Sunder Chabra , Bathinda V. The Assistant Commissioner of Income Tax, Bathinda

ITA 656/ASR/2013

• Counselvise Citation: 65620914 RSA 2013
• Duration Of Justice: 4 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 28-03-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 06-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRIK CHAND
• Keywords: Unexplained cash credit; Wrong claim
• Section: 68

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. 656(ASR)/2013 ASSESSMENT YEAR: 2006-07 PAN: ABNPS5743A SUNDER CHABRA PROP. SANITARY VS. ACIT, CIRCLE-1, BATHINDA SALES, BATHINDA (APPELLANT) (RESPONDENT) APPELLANT BY: SH. ASHWANI KALIA, CA RESPONDENT BY: SH. AMRIK CHAND, DR DATE OF HEARING: 28.03.2014 DATE OF PRONOUNCEMENT: 31.03.2014 ORDER PER BENCH 1) THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST IMPUGNED ORDER DATED 16.08.2013 PASSED BY THE COMMISSIONER O F INCOME TAX (APPEALS), BATHINDA, FOR THE ASSESSMENT YEAR 2006-0 7 ON THE FOLLOWING GROUNDS: I. THAT THE LEARNED CIT(A), BATHINDA, HAS ERRED IN LAW AND ON FACTS, IN UPHOLDING THE PENALTY IMPOSED U/S 271(1)(C) AMOU NTING TO RS. 117232 @ 200% OF THE TAX SOUGHT TO BE EVADED. II. THAT THE LEARNED CIT(A), BATHINDA, HAS ERRED IN HOL DING THAT THE REASONS FOR MAKING THE ADDITION AND CONFIRMATION OF THE SAME BY APPELLATE AUTHORITIES ARE EQUALLY APPLICABLE FOR TH E LEVY OF PENALTY ABSOLUTELY IGNORING THE FACT THAT THERE IS NO CONCL USIVE EVIDENCE OF 2 I.T.A. NO. 656(ASR)/2013 ASSESSMENT YEAR: 2006-07 CONCEALMENT OF INCOME ON THE BASIS OF WHICH THE PEN ALTY COULD BE LEVIED OR CONFIRMED BY CIT(A). III. THAT THE LEARNED CIT(A), BATHINDA, HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATED THE FACT THAT THE PENALTY IMPOSED U /S 271(1)(C) @ 200% IS HIGHLY EXCESSIVE AND ABSOLUTELY UNREASONABL E. IV. THAT THE ORDER IS BAD IN LAW AND ON FACTS. V. THAT THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. 2) THE FACTS NARRATED BY THE REVENUE AUTHORITY ARE NOT DISPUTED BY BOTH THE PARTIES. FOR THE SAKE OF CONVENIENCE, THE BRIEF FACTS NARRATED BY LEARNED BY LEARNED FIRST APPELLATE AUTHORITY IN THE IMPUGNED ORDER ARE AS UNDER: BRIEFLY NOTICED, THE FACTS OF THE CASE ARE AS UNDE R:- 1. THE APPELLANT IS CARRYING ON BUSINESS IN INDIV IDUAL STATUS. THE CASH CREDITS IN THE NAME OF ROSY CHHABRA(WIFE) AND SANJEEV KUMAR (FIRST COUSIN) APPEARED IN THE BOOKS OF ACCOUNT DU RING THE RELEVANT ASSESSMENT YEAR. THE APPELLANT FILED CONFIRMATION, COPY OF ITR, BANK STATEMENTS DURING THE COURSE OF ASSESSMENT PROCEEDI NGS. IT WAS EXPLAINED BY THE APPELLANT THAT BOTH THE CREDITORS EARNED PRO FIT FROM COMMODITY EXCHANGE THROUGH M/S S.P. SCRIPS LTD. LUDHIANA (BRO KER) AND THE COPY OF ACCOUNT OF THE CREDITORS IN THE BOOKS OF BROKER AND THE BILLS OF THE BROKER WERE ALSO FILED. 1.1 THE APPELLANT ALSO PRODUCED BOTH THE CREDITOR S AND THEIR STATEMENTS WERE RECORDED BY THE A.O. BUT THE CREDIT ORS COULD NOT TELL THE NAME OF THE BROKER, RATE OF COMMISSION CHARGED BY T HE BROKER. THE APPELLANT FILED AFFIDAVIT FROM BOTH THE CREDITORS I N WHICH IT WAS STATED THAT THE BROKERAGE COMMISSION WAS INCLUDED IN THE PURCHA SE PRICE. THE A.O. MADE ADDITION OF RS. 174140/- U/S 68 ON ACCOUNT OF UNEXPLAINED CREDITS VIDE ORDER DATED 12.12.2008. 