NO.566/MDS/2015 ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271( 1)(C) OF THE ACT . THE LEARNED COMMISSIONER OF INCOME TAX (A PPEALS) ALSO CONFIRMED THE ORDER OF THE PENALTY BECAUSE THE ASSESSEE COULD NOT PRODUCE ANY EVIDENCE TO JUSTIFY THE CREDI T BALANCE STANDING IN HIS NAME IN THE CURRENT ACCOUNT OF THE PARTNERSHIP FIRM OF THE ASSESSEE AND CREDIT BALANCE OF RS. 7,6 9,000/-. IT IS EVIDENT FROM THE ORDER OF THE LEARNED ASSESSING OFFICER THAT THE ASSESSEE HAS AGREED FOR THE ADDITIONS MADE BY T HE LEARNED ASSESSING OFFICER. FURTHER, WHILE CONFIRMIN G THE ORDER OF THE LEARNED ASSESSING OFFICER, THE LEARNED COMMI SSIONER OF INCOME TAX (APPEALS) HAD RELIED IN THE DECISIONS OF THE HONBLE APEX COURT IN THE CASE OF K.P.MADHUSOODAN V S. CIT REPORTED IN 251 ITR 99 AND THE DECISION OF THE HON BLE JURISDICTIONAL HIGH COURT IN THE CASE OF P.GOVINDAS AMY VS. CIT REPORTED IN 244 ITR 510 WHEREIN IT WAS HELD THA T PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS TO BE LEVIED EVEN WHEN THE ASSESSEE HAD AGREED FOR THE ADDITIONS. FURTHER BEFORE US THE ASSESSEE OR HIS REPRESENTATIVE COULD NOT BRING OUT ANY MATERIALS TO ESTABLISH THAT THE ADDITIONS ARE MADE AND SUSTAINED DUE TO POSSIBLE INTERPRETATIONS OF THE AC T OR DIFFERENCE OF OPINION. IT IS PURELY A FACTUAL CASE WHERE THE 4 ITA NO.566/MDS/2015 ASSESSEE WAS NOT ABLE TO ESTABLISH THE GENUINESS OF THE CREDITS IN THE ASSESSEES CURRENT ACCOUNT IN THE PA RTNERSHIP FIRM WHERE THE ASSESSEE IS THE MANAGING PARTNER AND OTHER CREDITS IN HIS BOOKS OF ACCOUNTS WHICH IS ELABORATE LY DISCUSSED IN THE ORDERS OF THE REVENUE. THESE ASPEC TS OF THE CASE LEAD TO THE FACT THAT THE ASSESSEE HAS CONCEAL ED HIS INCOME. IN SUCH CIRCUMSTANCES, WE DO NOT FIND IT N ECESSARY TO INTERFERE WITH THE ORDER OF THE LEARNED COMMISSI ONER OF INCOME TAX (APPEALS). ACCORDINGLY WE HEREBY CONFIRM THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS). 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DIS MISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 16 TH AUGUST, 2016 SD/- SD/- ( . . . ) ( . ) (N.R.S.GANESAN) ( A.M OHAN ALANKAMONY ) # % / JUDICIAL MEMBER % / ACCOUNTANT MEMBER # /CHENNAI, ( /DATED 16 TH AUGUST, 2016 SOMU *+ ,+ /COPY TO: 1. APPELLANT 2. RESPONDENT 3. - () /CIT(A) 4. - /CIT 5. + 1 /DR 6. /GF .