Vidya sagar Saini, Pathankot V. The Assistant commissioner of Income Tax, Pathankot

ITA 581/ASR/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7748 (ITAT-AMRITSAR)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 21-08-2017
• Assessment Year: 2009-2010
• Appeal Filed On: 23-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAHUL DHAWANLD
• Assessee Lawyers: ANANYA KAPOOR LD ADVS; SHALIL KAPOOR
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR BEFORE SH. T.S. KAPOOR, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER I.T.A NO.581(ASR)/2016 ASSESSMENT YEAR:2009- 10 SH. VIDYA SAGAR SAINI GOVERNMENT CONTRACTOR 24/8, PREM NAGAR, SAINGARH, PATHANKOT. PAN:AILPS -5183K VS. ASST. CIT-VI, PATHANKOT. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. SHALIL KAPOOR & ANANYA KAPOOR (LD. ADVS.) RESPONDENT BY: SH. RAHUL DHAWAN (LD. D.R) DATE OF HEARING:21.08.2017 DATE OF PRONOUNCEMENT:25.10.2017 ORDER PER N.K.CHOUDHRY: THE INSTANT APPEAL HAS BEEN PREFERRED BY THE ASSESSEE, ON FEELING AGGRIEVED AGAINST THE ORDER DATED 02.09.201 6 PASSED BY THE LD. CIT(A), AMRITSAR, IN APPEAL NO.165/14-15 FOR ASST. YEAR:2009-10. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL. 1. THAT THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-2 , AMRITSAR HAS, IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, GR OSSLY ERRED IN LAW AND ON FACTS IN UPHOLDING THE PENALTY OF RS.4,25,000/- LEVIED U/S .271(L)(C) BY THE ACIT, CIR.VI, PATHANKOT. THE PENALTY IMPOSED AND UPHELD IS ILLEGA L, UNLAWFUL AND WITHOUT JURISDICTION. 2. THAT THE PENALTY PROCEEDINGS WERE WRONGLY STARTED WITHOUT RECORDING THE STATUTORY SATISFACTION AND WITHOUT ANY LAWFUL BASIS AND THE PENALTY HAD ALSO BEEN WRONGLY IMPOSED. 3. THAT THE APPELLANT HAD NOT CONCEALED THE PARTIC ULARS OF HIS INCOME OR FURNISHED ANY INACCURATE PARTICULARS OF HIS INCOME AND THE PE NALTY HAD BEEN IMPOSED WITHOUT ANY LEGAL JUSTIFICATION. THE PENALTY ORDER PASSED WAS ALSO TIME BARRED. ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 2 4. THAT THE OBSERVATIONS MADE WERE AGAINST FACTS AND ARE BASED ON SURMISES & CONJECTURES AND DO NOT AFFORD ANY LEGAL JUSTIFICATI ON TO THE IMPOSITION OF PENALTY. IN ANY CASE, ALL THE FACTS & CIRCUMSTANCES OF THE CASE AND THE EXPLANATION GIVEN AND EVIDENCE AVAILABLE ON RECORD AND THE PROVISIONS OF LAW HAD NOT BEEN PROPERLY CONSIDERED AND HAD NOT BEEN JUDICIALLY INTERPRETED AND THE PENALTY HAS BEEN WRONGLY IMPOSED. 5. THAT IN ANY CASE, THE ALLEGED APPROVAL OF COMM ISSIONER OF INCOME TAX (OSD), RANGE- VI, PATHANKOT U/S.274(2) VIDE HIS OFFICE LET TER DATED 21.05.2014, WAS GRANTED WITHOUT APPLICATION OF MIND, IN A MECHANICA L MANNER AND WITHOUT AFFORDING OPPORTUNITY TO THE APPELLANT AND THE IMPO SITION OF PENALTY WAS UNLAWFUL EVEN ON THIS ACCOUNT. 