M/s. Trivium Power Engineers Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 586/DEL/2010

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 3608 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 24-05-2010
• Assessment Year: 2006-2007
• Appeal Filed On: 08-02-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: N K CHAND
• Assessee Lawyers: R K MEHRA
• Keywords: Unexplained cash credit; Gift; Search and seizure
• Section: 271(1)(c); 143(3); 133(6); 251; 143(2); 68; 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES: H NEW DELHI BEFORE SHRI C.L.SETHI, JUDICIAL MEMBER AND SHRI R.C.SHARMA, ACCOUNTANT MEMBER ITA NO: 586/DEL/2010 ASSESSMENT YEAR : 2006-07 M/S TRIVIUM POWER ENGINEERS P.LTD. VS. THE ITO, WARD 16(4) A-1/610, EKTA GARDEN ROOM NO. 143, C.R.BLDG. I.P.EXTENSION, PATPARGANJ I.P. ESTATE, NEW DELHI 2 DELHI 110 092 (APPELLANT) (RESPOND ENT) APPELLANT BY : SH. R.K.MEHRA, C.A. RESPONDENT BY : SRI NK CHAND, SR.D.R. O R D E R PER C.L.SETHI, JUDICIAL MEMBER THE ASSESSEE IS IN APPEAL AGAINST THE ORDER DATED 11.12.2009 PASSED BY THE LD. CIT(A) CONFIRMING THE PENALTY AMOUNTING TO RS. 2,01,628/- LEVIED BY THE A.O. U/S 271(1)(C ) OF THE INCOME TAX ACT, 1 961 FOR THE A.Y. 2006- 07. 2 2. THE ASSESSEE COMPANY FILED ITS RETURN OF INCOME ON 1.12.2006 DECLARING TOTAL INCOME AT RS. 5,61,362/-. A REGULA R ASSESSMENT CAME TO BE MADE U/S 143(3) OF THE ACT WHEREIN THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED AT RS. 11,67,360/-. IN THE ASSESSMENT, THE ADDITION OF RS. 6 LAKHS ON ACCOUNT OF UNEXPLAINED CASH CREDIT U/S 68 WAS MA DE BY THE A.O. DURING THE ASSESSMENT PROCEEDINGS, IT WAS NOTICED BY THE A.O. THAT THE ASSESSEE HAD RECEIVED UNSECURED LOAN AMOUNTING TO RS.6 LAKHS IN CASH FROM VARIOUS PERSONS DURING THE YEAR UNDER CONSIDERATION. THE N AMES OF THE PERSONS AND THE AMOUNTS TAKEN FROM THEM AS LOAN ARE AS UNDER. SL.NO . NAME AMOUNT RS . 1. PAWAN KUMAR MISHRA 18,500 2. SATYA PRAKASH 17500 3. SURENDER KUMAR 18800 4. RAM BABU 19800 5. RAVIR SINGH 16700 6. SUBHASH KUMAR 18500 7. MANOJ KUMAR 17800 8. SAMEER KUMAR 19200 9. BHOLA PRASAD 18500 10. R K CHAUDHARY 16800 11. SUSHIL NAGAR 17600 12. JITENDER SINGH 15800 13. RAM VIR 18900 3 14. NADIM 19500 15. JAMALUDDIN 18500 16. ASHOK KUMAR 19700 17. B N JHA 15900 18. JIBACHA JHA 15900 19. S K JHA 18500 20. HARI NARAIN 15600 21. MUKESH GOYAL 17000 22. VINITA DHAWAN 17800 23. NAVEEN KUMAR JHA 16800 24. SATISH KUMAR 16800 25. NAZIMUDDIN 18900 26. HEERA KANT 18900 27. AJIT KUMAR 18900 28. SURESH KUMAR SHUKLA 18900 29. GOPAL BAHADUR KC 17800 30. AJAY SHEKER CHAUDHARY 15800 31. ANTRIKSHA GUPTA 12500 32. AVINASH KUMAR /AMAR KUMAR 18500 33. AMAR KUMAR CHAUDHARY 18500 34. SANJEET MANDAL 14900 -------------- TOTAL: RS. 6,00,000/= IN ORDER TO VERIFY THE GENUINENESS OF THE ABOVE LOA N, THE A.O. ISSUED NOTICE U/S 133(6) TO THE AFORESAID PERSONS SEEKING RELEVAN T INFORMATION FROM THEM. 4 OUT OF THE TOTAL LETTERS SENT TO 34 PERSONS, 15 LET TERS WERE RECEIVED BACK UNSERVED WITH THE REMARKS NO SUCH ADDRESS AND 9 P ERSONS DID NOT GIVE ANY REPLY. IT WAS ALSO NOTICED BY THE A.O. THAT THE A SSESSEE COMPANY FAILED TO FURNISH EVEN THE ADDRESSES OF FOLLOWING 9 PERSONS. 1. RAM VIR 18,900 2. NADIM 19,500 3. JAMALUDDIN 18,500 4. MUKESH GOYAL 17,000 5. NAZIMUDDIN 18,900 6. HEERA KANT 18,900 7. AJIT KUMAR 18,900 8. SURESH KUMAR SHUKLA 18,900 9. SANJEET MANDAL 14,900 3. THE ASSESSEE COMPANY WAS THEN ASKED BY THE A.O. VIDE LETTER DT. 04.9.2008 AS TO WHY RS.6 LAKHS CLAIMED TO BE RECEI VED IN CASH AS UNSECURED LOAN SHOULD NOT BE TREATED AS UNEXPLAINED CASH CRED IT WITHIN THE MEANING OF S.68 OF THE ACT. THE ASSESSEE COMPANY VIDE LETTER DT. 26.9.08 SURRENDERED THE AMOUNT OF UNSECURED LOANS AMOUNTING TO RS.6 LAK HS RECEIVED DURING THE YEAR FOR TAXATION WITH A CONDITION THAT NO PENAL AC TION SHALL BE INITIATED AGAINST THE ASSESSEE. THE ASSESEES PLEA THAT NO P ENAL ACTION SHALL BE INITIATED AGAINST IT WAS NOT ACCEPTED BY THE A.O. AS THE A.O. WAS OF THE VIEW 5 THAT THIS PLEA CANNOT BE ACCEPTED FOR THE REASON TH AT THAT THE INCOME SURRENDERED BY THE ASSESSEE COMPANY WAS NOT VOLUNTA RY BUT THE SAID AMOUNT WAS SURRENDERED BECAUSE OF THE DETECTION