ACIT, Chandigarh V. Sh. Gurmukh Singh, Chandigarh

ITA 722/CHANDI/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2417 (ITAT-CHANDIGARH)
• Duration Of Justice: 11 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-06-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 01-01-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 03-07-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AHKILESH GUPTA
• Assessee Lawyers: ATUL MANDHAR
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES BCHANDIGARH BEFORE SHRI T.R.SOOD, ACCOUNTANT MEMBER AND MS SUSHMA CHOWLA, JUDICIAL MEMBER ITA NO. 722/CHD/2012 ASSESSMENT YEAR:2007-08 THE ACIT, V SHRI GURMUKH SINGH, CIRCLE 5(1), PROP. M/S NAMDHARI MARBLE HOUSE CHANDIGARH. MULLANPUR-DHANAS ROAD, VILLAGE DHANAS, CHANDIGARH. PAN NO. AKIPS-6104R (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AHKILESH GUPTA RESPONDENT BY : SHRI ATUL MA NDHAR DATE OF HEARING : 27.06.2013 DATE OF PRONOUNCEMENT : 28.06.2013 O R D E R PER SUSHMA CHOWLA, JM THE REVENUE HAS FILED THE APPEAL AGAINST THE ORDER OF CIT(APPEALS) DATED 18.04.2012 RELATING TO ASSESSMENT YEAR 2007-0 8 AGAINST THE ORDER PASSED UNDER SECTION 250(6) OF THE I.T. ACT, 1961. 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPE AL: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWIN G APPEAL OF HE ASSESSEE WITHOUT APPRECIATING THE FACTS OF TH E CASE. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT (A) HAS ERRED IN DELETING THE PENALTY I MPOSED U/S 271(L)(C) OF THE INCOME TAX ACT, 1961 BY HOLDING THAT ADDITION MADE WERE ON ESTIMATE BASIS ESPECIALLY WHEN THE ADD ITIONS MADE IN ASSESSMENT WERE NOT CONTESTED IN APPEAL. 3. IT IS PRAYED THAT THE ORDER OF THE LD. CIT (A) BE S ET ASIDE AND 2 THAT OF THE ASSESSING OFFICER MAY BE RESTORED. 4. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROU NDS OF APPEAL BEFORE THE APPEAL IS HEARD OR DISPOSED OFF. 3. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS A GAINST THE DELETION OF PENALTY LEVIED U/S 271(1)(C) OF THE ACT. 4. THE BRIEF FACTS OF THE CASE ARE THAT SURVEY U/S 133A OF THE ACT WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSE E ON 19.2.209. THE ASSESSEE DID NOT PRODUCE THE BOOKS OF ACCOUNT DURIN G THE COURSE OF SURVEY. NO SURRENDER WAS MADE AT THE TIME OF SURVEY AND IT WAS CLAIMED THAT THE BOOKS OF ACCOUNT WERE LYING WITH HIS ACCOUNTANT. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE CLAIM OF THE ASSESSEE WAS THAT THE BOOKS OF ACCOUNT HAVE BEEN LO ST ON 10.3.2009. THE ASSESSING OFFICER NOTED THAT THERE WERE DEPOSITS OF RS.1.64 CRORES IN THE BANK ACCOUNT OF THE ASSESSEE OUT OF WHICH LABOUR CH ARGES WERE SHOWN AT RS.64,31,812/-. ON THE BALANCE RECEIPTS DECLARED B Y THE ASSESSEE I.E. RS.1,00,17,339/-, THE ASSESSEE HAD DECLARED GP RATE OF 20%. HOWEVER, THE ASSESSING OFFICER APPLIED GP RATE OF 22% TO COMPUTE THE ADDITION IN THE HANDS OF THE ASSESSEE AT RS.10,76,489/-. THE ASSES SEE HAS NOT FILED ANY APPEAL AGAINST THE SAID ADDITION MADE IN ITS HANDS. HOWEVER, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE ASSESSING OFFICER IN THE FACTS OF THE CASE IMPOSED PENALTY OF RS.302,100/- U/S 271(1) (C) OF THE ACT. THE CIT(APPEALS) DELETED THE PENALTY LEVIED U/S 271(1)( C) OF THE ACT AS THE ADDITION IN THE HANDS OF THE ASSESSEE WAS MADE ON A CCOUNT OF ESTIMATION OF GROSS PROFIT. RELIANCE WAS PLACED BY THE CIT(APPEA LS) ON THE RATIO LAID DOWN BY THE HON'BLE PUNJAB & HARYANA HIGH COURT IN HARI GUPAL SINGH 3 258 ITR 85 (P&H) AND ALSO IN THE CASE OF KAILASH CR OCKERY HOUSE 235 ITR 544 (PATNA). 6. THE REVENUE IS IN APPEAL AGAINST THE ORDER OF TH E CIT(APPEALS). 7. SHRI ATUL MANDHAR APPEARED FOR THE ASSESSEE AND SHRI AKHILESH GUPTA APPEARED FOR THE REVENUE AND PUT FORWARD THEI R CONTENTIONS. 8. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ONLY ISSUE IN THE PRESENT APPEAL IS AGAINST LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THE BUSINESS PREMISES OF THE ASSESSEE WER E SURVEYED U/S 133A OF THE ACT ON 19.02.2009 I.E. AFTER THE CLOSE OF THE Y EAR UNDER CONSIDERATION. THE YEAR UNDER APPEAL IS RELATING TO ASSESSMENT YEA R 2007-08. THE ASSESSEE HAD FILED THE RETURN OF INCOME FOR THE YEAR UNDER C ONSIDERATION ON THE BASIS OF AUDITED ACCOUNTS WHICH WERE ACCOMPANIED BY THE A UDIT REPORT FILED BY THE ACCOUNTANT. HOWEVER, THE ASSESSEE WAS UNABLE T O PRODUCE THE BOOKS OF ACCOUNT, BOTH DURING THE SURVEY PROCEEDINGS AND ALS O DURING THE ASSESSMENT PROCEEDINGS. THE CLAIM OF THE ASSESSEE WAS THAT BO OKS OF ACCOUNT WERE LOST AND FIR WAS LODGED ON 10.3.2009. THE ASSESSING OFF ICER COMPUTED THE INCOME IN THE HANDS OF THE ASSESSEE ON THE BASIS OF THE CREDITS IN THE BANK ACCOUNT OF THE ASSESSEE. NO INFIRMITY WAS FOUND IN THE RECEIPTS DECLARED BY THE ASSESSEE. HOWEVER, ADDITION WAS MADE IN THE HA NDS OF THE ASSESSEE BY ESTIMATING THE INCOME BY ADOPTING THE GP RATE AT 22 % AS AGAINST 20% DECLARED BY THE ASSESSEE. IN THE ABOVESAID FACTS AN D CIRCUMSTANCES WHERE THE INCOME HAS BEEN ESTIMATED IN THE HANDS OF THE A SSESSEE ON THE GROUND OF THE RATE OF GP DECLARED BY THE ASSESSEE, IT IS N OT A FIT CASE FOR LEVY OF PENALTY U/S 271(1)(C) OF THE ACT FOR FURNIS HING OF INACCURATE PARTICULARS OF INCOME. WE FIND NO MERIT IN TH E ORDER OF THE ASSESSING 4 OFFICER IN THIS REGARD AND UPHOLDING THE ORDER OF C IT(APPEALS), WE DISMISS THE GROUND OF APPEAL RAISED BY THE REVENUE. 9. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 28 TH DAY OF JUNE, 2013. SD/- SD/- (T.R.SOOD) (SUSHMA CHOW LA) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 28 TH JUNE,2013 POONAM COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR BY ORDER ASSISTANT REGISTRAR, ITAT, CHANDIGARH