6. THAT PENALTY WAS NOT AUTOMATIC AND THE PENALTY COULD NOT BE IMPOSED MERELY ON THE BASIS OF ANY ADDITION UPHELD IN APPEAL. IN A NY CASE, PART OF THE ADDITION WAS UPHELD MERELY ON THE BASIS OF ESTIMATE AND GUES S WORK AND NO CONCEALMENT WAS FOUND. UNDER THE CIRCUMSTANCES, THE PENALTY IMP OSED WAS ILLEGAL, UNJUST AND UNLAWFUL. 3. THE BRIEF FACTS OF THE CASE ARE AS UNDER: THE ASSESSEE IS A CONTRACTOR AND HAD FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2009-10 FOR RS.38,70,532/- ON 19.01. 2010 AND THE SAME WAS PROCESSED U/S 143(2) OF THE I.T. ACT AND DU RING THE ASSESSMENT PROCEEDINGS WHILE EXAMINING THE BOOKS OF ACCOUNT CERTAIN DISCREPANCIES WERE OBSERVED. THE GROSS RECEIPTS WERE SHOWN AT RS.10,30,90,866/- AND NET PROFIT AMOUNTED TO RS.39,35 ,452/-. THE GROSS RECEIPTS INCLUDED RS.68,53,213/- ON ACCOUNT OF RECOV ERY MADE BY REVENUE DEPARTMENT ON ACCOUNT OF SUPPLY OF MATERIAL , MAINLY BITUMEN. IF THIS AMOUNT IS EXCLUDED THEN THE PROFIT R ATE WORK OUT TO 4.09%, AS THE ASSESSEE HAD DEBITED RS.2,63,94,120/- AS LA BOUR AND WAGES EXPENSES AND DURING EXAMINATION, IT WAS FOUND THA T WAGES RECORD WAS NOT MAINTAINED AND THE WAGES IN BOOK WERE E XCESSIVE AND UNVERIFIABLE. BY CLAIMING SUCH EXPENDITURE, THE ASSESSEE HAD REDUCED THE PROFIT DELIBERATELY. ACCORDINGLY THE BOOKS OF ACCOUN TS OF THE ASSESSEE WERE REJECTED AND ASSESSMENT WAS FRAMED BY APPLYING NET PROFIT RATE @ 12% WHICH WAS REDUCED TO 8% BY THE CIT(A ) AND UPHELD BY THE ITAT AMRITSAR BENCH. ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 3 SUBSEQUENTLY, WHILE PASSING THE ASSESSMENT ORDER, THE PENA LTY PROCEEDINGS WERE ALSO STARTED FOR FURNISHING INACCURATE PA RTICULARS OF INCOME FOR THE REASON OF NOT MAINTAINING THE RECORD QU A WAGES AND THE WAGES BOOKS WERE EXCESSIVE AND UNVERIFIABLE AND BY CL AIMING SUCH EXPENDITURES, THE ASSESSEE HAD REDUCED PROFIT DELIBERATEL Y. THE PENALTY ORDER WAS CHALLENGED BEFORE THE LD. CIT(A), W HO ALSO CONFIRMED THE SAID ORDER BY HOLDING THAT THE ADDITION HAS BEEN MADE ON ESTIMATION BY APPLYING NET PROFIT RATE OF 8% OF G ROSS CONTRACT RECEIPTS BUT THE FACT REMAINS THAT THE APPELLANTS WAGE S RECORD WAS NOT MAINTAINED AND THE WAGES BOOKED WERE EXCESSIVE AND UNVE RIFIABLE, THEREFORE, THE WAGES EXPENDITURE WAS INFLATED AND THE PROFITS OF THE APPELLANT WERE SUPPRESSED AND THE APPELLANT HAD FURNISH ED INACCURATE PARTICULARS OF INCOME TO THIS EXTENT. IN VIEW OF THESE F ACTS THE CASE LAWS RELIED UPON BY THE APPELLANT IN RESPECT OF HIS GRO UNDS OF APPEAL ARE NOT APPLICABLE AND DISTINGUISHED. IN VIEW OF THE ABOVE FACTS AND REASONING, IT IS HELD THAT AO WAS NOT JUSTIFIED FOR LEV YING PENALTY U/S 271(1) (C) OF THE ACT FOR FURNISHING INACCURATE PARTICU LARS OF INCOME AND THE PENALTY OF RS.4,52,000/- IMPOSED BY THE AO U/ S 271(1)(C) OF THE ACT IS ACCORDINGLY CONFIRMED. 