MUKESH D. DEDHIA, NAVI MUMBAI V. ACIT CEN CIR 23, MUMBAI

ITA 7032/MUM/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3133 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 6 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 17-11-2014
• Court: TRIBUNAL
• Department Lawyers: VINITA MENON
• Keywords: Gift; Search and seizure
• Section: 143(3); 15

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE S/SHRI B.R. BASKARAN (AM) & RAMLAL NEGI (JM) I.T.A. NO. 7032 /MUM/ 20 14 (ASSESSMENT YEAR 200 5 - 0 6 ) I.T.A. NO. 7033/MUM/2014 (ASSESSMENT YEAR 2007 - 08) SHRI MUKESH D. DEDHIA C - 308, SHREENATH DARS HAN OFF 30 TP ROAD BORIVALI WEST MUMBAI - 400 092. VS. ACIT CENTRAL CIR - 23 ROOM NO. 409 4 TH FLOOR AAYAKAR BHAVAN M.K. ROAD MUMBAI - 40 0020. ( APPELLANT ) ( RESPONDENT ) PAN NO . AAEPD1262F ASSESSEE BY NONE DEPARTMENT BY S MT. VINITA MENON DATE OF HEAR ING 13 . 6. 201 6 DATE OF PRONOUNCEMENT 13 . 6 . 201 6 O R D E R PER B.R. BASKARAN, A M : - BOTH T HE SE APPEAL S FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER S PASSED BY LEARNED CIT(A) - 40 , MUMBAI AND IT RELATE TO A.Y S . 2005 - 06 & 2007 - 08. 2. ASSESSEE IS AGGRIEVED BY THE DECISION OF LEARNED CIT(A) IN CONFIRMING THE PENALTY LEVIED IN BOTH THE YEARS BY THE ASSESSING OFFICER U/S. 271(1)(C) OF THE ACT. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE AND HENCE WE PROCEED TO DISPOSE OF THE APPEAL EX - PARTE, WITHO UT PRESENCE OF THE ASSESSEE. IN A.Y. 2005 - 06, THE ASSESSING OFFICER LEVIED PENALTY OF ` 10,247/ - AND IN A.Y. 2007 - 08, THE ASSESSING OFFICER LEVIED PENALTY OF ` 19,178/ - U/S 271(1)(C) OF THE ACT . BOTH PENALTIES PERTAIN TO CERTAIN DEPOSITS FOUND IN THE BANK ACCOUNT OF THE ASSESSEE, WHICH WERE ASSESSED AS INCOME OF THE ASSESSEE. SHRI MUKESH D. DEDHIA 2 4. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENTATIVE AND PERUSED THE RECORD. THE ASSESSEE BELONG S TO ZAMKUDI GROUP , WHICH WAS SUBJECTED TO SEARCH AND SEIZURE OPERATIONS ON 9.10.2 010. CONSEQUENT TO THE SEARCH OPERATION S , ASSESSMENT S IN THE HANDS OF THE ASSESSEE FOR THE TWO YEARS UNDER CONSIDERATION WERE COMPLETED U/S. 143(3) READ WITH SECTION 15 3C OF THE ACT. DURING THE COURSE OF SEARCH OPERATIONS , IT APPEARS THAT THE ASSESSEE COUL D NOT EXPLAIN CERTAIN CASH DEPOSITS FOUND IN THE BANK ACCOUNT AND ACCORDINGLY SURRENDERED THE AMOUNT OF ` 50,232/ - AND ` 1,20,000/ - RESPECTIVELY IN ASSESSMENT YEAR 2005 - 06 AND 2007 - 08. THOUGH THESE AMOUNTS WERE NOT ORIGINALLY DISCLOSED IN THE RETURNS OF I NCOME FILED U/S. 139(1) OF THE ACT, THE ASSESSEE DISCLOSED THE SAME IN THE RETURNS OF INCOME FILED IN RESPONSE TO THE NOTICES ISSUED U/S. 153C OF THE ACT BY HONOURING THE SURRENDER MADE . THE ASSESSING OFFICER ASSESSED THE ABOVE SAID AMOUNTS AS INCOME OF T HE ASSESSEE AND ALSO LEVIED PENALTY THERE ON TREATING THEM AS CONCEALMENT OF INCOME . THE LEARNED CIT(A) ALSO CONFIRMED THE SAME. 5. FROM PERUSAL OF THE ORDERS PASSED BY THE TAX AUTHORITIES, WE NOTICE THAT THE ASSESSEE HAS SUBMITT ED THAT THESE AMOUNTS R EPRESENT GIFT S RECEIVED FROM FRIENDS AND RELATIVES AND HENCE THEY WERE NOT ORIGINALLY DISCLOSED IN THE RETURNS OF INCOME FILED U/S. 139(1) OF THE ACT. HOWEVER, DURING THE COURSE OF SEARCH , THE ASSESSEE ADMITTED THE SAME AS HIS INCOME , SINCE HE COULD NOT P RODUCE NECESSARY DOCUMENTS TO SUPPORT THE CLAIM. IT WAS SUBMITTED THAT THE HE HAS SURRENDERED TH E SE AMOUNTS IN ORDER TO BUY PEACE AND NOT TO LITIGATE WITH THE DEPARTMENT. HOWEVER, THE ABOVE SAID EXPLANATIONS OF THE ASSESSEE WERE NOT FOUND CONVINCING TO THE TAX AUTHORITIES AND HENCE THEY HAVE LEVIED THE PENALTY U/S 271(1)(C) OF THE ACT . 6 . ON A CAREFUL PERUSAL OF THE FACTS , WE NOTICE THAT THE ASSESSEE HAS ADMITTED DEPOSITS FOUND IN THE BANK ACCOUNT AS HIS INCOME, SINCE HE WAS NOT IN A POSITION TO PRODUCE DO CUMENTS SUPPORTING THE CLAIM THAT THEY REPRESENT GIFTS RECEIVED FROM FRIENDS AND RELATIVES . WE NOTICE THAT THE ASSESSEE HAS DULY SHRI MUKESH D. DEDHIA 3 OFFERED THE SAME AS HIS INCOME IN THE RETURNS OF INCOME FILED U/S. 153C OF THE ACT. THUS, WE NOTICE THAT THE ASSESSEE W AS CON STRAINED TO OFFER THE GIFT RECEIPTS AS HIS INCOME, SINCE THE RELEVANT DOCUMENTS TO SUPPORT THE CLAIM COULD NOT BE OBTAINED AFTER PASSAGE OF CONSIDERABLE YEARS. CONSIDERING THESE FACTUAL ASPECTS, WE ARE OF THE VIEW THAT THE EXPLANATION S OFFERED IN THIS REG ARD AND THE CONSEQUENTIAL SURRENDER MADE ARE ON BONAFIDE ON E S. UNDER THESE SET OF FACTS, WE ARE OF THE VIEW THAT THE ASSESSEE HAS DISCHARGED BURDEN PLACED UPON HIM UNDER EXPLANATION - 1 TO SECTION 271(1)(C) OF THE ACT. ACCORDINGLY, WE SET ASIDE THE ORDERS PA SSED BY LEARNED CIT(A) FOR BOTH THE YEARS UNDER CONSIDERATION AND DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY LEVIED U/S. 271(1)(C) OF THE ACT IN BOTH THE YEARS. 6. I N THE RESULT, BOTH THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED. ORDER HAS BEE N PRONOU NCED IN THE OPEN COURT ON 13. 6 .2016 . SD/ - SD/ - (RAMLAL NEGI ) (B.R.BASKARAN ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 13 / 6/ 20 1 6 COPY OF THE ORDER FOR WARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( DY./ASSTT. REGISTRAR) ITAT, MUMBAI PS