RUPESH BANSAL, BHARATPUR V. DCIT, BHARATPUR

ITA 666/JPR/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5327 (ITAT-JAIPUR)
• Duration Of Justice: 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 27-07-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAJENDRA SINGH CIT DHK
• Keywords: Unexplained investment; Business income; Loose papers
• Section: 143(3); 133A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOE FLAG ;KNO] YS[KK LNL; ,OA JH YFYR DQEKJ] U; KF;D LNL; DS LE{K BEFORE: SHRI VIKRAM SINGH YADAV, AM & SHRI LALIET K UMAR, JM VK;DJ VIHY LA-@ ITA NO.666/JP/15 U/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 SHRI RUPESH BANSAL PROP. M/S BANSAL STONE INDUSTRY MURRKI, BAYANA DIST. BHARATPUR CUKE VS. THE DCIT, CIRCLE, BHARATPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AHMPB 1131G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI RAJENDRA AGARWAL (C.A.) JKTLO DH VKSJ LS@ REVENUE BY : SHRI RAJENDRA SINGH (ADDL.CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 01.04.2016 ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 13/05/2016. VKNS'K@ ORDER PER SHRI VIKRAM SINGH YADAV, A.M. THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A), ALWAR DATED 19.05.2015 WHEREIN THE ASSESSE HAS TAKEN FOLL OWING GROUNDS OF APPEAL: ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD . CIT(A) HAS ERRED IN CONFIRMING THE LEVY OF PENALTY OF RS. 5,11,021/- IM POSED BY THE AO U/S 271(1)(C) OF THE IT ACT. YFYR DQEKJ]] U;KF;D LNL; ITA NO.666/JP/15 SHRI RUPESH BANSAL VS. DCIT, CIRCLE, BHARATPUR 2 2. IN THIS CASE, THE RETURN OF INCOME DECLARING TOT AL INCOME OF RS.170,826/- WAS FILED BY THE ASSESSEE AND ASSESSMENT U/S 143(3) WAS COMPLETED AT THE TOTAL INCOME OF RS. 31,51,770/- BY MAKING ADDITION OF RS. 29,80,946/- ON ACCOUNT OF GP ON UNACCOUNTED SALE, UNACCOUNTED PURC HASE, UNACCOUNTED EXPENSES AND UNACCOUNTED INVESTMENT IN STOCK. IN T HIS CASE, SURVEY U/S 133A OF THE IT ACT WAS CARRIED OUT ON 18.03.2008 AT THE BUSINESS PREMISES OF THE ASSESSEE. DURING THE COURSE OF SURVEY PROCEEDINGS CERTAIN INCRIMINATING DOCUMENTS/LOOSE PAPERS DIARY/BILLS ETC. WERE FOUND AND IMPOUNDED. DURING THE COURSE OF ASSESSMENT PROCEEDINGS THE AR OF THE ASSESSEE WAS ASKED TO VERIFY THESE IMPOUNDED DOCUMENTS WITH REGULAR BOOKS OF ACCOUNTS. IN RESPONSE TO THE SAME, THE ASSESSEE PRODUCED REGULAR BOOKS OF ACCOUNTS WHICH WERE VERIFIED WITH THE IMPOUNDED MATERIAL. THE AOS VIEW WAS THAT THE ASSESSEE HAS NOT ACCOUNTED FOR HUGE AMOUNT OF SALE & PURCHASE AND EXPENSES IN HIS REGULAR BOOKS OF ACCOUNT WHICH IS EVIDENT FR OM THE IMPOUNDING MATERIAL. THUS THE ASSESSEE HAS CONCEALED HIS INCOME AND NOT DISCLOSED CORRECTLY AND ALSO FURTHER FURNISHED INACCURATE PARTICULARS OF HI S INCOME. THUS IT WAS HELD TO BE A FIT CASE OF IMPOSING PENALTY U/S 271(1)(C) OF THE IT ACT. THEREFORE, THE AO IMPOSED A PENALTY OF RS. 5,11,021/- U/S 271(1)(C) @ 100% OF THE TAX SOUGHT TO BE EVADED. 2.1 BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTE R IN APPEAL BEFORE THE LD. CIT(A) WHO HAS GIVEN HIS FINDING AS UNDER: I HAVE CAREFULLY EXAMINED THE FACTS OF THE CASE AN D FIND THAT DURING THE COURSE OF SURVEY OPERATIONS AT THE BUSINESS PREMISE S OF THE APPELLANT INCRIMINATING DOCUMENTS WERE FOUND PERTAINING TO TH E SALES BEING UNDERTAKEN OUTSIDE THE BOOKS OF ACCOUNTS, UNACCOUNTED INVESTME NT IN STOCK AND UNACCOUNTED EXPENSES ETC. BASED ON THESE FACTS AND EVIDENCE GATHERED AT THE TIME OF SURVEY, AN AMOUNT OF RS. 30 LACS WAS OFFERE D FOR TAXATION BY THE APPELLANT IN THE COURSE OF STATEMENT RECORDED AT TH E TIME OF SURVEY. THE APPELLANT HOWEVER DID NOT DISCLOSE ANY ADDITIONAL INCOME ON THIS ACCOUNT AT THE TIME OF FILING OF RETURN OF INCOME AFTER THE SU RVEY. THEREFORE, THE CLAIM OF THE APPELLANT THAT THE AMOUNT OF ADDITION IS COVERE D ON ACCOUNT OF SURRENDER MADE BY THE APPELLANT IS NOT CORRECT AND IS CONTRAR Y TO THE EVIDENCE AVAILABLE ON RECORD. FURTHER THE CLAIM OF HAVING FILED REVIS ED RETURN IN THE COURSE OF ASSESSMENT PROCEEDINGS IS ALSO FOUND TO BE NOT CORR ECT AS NO VALID REVISED ITA NO.666/JP/15 SHRI RUPESH BANSAL VS. DCIT, CIRCLE, BHARATPUR 3 RETURN COULD BE FILED WITHIN THE TIME PROVIDED UNDE R THE PROVISIONS OF THE IT ACT. THEREFORE, ADDITIONS MADE BY THE AO ON ACCOUNT OF I NCRIMINATING DOCUMENTS/PAPERS FOUND AT THE TIME OF SURVEY ARE BA SED ON THE EVIDENCE COLLECTED BY THE DEPARTMENT. THE AO HAS BEEN JUSTI FIED IN INITIATING & IMPOSING THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AS THE APPELLANT HAS CLEARLY CONCEALED THE INCOME AND FURNISHED INACCURATE PARTI CULARS OF THIS INCOME. IN VIEW OF THE ABOVE DISCUSSION, I CONFIRM THE LEVY OF PENALTY OF RS. 5,11,021/- IMPOSED BY THE AO U/S 271(1)(C) OF THE IT ACT, 196 1. 2.2 THE LD. AR OF THE ASSESSEE SUBMITTED THAT AT TH E TIME OF FILING OF RETURN OF INCOME, THE ASSESSEE HAS SHOWN AND DECLARED TOTA L SALES OF RS. 22,95,256/- AND RS. 52,22,593/- TOTALLING TO RS. 75,17,849/- AN D AFTER THE APPEAL EFFECT OF THE ORDER OF THE LD. CIT(A) THE TOTAL SALES COMPUTE D AT RS. 68,67,261/- AND RS. 13,80,472/- TOTALLING RS. 82,47,733/- HENCE FINALLY THE UNACCOUNTED SALES WHICH HAD NOT BEEN SHOWN AND DECLARED BY THE ASSESSEE IN THE RETURN OF INCOME COMES TO RS. 7,29,884/- ONLY. THEREFORE, CONSIDERA TION OF PROFIT ON ACCOUNT OF G.P. ON UNACCOUNTED SALES DETECTED, CONSIDERED BY T HE LD. AO RS. 9,61,417/- AT THE TIME OF LEVYING THE PENALTY U/S 271(1)(C) IS VE RY INCORRECT AS G.P. OF UNACCOUNTED SALES OF RS. 7,29,884/- @ 14% COMES TO RS. 1,02,184/- ONLY. THE LD. AO AS WELL AS CIT(A) HAVE IGNORED THIS VERY REL EVANT AND CRUCIAL FACT THAT THE ASSESSEE HAS HIMSELF VOLUNTARILY DECLARED UNACCOUNT ED SALES OF RS. 52,22,593/- IN THE RETURN OF INCOME ITSELF AND PAID THE TAXES B Y APPLYING NP RATE OF 3% WHILE THE LD. CIT(A) VERY INCORRECTLY STATED THAT T HE APPELLANT DID NOT DISCLOSE ANY ADDITIONAL INCOME ON THIS ACCOUNT AT THE TIME OF FILING OF RETURN OF INCOME AFTER SURVEY. HENCE THEREFORE THE ASSESSEE HAS NOT CONCEALED HIS INCOME AND DISCLOSED CORRECTLY AND NOT FURNISHED ANY INACCURAT E PARTICULAR IN HIS RETURN OF INCOME AND ACCORDINGLY NO PENALTY U/S 271(1)(C) IS LEVIABLE. THE ADDITION ON A/C OF UNACCOUNTED PURCHASES OF RS. 5,60,950/- IS M UCH LOWER CONSIDERING THE UNACCOUNTED SALES OF RS. 68,67,261/- VOLUNTARILY SH OWN BY THE ASSESSEE IN HIS RETURN OF INCOME ITSELF, WHICH WAS UTILIZED FOR MAK ING THE ENTIRE UNACCOUNTED PURCHASE HENCE THEREFORE THE ASSESSEE HAS NOT CONCE ALED HIS INCOME AND DISCLOSED CORRECTLY AND NOT FURNISHED ANY INACCURA TE PARTICULAR IN HIS RETURN OF INCOME. IT WAS FURTHER SUBMITTED THAT NO PENALTY U /S 271(1)(C) CAN BE IMPOSED IN REGARD TO ADDITIONS TO THE INCOME OF AN ASSESSEE ON ESTIMATED /ADHOC BASIS. 