4. THE ASSESSEE BEING DISSATISFIED WITH THE ORDER OF THE LD. CIT(A) PREFERRED THE INSTANT APPEAL AND IN SUPPORT OF ITS CASE SUBMITTED THAT THE PENALTY IS NOT IMPOSABLE ON ESTIMATED ADDITIONS. F OR THE REASONS GIVEN IN THE PENALTY ORDER, THE AO IMPOSED PENALTY O F RS.4,25,000/- U/S 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICU LARS OF INCOME. IN THE WRITTEN SUBMISSIONS FILED BY APPELLANT, IN APP ELLATE PROCEEDINGS, THE APPELLANT STATED THAT HE IS A GOVERNME NT CONTRACTOR AND WAS ENGAGED IN THE ACTIVITY OF CONSTRUCTION AND REP AIRS OF VILLAGE ROADS IN THE REMOTE/ BORDER AREAS OF PUNJAB AND HIMACH AL. HE WAS MAINTAINING REGULAR BOOKS OF ACCOUNT FROM YEAR TO YEAR WHICH WERE ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 4 DULY AUDITED AND THE RETURNS WERE FILED ON THE BASIS OF AUDITED ACCOUNTS. ALL THE RECEIPTS WERE FROM GOVERNMENT DEPARTME NTS AND THE SAME WERE DULY ACCEPTED. HOWEVER THE INCOME HAD BEEN ASSESSE D AT ESTIMATED PROFIT RATE OF 8% SUBJECT TO DEPRECIATION YEA R AFTER YEAR. ALTHOUGH THE FACTS HAVE BEEN THE SAME IN ALL THE YEARS BUT THE PENALTY HAS NEVER BEEN LEVIED IN THE PAST. THE APPELLANT ARGUED THAT THE AO HAS NOT POINTED OUT WHAT PARTICULAR OF INCOME HAVE BEEN FURNISHED INACCURATE EXCEP T FOR THE FOLLOWING ALLEGATIONS- (I) MUSTER ROLLS ARE NOT VERIFIED WITH REFERENCE TO WORK DONE. (II) MUSTER ROLLS DO NOT BEAR ANY REVENUE STAMP. IN THIS REGARD THE APPELLANT ARGUED IT IS NOT PHYSICAL LY POSSIBLE TO ENGAGE DIFFERENT LABOUR FOR DIFFERENT CONTRACTS. THE A SSESSEE HAD TAKEN MORE THAN 25 CONTRACTS DURING THE YEAR. THE LABOUR WAS TAKEN FROM ONE CONTRACTOR TO THE OTHER FOR DAY TO DAY NECESSITY BASI S. THE BOOKS OF ACCOUNTS CANNOT BE REJECTED FOR THIS OBJECTION. FURTHER MUSTER ROLL IS A RECORD OF ATTENDANCE OF WORKERS FOR WORK. THE PAYMEN TS WERE MADE TO THE WORKERS AS PER THIS RECORD AGAINST THEIR SIGNATUR ES. THAT THE SECTION 30 OF THE INDIAN STAMP ACT MAKES THE RECEIPT OB LIGATORY ONLY IF DEMANDED BY THE PERSONS PAYING THE MONEY. THEREFORE, THE STAMPING OF RECEIPT WAS NOT OBLIGATORY. THAT THE CONTRACT WORK W AS BEING CARRIED OUT IN REMOTE RURAL AREAS OF PUNJAB AND HIMACHAL, WHER E NEITHER THE REVENUE RECEIPTS WERE AVAILABLE NOR THE WORKERS HAVE T HE MEANS TO BRING AND AFFIX THE RECEIPTS EVERY TIME. THE WORKERS WERE DOING MANUAL WORK FOR THE APPELLANT AND THERE WAS NO NECESSIT Y OR BUSINESS EXPEDIENCY TO ASK THEM TO BRING THE REVENUE RECEIPTS A ND AFFIX THE SAME. ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 5 THE APPELLANT STATED THAT NO INCORRECT PARTICULARS OF IN COME WERE FURNISHED BY THE APPELLANT. FURTHER THE CASE LAWS RELIE D UPON BY THE A.O. WERE ON DIFFERENT FACTS AND NOT APPLICABLE TO TH E APPELLANT. THE APPELLANT RELIED UPON FOLLOWING CASE LAWS. (I) CIT VS DHILLON RICE MILLS 256 ITR 447 (P & H) (II) HARI GOPAL SINGH VS CIT 258 ITR 85 (P 8& H) (III) CIT VS.RAVAIL SINGH & CO. 254 ITR 191 (P&H) (IV) CIT, PATIALA VS. METAL PRODUCTS OF INDIA 150 ITR 715 (P&H) (V) CIT VS. SANGRUR VANASPATI MILLS LTD. 303 ITR 53 (P&H). THE LD. AR SPECIFICALLY RELIED UPON THE ORDER PASSED BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. SANGRUR VANASPATI MILLS LTD. 303 ITR 53 (P&H) AND THE ORDER PASSED BY THE ITAT , AMRITSAR BENCH IN THE CASE OF M/S TS SA ASSOCIATES IN ITA NO.519 ( ASR)/2013. 5. ON THE OTHER HAND, THE LD. DR RELIED UPON THE ORDE R PASSED BY THE AUTHORITIES BELOW AND SUBMITTED THAT THE SAME ARE BASED ON LOGIC, WELL REASONING, THEREFORE, DOES NOT DESERVE TO BE INTE RFERED WITH. 6. WE HAVE GONE THROUGH WITH THE FACT AND CIRCUMSTANCES OF THE CASE, AS IN THE INSTANT CASE THE APPELLANT WAS/IS MAINTAI NING REGULAR BOOKS OF ACCOUNT FROM YEAR TO YEAR WHICH WERE/ARE DULY AUDITED AND THE RETURNS WERE FILED ON THE BASIS OF AUDIT ACCOUNTS AND ALL THE RECEIPTS WERE FROM THE GOVT. DEPARTMENT AND THE SAME W ERE DULY ACCEPTED AND THE INCOME HAD BEEN ASSESSED AT ESTIMATED PRO FIT RATE OF 8% SUBJECT TO DEPRECIATION YEAR AFTER YEAR AND THE FAC TS OF THAT HAVE BEEN THE SAME IN ALL THE YEARS BUT THE PENALTY WAS NEV ER LEVIED IN THE PAST. WE ARE IN AGREEMENT WITH THE LD. AR THAT THE AO HAS NOT POINTED OUT AS TO WHAT PARTICULARS OF INCOME HAVE BEEN FURNISHED INACCURATE EXCEPT (A) MUSTER ROLLS ARE NOT VERIFIED WIT H REFERENCE TO ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 6 WORK DONE. (B) MUSTER ROLLS DO NOT BEAR ANY REVENUE STAMP. IT IS NOT PHYSICAL POSSIBLE TO ENGAGE DIFFERENT LABOUR FOR DIFFER ENT CONTRACTS AS THE ASSESSEE HAD ENGAGED IN MORE THAN 25 CONTRACTS DURING THE YEAR AND THE LABOUR WAS TAKEN FROM ONE CONTRACT TO THE OTHE R ON DAY TO DAY NECESSITY BASIS AND MUSTER ROLL IS A RECORD OF ATTENDANCE OF WORKERS FOR WORK AND THE PAYMENTS WERE MADE TO THE WORKERS AS PER THIS RECORD AGAINST THEIR SIGNATURES AND EVEN OTHERWISE SECTION 30 O F THE INDIAN STAMP ACT MAKES THE RECEIPT OBLIGATORY ONLY IF DEMAND ED BY THE PERSONS