ACIT, Kanpur V. Shri Som Prakash Goenka, Kanpur

ITA 689/LKW/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 78518 (ITAT-LUCKNOW)
• Duration Of Justice: 3 year(s) 5 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 21-04-2014
• Assessment Year: 2001-2002
• Appeal Filed On: 26-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK MITRA
• Assessee Lawyers: AKSHAY KUMAR GUPTA F
• Keywords: Gift; Valuation report; Assessment record
• Section: 133A; 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.689/LKW/2010 ASSESSMENT YEAR:2001 - 02 A.C.I.T. - 1, KANPUR. VS. SHRI SOM PRAKASH GOENKA, 51/40, NAYAGANJ, KANPUR. PAN:AAQPG0238C (APPELLANT) (RESPONDENT) APPELLANT BY SHRI ALOK MITRA, D.R. RESPONDENT BY SHRI AKSHAY KUMAR GUPTA, F.C.A. DATE OF HEARING 21/04/2014 DATE OF PRONOUNCEMENT 1 3 /05/2014 O R D E R PER A. K. GARODIA, A.M. THIS IS REVENUES APPEAL DIRECTED AGAINST THE ORDER PASSED BY LEARNED CIT(A) - I, KANPUR DATED 09/09/2010 FOR ASSESSMENT YEAR 2001 - 2002 2. THE GROUNDS RAISED BY THE REVENUE ARE AS UNDER: 1. THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) - I, KANPUR HAS ERRED IN LAW AND ON FACTS IN CANCELLING THE PENALTY UNDER SECTION 271(1)(C) OF RS.9,03,820/ - IMPOSED BY THE ASSESSING OFFICER ON THE CONCEALED INCOME OF RS.25,00,000/ - WITHOUT APPRECIATING THE FACTS OF THE CASE AND MATERIAL BROUGHT ON RECORD BY THE ASSESSING OFFICER. 2. IN DOING SO, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - I, KANPUR HAS NOT APPRECIATED THAT THE ACTION WAS TAKEN BY THE A.O. ON THE BASIS OF CREDIBLE INFORMATION REGARDING TAX EVASION IN THE FORM OF BOGUS GIFTS AS P ROVIDED BY THE DIRECTOR OF INCOME TAX (INVESTIGATION), KANPUR. 2 3. THE LD COMMISSIONER OF INCOME TAX (APPEALS) - I, KANPUR HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE ASSESSEE VOLUNTARILY SURRENDERED RS.25,00,000/ - , THE AMOUNT OF GIFT FOR TAX. THE ASSE SSEE HAD SURRENDERED THIS AMOUNT ONLY AFTER INITIATION OF ENQUIRIES IN THE TRANSACTION OF ALLEGED GIFT IN THE CASE OF THE ASSESSEE, BY THE DIT (INV), KANPUR. 4. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - I, KANPUR HAS FAILED TO APPRECIATE THE FACT THAT THE ASSESSEE HAD FAILED TO PROVE THE IDENTITY, CREDITWORTHINESS OF THE DONOR AND ALSO THE GENUINENESS OF THE TRANSACTION. 5. THAT THE ORDER OF THE LD. CIT (A) - I, KANPUR DATED 09.09.2010 NEEDS TO BE QUASHED AND THE ORDER PASSED BY THE ASSESSING OFFICER DAT ED 27.02.2006 BE RESTORED. 6. THAT THE APPELLANT CRAVES LEAVE TO MODIFY ANY OF THE GROUNDS OF APPEAL MENTIONED ABOVE AND/OR TO ADD ANY FRESH GROUNDS AS AND WHEN IT IS REQUIRED TO DO SO. 3. LEARNED D.R. OF THE REVENUE SUPPORTED THE PENALTY ORDER. HE PLACED RELIANCE ON THE JUDGMENT OF HON'BLE APEX COURT RENDERED IN THE CASE OF MAK DATA P. LTD. VS. CIT, CIVIL APPEAL NO. 9772 OF 2013. HE ALSO PLACED RELIANCE ON THE JUDGMENT OF HON'BLE ALLAHABA D HIGH COURT RENDERED IN THE CASE OF CIT VS. RAKESH SURI [2010] 233 CTR 0184 . A QUERY WAS RAISED BY THE BENCH REGARDING ASSESSMENT RECORDS OF THE ASSESSEE BECAUSE THE BENCH HAS DIRECTED ON EARLIER TWO OCCASIONS I.E. ON 22/11/2012 AND 09/04/2013 DIRECTING LEARNED D.R. TO PRODUCE THE ASSESSMENT RECORD. IN REPLY, IT WAS SUBMITTED BY LEARNED D.R. OF THE REVENUE THAT AS PER THE REPLY RECEIVED BY HIM FROM THE ASSESSING OFFICER, ASSESSMENT RECORDS OF THE ASSESSEE ARE NOT TRACEABLE. 4. AS AGAINST THIS , LEARNED A.R. OF THE ASSESSEE SUPPORTED THE ORDER OF CIT(A). REGARDING THE JUDGMENT CITED BY LEARNED D.R. OF THE REVENUE, IT WAS SUBMITTED THAT THESE JUDGMENTS ARE NOT APPLICABLE IN THE PRESENT CASE BECAUSE THE FACTS ARE DIFFERENT. HE PLACED RELIANCE ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS: 3 (I) I.T.A.T. LUCKNOW BENCH DECISION IN THE CASE OF VIVEK KUMAR AGARWAL VS. INCOME TAX OFFICER, I.T.A. NO.747/LUC/2006 (II) CIT VS. SURESH CHAND MITTAL 251 ITR 9 (SC) (III) JAYSUKH M. PARMAR VS. ACIT [2013] TAXMAN.COM 422 (AHMEDABAD TRIB) (IV) SAKET AGARWAL VS. INCOME TAX OFFICER [2013] 36 TAXMAN.COM 298 (DELHI TRIB.) (V) CIT UP VS. NET RAM SWARUP 88 ITR 213 (ALL) (VI) ADDL. CIT VS. SOLAR CHEMICALS PVT. LTD. 150 ITR 410 (ALL) 4.1 HE ALSO PLACED RELIANCE ON THE TRIBUNA L DECISION RENDERED IN THE CASE OF JAI NARAIN UPADHYAY VS. ACIT AS REPORTED IN [2012] 137 ITD 241 (LUC)(TM). 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND THE JUDGMENTS CITED BY BOTH THE SIDES. FIRST OF ALL , WE TAKE NOTE OF THE FACTS LEADING TO THE ADDITION. WE FIND THAT IN THE ASSESSMENT ORDER , IT IS NOTED BY THE ASSESSING OFFICER IN PARA 4 THAT IN THIS YEAR , THE ASSESSEE HAS SHOWN TO HAVE RECEIVED GIFT OF RS.25,00,000/ - FROM SANJEEV MOHAN AGARWAL, RESIDENT OF 4674 SHORA KOTHI, PAHARGANJ, NEW DELHI. IN COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED BY THE ASSESSING OFFICER TO FURNISH THE DETAILS IN RESPECT OF THE GIFT AND TO PROVE THE GIFT TRANSACTIONS. THE ASSESSING OFFICER FURTHER NOTED THAT IN THE MEANWHILE THE DIRECTORATE OF INCOME - TAX INVESTIGATION, KANPUR STARTED INVESTIGATION IN THE TRANSACTION OF ALLEGED GIFT IN THE CASE OF THE ASSESSEE. HE FURTHER NOTED THAT AT THIS STAGE, THE ASSESSEE SURRENDERED THE GIFT AMOUNT AS INCOME ON FEELING THE HEAT OF INVESTIGATION. ON THIS BASIS, THE ASSESSING OFFICER CAME TO THE CONCLUSION THAT IT IS ESTABLISHED BEYOND DOUBT THAT THE SAID GIFT SHOWN BY THE ASSESSEE WAS BOGUS. IN ORDER TO EXAMINE THESE FACTS, THE BENCH ASKED THE REVENUE TO PRODUCE THE ASSESSMENT RECORDS IN ORDER TO ASCERTAIN AS TO WHAT WAS THE ENQUIRY MADE BY THE ASSESSING OFFICER IN COURSE OF ASSESSMENT PROCEEDINGS. IT WA S ALSO CONSIDERED RELEVANT TO FIND OUT AS TO WHAT WAS THE FINDING OF THE INVESTIGATION WING OF THE DEPARTMENT IN THIS REGARD AND 4 WHETHER THIS PARTICULAR GIFT WAS FOUND BY THEM AS BOGUS OR THERE WAS A GENERAL DOUBT AND SUSPICION. THE REVENUE COULD NOT PRODUCE THE ASSESSMENT RECORDS TO ESTABLIS H THESE POINTS. HENCE, WE EXAMINE THE APPLICABILITY OF VARIOUS JUDGMENTS CITED BY REVENUE IN THE LIGHT OF THESE FACTS. 5.1 FIRST WE CONSIDER THE APPLICABILITY OF THE JUDGMENT OF HON'BLE APEX COURT RENDERED IN THE CASE OF MAK DATA P. LTD. (SUPRA). IN THI S CASE, THE DECISION OF HON'BLE APEX COURT IS ON THE BASIS THAT THE SURRENDER WAS MADE BY THE ASSESSEE IN VIEW OF DETECTION MADE BY THE ASSESSING OFFICER IN THE SEARCH CONDUCTED IN THE SISTER CONCERN OF THE ASSESSEE. IT WAS HELD BY HON'BLE APEX COURT THAT IN THAT SITUATION, IT CANNOT BE SAID THAT THE SURRENDER OF INCOME WAS VOLUNTARY. IN THAT CASE , IT WAS NOTICED BY THE ASSESSING OFFICER THAT CERTAIN DOCUMENTS COMPRISED OF SHARE APPLICATION FORMS, BANK STATEMENTS, MEMORANDUM OF ASSOCIATION OF COMPANIES, AFFIDAVITS, COPIES OF INCOME TAX RETURN AND ASSESSMENT ORDERS AND BLANK SHARE TRANSFER DEEDS HAVE BEEN IMPOUNDED IN THE COURSE OF SURVEY PROCEEDINGS U/S 133A CONDUCTED ON 16/03/2003 IN THE CASE OF SISTER CONCERN. WHEN A BLANK SHARE TRANSFER DEED IS FOUND IN COURSE OF SURVEY THEN THERE IS A EVIDENCE REGARDING CONCEALMENT OF INCOME BUT IN THE PRESENT CASE, NO SUCH EVIDENCE HAS BEEN FOUND BY THE ASSESSING OFFICER IN COURSE OF ASSESSMENT PROCEEDINGS. THE REVENUE COULD NOT PRODUCE EVEN THE ASSESSMENT RECORD B EFORE US AND THEREFORE, IN THE FACTS OF THE PRESENT CASE, WE ARE OF THE CONSIDERED OPINION THAT THIS JUDGMENT IS NOT APPLICABLE IN THE PRESENT CASE. 5.2 NOW WE EXAMINE THE APPLICABILITY OF THE JUDGMENT OF HON'BLE ALLAHABAD HIGH COURT RENDERED IN THE CASE OF RAKESH SURI (SUPRA). IN THAT CASE , THE DISPUTE WAS REGARDING LONG TERM CAPITAL GAIN DECLARED BY THE ASSESSEE IN RESPECT OF PURCHASE AND SALE OF SHARES. THE ASSESSING OFFICER REQUIRED THE ASSESSEE TO FURNISH THE VALUATION REPORT OF THE APPROVED VALUER, SOURCE OF INVESTMENT IN THE PURCHASE OF SHARES, COPY OF BANK PASSBOOK EXPLAINING EACH 5 CREDIT AND DEBIT ENTRY, COPY OF DEMAT ACCOUNT, IF ANY, BUT THESE DETAILS WERE NOT FURNISHED BY THE ASSESSEE AND THEREAFTER, THE ASSESSEE SURRENDERED THE ENTRIES APPEARIN G IN BANK ACCOUNT NO. 459 OF ALLAHABAD BANK ON SALE OF SHARES AMOUNTING TO RS.61,35,544/ - WHEREAS IN RETURN OF INCOME, THE SALE PROCEED WAS DISCLOSED AT RS.25,25,400/ - . THIS GOES TO SHOW THAT AS PER THE FACTS OF THAT CASE, THE ASSESSING OFFICER COULD UNEA RTH A BANK ACCOUNT NO. 459 IN WHICH SALE PROCEED S OF SHARES OF RS.61.35 LAC WAS DEPOSITED AND SAME WAS NOT DISCLOSED BY THE ASSESSEE IN THE RETURN OF INCOME AND ON SUCH INCOME , THE PENALTY WAS IMPOSED BY THE ASSESSING OFFICER AND SUCH PENALTY WAS UPHELD BY HON'BLE ALLAHABAD HIGH COURT. IT IS APPARENT THAT THE FACTS OF THAT CASE ARE TOTALLY DIFFERENT AND THEREFORE, THIS JUDGMENT OF HON'BLE ALLAHABAD HIGH COURT IS ALSO NOT APPLICABLE IN THE FACTS OF THE PRESENT CASE. 5.3 NOW WE EXAMINE THE APPLICABILITY OF THE JUDGMENTS CITED BY LEARNE D A.R. OF THE ASSESSEE. WE FIND THAT THE TRIBUNAL DECISION RENDERED IN THE CASE OF VIVEK KUMAR AGARWAL VS. INCOME TAX OFFICER IN I.T.A. NO.747/LUC/2006 IS SQUARELY APPLICABLE. IN THAT CASE ALSO, THE ASSESSEE OFFERED THE GIFT RECEIVED AS HIS INCOME IN THE RETURN FILED IN RESPONSE TO NOTICE U/S 148 AND THE ASSESSING OFFICER CONSIDERED THE SAME AS INCOME ON THE GROUND THAT THE INVESTIGATION DIRECTORATE UNEARTHED A FAKE GIFT RACKET. UNDER THESE FACTS, IT WAS HELD BY THE TRIBUNAL THAT THE DEPARTMENT DID NOT BR ING ANY EVIDENCE ON RECORD TO SHOW THAT THE ASSESSEE WAS PART OF GIFT RACKET OR THE ASSESSEE SURRENDERED THE GIFT PURSUANT TO INVESTIGATION BY THE DEPARTMENT AND ALSO THE DEPARTMENT COULD NOT BRING ANY EVIDENCE TO SUBSTANTIATE THAT THE EXPLANATION OF THE ASSESSEE WAS FALSE OR THE PARTICULARS GIFT WAS FAKE. ON THIS BASIS, THE PENALTY WAS CANCELLED IN THAT CASE BY THE TRIBUNAL. IN THE PRESENT CASE ALSO, THE FACTS ARE SIMILAR BECAUSE IN THE PRESENT CASE ALSO , THE DEPARTMENT HAS NOT BROUGHT ANY EVIDENCE ON RECORD TO SHOW THAT THE ASSESSEE WAS PART OF THE SAID GIFT RACKET OR THE ASSESSEE SURRENDERED THE GIFT PURSUANT TO THE INVESTIGATION BY THE DEPARTMENT AND THE DEPARTMENT ALSO COULD NOT BRING ANY 6 EVIDENCE TO S UBSTANTIATE THAT THE EXPLANATION OF THE ASSESSEE WAS FALSE OR THE PARTICULAR GIFT WAS FAKE. HENCE, RESPECTFULLY FOLLOWING THIS TRIBUNAL DECISION, WE DELETE THE PENALTY IN THE PRESENT CASE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIMISSED . (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 3 /05/2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR