ACIT, New Delhi V. Smt. Rosy Dabas, New Delhi

ITA 6641/DEL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3043 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 2 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2007-2008
• Appeal Filed On: 28-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ATIQ AHMAD SENIOR
• Keywords: Unexplained expenditure; Search and seizure; Source of fund

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH F : NEW DELHI) BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER ITA NO.6641/DEL./2016 (ASSESSMENT YEAR : 2007-08) ACIT, CENTRAL CIRCLE 18, VS. SMT. ROSY DABAS, NEW DELHI. C/O TIRUPATI BUILDING 1, PLOT NO.3, DWARKA CITY CENTRE, SECTOR 10, DWARKA, NEW DELHI 110 075. (PAN : ACEPD8776E) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI ATIQ AHMAD, SENIOR DR DATE OF HEARING : 20.03.2018 DATE OF ORDER : 23.03.2018 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, ASSISTANT COMMISSIONER OF INCOME-TAX, C ENTRAL CIRCLE 18, NEW DELHI (HEREINAFTER REFERRED TO AS T HE REVENUE), BY FILING THE PRESENT APPEAL SOUGHT TO SET ASIDE THE I MPUGNED ORDER DATED 24.10.2016 PASSED BY THE COMMISSIONER OF INCO ME-TAX (APPEALS)-27, NEW DELHI DELETING THE PENALTY ORDER DATED 21.03.2016 PASSED U/S 271(1)(C) OF THE INCOME-TAX A CT, 1961 (FOR ITA NO.6641/DEL./2016 2 SHORT THE ACT), QUA THE ASSESSMENT YEAR 2007-08 O N THE GROUNDS INTER ALIA THAT :- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT (A) HAS ERRED IN LAW IN DELETING THE PE NALTY U/S 271(1)(C) OF RS.21,35,630/- OVERLOOKING THE FAC T THAT THE ADDITIONS MADE BY THE ASSESSING OFFICER HAVE BE EN SUSTAINED BY CIT (A) AND THE ASSESSEE HAS FAILED TO SATISFACTORILY EXPLAIN AND PROVIDE DOCUMENTARY EVIDENCE IN SUPPORT OF ITS CLAIM OF SOURCE OF FUNDS FOR EXPENDITURE INCURRED. 2. THE ORDER OF THE LD. CIT (A) IS ERRONEOUS AND NO T TENABLE IN LAW AND ON FACTS. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : ON THE BASIS OF COMPLETED ASSESSMENT U/S 153A/143(3) OF THE ACT AT AN INCOME OF RS.65,81,260 /- AS AGAINST THE RETURNED INCOME OF RS.2,41,260/-, THE PENALTY P ROCEEDINGS WERE INITIATED AGAINST THE ASSESSEE ON THE GROUND THAT T HE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME TO THE T UNE OF RS.18,40,000/- AND RS.45,00,000/- AND ADDITION THER EOF WAS MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE. AO REJECTED THE CONTENTION OF THE ASSESSEE THAT THE SAID UNEXPLAINE D EXPENDITURE HAVE BEEN MADE BY THE ASSESSEE ON CONSTRUCTION OF H OUSE OUT OF SURRENDERED AMOUNT MADE BY SHRI SUBHASH DABAS, HUSB AND OF THE ASSESSEE DURING THE SEARCH CONDUCTED ON 01.06.2006, LEVIED THE PENALTY OF RS.21,35,630/-. ITA NO.6641/DEL./2016 3 3. ASSESSEE CHALLENGED THE PENALTY ORDER BY WAY OF AN APPEAL BEFORE THE LD. CIT (A) WHO HAS DELETED THE PENALTY OF RS.21,35,630/- LEVIED BY THE AO BY ALLOWING THE APP EAL. FEELING AGGRIEVED, THE REVENUE HAS COME UP BEFORE THE TRIBU NAL BY FILING THE PRESENT APPEAL. 