MADE BY TH E DEPARTMENT BY MAKING NECESSARY ENQUIRIES. THE A.O. WAS, THEREFORE, SAT ISFIED THAT THE ASSESSEE COMPANY HAS NOT DISCLOSED THE TRUE PARTICULARS OF I TS INCOME AND INITIATED PENALTY PROCEEDINGS U/S 271(1)(C ) OF THE ACT IN TH E COURSE OF ASSESSMENT MADE BY THE A.O. WHEREIN THE AFORESAID INCOME OF RS .6 LAKHS WAS ADDED TO THE ASSESSEES TOTAL INCOME. IN THE COURSE OF PEN ALTY PROCEEDINGS BEFORE THE A.O. THE ASSESSEE SUBMITTED VIDE LETTER DT. 22.3.20 09 THAT THE AMOUNT WAS SURRENDERED JUST TO BUY PEACE OF MIND AND ON THE CO NDITION THAT NO PENAL ACTION SHALL BE INITIATED AGAINST THE ASSESSEE. BUT THIS EXPLANATION OF THE ASSESSEE WAS NOT ACCEPTED BY THE A.O. BY GIVING THE REASON THAT INCOME SURRENDERED BY THE ASSESSEE WAS NOT VOLUNTARY BUT T HE ASSESSEE SURRENDERED THE INCOME BECAUSE OF THE DETECTION MADE BY THE DEP ARTMENT THROUGH ENQUIRIES CONDUCTED BY IT. THE AO, THEREFORE, HAD TAKEN A VIEW THAT THE ASSESSEE HAD CONCEALED PARTICULARS OF ITS INCOME MA KING IT LIABLE FOR PENALTY U/S 271(1)(C ) OF THE ACT. THE AO, THEREFORE. LEVI ED THE PENALTY EQUAL TO THE AMOUNT OF 100% OF THE TAX SOUGHT TO BE EVADED ON TH E CONCEALED INCOME ASSESSED TO TAX IN THE ASSESSMENT. 6 4. ON AN APPEAL, THE CIT(A) CONFIRMED THE AOS ORDE R BY OBSERVING THAT THE ASSESEE SURRENDERED THE AMOUNT AFTER POINTING O UT THE SAME BY THE AO AND THE ASSESSEE HAS BROUGHT INTO ITS BOOKS UNACCOU NTED INCOME IN THE SHAPE OF CASH CREDITS. 5. STILL AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFOR E US. 6. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED T HAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO WAS PROVIDED WITH THE ENTIRE INFORMATION AVAILABLE WITH THE ASSESSEE WITH REGARD TO THE NAME S AND ADDRESSES OF THOSE PARTIES TO THE EXTENT AVAILABLE WITH THE ASSESSEE. HE FURTHER STATED THAT THE LD.A.O. HAS ISSUED NOTICES U/S 133(6) SEEKING CERTA IN INFORMATION FROM THOSE PARTIES BUT THE ASSESSEE WAS NOT CONFRONTED WITH AN Y REPLY FURNISHED BY THOSE PARTIES. HE FURTHER SUBMITTED THAT THE A.O. HAS MA DE THE ADDITION OF RS.6 LAKHS ON THE SAME BEING SURRENDERED BY THE ASSESSEE WITH THE CONDITION THAT NO PENALTY PROCEEDINGS SHALL BE INITIATED BY THE A. O. U/S 271(1)(C ) OF THE ACT. HE, THEREFORE, SUBMITTED THAT WHEN THE AMOUNT WAS SURRENDERED VOLUNTARILY BY THE ASSESSEE WITH THE CONDITION THAT NO PENALTY PROCEEDINGS SHALL BE INITIATED U/S 271(1)(C ) OF THE ACT, THE A .O. WAS UNJUSTIFIED IN LEVYING THE PENALTY UPON THE ASSESSEE. IN SUPPORT OF THE ASSESSEES CASE, THE LD.COUNSEL FOR THE ASSESSEE HAS RELIED UPON THE FOL LOWING DECISIONS. 1. CIT VS. SURESH CHANDRA MITTAL(2001) 251 ITR 9 (SC) 7 2. SMT. RAJ RANI MITTAL VS ITO-RUDRAPUR (2010) 36 SOT 4 (DEL) (URO) COPY OF HEAD NOTES ENCLOSED . 3. ITO VS. DR.SAMEER KANT AGGARWAL (2009) 34 SOT 12 (LUCK) (URO) 4. ACIT VS. SMITA COMMERCIAL & INVESTMENT P.LT D. (1997) 90 TAXMANN 275 (DEL) (TRIB) 5. CIT VS. SARAN KHANDSARI SUGAR WORKS (2000) 246 ITR 216 (ALL.) 6. ADDL.CIT VS. PREM CHAND GARG (2009) 24 DTR( DEL) (TM) (TRIB.) 513 7. KUMAR AGENCIES (INDIA) VS ACIT, (2003) 87 I TD 69(MUM) (TM) 7. THE LD.D.R., ON THE OTHER HAND, HAS SUBMITTED TH AT IN NONE OF THE CASES, THE AMOUNT WAS RECEIVED EITHER BY CHEQUES OR THROUGH BANKING CHANNEL. IN ALL THE 34 CASES, THE AMOUNT BELOW RS. 20,000/- HAS BEEN SHOWN TO BE RECEIVED IN CASH. HE FURTHER SUBMITTED THAT NO CREDIBLE EVIDENCE WAS FILED EITHER IN ASSESSMENT PROCEEDINGS OR PENALTY P ROCEEDINGS TO ESTABLISH IDENTITY AND CREDIT WORTHINESS OF THE PAYER AND THE GENUINENESS OF THE TRANSACTION. WHATEVER FEW EVIDENCES THAT HAS BEEN FURNISHED BY THE ASSESEE, WHICH ARE PLACED AT PAGE NOS. 11, 12 AND 13 OF THE PAPER BOOK FILED BY THE ASSESSEE BEFORE THE TRIBUNAL, DO NOT INSPIRE ANY CO NFIDENCE. HE FURTHER SUBMITTED THAT THE ASSESSEE HAS NOT GIVEN THE DETAI LS ABOUT THE CREDITORS SO AS TO GIVE THE NAMES OF THE ORGANIZATION WHETHER THE C REDITORS WERE WORKING OR THEIR PAN NO. OR OTHER EVIDENCES TO ESTABLISH THEIR IDENTITY AND EXISTENCE. 