ACIT, CHENNAI V. T.Jayachandran, CHENNAI

ITA 724/CHNY/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96648 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 17-11-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 17-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: R MEENAKSHISUNDARAM
• Keywords: Reasonable cause; Benefit of exemption; Revised return

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , C B ENCH, CHENNAI . . , ' # , $ & BEFORE SHRI D.KARUNAKARA RAO, ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ./ I.T.A.NO . 724/MDS/2013 ( / ASSESSMENT YEAR: 2008-09) THE ASSISTANT COMMISSIONER OF INCOME TAX, BUSINESS CIRCLE-VIII, CHENNAI-600 006. VS MR. T.JAYACHANDRAN, PROP.OF M/S.CHANDRAKALA & CO. 167, THAMBU CHETTY STREET, CHENNAI-600 001. PAN:AABPJ8430G ( /APPELLANT) ( /RESPONDENT) / APPELLANT BY : MR. A.V.SREEKANTH, JCIT /RESPONDENT BY : MR. R.MEENAKSHISUNDARAM, ADVOCATE /DATE OF HEARING : 17 TH NOVEMBER, 2015 /DATE OF PRONOUNCEMENT : 30 TH DECEMBER, 2015 / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-IX, CHENN AI DATED 28.12.2012 FOR THE ASSESSMENT YEAR 2008-09 IN DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. 2. AT THE TIME OF HEARING, AN ADJOURNMENT PETITION WAS FILED BY THE COUNSEL FOR THE ASSESSEE REQUESTING FOR ADJO URNMENT ON THE GROUND THAT SOME DETAILS PERTAINING TO THE A PPEAL HAVE TO BE COLLECTED. ON A PERUSAL OF THE ORDER SHEET, W E FIND THAT SEVERAL OPPORTUNITIES HAVE BEEN GRANTED TO THE ASSE SSEE. WE 2 ITA NO.724 /MDS/2013 ALSO FIND THAT IN THE LAST PREVIOUS TWO HEARINGS I. E. ON 01.07.2015 & 02.09.2015 NONE APPEARED ON BEHALF OF THE ASSESSEE. THE ADJOURNMENT PETITION FILED BY THE COU NSEL IS VAGUE AND WHAT SORT OF DETAILS HE WANTS TO COLLECT HAS NOT BEEN MENTIONED. AS SEVERAL OPPORTUNITIES HAVE ALRE ADY BEEN GIVEN TO THE ASSESSEE AND AS WE DO NOT FIND THERE I S A REASONABLE CAUSE FOR ADJOURNING THE MATTER, WE REJE CT THE ADJOURNMENT PETITION FILED BY THE COUNSEL FOR THE A SSESSEE AND DISPOSE OFF THE APPEAL AFTER HEARING THE DEPART MENTAL REPRESENTATIVE. 3. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT THE APP EAL HAS BEEN FILED AGAINST THE ORDER OF THE COMMISSIONE R OF INCOME TAX (APPEALS) IN DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. DEPARTMENTAL REPRESEN TATIVE SUBMITS THAT ASSESSEE FILED RETURN OF INCOME DECLAR ING LOSS OF ` 12,29,330/- AND AGRICULTURAL INCOME OF ` 84,850/-. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT IN THE COU RSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER REQUIR ED THE ASSESSEE TO RECONCILE THE DIFFERENCE IN INVESTMENTS AS ON 31.03.2007 AND 31.03.2008 AND ALSO REQUIRED THE ASS ESSEE TO EXPLAIN MARK TO MARGIN ILFS VALUE OF ` 7,23,044/- WHICH 3 ITA NO.724 /MDS/2013 APPEARED AS ASSET AS ON 31.03.2007 HAD BECOME LIAB ILITY AS ON 13.11.2010. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT THE ASSESSEE CAME OUT WITH A REVISED COMPUTATION OF INC OME DECLARING INCOME OF ` 19,69,172/- AS AGAINST LOSS OF ` 12,29,330/- DECLARED. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT SINCE THE ASSESSEE HAS CONCEALED THE PARTICULA RS OF INCOME AND FURNISHED INACCURATE PARTICULARS OF SUCH INCOME, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT. DEPARTMENTAL REPRESEN TATIVE SUBMITS THAT FOR THE ENQUIRIES MADE BY THE ASSESSIN G OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AS SESSEE SINCE COULD NOT EXPLAIN / RECONCILE THE DIFFERENCE, THE ASSESSEE SURRENDERED PROFIT OF ` 19,69,172/-. THEREFORE, HE SUBMITS THAT THERE IS A CLEAR CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME BY T HE ASSESSEE AND THUS THE ASSESSING OFFICER IS JUSTIFIED IN LEVY ING PENALTY UNDER SECTION 271(1)(C) OF THE ACT ON THE DIFFERENC E I.E. ` 31,98,502/- ON ACCOUNT OF LOSS OF ` 12,29,330/- AND THE REVISED INCOME AT ` 19,69,172/-. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT COMMISSIONER OF INCOME TAX (APPEALS) DELETED THE PENALTY HOLDING THAT THE ADDI TION UNDER THE HEAD PROFIT AND GAINS OF BUSINESS OR PROFESSION IS NOT 4 ITA NO.724 /MDS/2013 ARISING AS A RESULT OF ANY POINT OF QUERY RELATING TO CORRECTNESS OF COMPUTATION OF INCOME FROM BUSINESS RAISED BY T HE ASSESSING OFFICER ON THE BASIS OF HIS SCRUTINY OF R ETURN BUT WAS ONLY DUE TO THE INABILITY OF THE ASSESSEE TO EX PLAIN THE DISCREPANCY OFFERED INCOME AT ` 19,69,172/- AS AGAINST LOSS DECLARED AT ` 12,29,330/-. 4. WE HAVE PERUSED THE ORDERS OF LOWER AUTHORITIES. THE ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271( 1)(C) OF THE ACT FOR THE REASON THAT THE ASSESSEE INITIALLY DECLARED LOSS OF ` 12,29,330/- AND IN THE COURSE OF ASSESSMENT PROCEEDINGS, HE ADMITTED INCOME OF ` 19,69,172/- WHICH RESULTED IN ADDITION OF ` 31,98,502/-, THEREFORE THERE IS A CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF INCOME BY THE ASSESSEE. IT WAS THE CONTENTION OF THE ASSESSEE BEFORE THE COMMISSIONER OF INCOME TAX (APP EALS) THAT IN THE COURSE OF ASSESSMENT PROCEEDINGS THE AS SESSING OFFICER REQUIRED THE ASSESSEE TO CLARIFY NAMELY I) LOSS IN DERIVATIVES TRADING; II) DIFFERENCE IN INVESTMENTS AS ON 31.03.2007 ` 2,47,57,076/- AND INVESTMENT AS ON 31.03.2008 ` 5 ITA NO.724 /MDS/2013 1,82,43,182/- (VIDE ORDER SHEET DATED 10.11.2010) AND RECONCILED THE SAME. III) MARK TO MARGIN ILFS WITH VALUE OF ` 7,23,044/- WHICH APPEARED AS ASSET AS ON 31.03.2007 WHICH HAD BECOME LIABILITY OF ` 58,99,322/- (VIDE ORDER SHEET NOTING DATED 13.11.2010). IT WAS CONTENDED BY THE ASSESSEE THAT THE ABOVE CLARIFICATIONS HAVE NOTHING TO DO WITH THE INCOME O FFERED BY THE ASSESSEE VOLUNTARILY IN THE REVISED MEMO. IT WA S CONTENDED BY THE ASSESSEE THAT ISSUES RAISED BY THE ASSESSING OFFICER INSOFAR AS LOSS IN DERIVATIVE TRA DING AND INVESTMENT IS CONCERNED, THEY HAVE BEEN SATISFACTOR ILY EXPLAINED BY THE ASSESSEE AND ACCEPTED BY THE ASSES SING OFFICER EXCEPT TO THE EXTENT OF TAXABILITY OF CAPIT AL GAINS OF ` 31,57,057/- WHICH WAS DISCLOSED AND CLAIMED AS EXEM PTION UNDER SECTION 10(38) OF THE ACT BY THE ASSESSEE BUT NEGATIVED BY THE ASSESSING OFFICER THAT TOO ON THE GROUND THAT ASSESSEE HAS NOT PROVED THAT IT IS LONG TERM C APITAL GAIN. IT WAS CONTENDED BY THE ASSESSEE THAT ON THE ISSUE OF CAPITAL GAIN ASSESSEES CONTENTION HAVING BEEN ACCEPTED IN FULL IN THE APPEAL PROCEEDINGS AND THAT TOO BASED ON THE ACCEPTANCE OF ASSESSEES SUBMISSIONS BY THE ASSESSI NG 6 ITA NO.724 /MDS/2013 OFFICER WHILE GIVING THE REMAND REPORT, ONLY ON TH E ISSUE OF MARK TO MARGIN ILFS VALUE, THE ASSESSING OFFICER ST ATED THAT ASSESSEE WAS NOT ABLE TO EXPLAIN SATISFACTORILY . I T WAS CONTENDED THAT THIS ISSUE BEING RELATING TO ASSETS AND LIABILITIES APPEARING AS A BALANCE SHEET ITEM AND N OT PROFIT AND LOSS ACCOUNT ITEM, THE SAME DID NOT HAVE ANY IM PACT ON THE COMPUTATION OF INCOME NOR ANY ADDITION HAS BEEN MADE ON THIS ACCOUNT BY THE ASSESSING OFFICER WHILE COMP LETING THE ASSESSMENT. THEREFORE, THIS ISSUE ALSO CANNOT BE SA ID TO BE SOMETHING WHICH HAS RESULTED IN OFFERING OF INCOME BY THE ASSESSEE BY FILING REVISED RETURN BUT OFFERED ONLY ON ACCOUNT OF EFFORTS TAKEN BY THE AUTHORIZED REPRESENTATIVE O F THE ASSESSEE AFTER GOING THROUGH THE BOOKS WHILE PREPAR ING FOR REPRESENTATION IN THE ASSESSMENT PROCEEDINGS AND VOLUNTARILY OFFERED FOR ASSESSMENT BY FILING REVISE D MEMO OF INCOME. THIS WAS CLEARLY POINTED OUT BY THE AUTHORI ZED REPRESENTATIVE OF THE ASSESSEE IN PARA 6 OF THE AFF IDAVIT WHICH IS EXTRACTED BELOW:- I SUBMIT THAT AS FAR AS OTHER INCOME OFFERED IN TH E REVISED MEMO ARE CONCERNED, THESE MISTAKES WERE FOUND OUT BY ME AND VOLUNTARILY OFFERED FOR ASSESSMENT BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 7 ITA NO.724 /MDS/2013 THE OMISSION TO OFFER CERTAIN INCOME WAS ONLY DUE T O MISTAKE COMMITTED BY THE REPRESENTATIVE WHILE PREPARING THE ORIGINAL RETURN WHICH ALSO SHOWS THAT CERTAIN EXPENDITURE WE RE CLAIMED AT A LOWER FIGURE AND WHICH WERE ALSO REVI SED IN THE REVISED MEMO OF INCOME. THIS PROVES THE BONAFIDE OF THE ASSESSEE ESPECIALLY WHEN THE SAID SUBMISSION HAVING NOT BEEN CONTROVERTED OR NEGATIVED BY THE ASSESSING OFF ICER. THUS, IT WAS CONTENDED BY THE ASSESSEE THAT IT IS N OT A CASE OF CONCEALMENT OF INCOME OR FURNISHING OF INACCURAT E PARTICULARS OF INCOME ATTRACTING LEVY OF PENALTY UN DER SECTION 271(1)(C) OF THE ACT. 5. CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND AVERMENTS OF THE ASSESSING OFFICER, THE COMMISSIONE R OF INCOME TAX (APPEALS) DELETED THE PENALTY OBSERVING AS UNDER:- 7. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CAS E AND THE SUBMISSIONS / CLARIFICATIONS OF THE AR OF THE A PPELLANT IN THIS REGARD.. HAVING CONSIDERED THE MATTER IN DE TAIL AND HAVING GONE THROUGH THE SUBMISSIONS OF THE AR OF TH E APPELLANT IN THE PRESENT CASE, I DO AGREE WITH THE SUBMISSIONS OF THE AR OF THE APPELLANT THAT THE DEC ISION OF THE HON'BLE SUPREME COURT OF INDIA IN THE CASE OF UNION OF INDIA VS. DHARRNENDRA TEXTILE PROCESSORS 306 ITR 277 IS LIMITED TO THE ISSUE OF NON-REQUIREMENT OF P ROVING OF MENS REA FOR THE PURPOSE OF LEVY OF PENALTY UNDER S ECTION 271(1)(C) OF THE ACT. . THE DECISION IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS REVERSES THE DECISION OF 8 ITA NO.724 /MDS/2013 THE HON'BLE SUPREME COURT IN THE CASE OF DILIP N. S HROFF VS. JCIT 291 ITR 519 ONLY INSOFAR AS IT RELATES TO THE SUBMISSIONS OF THE AR AND ON ALL OTHER ISSUES AS TO THE PARAMETERS REQUIRED TO BE SATISFIED FOR LEVYING PEN ALTY UNDER SECTION 271(1)(C) OF THE ACT, THE DECISION OF THE HON'BLE SUPREME COURT IN 291 ITR 519 IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS VS. JCIT STILL HOLDS THE FIELD. I ALSO AGREE WITH THE SUBMISSIONS OF THE LEA RNED AR OF THE APPELLANT THAT IN THE LIGHT OF THE OBSERVATI ONS MADE BY THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. ATUL MOHAN BINDAL 317 ITR .1 AT PAGE 13, REITERATED IN 3 22 ITR 158 AT PAGE 164 NOTWITHSTANDING THE DECISION OF THE HON'BLE COURT IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS, IT IS STILL INCUMBENT ON THE AO TO PROV E THAT ALL THE CONDITIONS REQUIRED FOR LEVY OF PENALTY UNDER S ECTION 271(1)(C) OF THE ACT SUCH AS (1) THERE IS CONCEALME NT, (2) SUCH CONCEALMENT WAS FOUND BY THE AO IN COURSE OF SCRUTINY OF THE RETURN AND (3) ON SUCH FINDING OF THE AO, THE APPELLANT WAS NOT ABLE TO EXPLAIN TH E OMISSION OR CONCEALMENT OR THE EXPLANATION OFFERED BY THE APPELLANT WAS FOUND TO BE FALSE, MUST EXIST. 7.1 IN THE PRESENT CASE, NONE OF THE CONDITIONS PRE SCRIBED HAVE BEEN SATISFIED JUSTIFYING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT AS HAS BEEN DONE BY TH E AO. THE AO HAS PROCEEDED ON THE ASSUMPTION THAT IT IS BECAUSE OF THE QUERY RAISED BY HIM ON THE THREE ISS UES, THE APPELLANT CAME OUT WITH THE REVISED MEMO OF INC OME DISCLOSING A PROFIT UNDER THE HEAD 'PROFITS AND GAI NS OF BUSINESS THE CASE, AS SUBMITTED BY THE AR, I FIND THAT THIS ASSUMPTION OF THE AO FOR LEVYING PENALTY IS NOT ESTABLISHED BY THE FACTS OF THE CASE. OF THE 3 QUER IES RAISED BY THE AO, THE EXPLANATION OFFERED BY THE AP PELLANT IN THE CASE OF LOSS IN DERIVATIVES TRADING AND DIFF ERENCE IN INVESTMENTS HAS BEEN ACCEPTED BY THE AO. IN THE CAS E OF DIFFERENCE IN INVESTMENTS, THE ONLY DISPUTE THAT WA S ALSO THERE ORIGINALLY WAS IN RESPECT OF THE PROFITABILIT Y OF RS.31,57,057/- BEING THE PROFIT ON SALE OF INVESTME NTS WHICH, ACCORDING TO THE APPELLANT, REPRESENTS LONG TERM CAPITAL GAIN EXEMPT ,UNDER SECTION 10(38) OF THE AC T SINCE SECURITIES TRANSACTION TAX (STT) HAS BEEN PAID IN RESPECT OF THE SAID SALE WHEREAS ACCORDING TO THE A O, IN THE ABSENCE OF DETAILS FURNISHED BY THE APPELLANT, . THE SAID RS.31,57,057/- REPRESENTS SHORT TERM CAPITAL G AIN, ASSESSABLE 'TO TAX. HOWEVER, WHEN THE APPELLANT CAM E ON APPEAL TO ME AGAINST THE SAID ORDER OF THE AO TREAT ING THE SUM OF RS.31,57,057/- AS INCOME ASSESSABLE TO TAX A ND DENYING THE BENEFIT OF EXEMPTION UNDER SECTION 10(3 8), THE VARIOUS DETAILS FURNISHED BY THE APPELLANT WERE FORWARDED TO THE AO WITH A DIRECTION TO SUBMIT A RE MAND REPORT AFTER GOING THROUGH THE DETAILS FURNISHED BY THE APPELLANT. HAVING GONE THROUGH THE DETAILS, THE AO ACCEPTED THAT THE SUM OF RS.31,57,057/- . REPRESENT S LONG 9 ITA NO.724 /MDS/2013 TERM CAPITAL GAIN, ELIGIBLE FOR EXEMPTION UNDER SEC TION 10(38) OF THE ACT AND ON THE BASIS OF THE SAID REMA ND REPORT, I HAVE ALLOWED THE APPEAL OF THE APPELLANT DELETING THE ADDITION OF RS.31,57,057/- AND UPHOLDING THE APPELLANT'S CLAIM FOR EXEMPTION UNDER SECTION 10(38 ) IN RESPECT OF THE SAID AMOUNT. THUS, THIS ADDITION WAS DELETED. IN OTHER WORDS, THE. EXPLANATIONS OFFERED BY THE APPELLANT IN RESPECT OF THE FIRST TWO ISSUES NAMELY , LOSS IN DERIVATIVES TRADING AND DIFFERENCE IN INVESTMENTS HAVE BEEN ACCEPTED BY THE AO AND THERE IS NO ADDITION MADE IN RESPECT THEREOF. 7.2 ON THE THIRD ISSUE 'MARK TO MARGIN ILFS', EVE N THOUGH THE AO HAS STATED IN THE ASSESSMENT ORDER TH AT THE APPELLANT IS NOT ABLE TO EXPLAIN SATISFACTORILY THE DIFFERENCE, NO ADDITION HAS BEEN MADE BY THE AO AS ALREADY HELD BY ME EARLIER IN THE ORDER. THIS ISSUE BEING ONE APPEARING IN THE BALANCE SHEET AND NOT IN THE P ROFIT AND LOSS ACCOUNT, NO ADDITION TO THE INCOME CAN BE MADE EXCEPT IN RESPECT OF CASES SPECIFICALLY PROVIDED FO R IN THE ACT. FOR EXAMPLE, ADDITION OF UNEXPLAINED INCOME UN DER SECTION 6S OF THE ACT WHERE A CREDIT APPEARING IN THE BALANCE SHEET CAN BE TREATED AS INCOME IF EXISTING ADDITION HAS BEEN MADE THEN, EVEN IF THE ISSUE IS O NE APPEARING AS A BALANCE SHEET ITEM, STILL PENALTY UN DER SECTION 271(1)(C) CAN BE LEVIED. HOWEVER IN THE PRE SENT CASE, WHEN THE AO HAS STATED THAT THE APPELLANT WAS NOT ABLE TO EXPLAIN MARK TO MARGIN ILFS SATISFACTORILY, NO ADDITION TO THE TAXABLE INC OME HAS BEEN MADE BY THE AO IN RESPECT OF SUCH ITEM NOR IN THE PENALTY PROCEEDINGS, ANY PENALTY HAS BEEN LEVIED BY THE AO WITH REFERENCE TO THE SAID ITEM. THE ONLY AD DITION IN RESPECT OF WHICH PENALTY HAS BEEN LEVIED IS CONVERS ION OF LOSS OF RS.12,29,330/- UNDER THE HEAD 'PROFITS AND GAINS OF BUSINESS OR PROFESSION' IN THE ORIGINAL MEMO OF INC OME BEING CONVERTED INTO A PROFIT OF RS.19,69,172/- IN THE REVISED MEMO, THUS RESULTING IN A ADDITION OF ` 31,98,502/- IN THE REVISED MEMO OF INCOME. THIS ADDITION UNDER THE HEAD 'PROFITS AND GINS OF BUSINESS OR PROFESSION', I FIND ON THE FACTS AND CIRCUMSTANCES OF THE CASE AVAILABLE T O ME AND THE FACTS OF THE CASE AS SET OUT BY THE AO IN H IS ASSESSMENT ORDER AND ALSO ON THE BASIS OF THE SUBMISSIONS MADE BY THE AR, DOES NOT IN ANY WAY HAS ARISEN AS A RESULT OF ANY POINT OF SPECIFIC QUERY R ELATING TO CORRECTNESS OF COMPUTATION OF INCOME FROM BUSINESS RAISED BY THE AO ON THE BASIS OF HIS SCRUTINY OF TH E RETURN AS POINTED, OUT BY THE LEARNED AR OF THE APPELLANT WHO APPEARED BEFORE THE AO IN THE AFFIDAVIT FILED BEFOR E THE AO, FILED AS A RESULT OF MISTAKES FOUND OUT .' BY' THE AR HIMSELF AS' MISTAK ES POINTED OUT, BY HIM WHILE PREPARING THE ORIGINAL ME MO AND SUBSEQUENTLY RECTIFIED AND VOLUNTARILY OFFERED FOR 10 ITA NO.724 /MDS/2013 ASSESSMENT BY FILING A REVISED MEMO OF INCOME. 7.3 THEREFORE, I DO AGREE WITH THE CONTENTION OF TH E AR THAT NONE OF THE CONDITIONS PRESCRIBED FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT EXISTENCE OF WHI CH IS A PREREQUISITE FOR LEVYING PENALTY UNDER THE SAID SEC TION ARE SATISFACTORILY EXPLAINED IN THE PRESENT CASE AND CONSEQUENTLY, AND IN THE ABSENCE OF ANY FAILURE ON THE PART OF THE APPELLANT TO EXPLAIN THE CONDITION IN THE RE VISED MEMO AND IN. THE ABSENCE OF ANY FINDING OF THE AO A S TO THE FALSITY OF EXPLANATIONS OFFERED BY THE APPELLAN T AS PRESCRIBED UNDER EXPLANATION (1) OF SECTION 271(1)( C) OF THE ACT TO EXPLAIN, THE AO HAS NOT MADE OUT A CASE FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT IN THE PRESENT, CASE. IN THE CIRCUMSTANCES, I AM OF THE CONSIDERED OPINION THAT THE AO'S ACTION IN LEVYING PENALTY OF RS.10,87,171/- UNDER SECTION 271(1)(C) OF THE AC T ON THE BASIS OF THE ADDITION TO THE INCOME OF RS.31,98,502/- OFFERED BY THE APPELLANT BY FILING A REVISED MEMO I S NOT JUSTIFIED EITHER IN LAW OR ON THE FACTS OF THE CASE . IN VIEW OF THE ABOVE, I HEREBY DIRECT THE ASSESSING OFFICER T O DELETE THE PENALTY OF ` 10,87,171/- LEVIED UNDER SECTION 271(1) OF THE ACT. 6. ON GOING THROUGH THE ABOVE ORDER OF THE COMMISSI ONER OF INCOME TAX (APPEALS) AND THE CONTENTIONS OF THE ASSESSEE BEFORE HIM AND THE ASSESSMENT ORDER, WE FIND THAT I T IS NOT A FIT CASE FOR LEVY OF PENALTY FOR THE REASON THAT TH E REVISED MEMO FILED BY THE ASSESSEE APPEARS TO HAVE BEEN FOR THE REASON THAT AUTHORIZED REPRESENTATIVE OF THE ASSESS EE NOTICED CERTAIN MISTAKES IN THE BOOKS OF ACCOUNT AN D REVISED MEMO WAS FILED VOLUNTARILY OFFERING THE INCOME. WE ALSO SEE THAT QUERIES RAISED BY THE ASSESSING OFFICER IN THE ASSESSMENT PROCEEDINGS APPARENTLY HAVE NO CONNECTIO N WITH THE REVISED INCOME OFFERED BY THE ASSESSEE. THIS AS PECT OF 11 ITA NO.724 /MDS/2013 THE MATTER HAS BEEN ELABORATELY DEALT WITH BY THE COMMISSIONER OF INCOME TAX (APPEALS) WITH REFERENCE TO THE SUBMISSIONS MADE BY THE ASSESSEE. NONE OF THESE FIN DINGS HAVE BEEN REBUTTED BY THE REVENUE. THUS, WE SUSTAI N THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) I N HOLDING THAT THERE IS NO CONCEALMENT OF INCOME IN T HE CASE OF THE ASSESSEE AND REJECT THE GROUNDS RAISED BY THE R EVENUE. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 30 TH DECEMBER, 2015. SD/- SD/- ( . $ ) ( & () ) (D.KARUNAKARA RAO) (CHALLA NAGENDR A PRASAD ) + / ACCOUNTANT MEMBER ( + / JUDICIAL MEMBER ( /CHENNAI, - /DATED 30 TH DECEMBER, 2015 SOMU /0 10 /COPY TO: 1. APPELLANT 2. RESPONDENT 3. 2 () /CIT(A) 4. 2 /CIT 5. 0 6 /DR 6. /GF .