R.Geetha, Coimbatore V. ACIT, Coimbatore

ITA 726/CHNY/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64428 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 11-10-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 09-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DAS GUPTA JT
• Assessee Lawyers: D ANAND
• Keywords: Unexplained cash credit; Unexplained investment; Additional evidence
• Section: 153A; 69; 132; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI [BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER] I.T.A.NOS.724 TO 728/MDS/2012 ASSESSMENT YEARS : 2002-03, 2004-05 TO 200 7-08 SMT.R.GEETHA A-7, SRI VARI BRINDHAVAN M.G.ROAD COIMBATORE 641 006 VS THE ACIT CENTRAL CIRCLE I COIMBATORE [PAN AHAPG 7234 K] (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI D. ANAND, ADVOCATE RESPONDENT BY : SHRI DAS GUPTA, JT. CIT DATE OF HEARING : 11-10-2012 DATE OF PRONOUNCEMENT : 12-10-2012 O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST SEPARATE ORDERS OF THE CIT(A) II, COIMBATORE, DAT ED 30.1.2012. 2. THE A.R OF THE ASSESSEE, AT THE TIME OF HEARING, SUBMITTED THAT THE SOLE ISSUE INVOLVED IN ALL THE PRESENT APP EALS IS THAT THE CIT(A) ERRED IN CONFIRMING THE LEVY OF PENALTY U/S 271(1 )(C) OF THE ACT. HE I.T.A.NO. 724 TO 728/12 :- 2 -: FURTHER SUBMITTED THAT AS THE FACTS AND ISSUE INVOLVED ARE SIMILAR, H E IS ARGUING THE SAME TOGETHER. 3. THE FACTS OF THE CASE ARE THAT A SEARCH U/S 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF THE ASSESSEE ON 27. 9.2005 AT HER RESIDENCE AND BUSINESS PREMISES RESULTING IN SEIZUR E OF BOOKS OF ACCOUNT AS PER ANNEXURE VKM/B&D/S68 IN RESPECT OF H ER RESIDENCE AT PEELAMEDU, COIMBATORE AND RJ/B&D/S 1 TO 4 DATED 27. 9.2005 OF PANCHANAMA RELATING TO THE BUSINESS PREMISES OF M/S KRISHNAVENI CARBON PRODUCTS PVT. LTD. THE ASSESSEE FILED RETU RN OF INCOME ON 22.3.2006 PURSUANT TO THE NOTICE ISSUED U/S 153A O F THE ACT ON 13.2.2006 ADMITTING INCOME OF ` 63,000/- IN ASSESSMENT YEAR 2002-03. IN ASSESSMENT YEAR 2004-05, THE ASSESSEE FILED RET URN OF INCOME ON 22.3.2006 PURSUANT TO THE NOTICE ISSUED U/S 153A O F THE ACT ON 13.2.2006, ADMITTING INCOME OF ` 92,533/-. IN ASSESSMENT YEAR 2005- 06, PURSUANT TO THE NOTICE ISSUED U/S 153A OF THE ACT ON 13.2.2006, THE ASSESSEE FILED RETURN OF INCOME ON 22.3.2006 A DMITTING INCOME OF ` 1,11,806/-. IN 2006-07, THE ASSESSEE FILED RETU RN OF INCOME ON 29.11.2006 ADMITTING A TOTAL INCOME OF ` 1,90,920/-/-. IN ASSESSMENT YEAR 2007-08, THE ASSESSEE FILED RETURN OF INCOME ON 31.10.2007 ADMITTING INCOME OF ` 1,72,343/-. THE ASSESSING OFFICER OBSERVED FROM THE BANK ACCOUNT NO.6971 WITH CENTRAL BANK OF INDIA, I.T.A.NO. 724 TO 728/12 :- 3 -: SIDDHAPUDUR THAT THE ASSESSEE HAD MADE DEPOSITS O F ` 1,25,000/- ON VARIOUS DATES FROM 8.6.2001 TO 28.2.2002. THE ASS ESSING OFFICER RECORDED SWORN STATEMENT ON 20.12.2007 AND VIDE QUE STION NO.21, ASKED THE ASSESSEE TO EXPLAIN THE SOURCE OF DEPOSI TS. IT WAS ALSO POINTED OUT THAT THESE DEPOSITS WERE NOT REFLECTED IN THE CASH FLOW STATEMENT FURNISHED ON 04.12.2007 AND 14.12.2007 TH ROUGH HER AUTHORIZED REPRESENTATIVE AND WHAT WAS THE REASON F OR OMISSION. THE ASSESSEE REPLIED THAT SHE DID NOT KNOW. THEREFORE, THE ASSESSING OFFICER TREATED THE SAME AS UNEXPLAINED INVESTMENT U/S 69 AND ADDED THE SAME TO THE INCOME OF THE ASSESSEE. 