PAYING THE MONEY. THEREFORE, STAMPING IS NOT OB LIGATORY AND EVEN OTHERWISE THE CONTRACT WORK WAS BEING CARRIED IN R EMOTE RURAL AREAS OF PUNJABH & HIMACHAL WHERE HARDLY THE REVENUE R ECEIPTS WERE AVAILABLE NOR THE WORKER HAVE THE MEANS TO BRING AND AFFIX THE RECEIPTS EVERY TIME. THEREFORE, FROM THE SAID CLARIFICATION, IT CAN EASILY BE INFERRED THAT NO INCORRECT PARTICULARS OF INCOME WERE F URNISHED BY THE APPELLANT. LET US TO CONSIDER THE DECISION RENDERED BY THE JURISDICT IONAL HIGH COURT IN THE CASE OF CIT VS. SANGRUR VANASPATI MILL S LTD. (SUPRA). THE CONCLUDING PART OF THE ORDER IS REPRODUCED HEREIN B ELOW FOR THE SAKE OF CONVENIENCE AND BREVITY. 6. WE HAVE HEARD COUNSEL FOR THE APPELLANT AN D HAVE GONE THROUGH THE IMPUGNED ORDER. 7. THE ORDER PASSED BY THE ITAT IS BASED UPON TWO DECISIONS OF THIS COURT IN CIT V. RAVAII SINGH & CO. [2002] 254 ITR 191 AND HARI GOPAL SINGH V. CIT [2002] 258 ITR 85 . IN BOTH THESE DECISIONS, THIS COURT HAS HELD THAT IN ORDER TO ATTRACT CLAUSE (C) OF SECTION 271(1) OF THE ACT, IT IS NECESSARY THAT THERE MUST BE CONCEALMENT BY THE ASS ESSEE OF THE PARTICULARS OF HIS INCOME OR FURNISHING OF INACCURA TE PARTICULARS OF SUCH INCOME. THE PROVISIONS OF SECTION 271 (1)(C) OF THE ACT ARE NOT ATTRACTED TO CASES WHERE THE INCOME OF AN ASSESSEE IS ASSESSED O N ESTIMATE BASIS AND ADDITIONS ARE MADE THEREIN. IT WAS HELD THAT WHEN T HE ADDITION HAD BEEN MADE ON THE BASIS OF ESTIMATE AND NOT ON ACCOUNT OF ANY CONCRETE EVIDENCE OF CONCEALMENT, THEN THE PENALTY WAS NOT L EVIABLE. THE SIMILAR VIEW WAS ALSO TAKEN BY THIS COURT IN CIT V. DHILLON RICE MILLS [2002] 256 ITR 447 WHERE THE ADDITION WAS MADE BY THE ASSESSING OFFIC ER BY ESTIMATING THE YIELD OF SUPER PHAK AS WELL AS OF CH HILKA AND ALSO THE PRICE OF CHHILKA, THAT ADDITION WAS REDUCED BY THE CIT(A) . HOWEVER, THE PENALTY LEVIED BY THE ASSESSING OFFICER WAS DELETED BY THE CIT(A). THE ORDER OF CIT(A) WAS CONFIRMED BY THE ITAT AND THE APPEAL FIL ED BY THE REVENUE ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 7 AGAINST THE SAID ORDER OF THE ITAT WAS DISMISSED BY THIS COURT, ON THE GROUND THAT THE ASSESSING OFFICER HAD MADE THE ADDI TIONS ON THE BASIS OF ESTIMATE OF THE YIELD OF PHAK AND CHHILKA AND AN ES TIMATE OF THE PRICE AND THAT THE ESTIMATE WOULD NOT IPSO FACTO LEAD TO PENALTY. FURTHER, THE HONBLE APEX COURT IN THE CASE OF CIT VS. RELIANCE PETRO LTD. (2010) 322 ITR 158 (SC) ALSO DEALT WITH T HE PENALTY PROCEEDINGS. 