4. ON THE LAST DATE OF HEARING I.E. 02.01.2018, THE MATTER WAS ADJOURNED TO 21.03.2018 ON THE WRITTEN REQUEST OF T HE LD. AR FOR THE ASSESSEE. BUT, ASSESSEE HAS NOT PREFERRED TO PUT I N APPEARANCE ON 21.03.2018 AND CONSEQUENTLY, WE PROCEEDED TO DECIDE THE PRESENT APPEAL WITH THE ASSISTANCE OF THE LD. DR AS WELL AS ON THE BASIS OF DOCUMENTS AVAILABLE ON THE FILE. 5. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIV E FOR THE REVENUE TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 6. UNDISPUTEDLY, ADDITION OF RS.18,40,000/- WAS MAD E ON ACCOUNT OF UNEXPLAINED EXPENDITURE INCURRED ON PAYM ENT OF STAMP DUTY ETC. ON PURCHASE OF LAND AND ADDITION OF RS.45 ,00,000/- WAS MADE ON ACCOUNT OF UNEXPLAINED EXPENDITURE INCURRED ON CONSTRUCTION OF HOUSE ON THE AFORESAID PLOT. IT IS ALSO NOT IN DISPUTE THAT DURING SEARCH AND SEIZURE OPERATION CONDUCTED AT THE PREMISES OF ASSESSEE AND HER HUSBAND, SHRI SUBHASH DABAS ON 01.06.2006. ITA NO.6641/DEL./2016 4 AFORESAID CASH WAS SURRENDERED AND THE ASSESSMENT W AS COMPLETED U/S 153A/143(3) OF THE ACT. 7. IN THE BACKDROP OF THE AFORESAID FACTS AND CIRCU MSTANCES OF THE CASE, ORDER PASSED BY THE LOWER AUTHORITIES AND ARGUMENTS ADDRESSED BY THE AUTHORIZED REPRESENTATIVES OF BOTH THE PARTIES, THE SOLE QUESTION ARISES FOR DETERMINATION IN THIS CASE IS:- AS TO WHETHER THE ASSESSEE HAS CONCEALED PARTICULA RS OF INCOME OR HAS FURNISHED INACCURATE PARTICULARS OF INCOME DURING ASSESSMENT PROCEEDINGS? 8. HONBLE SUPREME COURT IN A CASE CITED AS RELIANCE PETRO PRODUCTS PVT. LTD. 322 ITR 158 (SC) WHILE INTERPRETING THE PROVISIONS CONTAINED U/S 271(1)(C) OF THE ACT DECID ED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE. OPERATIVE PART OF WHICH IS REPRODUCED FOR READY REFERENCE AS UNDER :- A GLANCE AT THE PROVISIONS OF SECTION 271(1)(C) OF THE I.T. ACT, 1961 SUGGESTS THAT IN ORDER TO BE COVERED BY IT, THERE HAS TO BE CONCEALMENT OF THE PARTICULARS OF T HE INCOME OF THE ASSESSEE. SECONDLY, THE ASSESSEE MUS T HAVE FURNISHED INACCURATE PARTICULARS OF HIS INCOME . THE MEANING OF THE WORD PARTICULARS USED IN SECTI ON 271(1)(C) WOULD EMBRACE THE DETAIL OF THE CLAIM MAD E. WHERE NO INFORMATION GIVEN IN THE RETURN IS FOUND T O BE INCORRECT OR INACCURATE, THE ASSESSEE CANNOT BE HEL D GUILTY OF FURNISHING INACCURATE PARTICULARS. IN OR DER TO EXPOSE THE ASSESSEE TO PENALTY, UNLESS THE CASE IS STRICTLY COVERED BY THE PROVISION, THE PENALTY PROVISION CAN NOT BE INVOKED. BY NO STRETCH OF IMAGINATION CAN MAKIN G AN INCORRECT CLAIM TANTAMOUNT TO FURNISHING INACCUR ATE PARTICULARS. THERE CAN BE NO DISPUTE THAT EVERYTHI NG WOULD DEPEND UPON THE RETURN FILED BY THE ASSESSEE, ITA NO.6641/DEL./2016 5 BECAUSE THAT IS THE ONLY DOCUMENT WHERE THE ASSESSE E CAN FURNISH THE PARTICULARS OF HIS INCOME. WHEN SU CH PARTICULARS ARE FOUND TO BE INACCURATE, THE LIABILI TY WOULD ARISE. TO ATTRACT PENALTY, THE DETAILS SUPPL IED IN THE RETURN MUST NOT BE ACCURATE, NOT EXACT OR CORRE CT, NOT ACCORDING TO THE TRUTH OR ERRONEOUS. WHERE THERE IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE THERE IS NO QUESTIO N OF INVITING THE PENALTY UNDER SECTION 271(1)(C). A ME RE MAKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. SUCH A CLAIM MADE IN THE RETURN CANNOT AMOUNT TO FURNISHING INACCURATE PARTICULARS. 9. WHEN WE EXAMINE THE CONTENTIONS RAISED BY THE LD . AR FOR THE ASSESSEE BEFORE THE LD. CIT (A) THAT AO HAS NOT BROUGHT ON RECORD ANY EVIDENCE THAT THE ASSESSEE HAS INCURRED AFORESAID EXPENDITURE OUT OF UNEXPLAINED SOURCES, IN THE LIGH T OF THE SETTLED PRINCIPLES OF LAW THAT ASSESSMENT PROCEEDINGS AS WE LL AS PENALTY PROCEEDINGS ARE TO BE DECIDED INDEPENDENTLY AND MER ELY ON THE BASIS OF COMPLETED ASSESSMENT, PENALTY CANNOT BE LE VIED. IN THE INSTANT CASE, WHEN WE EXAMINE THE PENALTY ORDER THE RE IS NO INDEPENDENT MATERIAL WITH THE AO TO ARRIVE AT THE C ONCLUSION THAT THE AFORESAID AMOUNTS OF RS.18,40,000/- AND RS.45,0 0,000/- WERE UNEXPLAINED INCOME OF THE ASSESSEE. 10. WHEN THE ASSESSEE HAS COME UP WITH THE SPECIFIC PLEA DURING PENALTY PROCEEDINGS THAT THE AMOUNT OF RS.18,40,000 /- AND ITA NO.6641/DEL./2016 6 RS.45,00,000/- ARE PART AND PARCEL OF THE SURRENDER ED CASH AMOUNT BY HER HUSBAND, SHRI SUBHASH DABAS, THE AO HAS NOT RETURNED ANY FINDING TO DISPUTE THIS FACT, PENALTY IMPOSED IN TH IS CASE IS NOT SUSTAINABLE. 11. IN VIEW OF WHAT HAS BEEN DISCUSSED ABOVE, WE AR E OF THE CONSIDERED VIEW THAT THE AO HAS FAILED TO MAKE OUT THE CASE OF CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF SUCH INCOME BY THE ASSESSEE RATHER IMPOSED THE PENA LTY BY RELYING UPON THE ASSESSMENT ORDER ON THE BASIS OF HIS SUBJE CTIVE SATISFACTION WITHOUT COMPLETING NECESSARY INGREDIEN TS TO INITIATE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT, HENCE THE IMPUGNED ORDER PASSED BY THE LD. CIT (A) NEEDS NO INTERFEREN CE HAVING NO ILLEGALITY OR PERVERSITY IN THE SAME. CONSEQUENTLY , THE APPEAL FILED BY THE REVENUE IS HEREBY DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THIS 23 RD DAY OF MARCH, 2018. SD/- SD/- (R.K. PANDA) (KULDIP SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 23 RD DAY OF MARCH, 2018 TS ITA NO.6641/DEL./2016 7 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-27, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.