SUBBARAO P. PAILA, MUMBAI V. DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE-12, MUMBAI

ITA 5749/MUM/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8456 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-03-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2006-2007
• Appeal Filed On: 08-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: CHAUDHARY ARUNKUMAR
• Keywords: Search and seizure; Reasonable cause; Set aside
• Section: 271(1)(c); 153A

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL G BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) & SHRI AMARJIT SINGH ( J M) I.T.A. NO. 5749 /MUM/ 2017 (ASSESSMENT YEAR 20 06 - 07 ) I.T.A. NO. 5750/MUM/2017 (ASSESSMENT YEAR 2007 - 08) I.T.A. NO. 5751/MUM/2017 (ASSESSMENT Y EAR 2008 - 09) I.T.A. NO. 5752/MUM/2017 (ASSESSMENT YEAR 2009 - 10) SHRI SUBBARAO P. PAILA 82, INDAGE HOUSE DR. A.B. ROAD, WORLI MUMBAI - 400 018. PAN : AATPP2621F V S . DCIT CIRCLE 12 9 TH FLOOR OLD CGO BUILDING M.K. ROAD MUMBAI - 400 020. ( APPELLANT ) ( RESPON DENT ) ASSESSEE BY NONE DEPARTMENT BY SHRI CHAUDHARY ARUNKUMAR DATE OF HEARING 8 . 1 . 201 9 DATE OF PRONOUNCEMENT 27 . 3 . 201 9 O R D E R PER SHAMIM YAHYA (AM) : THE S E ARE APPEAL S BY THE ASSESSEE A GAINST RESPECTIVE ORDER OF LEARNED CIT(A) CONF IRMING THE LEVY OF PENALTY U/S. 271(1)(C) OF THE I.T. ACT AS UNDER : ASSESSMENT YEAR PENALTY LEVIED(RS.) 2006 - 07 1,12,167/ - 2007 - 08 14,060/ - 2008 - 09 2,20,935 2009 - 10 2,03,940 2. AT THE OUTSET IT IS NOTED THAT THESE APPEALS ARE DELAYED AS UND ER : - 2006 - 07 252 DAYS 2007 - 08 118 DAYS 2008 - 09 118 DAYS 2009 - 10 252 DAYS 3. THE REASONABLE CAUSE ATTRIBUTED IS THAT THE ASSESSEE IS A 77 YEAR OLD PERSON SUFFERING FROM SEVERAL AILMENTS. UPON CAREFUL CONSIDERATION AND 2 HEARING THE LEARNED DR IN THE SUBSTANT IAL INTEREST OF JUSTICE WE CONDONE THE DELAY. 4. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSMENT WAS COMPLETED UNDER SECTION 153A PURSUANT TO SEARCH ACTION. THE ADDITIONS WERE NOT BASED UPON ANY INCRIMINATING MATERIALS FOUND DURING THE COURSE OF SEARCH. R ATHER THE ADDITIONS WERE ON ACCOUNT OF DEPOSIT IN BANK ACCOUNT AND CASH OFFERED BY THE ASSESSEE IN THE RETURN OF INCOME. THE PENALTY WAS LEVIED ON THE GROUND THAT THESE WERE NOT OFFERED THE ORIGINAL RETURN OF INCOME AND BUT FOR THE SEARCH THEY WOULD NOT HAVE BEEN OFFERED. THE ASSESSEES EXPLANATION WAS THAT NOTHING INCRIMINATING TO THIS EFFECT WAS FOUND DURING SEARCH AND THE SAID INCOME WAS VOLUNTARILY OFFERED BY THE ASSESSEE BY WAY OF RETURN OF INCOME. HENCE, IT WAS PLEADED THAT THERE IS NO CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 5. BUT THE AFORESAID PLEA WAS REJECTED BY THE ASSESSING OFFICER AS WELL LEARNED CIT(A). AGAINST THE ABOVE ORDER THE ASSESSEE IS IN APPEAL BEFORE US. 6. WE HAVE HEARD THE LEARNED DR AND PERUSED THE RECORDS. NONE APPEARED ON BEHALF OF THE ASSESSEE. 7. UPON CAREFUL CONSIDERATION WE NOTE THAT THE ADDITION ON ACCOUNT OF CASH AND BANK DEPOSITS WERE MADE DURING THE COURSE OF ASSESSMENT ON THE BASIS OF INCOME SHOWN IN THE RETURN OF INCOME. NOT HING TO THIS EFFECT WAS FOUND DURING THE COURSE OF SEARCH. IT IS NOT THE CASE OF THE REVENUE THAT ANY INCRIMINATING MATERIAL TO THIS EFFECT OR ANY CASH WAS FOUND DURING SEARCH. IT IS SETTLED LAW THAT ADDITION PURSUANT TO SEARCH AND SEIZURE ACTION U/S. 153 A CANNOT BE MADE DIHORCE ANY INCRIMINATING MATERIAL FOUND DURING SEARCH. IN THIS VIEW OF THE MATTER IT IS ABUNDANTLY CLEAR THAT THE ASSESSEES OFFER OF THESE INCOMES IN THE RETURN OF INCOME WAS VOLUNTARY THE ASSESSEES CONDUCT WAS BONAFIDE. IN THIS VIEW O F THE MATTER THE ASSESSEE DOES NOT DESERVE TO BE VISITED WITH THE RIGOURS OF PENALTY U/S. 271(1)(C) OF THE ACT. IN THIS REGARD WE DRAW SUPPORT FROM THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN STEEL VS. STATE OF 3 ORISSA (82 ITR 26) FOR THE PROPOSITION THAT THE AUTHORITY MAY NOT LEVY PENALTY IF THE CONDUCT OF THE ASSESSEE IS NOT FOUND TO BE CONTUMACIOUS. 8. IN THE BACKGROUND OF AFORESAID DISCUSSION AND PRECEDENT WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE LEVY OF PENALT Y. 9. IN THE RESULT, APPEALS FILED BY THE ASSESSEE ARE ALLOWED. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 27 . 3 . 201 9 . SD/ - SD/ - (AMARJIT SINGH ) (SH A MIM YAHYA ) J U DICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; D ATED : 27 / 3 / 20 1 9 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( SENIOR P RIVATE S ECRETARY ) PS ITAT, MUMBAI