Denis Santos, Kolkata V. ITO, WD-14(4), KOLKATA, Kolkata

ITA 714/KOL/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1659 (ITAT-KOLKATA)
• Duration Of Justice: 3 year(s) 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 01-06-2017
• Assessment Year: 2001-2002
• Appeal Filed On: 21-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SHOBHANTANU BHATTACHARYA LD
• Section: 234B; 148

Judgement Text

I T A NOS. 714 & 715/KOL/14 1 IN THE INCOME TAX APPELLATE TRIBUNAL,CBENCH, KOLKATA BEFORE: SHRI J. SUDHAKAR REDDY,ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NOS. 714 & 715/KOL/2014 A.YS: 2001-02 & 2004-05 DENIS SANTOS VS. INCOME TAX OFFICER PAN: AKDPS 4921R WARD 14(4), KOLKATA (APPELLANT) (RESPONDENT) APPEARANCES BY : SHRI SHOBHANTANU BHATTACHARYA, LD.AR FOR THE AS SESSEE SHRI P.B. PRAMANIK, ADDL.CIT, LD.SR. DR FOR THE REVENUE DATE OF HEARING : 07-08-2017 DATE OF PRONOUNCEMENT : 25-08-2017 O R D E R SHRI S.S. VISWANETHRA RAVI, JM :- BOTH THE APPEALS BY THE ASSESSEE ARE AGAINST THE SE PARATE ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS), XXIV, KOLKATA BOTH DATED 21-01-2014 FOR THE ASSESSMENT Y EARS 2001- 02 & 2004-05, WHEREIN HE CONFIRMED THE PENALTIES OF RS. 87,083/- AND RS. 2,95, 171/- IMPOSED U/S. 271(1) ( C) OF THE ACT. 2. SINCE THE ISSUE(S) INVOLVED IN BOTH THE APPEALS ARE COMMON, THEREFORE, THEY WERE HEARD TOGETHER AND DIS POSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 3. FIRST, WE SHALL TAKE UP THE APPEAL IN ITA NO.714/KOL/2014 FOR THE A.Y 2001-02 ( BY THE ASSESS EE). I T A NOS. 714 & 715/KOL/14 2 4. THE LD.AR SUBMITS THAT THE AO INITIATED PENALTY PROCEEDINGS AGAINST THE ASSESSEE ON THE GROUND THAT THE ASSESSEE CONCEALED HIS INTEREST INCOME EARNED ON SA VING BANK ACCOUNT AND AS SUCH BY ISSUANCE OF NOTICE U/S. 274 R.W.S 271 OF THE ACT IMPOSED PENALTY OF RS.87,083/-. 5. THE ASSESSEE BY MISTAKE CHALLENGED THE SAME BEFO RE THE CIT, WB-V KOLKATA ON 8-12-2010 WITHIN TIME INSTEAD OF BEFORE CIT-A,XXIV, KOLKATA. THE ASSESSEE FILED AN APPEAL B EFORE THE CIT-A, XXIV, KOLKATA AND WAS DISMISSED THE SAID A PPEAL WITHOUT CONSIDERING THE REASONS STATED IN THE CONDO NATION PETITION AS NOT TENABLE IN THE EYE OF LAW. 6. HE FURTHER SUBMITS THAT THE ASSESSEE IS A RETIRE D RAILWAY EMPLOYEE AND SENIOR CITIZEN OF 77 YEARS AND PAID TA X OF RS.90,000/- ON 13-09-2010 AND RS.58,810/- ON 05-10- 2010 BY CHEQUE AND SOUGHT WAIVER OF PENALTY BY LETTER DT. 01/07/2012 ( WHICH IS ON RECORD). THE AO DID NOT CONSIDER THE SA ME AND IMPOSED THE SAME. HE PRAYED TO ALLOW THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE 7. ON THE OTHER HAND, THE LD.DR HAS RELIED ON THE O RDERS OF THE LOWER AUTHORITIES. 8. HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS NOTICED THAT THE AO IMPOSED THE IM PUGNED PENALTY OF RS. 87,083/- FOR CONCEALMENT OF INCOME A ND THE CIT- I T A NOS. 714 & 715/KOL/14 3 A CONFIRMED THE SAME WITHOUT CONSIDERING THE CONDON ATION PETITION. IT IS ALSO OBSERVED THAT THE ASSESSEE OFF ERED THE QUESTIONED AMOUNT IN RESPONSE TO NOTICE ISSUED U/S. 148 OF THE ACT AND PAID TAXES ALONG WITH INTEREST U/S. 234B OF THE ACT AND SOUGHT WAIVER OF PENALTY. 9. THE OFFENCE OF CONCEALMENT IS A DIRECT ATTEMPT T O HIDE AN ITEM OF INCOME OR A PORTION THEREOF FROM THE KNOWLEDGE OF T HE INCOME-TAX AUTHORITIES. IN THE INSTANT CASE THE AR HAS CLAIMED THAT THERE WAS NO DELIBERATE ACT ON THE PART OF THE ASSESSEE FOR THE CONCEALMENT OF THE INCOME BUT HE BEING AN OLD AGED MAN OMITTED TO INCO RPORATE THE ABOVE STATED INCOME. 10. AT THIS JUNCTURE WE FIND IMPORTANT TO REPRODUCE THE PROVISIONS AS SPECIFIED IN EXPLANATION- 1 TO SECTION 271 (1) OF T HE ACT WHICH READS AS UNDER 'EXPLANATION 1.-WHERE IN RESPECT OF ANY FACTS MATER IAL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT,- (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OF FERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMMISSIONER (APPEALS) OR THE COMMISSIONER TO BE FALSE, OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS NOT ABLE T O SUBSTANTIATE (AND FAILS TO PROVE THAT SUCH EXPLANATION IS BONA FIDE AND THAT ALL THE FACTS REL ATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM) THEN, THE AMOUNT ADDED OR DISALLOWED IN COMPUTING THE TOTAL INCOME OF SUCH PE RSON AS A RESULT THEREOF SHALL, FOR THE PURPOSES OF CLAUSE (C) OF THIS SUB-SECTION, BE DEEM ED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED'. 11. THE ABOVE EXPLANATION MAKES IT CLEAR THAT THE S TATUTE VISUALIZED THE ASSESSMENT PROCEEDINGS AND PENALTY PROCEEDINGS TO B E WHOLLY DISTINCT AND INDEPENDENT OF EACH OTHER. THE ABOVE STATED EXPLANA TION- 1 COMES INTO OPERATION WHEN, IN RESPECT OF ANY FACTS MATERIAL TO THE COMPUTATION OF TOTAL INCOME OF ANY PERSON, THERE IS FAILURE TO OFF ER AN EXPLANATION OR AN EXPLANATION IS OFFERED WHICH IS FOUND TO BE FALSE B Y THE ASSESSING OFFICER OR THE FIRST APPELLATE AUTHORITY, OR AN EXPLANATION IS OFFERED WHICH IS NOT SUBSTANTIATED. IN SUCH A CASE, THE AMOUNT ADDED OR DISALLOWED IN I T A NOS. 714 & 715/KOL/14 4 COMPUTING THE TOTAL INCOME IS DEEMED TO REPRESENT T HE INCOME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED. AS PER TH E PROVISION OF EXPLANATION 1, THE ONUS TO ESTABLISH THAT THE EXPLA NATION OFFERED WAS BONA FIDE AND ALL FACTS RELATING TO THE SAME AND MATERIA L TO THE COMPUTATION OF HIS INCOME HAVE BEEN DISCLOSED BY HIM WILL BE ON TH E PERSON CHARGED WITH CONCEALMENT. THE EXPLANATION OF THE ASSESSEE FOR TH E PURPOSE OF AVOIDANCE OF PENALTY MUST BE AN ACCEPTABLE EXPLANAT ION. AS INDICATED ABOVE, THE BURDEN IS ON THE ASSESSEE AND IF HE FAI LS TO DISCHARGE THAT BURDEN, THE PRESUMPTION THAT HE HAD CONCEALED THE I NCOME OR FURNISHED INACCURATE PARTICULARS THEREOF IS AVAILABLE TO BE D RAWN. HOWEVER IN THE INSTANT CASE THE ASSESSEE HAS EXPLAINED THE REASONS FOR NOT INCLUDING THE PARTICULARS OF INTEREST INCOME DUE TO IGNORANCE AN D MISGUIDANCE OF TAX CONSULTANT WHICH APPEARS TO BE BONAFIDE CONSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. 12. WE ARE, THEREFORE, OF THE VIEW THAT THE ASSESSE E COULD NOT BE SAID TO HAVE FILED 'FALSE' RETURNS WHEN IT DID NOT INCLU DE THE AMOUNT OF INTEREST INCOME IN THE TAXABLE INCOME IN THE ABOVE FACTS & C IRCUMSTANCES. WE ALSO FIND FORCE IN THE SUBMISSIONS OF THE LD.AR THA T THE ASSESSEE IS OLD AGED AND DISCLOSURE OF AMOUNTS IN R EOPENING PROCEEDINGS AND PAYMENT OF TAXES THEREON AND TAKING INTO CONSIDERATION THE SUBMISSIONS, FACTS AND CIRCUMSTAN CES OF THE CASE AND WE CANCEL THE IMPUGNED PENALTY OF RS.87,08 3/- IMPOSED BY THE AO AND CONFIRMED BY THE CIT-A. THERE FORE, THIS GROUND OF ASSESSEE IS ALLOWED. 13. THE APPEAL OF ASSESSEE IN ITA NO. 714/KOL/2014 FOR THE A.Y 2001-02 IS ALLOWED. 14. NOW, WE SHALL TAKE UP THE APPEAL IN ITA NO. 715 /KOL/2014 A.Y 2004- 05 ( BY THE ASSESSEE). I T A NOS. 714 & 715/KOL/14 5 ITA NO. 715/KOL/2014 A.Y 2004-05 ( BY THE ASSESSEE ) 15. WE FIND THAT THE ISSUE(S), FACTS AND CIRCUMSTAN CES OF THIS CASE ARE SIMILAR AND IDENTICAL WITH ITA NO. 714/KOL/2014 FO R THE A.Y 2001-02 ( BY THE ASSESSEE), WHICH WE HAVE ALREADY DISCUSSED AND EXPRESSED OUR VIEW IN FAVOUR OF ASSESSEE BY DISMISSING THE FINDING OF THE CIT-A AND IN VIEW OF THE SAME, THE EFFECTIVE GROUND OF ASSESSEES APPEAL IN ITA NO. 715/KOL/2014 FOR THE A,Y 2004-05 IS LIABLE TO BE AL LOWED AND, ACCORDINGLY IMPUGNED PENALTY OF RS.2,95,171/- IS CA NCELLED.. 16. IN THE RESULT, BOTH THE ASSESSEES APPEALS IN I TA NOS. 714 & 715/KOL/2014 FOR THE A.YS 2001-02 & 2004-05 ARE ALL OWED. ORDER PRONOUNCED IN OPEN COURT ON 25-08-2 017 J.SUDHAKAR REDDY S.S. VISWANETHRA RAVI ACCOUNTANT MEMBER JUDICIAL MEMBER DATED 25-08-2 017 SD/- SD/- *PP/SPS: COPY OF THE ORDER FORWARDED TO: 1 . THE APPELLANT/ASSESSEE: MR. DENIS SANTOS 373 M.G ROAD, SANTASHREE PALLY, THAKURPUKUR, KOLKATA-700 063 2 THE RESPONDENT/DEPARTMENT: INCOME TAX OFFICER, WAR D 14(4) 169 AJC BOSE ROAD, 2 ND FLOOR, KOLKATA-700 014. 3 4. THE CIT(A) THE CIT 5 . DR, KOLKATA BENCH 6 . GUARD FILE . BY ORDER, SR.PS/H.O.O ITAT, KOLKATA I T A NOS. 714 & 715/KOL/14 6