1.2 THE APPELLANT FILED AN APPEAL AGAINST THE ABOV E SAID ORDER BEFORE THE COMMISSIONER OF INCOME TAX(APPEALS), BAT HINDA. THE 3 I.T.A. NO. 656(ASR)/2013 ASSESSMENT YEAR: 2006-07 ADDITION OF RS. 174140/- WAS CONFIRMED BY MY PREDEC ESSOR IN APPEAL NO. 158-IT/08-09 VIDE ORDER DATED 12.06.2009. THE RELEV ANT FINDING ARE IN PARA 4.4 OF THE APPELLANT ORDER AND IT WAS HELD BY MY PREDECESSOR THAT IT CAN THUS BE CONCLUDED VERY RIGHTLY THAT THE AMOUNTS ALLEGEDLY RECEIVED BY THE ASSESSEE FROM THESE TWO PERSONS ARE HIS OWN MON EY CAMOUFLAGED AS RECEIVED FROM THEM THROUGH TRANSACTIONS WHICH HAVE BEEN FOUND TO BE IN GENUINE. AS SUCH AMOUNTS OF RS. 73145/- & RS. 10000 0/- ARE ADDED TO THE INCOME RETURNED BY THE ASSESSEE U/S 68 OF THE ACT A S THE ASSESSEES EXPLANATION ABOUT THE NATURE AND SOURCE OF THESE AM OUNTS HAS NOT BEEN FOUND SATISFACTORY. 1.3 THE APPELLANT FURTHER FILED APPEAL BEFORE THE I.T.A.T., AMRITSAR BENCH, AMRITSAR AGAINST THE ORDER OF MY PREDECESSOR . THE I.T.A.T. UPHELD THE ORDER OF MY PREDECESSOR VIDE ITS ORDER D ATED 30.10.2009 IN ITA NO. 351(ASR)/2009. 1.4 THE A.O. IMPOSED PENALTY OF RS. 1,17,232/- VID E ORDER DATED 14.05.2010 U/S 271(1)(C) OF THE ACT WITH REGARD TO ADDITION OF RS. 174140/- ON ACCOUNT OF ALLEGED UNEXPLAINED INVESTME NT U/S 68 AGAINST WHICH THE APPELLANT IS IN APPEAL. 3) AGAINST THE ORDER OF PENALTY DATED 14.05.210 PAS SED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE IN COME-TAX ACT, 1961 (IN SHORT THE ACT), THE ASSESSEE FILED AN APPEAL BEFORE THE LEARNED FIRST APPELLATE AUTHORITY, WHO VIDE IMPUGNED ORDER DATED 16.08.2013, DISMISSED THE APPEAL FILED BY THE ASSESSEE AND UPHE LD THE PENALTY IMPOSED BY THE ASSESSING OFFICER. NOW THE ASSESSEE, BEING AGGRIEVED WITH THE IMPUGNED ORDERED, FILED THE PRESENT APPEAL . 4) WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE R ELEVANT RECORDS AVAILABLE WITH US, ESPECIALLY THE ORDER PASSED BY L EARNED FIRST APPELLATE 4 I.T.A. NO. 656(ASR)/2013 ASSESSMENT YEAR: 2006-07 AUTHORITY ON THE ISSUE IN DISPUTE. WE ARE OF THE VI EW THAT THE REVENUE HAS IMPOSED THE PENALTY IN DISPUTE ON THE GROUND THAT S OURCE OF THE CREDITS ADVANCED BY THE ROSY CHHABRA, WIFE AND SANJEEV KUMA R, FIRST COUSIN OF THE ASSESSEE HAS NOT BEEN SUBSTANTIATED BY THE ASSE SSEE BY GIVING ANY PLAUSIBLE EXPLANATION. WE ARE OF THE VIEW THAT THE ADDITION ON ACCOUNT OF THIS CREDIT HAVE BEEN MADE BUT AS REGARDS TO PENALT Y IN DISPUTE, THE REVENUE AUTHORITY HAS NOT ESTABLISHED THAT THE ASSE SSEE HAS FILED ANY INCORRECT PARTICULARS OF INCOME IN THE RETURN OF IN COME. THE TRUE FACTS AND PARTICULARS ON THE CREDIT IN DISPUTE HAS BEEN FILED BY THE ASSESSEE IN RETURN OF INCOME, BUT THE SOURCE OF CREDIT HAS NOT BEEN BE LIEVED BY THE REVENUE AUTHORITY, WHICH DOES NOT MEAN THAT THE ASSESSEE HA S FILED INACCURATE PARTICULARS OF INCOME OR CONCEALED ANY PARTICULARS OF INCOME. THE ASSESSEE HAS ALSO NOT MADE ANY FALSE CLAIM BEFORE T HE REVENUE AUTHORITY. WE ARE OF THE VIEW THAT MERELY REJECTION OF CLAIM D OES NOT MEAN THAT THE PENALTY IN DISPUTE IS LEVIABLE IN THE PRESENT CASE. IN OUR CONSIDERED VIEW, THE EXPLANATION GIVEN BY THE ASSESSEE IS BONA FIDE AND IS ACCEPTABLE AND THE PENALTY IN DISPUTE IS NOT SUSTAINABLE IN THE EY E OF LAW. THEREFORE, THE IMPUGNED ORDER DATED 16.08.2013 PASSED BY LEARNED C IT(A), BATHINDA, DESERVES TO BE CANCELLED AND WE CANCEL THE SAME BY ACCEPTING THE APPEAL FILED BY THE ASSESSEE. 5 I.T.A. NO. 656(ASR)/2013 ASSESSMENT YEAR: 2006-07 5) IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MARCH, 2014 SD/./- SD/./- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 31 ST MARCH, 2014 /RK/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: SUNDER CHABRA PROP. SANITARY SALES, BATHINDA 2. ACIT, CIRCLE-1, BATHINDA 3. THE CIT(A), 4. THE CIT, 5. THE SR DR, I.T.A.T., TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.