8. THEREFORE, IT IS OBVIOUS THAT IT MUST BE SHOWN THAT THE CONDITIONS UNDER SECTION 271(1)(C) MUST EXIST FORE THE PENALTY IS IMPOSED. THERE CAN BE NO DISPUTE THAT EVERYTHING WO ULD DEPEND UPON THE RETURNED BECAUSE THAT IS THE ONLY DOCUMENT , WHERE THE ASSESSEE CAN FURNISH THE PARTICULARS OF HIS INCOME. WHEN SUCH PARTICULARS ARE FOUND TO BE INACCURATE, THE LIABILI TY WOULD ARISE. IN DILIP N. SHROFF V. JT. ('IT [2007] 6 SCC 329, THIS COURT EXPLAINED THE TERMS 'CONCEALMENT OF INCOME' AND 'FURNISHING INACC URATE PARTICULARS'. THE COURT WENT ON TO HOLD THEREIN THA T IN ORDER TO ATTRACT THE PENALTY UNDER SECTION 271(1)(C), MENS REA WAS NECESSARY, AS ACCORDING TO THE COURT, THE WORD 'INA CCURATE' SIGNIFIED A DELIBERATE ACT OR OMISSION ON BEHALF OF THE ASSESSEE. IT WENT ON TO HOLD THAT CLAUSE (III) OF SECTION 271(1) PROVIDED FOR A DISCRETIONARY JURISDICTION UPON THE ASSESSING AUTHO RITY, INASMUCH AS THE AMOUNT OF PENALTY COULD NOT HE LESS THAN THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF SUCH CONCEALMENT O F PARTICULARS OF INCOME, BUT IT MAY NOT EXCEED THREE TIMES THEREO F. IT WAS POINTED OUT THAT THE TERM 'INACCURATE PARTICULARS' WAS NOT DEFINED ANYWHERE IN THE ACT AND, THEREFORE, IT WAS HELD THA T FURNISHING OF AN ASSESSMENT OF THE VALUE OF THE PROPERTY MAY NOT BY ITSELF BE FURNISHING INACCURATE PARTICULARS. IT WAS FURTHER H ELD THAT THE ASSESSEE MUST BE FOUND TO HAVE FAILED TO PROVE THAT HIS EXPLANATION IS NOT ONLY NOT BONA FIDE BUT ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS INCOME WERE NOT DISCLOSED BY HIM. IT WAS THEN HELD THAT THE EXPLANATION MUST BE PRECEDED BY A FINDING AS TO HOW AND IN WHAT MANNER, THE ASSESSEE HAD FURNISHED THE PARTICULARS OF HIS INCOME. THE COURT ULTIMATELY WENT ON TO HOLD THAT THE CLEMENT OF MENS REA WAS ESSENTIAL. IT WAS ONLY ON THE POINT OF MENS REA THAT THE JUDGMENT IN DILIP N. SHROFFS CASE (SUPRA) WAS UPSET. IN DHARAMENDRA TEXTILE PROCESSORS' CASE (SUPRA), AFTER QUOTING FROM SECTION 271 EXTENSIVELY AND ALSO CONSIDERING S ECTION 271(1)(C), THE COURT CAME TO THE CONCLUSION THAT SI NCE SECTION 271 (1)(C) INDICATED THE ELEMENT OF STRICT LIABILITY ON THE ASSESSEE FOR THE CONCEALMENT OR FOR GIVING INACCURATE PARTICULARS WH ILE FILING RETURN, THERE WAS NO NECESSITY OF MENS REA. THE COURT WENT ON TO HOLD THAT THE OBJECTIVE BEHIND ENACTMENT OF SECTION 271(L)(C) READ WITH EXPLANATIONS INDICATED WITH THE SAID SECTION WAS FOR PROVIDING REMEDY FOR LOSS OF REVENUE AND SUCH A PENALTY WAS A CIVIL LIABILITY AND, THEREFORE, WILFUL CONCEALMENT IS NOT AN ESSENTIAL INGREDIENT FOR ATTRACTING CIVIL LIABILITY AS WAS THE CASE IN THE M ATTER OF PROSECUTION UNDER SECTION 276C OF THE ACT. THE BASI C REASON WHY ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 8 DECISION IN DILIP N. SHROFFS CASE (SUPRA) WAS OVERRULED BY THIS COURT IN DHARAMENDRA TEXTILE PROCESSORS' CASE (SUPRA), WAS THAT ACCORDING TO THIS COURT THE EFFECT AND DIFFERENCE BETWEEN SECTIO N 271(1)(C) AND SECTION 276C OF THE ACT WAS LOST SIGHT OF IN. CASE OF DILIP N. SHROFF (SUPRA). HOWEVER, IT MUST BE POINTED OUT THAT IN DHARAMENDRA TEXTILE PROCESSORS' CASE (SUPRA), NO FAULT WAS FOUND WITH THE REASONING IN THE DECISION IN DILIP N. SHROFF'S CASE (SUPRA), WHERE THE COURT EXPLAINED THE MEANING OF THE TERMS 'CONCEAL' AND 'I NACCURATE'. IT WAS ONLY THE ULTIMATE INFERENCE IN DILIP N. SHROFF'S CASE (SUPRA) TO THE EFFECT THAT MENS REA WAS AN ESSENTIAL INGREDIENT FOR THE PENALTY UNDER SECTION 271 (1)(C) THAT THE DECISION IN DILIP N. SHROFFS CASE (SUPRA) WAS OVERRULED. COMING TO THE INSTANT CASE AS THE APEX COURT CLEARLY HEL D THAT CONDITION U/S 271(1) (C) MUST EXISTS BEFORE THE PENALTY IS IMPOSED AND EVERYTHING WOULD DEPEND UPON THE I.T.RETURN BECAUSE THAT IS THE ONLY DOCUMENT, WHERE THE ASSESSEE CAN FURNISH THE P ARTICULARS OF HIS INCOME. WHEN SUCH PARTICULARS ARE FOUND TO BE I NACCURATE, THE LIABILITY WOULD ARISE. THEREFORE, CONSIDERING THE SAID RATIO TO THE INSTANT CASE AS IN THE INSTANT CASE AS THE REVENUE DEPART MENT HAS NOT BROUGHT ANY MATERIAL WITH REGARD TO THE VERIFYING O F INACCURATE PARTICULARS OF INCOME IN ITS RETURN FILED, THEREFORE, I N OUR CONSIDERED OPINION, LIABILITY WOULD NOT ARISE AND EVEN OTHERWISE IN ALL THE PREVIOUS YEARS THE N.P RATE @ 8% HAS BEEN FOLLOWED/SUSTAINED BY THE REVENUE DEPARTMENT MAY BE ON THE ESTIMATE BASIS OR ON ORDER BY APPELLANT FORUM AND THE PENALTY HAS NEVER BEEN LEVIED IN THE PAST AND SPECIFICALLY JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V S. SANGRUR VANASPATI MILLS LTD. (SUPRA) CLEARLY HELD THAT PROVISIO NS OF SEC.271(1) (C) OF THE ACT DOES NOT ATTRACT TO THE CASES WHERE THE IN COME OF THE ASSESSEE IS ASSESSED ON ESTIMATE BASIS AND ADDITIONS ARE MADE THEREIN, AND WHEN THE ADDITION HAD BEEN MADE ON THE BASIS OF ESTIMATE AND NOT ON ACCOUNT OF ANY CONCRETE EVIDENCE OF CO NCEALMENT, THEN THE PENALTY WAS NOT LEVIABLE. ITA NO.581 (ASR)/2016 ASST. Y EAR:2009-10 9 ON THE AFORESAID CONSIDERATION AND REASONING, WE DO N OT HAVE ANY HESITATION TO HOLD THAT IN THE INSTANT CASE, THE PE NALTY IS NOT LEVIABLE, HENCE, WE DELETE THE SAME. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 25.10.2017. SD/- SD/- (T. S. KAPOOR) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED:25.10.2017. /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) THE ASSESSEE: (2) THE (3) THE CIT(A), (4) THE CIT, (5) THE SR DR, I.T.A.T., TRUE COPY BY ORDER