8 HE FURTHER SUBMITTED THAT THE ARGUMENT OF THE LD.CO UNSEL FOR THE ASSESSEE THAT THE SUM WAS SURRENDERED VOLUNTARILY DOES NOT HOLD A NY WATER AS THE SURRENDER WAS MADE SUBSEQUENT TO THE DETECTION MADE BY THE A.O. AND AFTER A SHOW CAUSE NOTICE ISSUED BY THE A.O TO THE ASSES SEE. HE, THEREFORE, SUBMITTED THAT SINCE THE SURRENDER WAS NOT VOLUNTAR Y AND THE ADDITION HAS BEEN MADE BY THE A.O. AS A RESULT OF ENQUIRY CONDUC TED BY HIM, THE VARIOUS DECISIONS RELIED UPON BY THE ASSESSEE WOULD BE OF N O ASSISTANCE TO THE ASSESSEES CASE RATHER THEY SUPPORT THE REVENUES C ASE. IN SUPPORT OF THE REVENUES CASE, THE LD. D.R. HAS RELIED UPON THE CE RTAIN DECISIONS. 8. WE HAVE CONSIDERED THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE DELIBERATED UPON THE VARIOUS DECISIONS CITED AT THE BAR IN THE LIGHT OF THE FACTUAL MATRIX OF THE PRESENT CASE. 9. FROM THE PERUSAL OF THE PROVISIONS OF SECTION 27 1(1)(C) OF THE ACT, IT IS CLEAR THAT PENALTY IN THIS SECTION IS LEVIABLE IF T HE ASSESSING OFFICER IS SATISFIED IN THE COURSE OF ANY PROCEEDINGS UNDER TH E ACT THAT ANY PERSON HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHE D INACCURATE PARTICULARS OF THE INCOME. IT IS WELL SETTLED THAT THE PENALTY PR OCEEDINGS AND THE ASSESSMENT PROCEEDINGS BOTH ARE DIFFERENT. THE EXP LANATION-1 TO SECTION 271(1)(C) OF THE ACT PROVIDES THAT THE AMOUNT ADDED OR DISALLOWED IN COMPUTING THE TOTAL INCOME OF THE ASSESSEE SHALL BE DEEMED TO BE THE INCOME 9 IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED . THIS DEEMING PROVISION IS NOT ABSOLUTE BUT IS REBUTTABLE ONE. I T ONLY SHIFTS BURDEN ON THE ASSESSEE. THE EXPLANATION 1 TO SECTION 271(1)(C) R EFERS TO THE TWO SITUATIONS IN WHICH PRESUMPTION OF THE CONCEALMENT OF INCOME O R PARTICULARS OF INCOME CAN BE DRAWN. THE FIRST SITUATION IS WHERE THE ASS ESSEE IN RESPECT OF ANY FACTS MATERIAL TO THE COMPUTATION OF HIS TOTAL INCO ME FAILS TO OFFER AN EXPLANATION OR OFFERS AN EXPLANATION, WHICH IS FOUN D BY THE ASSESSING OFFICER OR THE COMMISSIONER TO BE FALSE. THE SECON D SITUATION IS WHERE THE ASSESSEE IN RESPECT OF ANY FACTS MATERIAL TO THE CO MPUTATION OF HIS TOTAL INCOME OFFERS AN EXPLANATION, WHICH THE ASSESSEE IS NOT ABLE TO SUBSTANTIATE AND ALSO FAILS TO PROVE THAT SUCH EXPLANATION WAS B ONA FIDE ONE AND THAT ALL THE FACTS RELATING TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM. 10. IN THE LIGHT OF THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF UNION OF INDIA VS. DHARMENDRA TEXTILE PROCESSORS (2 008) 306 ITR 277, A WILLFUL CONCEALMENT IS NOT ESSENTIAL FOR ATTRACTING CIVIL LIABILITY OF PENALTY LEVIABLE UNDER SEC. 271(1)(C) OF THE ACT, BUT, AT T HE SAME TIME, APART FROM EXAMINING THE CASE FROM THE POINT OF VIEW OF MENS R EA, IT IS ALSO ESSENTIAL TO APPRECIATE AS TO WHETHER THE ASSESSEE HAS OFFERED A NY EXPLANATION AND IN CASE ANY EXPLANATION IS OFFERED, WHETHER THE SAME IS FOU ND TO BE FALSE OR IS BONA 10 FIDE ONE AND WHETHER ALL THE FACTS RELATING TO THE COMPUTATION OF ASSESSEES TOTAL INCOME HAS BEEN DISCLOSED. 11. IN THE LIGHT OF THE POSITION OF LAW DISCUSSED A BOVE, WE NOW PROCEED TO EXAMINE AND APPRECIATE THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. IT IS NOT IN DISPUTE THAT IN THE COURSE OF ASSESSMENT PRO CEEDINGS AN ADDITION OF RS.6 LACS ON ACCOUNT OF UNEXPLAINED CASH CREDIT HAS BEEN MADE BY THE AO AND THAT STANDS FINAL. NOW, THEREFORE, QUESTION AR ISES AS TO WHETHER THE ASSESSEE HAS OFFERED ANY EXPLANATION WITH REGARD TO THE AFORESAID ADDITION OF RS.6 LACS ON ACCOUNT OF UNEXPLAINED CREDIT INTRODUC ED BY THE ASSESSEE IN ITS BOOKS OF ACCOUNTS. THE ASSESSEE HAS GIVEN AN EXPLA NATION THAT THE AFORESAID AMOUNT OF RS.6 LACS HAS BEEN SURRENDERED VOLUNTARIL Y AS ASSESSEE FOUND IT DIFFICULT TO SUBSTANTIATE THE CASH CREDIT INASMUCH AS NUMBER OF CREDITORS WERE INVOLVED AND THERE WHEREABOUTS COULD NOT BE ASCERTA INED AT THE TIME WHEN THE ASSESSMENT PROCEEDINGS HAD TAKEN UP. THE ASSES SEE HAS ALSO GIVEN AN EXPLANATION THAT THE ASSESSEE HAS SURRENDERED THIS INCOME WITH THE CONDITION THAT NO PENALTY UNDER SEC.271(1)(C) SHALL BE INITIA TED BY THE AO. IN OTHER WORDS, IT IS THE CASE OF THE ASSESSEE THAT THE ASSE SSEE HAS SURRENDERED AMOUNT VOLUNTARILY WITH THE CONDITION THAT NO PENALTY SHAL L BE LEVIED UNDER SEC. 271(1)(C) OF THE ACT BY THE AO. 11 12. NOW, LET US EXAMINE AS TO WHETHER THE INCOME SU RRENDERED BY THE ASSESSEE IS VOLUNTARY OR BONA FIDE ONE. IN THIS CA SE, THE ASSESSING OFFICER HAD TAKEN UP THE CASE FOR SCRUTINY AND ISSUED NOTIC E UNDER SEC. 143(2) THAT WAS SERVED UPON THE ASSESSEE. THE AO ALSO RAISED C ERTAIN QUESTIONNAIRE AND IN RESPONSE THERETO CERTAIN DETAILS WERE FILED BY T HE ASSESSEE. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS NOTICED BY THE AO THAT THE ASSESSEE HAD SHOWN UNSECURED LOANS AMOUNTING TO RS.6 LACS RE CEIVED IN CASH FROM 34 PERSONS. IN ORDER TO VERIFY THE GENUINENESS OF THE AFORESAID TRANSACTIONS, THE AO SOUGHT INFORMATION UNDER SECTION 133(6) OF THE A CT FROM THE AFORESAID 34 PERSONS BY ISSUING NOTICES TO THEM. OUT OF 34 P ERSONS, 15 LETTERS WERE RECEIVED BACK UNSERVED WITH THE REMARKS NO SUCH PE RSON OR INCOMPLETE ADDRESS OR NO SUCH ADDRESS. 9 PERSONS DID NOT F ILE ANY REPLY AND IN RESPECT OF OTHERS, ADDRESSES FURNISHED BY THE ASSES SEE WERE NOT COMPLETE. THIS OUTCOME OF THE ENQUIRY CONDUCTED BY THE AO WAS CONFRONTED TO THE ASSESSEE, WHO WAS ASKED TO SHOW CAUSE VIDE LETTER D ATED 4.9.2008 OF THE AO AS TO WHY THE AMOUNT OF RS.6 LACS RECEIVED IN CASH SHOULD NOT BE TREATED AS UNEXPLAINED CASH CREDIT UNDER SEC.68 OF THE ACT. H AVING RECEIVED THE SHOW CAUSE NOTICE FROM THE AO, THE ASSESSEE VIDE LETTER DATED 26.9.2008 SURRENDERED THE AMOUNT FOR TAX, AND IN THE LETTER T HE ASSESSEE STATED THAT THE AMOUNT IS BEING SURRENDERED ON THE CONDITION THAT N O PENAL ACTION SHALL BE 12 INITIATED AGAINST THE ASSESSEE. HOWEVER, THIS STAN D OF THE ASSESSEE THAT NO PENAL ACTION SHOULD BE INITIATED AGAINST IT WAS NOT ACCEPTED BY THE AO FOR THE REASON THAT THE INCOME SURRENDERED BY THE ASSESSEE COMPANY WAS NOT VOLUNTARY BUT THE SAID AMOUNT WAS SURRENDERED BECAU SE OF THE DETECTION MADE BY THE DEPARTMENT THROUGH ENQUIRIES CONDUCTED BY IT. THE AO, THEREFORE, MENTIONED IN THE ASSESSMENT ORDER THAT H E WAS CONVINCED THAT THE ASSESSEE COMPANY HAD NOT DISCLOSED THE TRUE PARTICU LARS OF HIS INCOME AND HENCE HE INITIATED PENALTY PROCEEDINGS UNDER SECTIO N 271(1)(C) OF THE ACT. FROM THESE FACTS NARRATED ABOVE, IT IS CLEAR THAT T HE ASSESSEE COMPANY HAD SURRENDERED THE AMOUNT VIDE ITS LETTER DATED 26.9.0 08 ONLY AFTER A SHOW CAUSE NOTICE DATED 4.9.2008 WAS ISSUED BY THE AO INTIMATI NG THE ASSESSEE ABOUT THE OUTCOME OF HIS ENQUIRY AND THEN TO SHOW CAUSE A S TO WHY THE AMOUNT OF RS.6 LACS SHOULD NOT BE ADDED AS UNEXPLAINED CASH C REDIT UNDER SEC.68 OF THE ACT. IN THE PRESENT CASE IT IS NOT IN DISPUTE THAT THE ASSESSEE HAS RECEIVED VARIOUS AMOUNTS BELOW RS.20,000/- IN EACH CASE IN C ASH FROM 34 PERSONS. THE ASSESSEE HAS GIVEN JUST THE NAMES AND INCOMPLET E ADDRESSES OF THE PERSONS WITHOUT FURNISHING ANY DETAILS OR PARTICULA RS OR EVIDENCES AS TO THEIR IDENTITY, NATURE OF THEIR BUSINESS OR PROFESSION OR EMPLOYMENT AND THE SOURCE OF THEIR INCOME FROM WHICH THE AMOUNT WAS CLAIMED T O HAVE BEEN ADVANCED TO THE ASSESSEE. THE ASSESSEE IS A PRIVATE LIMITED COMPANY, AND IT IS BEYOND 13 IMAGINATION THAT THE 34 PERSONS WITHOUT HAVING ANY CLOSE RELATION OR CONNECTION TO THE BUSINESS OF THE ASSESSEE COMPANY WOULD ADVANCE AMOUNT IN CASH TO THE ASSESSEE. THE ASSESSEE HAS NOT BEEN ABLE TO EXPLAIN AS TO UNDER WHAT CIRCUMSTANCES THE AMOUNT WAS RECEIVED IN CASH FROM 34 PERSONS IN THE DENOMINATION OF BELOW RS.20,000/- IN EACH CASE. T HE VERY TRANSACTION OF RECEIVING MONEY FROM RESPECTIVE PERSONS HAS NOT BEE N ESTABLISHED. THE ASSESSEE HAS ALSO NOT GIVEN ANY DETAILS AS TO WHEN AND BY WHAT MODE THIS AMOUNT HAS BEEN REPAID BY THE ASSESSEE TO THE CREDI TORS. EVEN IN THE COURSE OF PENALTY PROCEEDINGS, NO PRIMA-FACIE EVIDENCE OR DETAILS AS TO THE IDENTITY AND/OR THE CREDITWORTHINESS OF THE CREDITORS, AND G ENUINENESS OF TRANSACTION WERE FURNISHED BY THE ASSESSEE. MERE SEVERAL CASH LOAN ENTRIES IN THE NAME OF DIFFERENT PERSONS MADE IN THE BOOKS IS NOT SUFFI CIENT TO SHOW EVEN PRIMA- FACIE THAT THE AMOUNT WAS ACTUALLY RECEIVED BY THE ASSESSEE AS LOAN FROM THESE PERSONS. THE ASSESSEE SHOULD HAVE FURNISHED AT LEAST SOME PIECE OF EVIDENCE TO SHOW PRIMA-FACIE THAT THE ASSESSEE HAD ACCEPTED THE AMOUNT AS LOAN. BUT THAT MUCH HAS NOT BEEN DONE BY THE ASSES SEE