2.3 THE LD DR IS HEARD WHO HAS RELIED ON THE ORDER OF LOWER AUTHORITIES. 2.4 WE HAVE HEARD THE RIVAL CONTENTIONS AND PURSUED THE MATERIAL ON RECORD. IT IS NOTED THAT PENALTY HAS BEEN LEVIED I N RESPECT OF G.P ADDITION ON ITA NO.666/JP/15 SHRI RUPESH BANSAL VS. DCIT, CIRCLE, BHARATPUR 4 UNACCOUNTED SALES, UNACCOUNTED PURCHASES AND UNACCO UNTED EXPENSES. FIRSTLY, REGARDING G.P. ADDITION ON ACCOUNT OF UNAC COUNTED SALES OF RS 68,67,261 IS CONCERNED, THE LD AR HAS SUBMITTED THAT THE APPELLANT HAS ALREADY DECLARED THE UNACCOUNTED SALES AMOUNTING TO RS 52,22,593 IN HIS RETURN OF INCOME FILED AFTER THE DATE OF SURVEY OUT OF TOTAL UNACCOUNTED SALES OF RS 68,67,261 AND AFTER TAKING INTO CONSIDERATION SALES ORIGINALLY SHOWN IN THE FINANCIAL STATEMENTS OF RS 22,95,256, THE ADDITION ON ACCOUNT OF UNACCOUNTED SALES SHOULD HAVE BEEN RESTRICTED TO RS 7,29,884 ON LY. THE LD AR FURTHER SUBMITTED THAT EVEN THOUGH THE APPELLANT HAS NOT FU RTHER CONTESTED THE SAID DOUBLE ADDITION BEFORE THE AO OR BEFORE THE TRIBUNA L, THE SAME CANNOT BE BASIS FOR LEVY OF PENALTY. WE FIND FORCE IN THE AR GUMENT OF THE LD AR AND THE AO IS DIRECTED TO VERIFY THE SAME CLAIM OF THE APPE LLANT AND WHERE THE SAID CLAIM IS FOUND TO BE CORRECT, THE AO IS DIRECTED TO DELETE THE PENALTY CORRESPONDING TO THE DOUBLE ADDITION MADE IN THE QU ANTUM PROCEEDINGS. REGARDING LEVY OF PENALTY ON ACCOUNT OF UNACCOUNTED PURCHASES OF RS 5,60,950 WHICH HAS BEEN CONFIRMED IN THE QUANTUM PROCEEDINGS BEFORE THE LD CIT(A), THE APPELLANT HAS NOT SUBMITTED ANY CONVINCING EXPL ANATION TO SUPPORT ITS CASE. THE FACT THAT SURVEY HAS HAPPENED AND INSPITE OF OP PORTUNITY TO FILE UNDISCLOSED PURCHASES IN THE RETURN OF INCOME WHICH HAS BEEN FILED SUBSEQUENTLY, THE APPELLANT HAS NOT DISCLOSED THE S AID UNACCOUNTED PURCHASES, THE SAME SHOWS LACK OF BONAFIDE ON PART OF THE APPE LLANT TO DISCLOSE ACCURATE PARTICULARS OF HIS INCOME. THE PENALTY ON ACCOUNT OF UNACCOUNTED PURCHASES OF RS 5,60,950 IS ACCORDINGLY CONFIRMED. REGARDING LEVY OF PENALTY ON ACCOUNT OF UNACCOUNTED EXPENSES, THE LD AR HAS SUBMITTED THAT THIS RELATES TO DONATION OF RS 5000 WHICH HAS NOT BEEN CLAIMED IN THE PROFIT/LOSS ACCOUNT AT FIRST PLACE AND THERE FORE THE QUESTION OF DISALLOWANCE AND CONSEQUENT LEVY OF PENALTY THEREON DOESNT ARISE. WE ARE IN AGREEMENT WITH THE LD AR. THE AO IS DIRECTED TO VE RIFY THE SAID CLAIM OF THE APPELLANT AND WHERE THE SAME IS FOUND TO BE CORRECT , THE AO IS DIRECTED TO DELETE THE SAME. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. ITA NO.666/JP/15 SHRI RUPESH BANSAL VS. DCIT, CIRCLE, BHARATPUR 5 ORDER PRONOUNCED IN THE OPEN COURT ON 13 / 05/2016. SD/- SD/- ( LALIET KUMAR ) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED:- 13 / 05 /2016 PILLAI VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SHRI RUPESH BANSAL, BHARATPUR 2. THE RESPONDENT- THE DCIT, CIRCLE, BHARATPUR 3. THE CIT(A) KOTA 4. THE CIT-KOTA 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO.666 /JP/15) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR