BEST DEVELOPERS, THANE V. DCIT CIR 4, THANE

ITA 7257/MUM/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 7684 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 1 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-01-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2007-2008
• Appeal Filed On: 09-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITTAL; ABHIRAMA KARTIKEYAN
• Assessee Lawyers: PRAKASH JUNJHUNWALA
• Keywords: Question of law; Initiation of penalty proceedings; Reasonable cause; Difference of opinion; Procedural lapse
• Section: 271(1)(c); 133A; 153A; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE S/ SHRI B.R. BASKARAN (AM) & SANDEEP GOSAIN (JM) I.T.A. NO. 7257/MUM/2016 (ASSESSMENT YEAR 2007 - 08) I.T.A. NO. 7258/MUM/2016 (ASSESSMENT YEAR 2008 - 09) I.T.A. NO. 7259/MUM/2016 (ASSESSMENT YE AR 2009 - 10) I.T.A. NO. 726 0 /MUM/2016 (ASSESSMENT YEAR 201 0 - 1 1 ) I.T.A. NO. 7261/MUM/2016 (ASSESSMENT YEAR 2012 - 13) M/S. BEST DEVELOPERS SHOP NO. 157, VASAI PATHA PELHAR, VASAI (EAST) THANE - 401208. PAN : AAHFB 3876C VS. DCIT CIRCLE - 4 THANE ( APPELLANT ) ( RESPONDENT ) I.T.A. NO. 7262 /MUM/20 1 6 (ASSESSMENT YEAR 20 0 8 - 0 9 ) I.T.A. NO. 7263/MUM/2016 (ASSESSMENT YEAR 2009 - 10) I.T.A. NO. 7264/MUM/2016 (ASSESSMENT YEAR 2010 - 11) I.T.A. NO. 7265/MUM/2016 (ASSESSMENT YEAR 2011 - 12) M/S. BEST GROUP OF COMPANIES SH OP NO. 157, VASAI PATHA PELHAR, VASAI (EAST) THANE - 401208. PAN : AAHFB7869B VS. DCIT CIRCLE - 4 THANE ( APPELLANT ) ( RESPONDENT ) I.T.A. NO. 7266/MUM/2016 (ASSESSMENT YEAR 2007 - 08) I.T.A. NO. 7267/MUM/2016 (ASSESSMENT YEAR 2008 - 09) I.T.A. NO. 7268/MUM /2016 (ASSESSMENT YEAR 2009 - 10) I.T.A. NO. 7269/MUM/2016 (ASSESSMENT YEAR 2010 - 11) I.T.A. NO. 7270/MUM/2016 (ASSESSMENT YEAR 2011 - 12) M/S. BEST ENTERPRISES SHOP NO. 157, VASAI PATHA PELHAR, VASAI (EAST) THANE - 401208. PAN : AAHFB7929E VS. DCIT CIRCLE - 4 THANE ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY SHRI PRAKASH JUNJHUNWALA & SHRI NEELKANTH KHANDELWAL DEPARTMENT BY SH RI RAJAT MITTAL & SHRI ABHIRAMA KARTIKEYAN 2 DATE OF HEARING 11 . 1 2 . 201 8 DATE OF PRONOUNCEMENT 10 . 0 1 . 201 9 O R D E R PER B.R . BASKARAN (AM) : - ALL THESE APPEALS HAVE BEEN FILED BY THE RESPECTIVE ASSESSEES CHALLENGING THE ORDER PASSED BY LD CIT(A) IN THEIR RESPECTIVE HANDS CONFIRMING THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE ACT FOR THE YEARS CITED IN THE CAPTION. SINCE ALL THESE ASSESSEES BELONG TO SAME GROUP AND SINCE THE ADDITIONS HAVE BEEN MADE ON IDENTICAL SET OF FACTS, WE HEARD ALL THE APPEALS TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER, FOR THE SAKE OF CONVENIENCE. 2. THE FACTS RELATING THE CASES ARE DISCUSSED IN BRIEF. ALL THE THREE ASSESSEES ARE PARTNERSHIP FIRMS EITHER HAVING COMMON PARTNERS OR THEIR FAMILY MEMBERS AS PARTNERS . ALL THE THREE CONCERNS ARE CARRYING ON THE BUSINESS OF TRADING IN LAND. THESE FIRMS DID NOT FILE RETURN OF INCOME SINCE ITS FORMATION. THE ABOVE SAID FACT CAME TO THE NOTICE OF THE REVENUE, WHEN IT CARRIED OUT SURVEY OPERATIONS U/S 133A OF THE ACT ON 20.11.2013. AT THE TIME OF SURVEY, INCRIMINATING DOCUMENTS WERE FOUND AND FURTHER A STATEMENT U/S 13 3A OF THE ACT WAS RECORDED FROM THE PARTNER NAMED SHRI SARFARAZ ALAM SHAIKH. IN THE STATEMENT, HE ADMITTED LUMP SUM OF RS.2.00 CRORES AS INCOME OF ALL THE THREE FIRMS IN VARIOUS YEARS. ACCORDINGLY, THESE FIRMS FIL ED RETURNS OF INCOME FOR ALL THE ABOVE CI TED YEARS , DECLARING INCOME FROM BUSINES S. THE INCOME DECLARED IN AGGREGATE IN EACH OF THE FIRM FOR THE YEARS UNDER CONSIDERATION IS GIVEN BELOW: - BEST ENTERPRISES - 1,12,49,535 BEST DEVELOPERS - 1,05,07,254 BEST GROUP OF COMPANIES 39,35,082 IT CAN BE NOTICED THAT T HESE FIRMS HAVE FILED RETURNS OF INCOME DECLARING INCOME OF MORE THAN RS.2.00 CRORES. 3 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO ACCEPTED THE INCOME SO DECLARED BY THESE CONCERNS AND INITIATED PENALTY PROCEEDINGS FOR CONCEALMENT OF INCOME ON THE INCOME RETURNED BY THEM . 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER MADE ADDITIONS TO THE INCOME RETURNED BY THE SE ASSESSEE S. THE DETAILS RELATING TO THE SAME ARE DISCUSSED IN BRIEF. (A) BEST ENTERPRISES : - DURING THE COURSE OF SURVEY OPERATIONS, COPIES OF CERTAIN PROPERTY AGREEMENT DOCUMENTS WERE FOUND. THE SAME CONSISTED OF SATHE KARAR AGREEMENT EN TERED BETWEEN M/S BEST ENTERPRI SES AND SHRI PANDURANG BALWANT NAIK. THE SAME WAS ENTERED IN C ONNECTION WITH THE LAND LOCATED AT S.NO.215, HISSA NO.6 ADMEASURING 47.7 GUNTHE OF PELHAR, TALUK VASAI, DISTRICT THANE. THE CONSIDERATION WAS MENTIONED AS RS.2,20,000/ - PER GUNTHA. HENCE THE TOTAL CONSIDERATION FOR THE ABOVE TRANSACTION SHOULD HAVE BE EN RS.1,04,94,000/ - . HOWEVER, IT WAS NOTICED THAT THE CONVEYANCE DEED WAS REGISTERED FOR A SUM OF RS.34,17,000/ - . ACCORDINGLY IT WAS NOTICED THAT CONSIDERATION WAS UNDERSTATED BY RS.70,77,000/ - . THE SURVEY TEAM ALSO FOUND CASH VOUCHERS GIVING DETAILS OF PA YMENTS MADE BY WAY OF CASH ON VARIOUS DATES. BASED ON THOSE CASH VOUCHERS, THE AO ADDED THE ABOVE SAID AMOUNT OF RS.70,77,000 / - IN VARIOUS YEARS AS UNDER: - ASSESSMENT YEAR AMOUNT 2008 - 09 49,92,000 2009 - 10 16,40,000 2010 - 11 1, 85,000 2011 - 12 2,60,000 (B) BEST GROUP OF COMPANIES : - IN THIS CASE ALSO, SATHE KARAR AGREEMENT ENTERED BE T WEEN THIS ASSESSEE AND SHRI KALAKAR DATTATRAYA NAIK AND OTHERS , WERE FOUND IN RESPECT OF CERTAIN LAND. THE TOTAL CONSIDERATION PAYABLE W AS RS.87.48 LAKHS. HOWEVER, THE SALE AGREEMENT WAS EXECUTED ONLY FOR RS.38.50 LAKHS. HOWEVER, I N THE BOOKS, THE CONSIDERATION WAS SHOWN AT RS.41.50 LAKHS. THUS THERE WAS A DIFFERENCE 4 OF RS.45.98 LAKHS (87.48 ( - ) 41.50) , WHICH WAS TREATED AS SUPPRESSED V ALUE BY THE AO . THE SURVEY TEAM ALSO FOUND CASH VOUCHERS GIVING DETAILS OF PAYMENTS MADE BY WAY OF CASH ON VARIOUS DATES. BASED ON THE CASH VOUCHERS, THE AO ADDED THE AMOUNT OF RS.45.98 LAKHS IN VARIOUS YEARS AS UNDER: - ASSESSMENT YEAR AMOUNT 200 8 - 09 39,00,000 2009 - 10 4,75,000 2010 - 11 80,000 THE DIFFERENCE AMOUNT OF RS.1,43,000/ - WAS RELATING TO AY 2007 - 08. (C) BEST DEVELOPERS : - IN THIS CONCERN, THE AO ADDED A SUM OF RS.6,01,500/ - IN AY 2009 - 10. THE ASSESSEE FILED ITS RETURN OF INCOME FOR AY 2009 - 10 DECLARING A TOTAL INCOME OF RS.4,01,464/ - . HOWEVER, THE PROFIT AND LOSS ACCOUNT FILED SUBSEQUENTLY DISCLOSED A NET PROFIT OF RS.10,02,964/ - . HENCE THE AO ADDED THE DIFFERENCE AMOUNT OF RS.6,01,500/ - TO THE TOTAL INCOM E OF THIS YEAR. THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS ON THE ABOVE SAID ADDITIONS FOR FURNISHING INACCURATE PARTICULARS OF INCOME. 5. IN THE PENALTY ORDERS PASSED IN THE HANDS OF THREE ASSESSEES FOR ALL THE YEARS UNDER CONSIDERATION, T HE AO LEVIED PENALTY U/S 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICULARS OF INCOME. IT IS PERTINENT TO NOTE THAT THE AO HAD INITIATED THE PENALTY PROCEEDINGS FOR CONCEALMENT OF INCOME IN RESPECT OF INCOME DECLARED BY THESES ASSESSEES IN THE IR RESPECTIVE RETURNS OF INCOME. IN THE PENALTY ORDER, THE AO ALSO TOOK SUPPORT OF EXP LANATION 3 TO SEC. 271(1)(C) OF THE ACT, WHICH PROVIDES THAT TAXABLE INCOME OF A PERSON SHALL BE DEEMED TO BE CONCEALMENT OF INCOME, EVEN IF THE RETURN OF INCOME IS FILE D AFTER EX PIRY OF CERTAIN PERIOD. AS NOTICED EARLIER , THE AO , HOWEVER, LEVIED PENALTY ON THE INCOME DECLARED BY THE ASSESSEE AS WELL AS ON THE ADDITION MADE BY HIM FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE LD CIT(A) ALSO CONFIRMED THE SAM E. 5 6. THE LD COUNSEL APPEARING FOR THE ASSESSEE RAISED CERTAIN LEGAL ISSUES, WHICH ARE DETAILED BELOW: - (A) IN RESPECT OF INCOME DECLARED BY THE ASSESSEES IN THE RETURN OF INCOMES FILED FOR ALL THESE YEARS, THE AO HAS INITIATED THE PROCEEDINGS FOR C ONCEALMENT OF INCOME IN THE ASSESSMENT ORDERS. IN THE PENALTY ORDERS ALSO, THE AO HAS ALSO TAKEN SUPPORT OF EXPLANATION 3 TO SEC.271(1)(C) OF THE ACT, WHICH DEEMS THE INCOME SO DECLARED AS CONCEALMENT OF INCOME. HOWEVER, THE AO HAS FINALLY LEVIED PENA LTY ON THE ABOVE SAID INCOME FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. HE SUBMITTED THAT THE AO HAS THUS INITIATED PENA LTY PROCEEDINGS UNDER ONE LIMB , BUT LEVIED PENALTY UNDER ANOTHER LIMB IN RESPECT OF THE INCOME DECLARED BY THE ASSESSEES IN THE RETURNS OF INCOME. ACCORDINGLY HE CONTENDED THAT THE PENALTY LEVIED THEREON IS LIABLE TO BE QUASHED AS PER THE DECISION RENDERED BY HONBLE JUR I SDICTIONAL BOMBAY HIGH COURT IN THE CASE OF SAMSON PERINCHERY (ITA 1154 OF 2014 DATED 5 TH JANUARY, 2017). (B) T HE ADDITIONS MADE BY THE AO TO THE RETURNED INCOME WAS RELATING TO ALLEGED INCOME NOT DISCLOSED BY THE ASSESSEES IN THEIR RETURN OF INCOME , WHICH WERE BASED ON CERTAIN MATERIALS FOUND DURING THE COURSE OF SEARCH. THE ADDITIONS SO MADE, SHOULD FALL U NDER THE CATEGORY OF CONCEALMENT OF PARTICULARS OF INCOME , AS THE ASSESSEES DID NOT DISCLOSE THE SAME IN THEIR RESPECTIVE RETURNS OF INCOME . H E SUBMITTED THAT THE AO HAS , HOWEVER, LEVIED PENALTY ON THE ABOVE SAID ADDITIONS ALSO FOR FURNISHING OF INACCU RATE PARTICULARS OF INCOME. HE SUBMITTED THAT THE EXPRESSIONS CONCEALMENT OF PARTICULARS OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME CARRY DIFFERENT MEANING. HENCE THE PENALTY SHOULD BE LEVIED ON CORRECT CHARGE ONLY. IN THE INSTA NT CASE, THE AO HAS LEVIED PENALTY ON AN INAPPROPRIATE CHARGE AND HENCE IT IS LIABLE TO BE QUASHED AS PER THE T HIRD MEMBER DECISION RENDERED IN AMRISTAR 6 BENCH OF ITAT IN THE CASE OF HPCL MITTAL ENERGY LIMITED (ITA NOS.554 & 555/ASR/2014 & OTHERS DATED 07 - 0 5 - 2018). (C) THE AO DID NOT STRIKE DOWN THE INAPPROPRIATE PORTION IN THE PENALTY NOTICE ISSUED BY HIM. HENCE THE IMPUGNED PENALTY ORDERS ARE LIABLE TO BE QUASHED. IN THIS REGARD HE PLACED HIS RELIANCE ON THE DECISION RENDER E D BY HONBLE KARNATAKA HIG H COURT IN THE CASE OF SSAS EMERAL MEADOWS (73 TAXMANN.COM 241)(KAR). HE SUBMITTED THAT THE SLP FILED AGAINST THE ABOVE SAID DECISION HAS SINCE BEEN DISMISSED BY HONBLE SUPREME COURT. HE ALSO PLACED HIS RELIANCE ON THE DECISION RENDERED BY HONBLE ANDH RA PRADESH AND TELEGANA HIGH COURT IN THE CASE OF PCIT VS. SMT. BAISETTY REWATHI (ITA NO.684 OF 2016). (D) THE LD A.R SUBMITTED THAT THE AO, HAVING INVOKED EXPLANATION 3 TO SEC. 271(1)(C) OF THE ACT, SHOULD HAVE GIVEN CREDIT FOR THE TAXES ALREADY PAID P RIOR TO THE ISSUE OF NOTICE U/S 148 OF THE ACT AS PROVIDED IN THE ABOVE SAID PROVISIONS. HE SUBMITTED THAT THE ASSESSEE HAD PAID FOLLOWING AMOUNTS AS TAXES PRIOR TO ISSUE OF NOTICE U/S 148 OF THE ACT: - (A) BEST ENTERPRISES: - ASSESSMENT YEAR 2008 - 09 - 1 0,95,566 ASSESSMENT YEAR 2009 - 10 - 4,00,000 (B) BEST DEVELOPERS: - ASSESSMENT YEAR 2012 - 13 - 5,00,000 (C) BEST GROUP OF COMPANIES: - ASSESSMENT YEAR 2009 - 10 - 1,00,000 ASSESSMENT YEAR 2010 - 11 - 1,00,000 THE LD A.R SUBMITTED THAT THE ASSESSING OFFICER DID NOT GIVE CREDIT TO THE ABOVE SAID AMOUNTS, WHILE COMPUTING PENALTY LEVIED BY HIM. 7. ON MERITS, THE LD A.R SUBMITTED THAT THESE PARTNERSHIP FIRMS WERE HAVING EITHER COMMON PARTNERS OR T HEIR RELATIVES ONLY. THE MAIN PARTNERS WERE NEGOTIATING THE DEALS FOR PURCHASE OF LANDS ON BEHALF OF ALL THE THREE FIRMS . 7 WHEN THOSE TRANSACTIONS WERE BROUGHT INTO BOOKS OF ONE OF THE FIRMS, THE PARTNERS IN THE OTHER FIRMS ALSO CLAIMED THAT THE SAME SHOULD HAVE BEEN ACCOUNTED IN BOOKS OF THE P ARTNERSHIP FIRMS IN WHICH THEY ARE PARTNERS , I.E., THOSE PARTNERS ALSO CLAIMED THEIR SHARE IN THE PROFITS . DUE TO DIFFERENCE OF OPINION BETWEEN THE PARTNERS ON THIS ISSUE, LEGAL DISPUTES AROSE BETWEEN THEM . THE LD A.R SUBMITTED THAT THE ASSESSEE HAS FURN ISHED DETAILS OF THE LEGAL DISPUTES AND COURT PROCEEDINGS BEFORE THE AO TO SUBSTANTIATE THE ABOVE SAID CLAIM. IN VIEW OF THE SAME, THESE ASSESSEES COULD NOT DE T E RMINE THE QUANTUM OF PROFITS IN THE HANDS OF EACH OF THE FIRMS, AS THERE WAS DISPUTE WITH REGA RD TO THE OWNERSHIP OF TRANSACTIONS ITSELF. HENCE THE ASSESSEES COULD NOT FILE THEIR RETURNS OF INCOME. HE FURTHER SUBMITTED THAT THE MAIN PARTNER OF THESE FIRMS HAS ADMITTED THE INCOME OF RS.2.00 CRORES ON ADHOC BASIS BY ESTIMATING THE TOTAL VALUE OF LA ND TRANSACTIONS AT RS.20.00 CRORES. HE SUBMITTED THAT THE ABOVE SAID INCOME WAS GROSS INCOME AND OFFERED ON ESTIMATED BASIS ONLY. HOWEVER, WHILE FILING RETURNS OF INCOME, THESE ASSESSEES HAVE OFFERED MORE AMOUNT OF INCOME. THE LD A.R, ACCORDINGLY, CONTE NDED THAT THERE WAS REASONABLE CAUSE FOR THE ASSESSEES FOR NOT FILING RETURNS OF INCOME AND THE EXPLANATIONS SO GIVEN BY THEM HAVE NOT BEEN FOUND TO BE FALSE BY THE ASSESSING OFFICER. IN VIEW OF EXISTENCE OF REASONABLE CAUSE, THE EXPLANATION 3 SHOULD NOT HAVE BEEN INVOKED BY THE AO. T HE LD A.R SUBMITTED THAT , ON THE CONTRARY, THE BENEFIT OF IMMUNITY GRANTED UNDER EXPLANATION 1 SHOULD BE GIVEN TO THESE ASSESSEES. 