EXCEPT FURNISHING CERTAIN NAMES EVEN WITHOUT ESTABLISHING THEIR IDENT ITY AND EXISTENCE. THE ASSESSEE HAS ALSO NOT FILED ANY SORT OF CONFIRMATIO NS FROM THE RESPECTIVE PERSONS TO ESTABLISH THAT THE ASSESSEE HAD ACTUALLY TAKEN THE LOAN IN CASH FROM 34 PERSONS. IT IS, THUS, A CASE WHERE THE ASSESSEE HAS NOT FURNISHED FULL 14 PARTICULARS AS TO THE NATURE AND CHARACTER OF THE L OAN AS WELL AS TO THE IDENTITY, NATURE OF BUSINESS OR PROFESSION OR EMPLO YMENT AND SOURCE OF INCOME OF THE CREDITORS. THE ASSESSEE HAS THEREFOR E, NOT ACTED BONAFIDELY AND HAS NOT FURNISHED CORRECT INFORMATION AS TO THE DETAILS OF THE LOAN INTRODUCED BY THE ASSESSEE IN ITS BOOKS OF ACCOUNT. THE FACT THAT THE AO CONDUCTED AN ENQUIRY BY ISSUING NOTICE UNDER SEC. 1 33(6) OF THE ACT TO THE CREDITORS BEFORE THE INCOME WAS SURRENDERED BY THE ASSESSEE, IS NOT IN DISPUTE. IT IS ALSO SEEN THAT THE PERSONS TO WHOM NOTICES UNDER SEC. 133(6) OF THE ACT WERE ISSUED, WERE NOT FOUND AVAILABLE AT TH E GIVEN ADDRESS AS A RESULT THEREOF, THE NOTICES ISSUED TO THEM WERE RETURNED B ACK UNSERVED. EVEN IN THE CASES WHERE THE LETTERS WERE NOT RETURNED BACK UNSE RVED, NO REPLY HAS BEEN FURNISHED BY ANY OF THEM. THIS OUTCOME OF THE ENQU IRY CONDUCTED BY THE AO WAS CONFRONTED TO THE ASSESSEE VIDE AOS LETTER DATED 4.9.2008 AND ONLY THEREAFTER THE ASSESSEE VIDE LETTER DATED 26.09.200 8 HAD SURRENDERED THE AMOUNT TO TAX. IT IS, THEREFORE, CLEAR THAT THE SU RRENDER MADE BY THE ASSESSEE DOES NOT SEEM TO BE VOLUNTARY AND BONA FIDE BUT UND ER THE COMPULSION. IT IS ONLY AFTER THE ASSESSEE WAS CORNERED, THE ASSESSEE CAME FORWARD TO DISCLOSE THE AMOUNT FOR TAXATION AND THEREFORE, IN THIS CASE , IT IS VERY DIFFICULT TO HOLD THAT THE ASSESSEE HAS FILED THE SURRENDER LETTER DA TED 26.09.008 VOLUNTARILY AND BONAFIDE. IN THESE CIRCUMSTANCES, IT IS VERY DIFFICULT TO BEL IEVE THAT THE 15 AMOUNT WAS SURRENDERED BY THE ASSESSEE JUST TO BUY PEACE. IT IS THE CASE WHERE THE ASSESSEE HAD NO OTHER OPTION THAN TO AGRE E TO THE ADDITIONS UNDER COMPULSION, BEING CORNERED BY REVENUE. OF COURSE, THINGS WOULD HAVE BEEN DIFFERENT IN CASE BEFORE THE ENQUIRY CONDUCTED BY T HE AO BY ISSUING NOTICES TO THE CREDITORS U/S 133(6) OF THE ACT, THE ASSESSE E WOULD HAVE DISCLOSE THE INCOME IN THE NATURE OF UNEXPLAINED CREDIT. 13. THE MEANING OF WORD VOLUNTARILY HAS RECENTLY BEEN DELIBERATED UPON BY THE HONBLE ALLAHABAD HIGH COURT IN THE CAS E OF CIT VS. SHRI RAKESH SURI REPORTED IN 2010-TIOL-357-HC-ALL-IT AS UNDER:- 41. A FULL BENCH OF THE ALLAHABAD HIGH COURT IN THE CASE REPORTED IN (1998) 230 ITR 855: BHAIRAV LAL VERMA VERSUS UNION OF INDIA, WHILE INTERPRETING THE WORD `VONUTARILY GIVEN IN SECTION 273(A) OF THE ACT HELD THAT VOLUNTARILY MEANS OUT OF FREE WILL WITHOUT ANY COMPULSION. WHEN THE ASSESSEE CONCEALED THE INCRIMINATING MATERIAL WITH REGARD TO INCOME SO DISCLOSED CANNOT BE HELD TO BE VOLUNTARILY. IT SHALL BE APPROPRIATE TO REPRODUCE THE RELEVANT PORTION FROM THE JUDGMENT OF BHAIRAV LAL VERMA (SUPRA) AS UNDER: THE POSITION THUS SETTLED IS THAT THE WORD VOLUNTARILY IN SECTION 273A OF THE ACT MEANS OUT OF FREE WILL WITHOUT ANY COMPULSION. DISCLOSURE OF CONCEALED 16 INCOME AFTER THE DEPARTMENT HAS SEIZED THE INCRIMINATING MATERIAL WITH REGARD TO THE INCOME SO DISCLOSED, CANNOT BE VOLUNTARY DISCLOSURE, BECAUSE IT WAS MADE UNDER THE CONSTRAINT OF EXPOSURE TO ADVERSE ACTION BY THE DEPARTMENT. BUT IT CANNOT BE HELD AS A PRINCIPLE OF LAW THAT THE DISCLOSURE OF INCOME MADE AFTER THE SEARCH/RAID CANNOT BE VOLUNTARY. IT IS A QUESTION WHICH AHS TO BE DECIDED BY THE DEPARTMENT IN EACH CASE ON THE BASIS OF THE MATERIAL ON THE RECORD. IF ON RECORD THERE IS INCRIMINATING MATERIAL WITH REGARD TO THE DISCLOSED INCOME, THE DISCLOSURE CANNOT BE VOLUNTARY. BUT IF THE DEPARTMENT HAS NO INCRIMINATING MATERIAL WITH REGARD TO THE INCOME DISCLOSED, THE DISCLOSURE IS LIABLE TO BE TREATED AS VOLUNTARY HAVING BEEN MADE WITHOUT ANY COMPULSION OR CONSTRAINT OF EXPOSURE TO ADVERSE ACTION BY THE DEPARTMENT. IN A CASE WHERE THE ASSESSEE HAS DISCLOSED NOT ONLY THE INCOME REGARDING WHICH THE DEPARTMENT HAS INCRIMINATING MATERIAL, BUT HAS ALSO DISCLOSED THE INCOME WITH REGARD TO