Sh. Raman Watts Prop M/s., Abohar V. The Income-tax Officer, Abohar

ITA 607/ASR/2011

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0579 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2005-2006
• Appeal Filed On: 13-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit
• Section: 143(3); 68; 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO.607(ASR)/2011 ASSESSMENT YEAR:2005-06 PAN :AAJPW8600R SH. RAMAN WATTS PROP. VS. THE INCOME TAX OFFICER, M/S. SUWIDHA ELECTRONICS, WARD-2(3), ABOHAR. ABOHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:WRITTEN SUBMISSIONS RESPONDENT BY:SH.TARSEM LAL, DR DATE OF HEARING: 08/01/2013 DATE OF PRONOUNCEMENT:09/01/2013 ORDER PER BENCH ; THIS APPEAL OF THE ASSESSEE ARISES FROM THE ORDER OF THE CIT(A), BATHINDA, DATED 27.09.2011 FOR THE ASSESSMENT YEAR 2005-06. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE ORDER OF THE LD. CIT(A), BATHINDA U/S 250(6) IS AGAINST FACTS AND LAW. ITA NO.607(ASR)/2011 2 2. THAT THE LD. CIT(A) ERRED ON FACTS AND LAW IN UPHOL DING THE ORDER OF THE AO U/S 271(1)(C) IMPOSING PENALTY OF R S.30,600/-. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR DISPO SED OFF. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E RECEIVED THREE CHQUES OF RS. 40,000/-, RS.40,000/- AND RS.20,000/- WHICH WERE CREDITED IN ASSESSEES BANK ACCOUNT IN ORIENTAL BANK OF COMMERC E ON 22.09.2004. THE ASSESSEE COULD NOT PROVE THE IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE SAID CASH CREDIT TOTALING TO RS. 1 LAC. THE AO ACCORDINGLY MADE AN ADDITION AND INITIATED PENALTY PROCEEDINGS AND LEV IED THE PENALTY OF RS.30,600/- UNDER SECTION 271(1)(C) OF THE INCOME T AX ACT, 1961 ( IN SHORT, THE ACT). 3. ON APPEAL, THE LD. CIT(A) CONFIRMED THE ACTION O F THE ASSESSING OFFICER. 4. BEFORE US, THE ASSESSEE HAS FILED WRITTEN SUBMIS SIONS DATED 29.12.2012, WHICH FOR THE SAKE OF CLARITY ARE REPRO DUCED AS UNDER: 1. THE LD. AO MADE AN ADDITION OF RS.1,00,000/- 9 RS.40,000/-, RS.40,000/- AND RS.20,000) ON ACCOUNT OF CREDIT O F THE ABOVE SAID CHEQUES IN THE BANK ACCOUNT OF THE ASSESSEE WITH OBC, WHILE FRAMING ASSESSMENT U/S 143(3) VIDE ORDER DA TED 24.12.2007 BECAUSE THE ASSESSE COULD NOT PROVE TH E IDENTITY AND CAPACITY OF THE CREDITOR SH. SANDEEP KUMAR AND G ENUINENESS OF THE TRANSACTION. THE ASSESSE FILED AN APPEAL BEFO RE THE CIT(A), BATHINDA IN WHICH THE ADDITION OF RS.10000/- ON ACCOUNT OF ITA NO.607(ASR)/2011 3 UNEXPLAINED CASH CREDIT WAS SUSTAINED AND THE ASS ESSEE DID NOT FILE ANY FURTHER APPEAL. 2. DURING THE COURSE OF PENALTY PROCEEDINGS U/S 27 1(1)(C) THE ASSESSEE FURNISHED A COY OF THE BANK ACCOUNT OF T HE CREDITOR, MR. SANDEEP KUMAR IN WHICH THE CHEQUES OF RS.40,0 00/-, RS.40,000/- AND RS.20,000/- HAD BEEN DEBITED. THU S, THE SOURCE OF DEPOSIT OF SH. SANDEEP KUMAR IN THE BOOKS OF T HE ASSESSEE STOOD EXPLAINED. THE REPLY FILED BY THE ASSESSEE DURING THE COURSE OF PENALTY PROCEEDINGS HAS BEEN REPRODUCED BY THE AO ON PAGE 2 OF THE PENALTY ORDER. 3. THE AO IGNORED THE EVIDENCE FILED BY THE ASSESS EE DURING THE COURSE OF PENALTY PROCEEDINGS AND IMPOSED PENALTY OF RS.30,600/- VIDE ORDER DATED 09.02.2011. THE AO H AS IGNORED THE FACT THAT THE HONBLE PUNJAB & HARYANA HIGH C OURT HAS HELD IN THE FOLLOWING CASES THAT THE PENALTY PROC EEDINGS BECAUSE PENALTY PROCEEDINGS ARE INDEPENDENT PROCEEDINGS. THE ASSESSEE FILED AN APPEAL AGAINST THE ORDER OF THE AO IMPOS ING PENALTY U/S 271(1)(C) BEFORE THE CIT(A), BATHINDA. 4. THE CIT(A) BATHINDA VIDE ORDER DATED 27.09.2011 CONFIRMED THE PENALTY U/S 271(1)(C) AGAINST WHICH THE ASSES SEE HAS FILED AN APPEAL BEFORE THIS HONBLE BENCH. 5. THE APPEAL MAY KINDLY BE DECIDED ON THE BASIS O F WRITTEN SUBMISSIONS BEING FILED BEFORE THIS HONBLE BENCH . 5. IN THE WRITTEN SUBMISSIONS, THE ASSESSEE RELIED UPON THE DECISIONS OF HONBLE PUNJAB & HARYANA HIGH COURT, IN THE CASE OF CIT VS. BALBIR SINGH (2008) 304 ITR 125, CIT VS. KAMAL CHEMICALS INDUSTR IES (2005) 277 ITR 150 AND CIT VS. AGRO CHEMICALS (INDIA) 288 ITR 149 AND PRAYED TO DELETE THE PENALTY CONFIRMED BY THE LD. CIT(A). ITA NO.607(ASR)/2011 4 6. ON THE OTHER HAND, THE LD. DR, SH. TARSEM LAL, R ELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 7. WE HAVE HEARD THE LD. DR AND PERUSED THE WRITTEN SUBMISSIONS OF THE ASSESSEE ON RECORD. THE AMOUNT IN THE PRESENT CASE HAVING BEEN RECEIVED THROUGH A/C PAYEE CHEQUES AND THROUGH BANKING CHANN EL IS NOT UNDER DISPUTE. THEREFORE, THE IDENTITY OF MR. SANDEEP KUM AR, WHICH IS ON RECORD AS SUBMITTED BY THE ASSESSEE DURING THE PENALTY PRO CEEDINGS CAN NOT BE UNDER DISPUTE. THERE IS NOTHING ON RECORD BROUGHT BY THE REVENUE THAT THE SAID RS. 1 LAC RAISED IS THE MONEY BELONGING TO THE ASSESSE E HIMSELF. NO ADVERSE MATERIAL HAS BEEN BROUGHT ON RECORD BY THE REVENUE IN THIS REGARD. THE ADDITION HAVING BEEN MADE U/S 68 OF THE ACT IN THE QUANTUM PROCEEDINGS DOES NOT ENTITLE THE REVENUE TO REJECT THE EXPLANA TION OF THE ASSESSEE DURING PENALTY PROCEEDINGS. THE ASSESSEE HAVING FURNISHED THE EXPLANATION HAS NOT CONCEALED ANY INCOME OR HAS NOT FURNISHED INACCURAT E PARTICULARS WITH REGARD TO SUCH INCOME. PENALTY PROCEEDINGS ARE INDEPENDENT OF THE ASSESSMENT PROCEEDINGS, AS HAS BEEN HELD BY THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. AGRO CHEMICALS (INDIA) 288 I TR 149. THEREFORE, IN THE CIRCUMSTANCES AND FACTS OF PRESENT CASE, THE LD. CI T(A) IS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIED BY THE AO UNDER SECTI ON 271(1)(C) OF THE ACT. ITA NO.607(ASR)/2011 5 ACCORDINGLY, THE AO IS DIRECTED TO DELETE THE PENAL TY SO LEVIED. ALL THE GROUNDS OF THE APPEAL OF THE ASSESSEE ARE ALLOWED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN ITA NO.607(ASR)2011 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 9TH JANUARY, 2013. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 9TH JANUARY, 2013 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE:SH. RAMAN WATTS. PROP. M/S.SUWIDHA ELE CTRONICS, ABOHAR. 2. THE ITO WARD 2(3), ABOHAR. 3. THE CIT(A), BATHINDA. 4. THE CIT, BATHINDA. 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.