8. THE LEARNED DR, ON THE CONTRARY, SUBMITTED THAT WHENEVER THERE IS DIFFERENCE BETWEEN RE TURNED INCOME AND ASSESSED INCOME, THERE IS INFERENCE OF CONCEALMENT AS PER RULE OF LAW. THE R ESPONSIBILITY TO REBUT THE ABOVE SAID INFERENCE SQUARELY L IES ON THE SHOULDERS OF THE ASSESSEE. ABSENCE OF ANY EXPLANATION FROM THE ASSESSEE WILL ATTRACT PENALTY U/S. 271(1)(C) OF THE ACT. THE LEARNED DR FURTHER SUBMITTED THAT TWO TYPES OF CHARGES HAVE BEEN PRESCRIBED U/S. 271(1)(C) OF THE ACT , VIZ., CONCEALMENT OF PARTICULARS OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME . BY PLACING RELIANCE ON THE DECISION RENDERED BY HON'BLE ORISSA HIGH COURT IN THE CASE OF INDIAN METALS 8 AND FERRO ALLOYS (211 ITR 35), THE LEARNED DR SUBMITTED THAT BOTH CHARGES MENTIONED ABOVE MAY LEAD TO SAME EFFECT, NAMELY, KEEPING OF A CERTAIN PORTION OF INCOME. WHILE CONCEAL MENT OF PARTICULARS OF INCOME WOULD RESULT IN DIRECT HIDING OF INCOME AND OTHER ONE WOULD RESULT IN HIDING OF INCOME IN INDIRECT MANNER. ACCORDINGLY HE SUBMITTED THAT THE FINAL OUTCOME, VIZ., HIDING OF INCOME SHOULD BE GIVEN IMPORTANCE THAN THE CHARGE INI TIALLY FRAMED. 9. WITH REGARD TO NON - STRIKING OF INAPPLICABLE PORTION IN THE NOTICE OF PENALTY ISSUED BY THE ASSESSING OFFICER, THE LEARNED D R SUBMITTED THAT THE SAME HAS BEEN CONSIDERED TO BE A PROCEDURAL LAPSE BY HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. KAUSHALYA AND OTHERS (216 ITR 660). HE SUBMITTED THAT DECISION RENDERED IN THE CASE OF KAUSHALYA AND OTHERS (SUPRA) WAS NOT BROUGHT TO THE NOTICE OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF SAMSON PERINCHERY (SUPRA). THE LEARNED DR FURTHER SUBMITT ED THAT D EFICIENCY IN NOTICE WOULD STAND CURE D BY THE PROVISIONS OF SECTION 292B/292BB OF THE ACT , WHEN THE ASSESSEE PARTICIPATES IN THE PROCEEDINGS . 10. THE LD D.R FURTHER SUBMITTED THAT THE HON'BLE SUPREME COURT IN THE CASE OF MAK DATA (P) LTD. VS. CIT (358 ITR 593) HAS HELD THAT THERE IS NO ANY SPECIFIC FORM OF RECORDING SATISFACTION BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER AND IT IS NECESSARY FOR THE ASSESSEE TO OFFER EXPLANATION IN TERMS OF SECTION 271(1)(C) OF THE ACT EVEN THOUGH INCOME IS SU RRENDERED VOLUNTARILY DURING THE COURSE OF SURVEY. THE LEARNED DR ALSO TOOK SUPPORT OF THE DECISION RENDERED BY HON'BLE SUPREME COURT IN THE CASE OF K.P. MADHUSUDANAN VS. CIT (251 ITR 99) . ACCORDINGLY THE LD D.R SUBMITTED THAT THE LEGAL ISSUES URGED BY TH E ASSESSEE SHOULD BE DISMISSED. 11. ON MERITS, THE LD D.R SUBMITTED THAT THE ASSESSEES HAVE FILED THEIR RETURN OF INCOME ONLY AFTER THEY WERE CAUGHT, I.E., AFTER THE SURVEY OPERATIONS CONDUCTED U/S 133A OF THE ACT. FURTHER THE ASSESSEES HAVE ALSO ACCE PTED THE ASSESSMENT ORDERS BY NOT FILING APPEALS. HE FURTHER SUBMITTED THAT THE LD CIT(A) HAS HELD THAT, THE SO CALLED DISPUTES WERE ONLY AN AFTERTHOUGHT, WHICH IS 9 NOT SUPPORTED BY ANY DOCUMENTARY EVIDENCE. HE FURTHER SUBMITTED THAT, DESPITE THE EXISTENCE OF DISPUTE, IF ANY, THESE ASSESSEES HAVE FILED RETURN OF INCOME AFTER THE SURVEY OPERATIONS. THE LD D.R FURTHER SUBMITTED THAT THESE ASSESSEES HAVE ALSO CLAIMED THAT THEIR COMPUTER GOT CRASHED AND HENCE THEY DID NOT FILE RETURNS OF INCOME. HOWEVER THIS FACT WAS NEVER MENTIONED DURING THE COURSE OF SURVEY OPERATIONS AND HENCE THE SAID EXPLANATIONS WERE NOT RIGHTLY CONSIDERED BY LD CIT(A). HE SUBMITTED THAT THE HONBLE SUPREME COURT HAS HELD IN THE CASE OF MAK DATA LTD (358 ITR 593) THAT THE AMOUNT SURREN DERED DURING THE COURSE OF SEARCH CANNOT BE CONSIDERED TO BE VOLUNTARY. IT WAS HELD IN THE CASE OF PRASANNA DUGAR VS. CIT (70 TAXMAN.COM) THAT THE ADDITIONAL INCOME DISCLOSED IN THE RETURN FILED U/S 153A OF THE ACT CANNOT BE CONSIDERED TO BE VOLUNTARY. H E FURTHER SUBMITTED THAT THE HONBLE BOMBAY HIGH COURT HAS HELD IN THE CASE OF SAMSON MARITIME LTD VS. CIT THAT ANY DISCLOSURE MADE BY THE ASSESSEE IN RESPONSE TO NOTICES ISSUED U/S 143 AND 142 OF THE ACT IS LIABLE TO PENALTY U/S 271 OF THE ACT. THE LD D. R, ACCORDINGLY SUBMITTED THAT THE RETURNS OF INCOME FILED BY THE ASSESSEES WERE NOT VOLUNTARY AND FURTHER THEY HAVE NOT AFFORDED PROPER EXPLANATIONS. ACCORDINGLY HE SUBMITTED THAT THE ORDERS PASSED BY LD CIT(A) IN ALL THE YEARS IN THE HANDS OF THESE ASSES SEES SHOULD BE CONFIRMED. 12. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD. WE SHALL FIRST DEAL WITH THE LEGAL ISSUE S URGED BY THE ASSESSEES. THE F IRST LEGAL ISSUE CONTESTED BY THE ASSESSEES IS THAT THE ASSESSING OFFICER HAS INITIATED PENALTY PRO CEEDINGS FOR CONCEALMENT OF INCOME IN RESPECT OF INCOME DISCLOSED BY THE ASSESSEES IN THE RETURN OF INCOME FILED BY THEM, BY TAKING SUPPORT FROM THE EXPLANATION 3 OF SECTION 271(1)(C) OF THE ACT. SINCE EXPLANATION 3 HAS BEEN INVOKED, WE ARE OF THE VIEW THAT THE AO HAS INITIATED PENALTY PROCEEDINGS FOR CONCEALMENT OF PARTICULARS OF INCOME AND HAS MENTIONED THE SAME AS CONCEALMENT OF INCOME, BOTH IN THE ASSESSMENT ORDER AS WELL AS PENALTY ORDER. HOWEVER, THE ASSESSING OFFICER HAS LEVIED PENALTY ON THE INCOME SO RETURNED BY THE ASSESSEES FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THUS, WE NOTICED 10 THAT THE ASSESSING OFFICER HAS INITIATED PENALTY PROCEEDINGS UNDER ONE LIMB OF SECTION 271(1)(C) OF THE ACT BUT LEVIED PENALTY UNDER ANOTHER LIMB. 13 . WE NOTICED THAT AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY HON'BLE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF SHRI SAMSON PERINCHERY (SUPRA) . W E NOTICED THAT HON'BLE BOMBAY HIGH COURT HAS FOLLOW ED THE DECISION RENDERED BY HON'BLE KARNATAK A HIGH COU RT IN THE CASE OF MANJUNATHA COTTON AND GINNING FACTORY (359 ITR 565) AND ALSO DECISION RENDERED BY HON'BLE SUPREME COURT IN THE CASE OF T. ASHOK PAI (292 ITR 11). IN THE ABOVE SAID CASE, THE ASSESSING OFFICER HAD INITIATED PENALTY PROCEEDINGS FOR FURNISH ING OF INACCURATE PARTICULARS OF INCOME BUT ULTIMATE LEVIED PENALTY FOR CONCEALMENT OF INCOME. THE HON'BLE BOMBAY HIGH COURT HAS CONFIRMED THE ORDER PASSED BY THE TRIBUNAL DELETING THE PENALTY. FOR THE SAKE OF CONVENIENCE, WE EXTRACT BELOW THE ORDER PASSE D BY HON'BLE BOMBAY HIGH COURT : - 3 THE IMPUGNED ORDER OF THE TRIBUNAL DELETED THE PENALTY IMPOSED UPON THE RESPONDENT - ASSESSEE. THIS BY HOLDI N G THA T T HE INITIATION OF PENALTY UNDER SECTION 271 (1) (C) OF THE ACT BY ASSES S ING 0 F FICER WAS FOR FURNISHING I NA CCURATE PARTICULARS OF INCOME WHILE THE ORDER IMPOSING PENALTY IS FOR CONCEALMENT OF INCOME. TH E IMPUGNED ORDER HOLDS THAT THE CONCEALMENT OF INCOME AND FURNISHIN G INACC URATE PARTICULARS OF INCOME CARRY DIFFERENT CONNOTATIONS . THEREFORE THE ASSESSING OFFIC ER SHOULD BE CLEAR AS TO WHICH OF THE T WO LIMBS UNDER WHICH PENALTY IS IMPOSABLE, HAS BEEN CONTRAVENED OR INDICATE TH AT BOTH HAVE BEEN CONTRAVENED WHILE INITIATING PENALTY PROCEEDINGS. IT CANNOT BE THAT THE INITIATION WOULD BE ONLY ON ONE LIMB I.E. FOR FUR NISHING INACCURATE PARTICULARS OF INCOME WHILE IMPOSITION OF PENALTY ON THE OTHER LIMB I.E. CONCEALMENT OF INCOME. FURTHER, THE TRIBUNAL ALSO NOTED THAT NOTICE ISSUED UNDER SECTION 274 OF ACT IS IN A STANDARD PROFORMA, WITHOUT HAVING STRIKE - OUT IRRELEVANT THEREIN. THIS INDICATES NON - APPLICATION OF MIND ON THE PART OF THE ASSESSING OFFICER WHILE ISSUING THE PENALTY NOTICE. 4. THE IMPUGNED ORDER RELIED UPON THE FOLLOWING EXTRACT OF KARNATAKA HIGH COURT'S DECISION IN CIT V/S. MANJUNATH COTTON AND GINNING FAC TORY 359 ITR 565 TO DELETE THE PENALTY: - 'T HE ASSESSING OFFICER IS EMPOWERED UNDER THE ACT TO INITIATE PENALTY PROCEEDINGS ONCE HE IS SATISFIED IN THE COURSE OF ANY PROCEEDINGS THAT THERE IS CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF TOTAL INCOME UNDER CLAUSE (C). 11 CONCEALMENT, FURNISHING INACCURATE PARTICULARS OF INCOME ARE DIFFERENT. THUS, THE ASSESSING OFFICER WHILE ISSUING NOTICE H AS TO COME TO THE CONCLUSION THAT WHETHER IS IT A CASE OF CONCEALMENT OF INCOME OR IS IT AS CASE OF FURNISHING OF INACCURATE PARTICULARS. THE APEX COURT IN THE CASE OF ASHOK PAI REPORTED I N [2007] 292 ITR 11 (SC) AT PAGE 19 HAS HELD THAT CONCEALME NT OF INCOME AND FURNISHING INACCURATE PARTICULARS OF INCOM E CARRY DIFFERENT CONNOTATIONS. THE GUJARAT HIGH COURT IN THE CASE OF MANU ENGINEERING REPORTED IN 122 ITR 306 AND THE DELHI HIGH COURT IN THE CASE OF VIRGO MARKETING P. LTD., REPORTED IN 171 TAXM A N 156, HAS HELD THAT LEVY OF PENALTY HAS TO BE CL EAR AS TO THE LIMB FOR WHICH IT IS LEVIED AND THE POSITION BEING UNCLEAR PENALTY IS NOT SUSTAINABLE. THEREFORE , WHEN THE ASSESSING OFFICER PROPOSES TO INVOKE THE FIRST LIMB BEING CONCEALMENT, THEN THE NOTICE HAS TO BE APPROPRIATELY M ARKED. SIMILAR IS THE CASE FOR FURNISHING INACCURATE PARTICULARS OF INCOME. T HE STANDARD PROFORMA WITHOUT STRIKING OF THE RELEVANT CLAUSES WILL LEAD TO AN INFERENCE AS TO NON - APPLICATION OF MIND. 5 THE GRIEVANCE OF THE REVENUE BEFORE US IS THAT THERE IS NO DIFFERENCE BETWEEN FURN ISHING OF INACCURATE PARTICULARS OF INCOME AND CO NCEALMENT OF INCOME. THUS, DISTINCTION DRAWN BY THE IMPUGNED ORDER IS BETWEEN TWEEDLEDUM AND TWEEDLEDEE. IN THE ABOVE VIEW, THE DELETION OF PENALTY IS UNJUSTIFIED. 6. THE ABOVE SUBMISSION ON THE PART OF THE REVENUE IS IN THE FACE OF THE DECISION OF THE SU PREME COURT IN ASHO K PAI V/S. CIT 292 ITR [RELIED UPON IN MANJUNATH COTTON & GINNING FACTORY (SUPRA)] - WHEREIN IT IS OBSERVED THAT CONCEALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME IN SECTION 271(L)(C) OF THE ACT, CARRY DIFFERENT MEA NINGS/ CONNOTATIONS. THEREFORE, THE SATISFACTION OF THE ASSESSING OFFICER WITH REGARD TO ONLY ONE OF THE TWO BREACHES MENTIONED UNDER SECTION 271(L)(C) OF THE ACT, FOR INITIATION OF PENALTY PROCEEDINGS WILL NOT WARRANT/ PERMIT PENALTY BEING IMPOSED FOR THE OTHER BREACH. THIS IS MORE SO, AS AN ASSESSEE WOULD RESPOND TO THE GROUND ON WHICH THE PENALTY HAS BEEN INITIATED/NOTICE ISSUED. IT MUST, THEREFORE, FOLLOW THAT THE ORDER IMPOSING PENALTY HAS TO BE MADE ONLY ON THE GROUND OF WHICH THE PENALTY PROCEEDINGS HAS BEEN INITIATED, AND IT CANNOT BE ON A FRESH GROUND OF WHICH THE ASSESSEE HAS NO NOTICE. 7. THEREFORE, THE ISSUE HEREIN STANDS CONCLUDED IN FAVOUR OF THE RESPONDENT - ASSESSEE BY THE DECISION OF THE KARNATAKA HIGH COURT IN THE CASE OF MANJUNATHA COTTON AND GINNING FACTORY (SUPRA). NOTHING HAS BEEN SHOWN TO USE IN THE PRESENT FACTS WHICH WOULD WARRANT OUR TAKING A VIEW DIFFERENT FROM THE KARNATAKA HIGH COURT IN THE CASE OF MANJUNATHA COTTON AND GINNING FACTORY (SUPRA). 12 8. IN VIEW OF THE ABOVE, THE QUESTI ON AS FRAMED DO NOT GIVE RISE TO ANY SUBSTANTIAL QUESTION OF LAW. THUS , NOT ENTERTAINED. 9. ACCORDINGLY, ALL THESE APPEALS ARE DISMISSED. NO ORDER AS TO COSTS. 14 . IN THE INSTANT CASE S ALSO , WE HAVE NOTICED THAT THE ASSESSING OFFICER HAS INITIA TED PROCEEDINGS FOR CONCEALMENT OF INCOME IN RESPECT OF INCOME DISCLOSED BY THE ASSESSEES IN THE RETURN S OF INCOME FILED BY THEM. HOWEVER, ASSESSING OFFICER HAS LEVIED PENALTY ON THE ABOVE SAID INCOME FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THU S THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS UNDER ONE LIMB , BUT LEVIED PENALTY UNDER ANOTHER LIMB. ACCORDINGLY, BY FOLLOWING BINDING DECISION OF HON'BLE BOMBAY HIGH COURT RENDERED IN THE CASE OF SHRI SAMSON PERINCHERY (SUPRA), WE SET ASIDE THE OR DER PASSED BY LD CIT(A) ON THIS ISSUE IN ALL THE YEARS UNDER CONSIDERATION IN THE HANDS OF ALL THESE ASSESSEES AND DIRECT THE AO TO DELETE PENALTY LEVIED BY HIM IN RESPECT OF INCOME DISCLOSED BY THE ASSESSEES IN THE RETURN S OF INCOME FILED BY THEM FOR THE YEARS UNDER CONSIDERATION. 15. THE ASSESSING OFFICER HAS ALSO LEVIED PENALTY ON THE ADDITION MADE BY HIM IN THE RETURN S OF INCOME OF THE ASSESSEES , THE DETAILS OF WHICH ARE GIVEN BY US IN AN EARLIER PARAGRAPH. THE C ONTENTION OF THE ASSESSEE IS THAT THE A SSESSING OFFICER HAS LEVIED PENALTY ON THE ADDITIONS MADE BY HIM UNDER THE LIMB OF FURNISHING OF INACCURATE PARTICULARS OF INCOME . HOWEVER, ADDITION SO MADE WOULD FALL UNDER THE CATEGORY OF CONCEALMENT OF PARTICULARS OF INCOME , AS THE ASSESSEE HA VE B EEN ALLEGED TO HAVE NOT DISCLOSED THE SAME IN THEIR BOOKS OF ACCOUNT AND FURTHER THE ASSESSING OFFICER HAS MADE ADDITION S ON THE BASIS OF INCRIMINATING MATERIAL FOUND DURING THE COURSE OF SURVEY OPERATION. THE LEARNED AR SUBMITTED THAT THE EXPRESSION S FUR NISH ING OF INACCURATE PARTICULARS OF INCOME AND CONCEALMENT OF PARTICULARS OF INCOME CARRY DISTINCT CONNOTATIONS AS HELD BY HONBLE SUPREME COURT IN THE CASE OF T.ASHOK PAI (SUPRA). ACCORDINGLY HE CONTENDED THAT THE PENALTY LEVIED ON AN INAPPROPRIATE C HARGE WOULD VITIATE THE PENALTY ORDER. IN THIS REGARD, LEARNED AR PLACED HIS RELIANCE ON THE DECISION RENDERED BY THE THIRD MEMBER IN 13 AMRITSAR BENCH IN THE CASE OF HPCL MITTAL ENERGY LTD. (ITA NO. 554 & 555/ASR/2014 DATED 7.5.2018). 16 . FOR THE SAKE OF C ONVENIENCE, WE EXTRACT BELOW RELEVANT OBSERVATIONS MADE BY THE THIRD MEMBER IN THE CASE OF HPCL MITTAL ENERGY LTD. (SUPRA) : - 6. AT THIS JUNCTURE AND BEFORE ESPOUSING THE MAIN QUESTION, IT WOULD BE BEFITTING TO FIRST DECIDE AS TO WHETHER THE THREE ITEMS CON STITUTING BEDROCK OF PENALTY, VIZ., DISALLOWANCE OF BUSINESS LOSS; NON - DECLARATION OF INTEREST INCOME FROM DEPOSITS WITH BANKS AND HPCL; AND NON - DECLARATION OF INTEREST INCOME ON FDRS AS SECURITY GIVEN TO THE TRIAL COURT, FALL UNDER THE EXPRESSION CONCEAL MENT OF THE PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME. THE HONBLE SUPREME COURT IN CIT VS. U.P. STATE FOREST CORPORATION (1998) 230 ITR 945 (SC) HAS HELD THAT IF THE MEANING OF A WORD IS NOT FOUND IN THE RELEVANT STAT UTE, THEN ITS MEANING SHOULD BE FOUND OUT FROM THE GENERAL CLAUSES ACT AND IF IT IS NOT DEFINED IN THAT ACT AS WELL, THEN ITS POPULAR MEANING SHOULD BE CONSIDERED. ADMITTEDLY, THE ABOVE TWO EXPRESSIONS HAVE NEITHER BEEN DEFINED UNDER THE ACT NOR THE GENERA L CLAUSES ACT. IN SUCH A SCENARIO, THEIR POPULAR MEANINGS HAVE TO BE SEEN AND UNDERSTOOD. IN COMMON PARLANCE, THE WORD CONCEAL MEANS `TO HIDE AND THE WORD PARTICULARS IS UNDERSTOOD AS `DETAILS. ACCORDINGLY, THE EXPRESSION CONCEALMENT OF PARTICULARS OF INCOME MEANS `HIDING THE DETAILS OF INCOME. CONCEALING THE PARTICULARS OF INCOME OR HIDING DETAILS OF INCOME, ERGO, PRE - SUPPOSES THE EXISTENCE OF SOME INCOME, WHICH HAS BEEN HIDDEN OR NOT BEEN SHOWN BY THE ASSESSEE. IT MAY INCLUDE NOT REPORTING TRANSA CTION OF SALE OF PROPERTY AND CONSEQUENTLY HIDING CAPITAL GAIN. IT MAY ALSO INCLUDE MAKING SALES OUTSIDE THE BOOKS OF ACCOUNT AND, RESULTANTLY, HIDING PROFIT EARNED FROM SUCH SALES. IT MAY ALSO INCLUDE EARNING OF SOME INTEREST INCOME BUT HIDING IT BY NOT D ECLARING IT. THE SECOND EXPRESSION IS FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME. `INACCURATE MEANS NOT ACCURATE OR CORRECT. `INACCURATE PARTICULARS OF INCOME MEANS THE `DETAILS OF INCOME WHICH ARE NOT CORRECT. THIS WOULD EMBRACE SITUATIONS W HERE THE TOTAL INCOME GOES UNDER - REPORTED BECAUSE OF THE ASSESSEE FURNISHING WRONG DETAILS. IT MAY INCLUDE CLAIMING CERTAIN DEDUCTIONS OF EXPENSES WHICH ARE NOT LEGITIMATELY DUE TO THE ASSESSEE. IT MAY ALSO INCLUDE CLAIMING CERTAIN EXEMPTIONS OF INCOME WHI CH ARE OTHERWISE NOT AVAILABLE AS PER LAW. BOTH THE EXPRESSIONS, VIZ., `CONCEALMENT OF PARTICULARS OF INCOME AND `FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME ULTIMATELY LEAD TO UNDER - REPORTING OF INCOME. WHEREAS THE FORMER CONNOTES UNDER - DECLARAT ION BY DIRECTLY HIDING THE DETAILS OF SOME ITEMS OF INCOME, THE LATTER ENCOMPASSES UNDER - DECLARATION OF INCOME INDIRECTLY, THAT IS, BY FURNISHING DETAILS IN SUCH A WAY WHICH ULTIMATELY RESULTS IN NOT REPORTING CORRECT INCOME, BUT SUCH UNDER - REPORTING IS OT HERWISE THAN BY MEANS OF DIRECT HIDING. THE NITTY - GRITTY OF THE MATTER IS THAT WHEREAS `CONCEALMENT OF PARTICULARS OF INCOME 14 IMPLIES NOT AT ALL DECLARING A PARTICULAR INCOME, WHICH EVENTUALLY RESULTS IN UNDER - DECLARATION OF INCOME, `FURNISHING OF INACCURA TE PARTICULARS OF INCOME IMPLIES GIVING DETAILS OF SOME ITEMS OF INCOME/EXPENSES, BUT, CLAIMING THEM EXEMPT/DEDUCTIBLE, FULLY OR PARTLY, WHICH IS ACTUALLY NOT THE CASE AND SUCH ACTION OF THE ASSESSEE RESULTS IN UNDER - DECLARATION OF TOTAL INCOME. WITH THE ABOVE UNDERSTANDING OF THE AMBIT OF THE TWO EXPRESSIONS, I WILL NOW PROCEED TO EXAMINE THE TRUE NATURE OF THREE DISALLOWANCE/ADDITIONS, IN SERIATIM, WHICH FORM THE BASIS OF PENALTY IN THE FOUR APPEALS UNDER CONSIDERATION . . 20. ANOTHER CRUCIAL FACTOR TO BE KEPT IN MIND IS THAT THAT THE SATISFACTION OF THE AO AS TO A CLEAR - CUT CHARGE LEVELED BY HIM IN THE PENALTY NOTICE OR THE PENALTY ORDER MUST CONCUR WITH THE ACTUAL DEFAULT. IF THE CLEAR - CUT CHARGE IN THE PENALTY NOTICE OR THE PENALTY ORDER IS THAT OF `CONCEALMENT OF PARTICULARS OF INCOME, BUT IT TURNS OUT TO BE A CASE OF `FURNISHING OF INACCURATE PARTICULARS OF SUCH INCOME OR VICE - VERSA, THEN ALSO THE PENALTY ORDER CANNOT LEGALLY STAND. 17. WE NOTICED THAT THE CONTENTIONS OF THE ASSESSEES WITH REGA RD TO PENALTY LEVIED ON THE ADDITIONS MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER S WOULD GET SUPPORT FROM THE ABOVE SAID DECISION . THE HONBLE SUPREME COURT HAS HELD IN THE CASE OF T.ASHOK PAI (SUPRA) THAT BOTH THE CHARGES SPECIFIED IN SEC. 271( 1)(C) CARRY DIFFERENT CONNOTATIONS, MEANING THEREBY, THEY CANNOT BE USED INTERCHANGEABLY. ACCORDINGLY, WE ARE OF THE VIEW THAT THE ASSESSING OFFICER WAS NOT RIGHT IN LAW IN LEVYING PENALTY FOR FURNISHING OF PARTICULARS OF INCOME IN RESPECT OF ADDITIONS WHICH FALL UNDER THE CATEGORY OF CONCEALMENT OF PARTICULARS OF INCOME . THE S AID ACTION OF THE ASSESSING OFFICER WOULD VITIATE PENALTY PROCEEDINGS , SINCE IT DISPLAYS THE NON - APPLICATION OF MIND ON THE PART OF THE ASSESSING OFFICER . THE NON - APPLICATION OF MIND WHILE INITIATING PENALTY PROCEEDINGS WOULD VITIATE PENALTY PROCEEDINGS AS HELD BY HONBLE BOMBAY HIGH COURT IN THE CASE OF KAUSHALYA AND OTHERS (SUPRA). A CCORDINGLY WE SET ASIDE THE ORDERS PASSED BY THE LD CIT(A) IN THE HANDS OF ALL THE ASSESSEES IN RESPECT OF ADDITIONS MADE BY THE AO IN THE ASSESSMENT ORDERS AND DIRECT THE AO TO DELETE THE PENALTY LEVIED BY HIM ON THE ADDITIONS MADE BY HIM IN ALL THE RELEVANT YEARS IN THE HANDS OF ALL THE THREE ASSESSEES . 15 18. ON MERITS , WE NOTICED THAT THE ASSESS EE HAS GIVEN EXPLANATION S FOR NOT FILING RETURN OF INCOME, I.E., THE DISPUTE BETWEEN THE PAR TNER S. IN THE PAPER BOOK, THE ASSESSEE ALSO FURNISHED COPIES OF FIR FILED AGAINST THE PARTNER S , BAIL ORDER S OF THE PARTNER S, LEGAL NOTICES ISSUED BETWEEN THE PARTNE RS. WE NOTICED THAT THE TAX AUTHORITIES HAVE NOT CONSIDERED THESE DOCUMENTS. EVEN THOUGH, LEARN ED CIT(A) HAS OBSERVED THAT THE CLAIM OF LEGAL DISPUTE S MAY BE A CASE OF AFTERTHOUGHT, YET WE FIND THAT THE LD CIT(A) HAS MADE THOSE OBSERVATION ONLY ON SURMISES AND THAT TOO WITHOUT EXAMINING THE DOCUMENTS FURNISHED BY THE ASSESSEE AND WITHOUT FINDING FAULT WITH THOSE DOCUMENTS. ACCORDINGLY, WE ARE OF THE VIEW THAT THE ASSESSEE HAS FURNISHED EXPLANATION WHICH WAS NOT FOUND TO BE FALSE BY THE TAX AUTHORITIES. AC CORDINGLY, THE LD A.R CONTENDED T HAT THE ASSESSEE WOULD GET IMMUNITY UNDER EXPLANATION 1 TO SECTION 271(1)(C) OF THE ACT. SINCE WE HAVE DELETED THE PENALTY ON LEGAL ISSUES, WE DO NOT FIND IT NECESSARY TO ADJUDICATE THE CONTENTIONS URGED ON MERITS. 19 . S INCE WE HAVE DELETED THE PENALTY ON THE BASIS OF LEGAL GROUNDS DISCUSSED ABOVE, WE DO NOT FI ND IT NECESSARY TO ADDRESS OTHER ISSUES CONTESTED BY THE ASSESSEES. 2 0 . IN THE RESULT, ALL THE APPEALS FILED BY THE ASSESSEES ARE ALLOWED. O RDER HAS BE E N PRONOUNCED IN THE COURT ON 10 . 1 .201 9 . SD/ - SD/ - (SANDEEP GOSAIN ) (B.R.BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 10 / 0 1 / 20 1 9 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 16 6. GUARD FILE. BY ORDER, //TRUE COPY// ( SENIOR PRIVATE SECRETARY ) PS ITAT, MUMBAI