WHICH NO INCRIMINATING MATERIAL WAS SEIZED BY THE DEPARTMENT, THE DISCLOSURE OF THE INCOME WITH REGARD TO WHICH THE DEPARTMENT HAS NO INCRIMINATING MATERIAL, IS LIABLE TO BE TREATED AS VOLUNTARY. FOR EXAMPLE, IF AN ASSESSEE IS HAVING FIVE ACCOUNTS AND THE DEPARTMENT HAS INCRIMINATING MATERIAL WITH REGARD TO ONE OF THOSE ACCOUNTS ONLY, THE DISCLOSURE OF INCOME RELATING TO FOUR ACCOUNTS WITH REGARD TO WHICH THE DEPARTMENT HAS NO INCRIMINATING MATERIAL, IS VOLUNTARY, BECAUSE IT WAS MADE WITHOUT ANY CONSTRAINT OR COMPULSION, EVEN THOUGH THE DISCLOSURE OF THE INCOME RELATING TO THE ACCOUNT REGARDING WHICH THE DEPARTMENT HAS INCRIMINATING 17 MATERIAL, IS LIABLE TO BE TREATED AS NON- VOLUNTARY. :- DICTIONARY:- 42. BLACKS LAW DICTIONARY (SEVENTH EDITION) DEFINES VOLUNTARILY AS INTENTIONALLY OR WITHOUT COERCION. IT SHALL BE APPROPRIATE TO REPRODUCE MEANING OF VOLUNTARILY AND VOLUNTARY AS GIVEN IN BLACKS LAW DICTIONARY, WHICH IS AS UNDER:- VOLUNTARILY, ADV. INTENTIONALLY; WITHOUT COERCION. VOLUNTARY, ADJ. 1. DONE BY DESIGN OR INTENTION . 2. UNCONSTRAINED BY INTERFERENCE; NOT IMPELLED BY OUTSIDE INFLUENCE . 3. WITHOUT VALUABLE CONSIDERATION; GRATUITOUS . 4. HAVING MERELY NOMINAL CONSIDERATION -VOLUNTARINESS, N. 43. IN THE LAW LEXICON BY P. RAMANATHA AIYAR, MEANING OF VOLUNTARY HAS BEEN GIVEN AS, TO QUOTE:- VOLUNTARY OF ONES FREE WILL, IMPULSE OF CHOICE; NOT CONSTRINGED BY ANOTHER; ACTING VOLUNTARILY OR WILLINGLY [S. 2(2), SALE OF GOODS ACT]; [ART. 101(3), PROV., CONST.] VOLUNTARY THE EXPRESSION `VOLUNTARY IS USED IN THIS SECTION TO MEAN `NATURALISATION IN THE NARROW SENSE OF THAT TERM AND EXCLUDING COMPULSORY, INVOLUNTARY OF COLLECTIVE NATURALIZATION WHICH SOME STATES HAVE ADOPTED AT DIFFERENT TIMES. T.E. MOHOMED USMAN VS. STATE OF MADRAS, AIR 18 1961 MAD 129, 138. [CITIZENSHIP ACT, 1955, S. 9(1)] MEANS DOING OF SOMETHING AS THE RESULT OF THE FREE EXERCISE OF THE WILL BUT NOT SOMETHING DONE UNDER A LEGAL DUTY. WHERE A PERSON OBTAINED A PASSPORT ACTED ON HIS OWN VOLITION AND KNEW THE NATURE OF HIS ACT AND DID NOT ACT IN PERFORMANCE OF A LEGAL DUTY, NOR DUE TO COERCION OR FRAUD OR MISREPRESENTATION OR MISTAKE HE HAS ACTED VOLUNTARILY. ABDUL SALAM V. UNION OF INDIA, AIR 1969 ALL. 223 AT 228. [CITIZENSHIP RULES (1956) R. 30] FROM THE SAID DECISION IT IS THUS CLEAR THAT VOLUNT ARILY MEANS OUT OF FREE WILL WITHOUT ANY COMPULSION. IT IS ALSO OBSERVED THEREI N THAT WHEN THE ASSESSEE CONCEALED INCRIMINATING MATERIAL WITH REGARD TO THE INCOME DISCLOSED BY THE ASSESSEE, DISCLOSURE CANNOT HELD TO BE VOLUNTARILY. DISCLOSURE OF INCOME AFTER THE DEPARTMENT HAS COLLECTED INCRIMINATING MA TERIAL WITH REGARD TO THE INCOME SO DISCLOSED, CANNOT BE VOLUNTARY DISCLOSURE , BECAUSE IT WAS MADE UNDER THE CONSTRAINT OF EXPOSURE TO ADVERSE ACTION BY THE DEPARTMENT. IN THE PRESENT CASE, THE DEPARTMENT HAS COLLECTED SUFFICIE NT MATERIAL AGAINST THE ASSESSEE WITH REGARD TO THE IDENTITY AND EXISTENCE OF THE CREDITOR AND GENUINENESS OF THE TRANSACTION, AND ONLY AFTER INCR IMINATING MATERIAL COLLECTED BY THE DEPARTMENT WAS BROUGHT TO THE KNOW LEDGE OF THE ASSESSEE, THE DISCLOSURE WAS MADE BY THE ASSESSEE UNDER THE C ONSTRAINT OF EXPOSURE TO ADVERSE ACTION BY THE AO. IT IS, THUS, THE CASE WHE RE DISCLOSURE HAS NOT BEEN 19 MADE VOLUNTARY AND OUT OF FREE WILL, BUT DISCLOSURE HAS BEEN MADE UNDER COMPULSION. 14. HAVING REGARD TO THE TOTALITY OF THE ABOVE FACT S AND CIRCUMSTANCES OF THE CASE, WE ARE NOT IN AGREEMENT WITH THE CONTENTI ON OF THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE AO HAS MADE THE ADDITION MERELY ON SURRENDER OR DISCLOSURE BY THE ASSESSEE. IN THE PRESENT CASE, T HE AO HAS MADE THE ADDITION NOT ON THE BASIS OF SURRENDER MADE BY THE ASSESSEE BUT IT HAS BEEN MADE IN THE LIGHT OF THE OUTCOME OF THE ENQUIRY CON DUCTED BY THE AO DURING THE COURSE OF WHICH IT WAS FOUND BY THE ASSESSING O FFICER THAT THE CREDITORS WERE NOT EVEN IN EXISTENCE INASMUCH AS THEY WERE NO N-RESPONSIVE TO THE NOTICES TO THEM AND EVEN IN MOST OF THE CASES, THE NOTICES COULD NOT BE SERVED AND HAD RETURNED BACK UNSERVED. THEREFORE, THE ASSESSEES CONTENTION THAT NO PENALTY UNDER SEC.271(1)(C) IS TO BE LEVIED INASMUCH AS THE ASSESSEE HAS SURRENDERED THE AMOUNT VOLUNTARILY IS WITHOUT A NY FORCE. 15. THE NEXT CONTENTION OF THE ASSESSEE THAT THE AS SESSEE HAS SURRENDERED THE AMOUNT ONLY WITH A CONDITION THAT NO PENALTY UN DER SECTION 271(1)(C) SHALL BE LEVIED, HAS ALSO NO MERIT. IT IS NOT IN D ISPUTE THAT IN THE ASSESSEES LETTER DATED 26.9.2008 THE ASSESSEE HAS SUBMITTED T HAT THE ASSESSEE HAS SURRENDERED THE AMOUNT WITH THE CONDITION THAT NO P ENALTY PROCEEDINGS SHOULD BE INITIATED AGAINST IT. HOWEVER, THIS COND ITION WAS NOT ACCEPTED BY 20 THE AO WHILE MAKING THE ASSESSMENT WHERE THE AO HAS CATEGORICALLY OBSERVED THAT THIS PLEA OF THE ASSESSEE COMPANY CAN NOT BE ACCEPTED ON THE GROUND THAT THE INCOME SURRENDERED BY THE ASSESSEE COMPANY WAS NOT VOLUNTARILY BUT THE SAID AMOUNT WAS SURRENDERED BEC AUSE OF DETECTION MADE BY THE DEPARTMENT THROUGH ENQUIRIES CONDUCTED BY IT . THUS, ON FACTS, THIS CONTENTION OF THE ASSESSEE ALSO FAILS. MOREOVER, M ERE BECAUSE THE ASSESSEE HAD AGREED TO THE ADDITION SUBJECT TO THE CONDITION THAT PENALTY UNDER SEC. 271(1)(C) WOULD NOT BE LEVIED SHALL NOT PRECLUDE TH E DEPARTMENT FROM PROCEEDING TO LEVY THE PENALTY IN VIEW OF THE SETTL ED POSITION OF LAW THAT THERE CANNOT BE ESTOPPEL AGAINST THE STATUTE AND TH E ASSESSEES EXPLANATION REGARDING THE ADDITION HAD TO BE CONSIDERED BY THE AO INDEPENDENTLY AS SO OBSERVED BY THE HONBLE KERALA HIGH COURT IN THE CA SE OF CIT VS. D.K.B. & CO. (2000) 243 ITR 618 (KER.). SINCE, IN THE PRESE NT CASE, THE ADDITION HAS BEEN MADE ON THE BASIS OF THE ENQUIRY CONDUCTED BY THE AO AND NOT MERELY ON THE BASIS OF DISCLOSURE MADE BY THE ASSESSEE AGR EEING TO THE ADDITION, THE CONDITION IMPOSED BY THE ASSESSEE THAT NO PENALTY U NDER SEC. 271(1)(C) SHOULD BE LEVIED, HAS NO FORCE IN THE EYES OF LAW. HENCE, THIS CONTENTION OF THE ASSESSEE IS ALSO REJECTED. THE VARIOUS DECISIO NS CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE IN SUPPORT OF THE CONTENTI ON THAT NO PENALTY UNDER SEC. 271(1)(C) SHOULD BE IMPOSED IN THE CASE OF CON DITIONAL SURRENDER WOULD 21 NOT ADVANCE ANY FURTHER THE ASSESSEES CASE INASMUC H AS ALL THOSE CASES RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE WERE RENDERED IN THE DIFFERENT CONTEXT AS DISCUSSED HEREUNDER. 16. IN THE CASE OF CIT VS. SURESH CHANDRA MITTAL (S UPRA), THE INCOME WAS OFFERED TO TAX IN THE RETURN FILED IN RESPONSE TO T HE NOTICE ISSUED BY THE AO. HOWEVER, IN THE PRESENT CASE, IN THE RETURN OF INCO ME THE ASSESSEE HAS NOT OFFERED THE AFORESAID AMOUNT OF RS.6 LACS AS INCOME LIABLE TO TAX BUT THE SAID CONCEALED INCOME HAS BEEN DETECTED BY THE AO AFTER MAKING NECESSARY ENQUIRIES AS A RESULT OF WHICH THE ASSESSEE HAD NO OTHER ALTERNATIVE BUT TO SURRENDER THE SAME TO THE DEPARTMENT. THEREFORE, T HIS CASE IS OF NO HELP TO THE ASSESSEE. 17. THE ASSESSEE HAS MAINLY RELIED UPON THE DECISIO N OF ITAT, DELHI BENCH, DELHI IN THE CASE OF SMT. RAJ RANI MITTAL VS . ITO REPORTED IN (2010) 36 SOT 4 (DEL) (URO). HOWEVER, THIS CASE GIVES NO ASSISTANCE TO THE ASSESSEES CASE. IN THAT CASE, THE AO JUST MADE TH E ADDITION ON THE BASIS OF SURRENDER MADE BY THE ASSESSEE AND THE AO DID NOT B OTHER TO ISSUE SUMMONS TO THE PARTIES SO THAT THEY COULD BE BROUGHT ON REC ORD AS WITNESSES OF THE REVENUE TO PROVE THAT THE ASSESSEE HAD CONCEALED TH E INCOME. IN THAT CASE, THE ASSESSEE HAD TAKEN UNSECURED LOANS FROM 2 PERSO NS. THE ADDITION WAS MADE BY THE AO ON THE BASIS OF SURRENDER MADE BY TH E ASSESSEE. IN OTHER 22 WORDS, THE ADDITION WAS MADE ON AGREED BASIS AND TH E AO HAD FAILED TO BRING ANY MATERIAL ON RECORD TO SUPPORT THE ADDITION. IN THAT CASE, THE ASSESSEE SUBMITTED AFFIDAVITS OF THE LOAN CREDITORS. HOWEVE R, THE ASSESSEE SURRENDERED THE INCOME AS SHE COULD NOT PRODUCE THE PARTIES LIVING AT DELHI AT FAR AWAY PLACE OF RUDRAPUR, AND, THEREFORE, ON T HE BASIS OF SURRENDER THE AO MADE THE ADDITION. HOWEVER, THE FACTS OF THE PR ESENT CASE ARE QUITE DISTINCT TO THE AFORESAID CASE CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE INASMUCH AS, IN THE PRESENT CASE, THE ASSESSEE HAS NOT FURNISHED ANY IOTA OF EVIDENCE AS TO IDENTITY AND EXISTENCE OF THE ALLEGE D CREDITORS NOR FURNISHED ANY CONFIRMATION FROM THE RESPECTIVE PARTIES. THE A SSESSEE HAS NOT FURNISHED PARTICULARS OF THEIR IDENTITY, CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION. THE PAYMENTS WERE ALSO RECEIVED IN CA SH THOUGH, IN THE CASE RELIED UPON BY THE LEARNED COUNSEL FOR THE ASSESSEE , THE PAYMENTS WERE RECEIVED BY ACCOUNT PAYEE CHEQUE AND DEPOSITED IN T HE ASSESSEES BANK ACCOUNT. IN THE PRESENT CASE, THE ADDITION HAS BEE N MADE ON THE BASIS OF INCRIMINATING MATERIAL COLLECTED BY THE ASSESSING O FFICER AND NOT MERELY ON THE BASIS OF THE SURRENDER MADE BY THE ASSESSEE. T HEREFORE, THIS CASE IS ALSO OF NO HELP TO THE ASSESSEE RATHER IT SUPPORTS REVEN UES CASE. 18. SIMILAR IS THE POSITION WITH REGARD TO SOME OTH ER DECISIONS CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE INASMUCH AS IN THO SE CASES THE ADDITIONS 23 WERE MADE PURELY ON THE BASIS OF SURRENDER MADE BY THE ASSESSEE AND NOT ON THE BASIS OF ANY SORT OF INCRIMINATING MATERIAL BR OUGHT ON RECORD BY THE AO. IN THE CASE OF KUMAR AGENCIES (INDIA) VS ACIT (2003 ) 87 ITD 69 (MUM) (TM), TRANSACTIONS WERE MADE THROUGH BANKS AND PART IES WERE ASSESSED TO TAX, AND THE ASSESSEE SURRENDERED THE AMOUNT TO BUY PEACE AND AVOID LITIGATION AS THE ASSESSEE EXPRESSED ITS INABILITY TO PRODUCE CREDITORS, WHO WERE NOT DIRECTLY KNOWN PERSONS NUT THE TRANSACTION S WERE MADE THROUGH BROKERS. THE LOAN WAS RECEIVED AND REPAID BY ACCOU NT PAYEE CHEQUES, CONFIRMATIONS FROM CREDITORS WERE FILED WHICH BORE P.A. NO. OF THE DEPOSITORS. HOWEVER, IN THE PRESENT CASE, NO SUCH FACTS ARE AVAILABLE WHERE TRANSACTIONS WERE MADE IN CASH, AND NO EVIDENCE AS TO THE IDENTITY, AND EXISTENCE OF THE DEPOSITORS WAS FILED. THUS, THIS CASE DOES NOT SUPPORT AT ALL THE ASSESSEES CASE. 19. IN ITO VS DR. SAMEER KANT AGGARWAL (SUPRA), THE PENALTY LEVIED BY THE DEPARTMENT WAS DELETED AS THE AO HAD FAILED TO PROVE BY INDEPENDENT MATERIAL THAT ASSESSEE HAD CONCEALED HIS INCOME OR HAD FURNISHED INACCURATE PARTICULARS OF INCOME. BUT, IN THE INSTANT CASE BE FORE US, THE AO HAS BEEN ABLE TO BRING ON RECORD THE INCRIMINATING MATERIAL EVEN AS TO VERY EXISTENCE OR IDENTITY OF THE DEPOSITORS, AND THE GENUINENESS OF THE TRANSACTION. 24 20. THE CASE OF CIT VS SARAN KHANDSARI SUGAR WORKS (SUPRA) IS A CASE WHERE INCOME WAS ESTIMATED WITHOUT ANY BASIS. HENC E, THIS CASE IS ON DIFFERENT FACTS AND OF NO HELP TO THE ASSESSEE. 21. TO THE PRESENT CASE, THE DECISION OF HONBLE AL LAHABAD HIGH COURT, LUCKNOW BENCH IN THE CASE OF SHRI RAKESH SURI (SUPR A), WHICH HAS BEEN STRONGLY RELIED UPON BY THE LEARNED DR, IS FULLY AP PLICABLE WHERE THE PENALTY LEVIED UNDER SECTION 271(1)(C) WAS HELD TO BE JUSTI FIED EVEN ON CONDITIONAL/AGREED SURRENDER OF INCOME IF IT WAS ES TABLISHED THAT THE SURRENDER WAS NOT VOLUNTARILY BUT AN AFTERTHOUGHT, WHICH IS THE SITUATION IN THE PRESENT CASE BEFORE US. SINCE THE SURRENDER OF INCOME BY THE ASSESSEE IS NOT FOUND TO BE VOLUNTARILY BUT HAS BEEN MADE UNDER COMPULSION, THE PENALTY LEVIED BY THE AO UNDER SEC. 271(1)(C) WITH REGARD T O THE ADDITION OF UNEXPLAINED CREDIT OF RS.6 LACS CANNOT BE SAID TO B E INVALID OR UNJUSTIFIED MORE PARTICULARLY IN VIEW OF THE FACT THAT THE ASSE SSEES EXPLANATION IS NOT FOUND TO BE BONA FIDE AND FURTHER THE ASSESSEE HAS FAILED TO FURNISH ALL RELEVANT MATERIAL PARTICULARS RELATING TO THE CONCE ALED INCOME OF RS.6 LACS ADDED BY THE AO. IN OTHER WORDS, WE ARE OF THE CON SIDERED VIEW THAT THE ASSESSEE HAS NOT BEEN ABLE TO DISCHARGE ITS BURDEN THAT LAY UPON IT VIDE EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT. 25 22. FOR THE REASONS AND DISCUSSIONS MADE ABOVE, WE ARE, THEREFORE, OF THE CONSIDERED VIEW THAT THE LEARNED CIT(A) HAS RIGHTLY CONFIRMED THE AOS ORDER IN LEVYING PENALTY U/S 271(1)(C) OF THE ACT. WE, THEREFORE, AFFIRM THE CIT(A)S ORDER, AND DISMISS THIS APPEAL FILED BY TH E ASSESSEE. 23. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. 24. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT ON 25 TH JUNE, 2010. (R.C. SHARMA) (C.L. SETHI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 25 TH JUNE, 2010 VIJAY COPY TO : 1. APPELLANT 2. RESPONDENT,. 3. CIT 4. CIT(A)-XIX, NEW DELHI 5. DR ASSISTANT REGISTRAR