Shri Rashik R. Kapuria, JAMNAGAR V. The Income Tax Officer, Ward-2(2), JAMNAGAR

ITA 571/RJT/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0127 (ITAT-RAJKOT)
• Duration Of Justice: 2 year(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 07-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: USHA N SHROTE
• Assessee Lawyers: CHETAN L AGRAWAL
• Keywords: Income from undisclosed sources

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH , RAJKOT BEFORE: SHRI S. S. GODARA, JUDICIAL MEMBER AND S H RI AMARJIT SINGH , ACCOUNTANT MEMBER [CONDUCTED THROUGH E - COURT AT AHMEDABAD] SHRI RASHIK R. KAPURIA, PLOT NO. 3527, ROAD NO. G , GIDC, PHASE - III, DARED, JAMNAGAR PAN: AOBPK0092H (APPELLANT) VS THE ITO, WARD 2(2 ), JAMNAGAR (RESPONDENT) REVENUE BY : S MT. USHA N. SHROTE , SR. D . R. ASSESSEE BY: S H RI CHETAN L. AGRAWAL , A.R. DATE OF HEARING : 03 - 10 - 2 016 DATE OF PRONOUN CEMENT : 21 - 10 - 2 016 / ORDER P ER : AMARJIT SINGH, ACCOUNTANT MEMBER : - THI S ASSESSEE S APPEAL FOR A.Y. 2009 - 10 , AR ISES FROM ORDER OF THE CIT(A) , JAMNAGAR DATED 06 - 08 - 2014 IN APPEAL NO. CIT(A) / JAM/4/13 - 04/515 , IN PROCEEDINGS UNDER SECTION 271(1 ) (C) OF THE INCOME TAX ACT , 1961; IN SHORT THE ACT . I T A NO . 571 / RJT /20 14 A SSESSMENT YEAR 200 9 - 10 I.T.A NO. 571 /RJT /20 14 A.Y. 2009 - 10 PAGE NO SHRI RASHIK R. KAPURIA, VS. ITO 2 2. THE ASSESSEE HAS RAISED FOLLOWING GROUND OF APPEAL: - HON. CIT(A) HAS ERRED IN LAW AS WELL AS ON FACT IN CONFIRMING PENALTY U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961 OF RS. 13,600/ - IMPOSED BY THE ASSESSING OFFICER. 3 . T HE ASSESSEE IN THIS CASE FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 149541/ - . ASSESSEE IS AN INDIVIDUAL AND DEALS IN MANUFACTURING OF BRASS PARTS. DURING THE COURSE OF ASSESSMENT, THE ASSESSING OFFICER HAS NOTICED THAT ASSESSEE HAS NOT DISCLOS ED THE DETAIL OF SB ACCOUNT NO. 020501515797 WITH THE ICICI JAMNAGAR AND DEPOSITED ON VARIOUS DATES FROM 01 - 04 - 2008 TO 31 ST MARCH, 2009. IN THIS CONNECTION, THE ASSESSEE HAS EXPLAINED THAT HE HAS ALREADY ACCOUNTED ICICI BANK ACCOUNT AND TRANSACTION ON VAR IOUS DATES WERE DULY ACCOUNTED DURING THE YEAR UNDER CONSIDERATION. HOWEVER, DUE TO OVERSIGHT THE CLOSING BALANCE OF ABOVE BANK ACCOUNT HAS BEEN WRONGLY GROUPED UNDER THE HEAD ACCOUNT RESPECTIVELY. THE ASSESSING OFFICER HAS NOT ACCEPTED THE SUBMISSION OF THE ASSESSEE AND STATED THAT IT APPEARED THAT THE ASSESSEE HAS DONE BUSINESS OF BRASS PARTS AND THE TRANSACTION IN THE SAID ACCOUNT IS OF TRADING ACTIVITIES DONE BY THEM OUT OF BOOKS. THE ASSESSING OFFICER STATED THAT TRANSACTION OF RS. 27 , 25 , 195/ - WILL BE TREATED AS UNDISCLOSED SALE DONE OUT OF BOOKS OF ACCOUNT ON WHICH GP RATIO IS TO BE ADOPTED. THE ASSESSING OFFICER HAS STATED THAT DURING THE YEAR DISCLOSED TURNOVER OF RS. 11 , 68 , 162/ - @ 19.28% WAS REPORTED BY THE ASSESSEE. ACCORDINGLY, BY APPLYING TH IS GP RATIO ON TOTAL TURNOVER OF RS. 27 , 25 , 195/ - . THE ASSESSING OFFICER HAS WORKED UNACCOUNTED INCOME I.T.A NO. 571 /RJT /20 14 A.Y. 2009 - 10 PAGE NO SHRI RASHIK R. KAPURIA, VS. ITO 3 OF RS. 5 , 25 , 417/ - AND ADDED TO THE TOTAL INCOME OF THE ASSESSEE ON WHICH THE ASSESSING OFFICER INITIATED PENALTY PROCEEDING U/S. 271(1) (C) OF THE I.T. A CT. THE ASSESSEE HAS APPEALED BEFORE THE LD. COMMISSIONER OF INCOME TAX(A) AGAINST THE ORDER OF ASSESSING OFFICER FOR MAKING SAID ADDITION. BEFORE THE LD. COMMISSIONER OF INCO ME TAX(A), THE ASSESSEE HAS STATED THAT THE BANK ACCOUNT MAINTAINED WITH ICICI BANK WAS DULY REFLECTED IN THE BOOKS OF ACCOUNTS AND ASSESSING OFFICER HAS INCORRECTLY MADE THE ADDITION. THE LD. COMMISSIONER OF INCOME TAX(A) HAS REDUCED THE ADDITION TO RS. 1 , 36 , 430/ - . THEREAFTER, THE ASSESSING OFFICER HAS IMPOSED PENALTY U/S. 271(1)( C) OF THE I.T. ACT ON THE CONCEALMENT OF RS. 1,36,430/ - TO THE EXTENT OF RS. 13,597/ - FOR FURNISHING INACCURATE PARTICULARS OF INCOME WITHIN THE MEANING OF SECTION 271(1)(C) OF THE ACT. THE ASSESSEE HAS FILED FURTHER APPEAL AGAINST THE LEVY OF PENALTY BY THE ASSESSING OFFICER BEFORE THE COMMISSIONER OF INCOME TAX(A). LD. COMMISSIONER OF INCOME TAX(A) HAS DISMISSED THE APPEAL OF THE ASSE SSEE BY STATING THAT SUCH TRANSAC TION IS NOTHING BUT CONCEALED INCOME. 4. BEFORE US, LD. AUTHORIZED REPRESENTATIVE ST ATED THAT THERE IS NO CONCEALMENT OF INCOME AND ASSESSEE HAS DISCLOSED THE TRANSACTION REPORTED IN T H E BANK ACCOUNT AND THIS ADDITION IS JUST MADE ON ESTIMATED BASIS WITHOUT ANY CONCEALMENT DONE BY THE ASSESSEE. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESEN TATIVE RELIED ON THE ORDER OF THE COMMISSIONER OF INCOME TAX(A) . I.T.A NO. 571 /RJT /20 14 A.Y. 2009 - 10 PAGE NO SHRI RASHIK R. KAPURIA, VS. ITO 4 5. AFTER HEARING BOTH THE PARTIES AND ON PERUSAL OF THE MATERIAL AVAILABLE ON RECORD, WE FIND THAT THE DECISION OF THE LD. COMMISSIONER OF INCOME TAX(A) IS NOT CORRECT AS IT COULD NOT BE E STABLISHED THAT ASSE SSEE HAS CONCEALED THE TRANSACTION REPORTED IN THE BANK ACCOUNT AND ADDITION WAS JUST MADE ON ESTIMATED BAS IS. IN ORDER TO ATTRACT CLAUSE (C) OF SECTION 271(1) OF THE ACT, IT IS NECESSARY THAT THERE MUST BE CONCEALMENT BY THE ASSESSEE OF THE PARTICULARS OF HIS INCOME OR IF HE FURNISHES INACCURATE PARTICULARS OF SUCH INCOME. IT IS EVIDENT FROM THE FACTS REPORTED THAT ADDITION WAS MADE ON AGREED BASIS BY ESTIMATING THE NET PROFIT AT RS. 5 , 25 , 417/ - AND THIS ADDITION W A S REDUCED TO RS. 1 , 3 6 , 430/ - BY THE LD. COMMISSIONER OF INCOME TAX(A). WE FIND THAT ASSESSING OFFICER HAS NOT ESTABLISHED THAT THERE IS CONCEALMENT OF PARTICULARS OF INCOME BY THE ASSESSEE OR HE HAS FURNISHED INACCURATE PARTICULARS OF INCOME, THEREFORE, WE DELETE THE PENALTY OF RS . 13 , 597/ - SUSTAINED BY THE LD. COMMISSIONER OF INCOME TAX(A). 6. IN THE END, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PR ONOUNCED IN THE OPEN C OUR T ON 21 - 10 - 201 6 SD/ - SD/ - (S.S. GODARA ) ( AMARJIT SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD : DATED 21 /10 /2016 AK / COPY OF ORDER FORWARDED TO: - 1. ASSESSEE I.T.A NO. 571 /RJT /20 14 A.Y. 2009 - 10 PAGE NO SHRI RASHIK R. KAPURIA, VS. ITO 5 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, ASSISTANT REGIST RAR, INCOME TAX APPELLATE TRIBUNAL, RAJKOT