4. SIMILARLY, IN ASSESSMENT YEAR 2004-05, THE ASSESSIN G OFFICER MADE ADDITION OF ` 3,68,700/- DEPOSITED IN CENTRAL BANK OF INDIA, SIDDHAPUDUR, COIMBATORE, SB ACCOUNT NO.6971 AND ADD ITION OF ` 35,000/- ON ACCOUNT OF DEPOSIT IN CORPORATION BANK, BODIPATTI, A/CAPITAL NO.SB/01/005018, THEREBY MAKING A TOTAL A DDITION OF ` 4,03,700/- U/S 69 OF THE ACT. 5. IN ASSESSMENT YEAR 2005-06, THE ASSESSING OFFICER M ADE SIMILAR ADDITION OF ` 22,500/- FOR DEPOSITS MADE IN CENTRAL BANK OF INDIA, SIDDHAPUDUR, ACCOUNT NO.6971 AND FOR ` 20,000/- FOR DEPOSITS IN CORPORATION BANK, BODIPATTI, ACCOUNT NO.SB/01/005 018, THEREBY MAKING A TOTAL ADDITION OF ` 42,500/- U/S 69 OF THE ACT. I.T.A.NO. 724 TO 728/12 :- 4 -: 6. SIMILARLY, IN ASSESSMENT YEAR 2006-07, THE ASSESSIN G OFFICER MADE AN ADDITION OF ` 3,00,000/- FOR DEPOSITS IN CORPORATION BANK, BODIPATTI, ACCOUNT NO.SB/01/005018, U/S 69 OF THE ACT. 7. IN ASSESSMENT YEAR 2007-08, THE ASSESSING OFFICER M ADE AN ADDITION OF ` 1,30,000/- U/S 68 OF THE ACT TOWARDS UNEXPLAINED CREDIT FROM SHRI K.P.SRINIVASAN. 8. THE ABOVE ADDITIONS WERE CONFIRMED IN APPEAL BY THE TRIBUNAL IN THE ASSESSMENT YEARS 2002-03, 2004-05, 2005-06 AND 2006-07 AND IN ASSESSMENT YEAR 2007-08, THE ASSESS EE ADMITTED THE ADDITION AND DID NOT FILE APPEAL THEREAGAINST BEFOR E ANY APPELLATE AUTHORITIES. THEREAFTER, THE ASSESSING OFFICER INI TIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT ON ACCOUNT O F CONCEALMENT OF INCOME BY THE ASSESSEE. THE PENALTY LEVIED WAS ` 38,250/- IN ASSESSMENT YEAR 2002-03, ` 1,14,800/- IN ASSESSMENT YEAR 2004-05, ` 13,005/- IN ASSESSMENT YEAR 2005-06, ` 85,774/- IN ASSESSMENT YEAR 2006-07 AND ` 31,234/- IN ASSESSMENT YEAR 2007-08. 9. WHEN THE ASSESSEE FILED APPEAL BEFORE THE CIT(A), SHE RELIED ON THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS RELIANCE PETRO PRODUCTS P. LTD, 36 DTR 449[SC]. TH E ASSESSEE ALSO SUBMITTED THAT RELIANCE PLACED BY THE ASSESSING OFF ICER ON THE DECISION I.T.A.NO. 724 TO 728/12 :- 5 -: OF HON'BLE SUPREME COURT IN THE CASE OF UOI VS DHAR MENDRA TEXTILE PROCESSORS & OTHERS, 306 ITR 277, WAS NOT CORRECT A S THE HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN STEEL LTD VS STATE OF ORISSA, 83 ITR 26 (SC) HELD THAT EVERY ADDITION DOES NOT L EAD TO AUTOMATIC LEVY OF PENALTY. IT WAS SUBMITTED THAT NO SPECIFI C RECORDING OF SATISFACTION ON THE PART OF THE ASSESSING OFFICER W AS MENTIONED FOR INITIATION OF PENALTY U/S 271(1)(C) OF THE ACT WH ICH IS A SINE QUA NON . THE CIT(A) CONFIRMED THE LEVY OF PENALTY IN RESPECT IVE YEARS BY OBSERVING AS UNDER: A.Y 2002-03 5. THE RIVAL SUBMISSIONS ARE CONSIDERED. IT IS IMPORTANT TO NOTE THAT WHEN THE APPELLANT WENT ON APPEAL BEFORE THE HON'BLE IT AT, 'C' BENCH, CHENNAI ON THE ISSUE OF CASH DEPOSIT AMO UNTING TO RS.1,25,000/- WHICH WAS BROUGHT TO TAX U/S 69, THE HON'BLE ITAT HAD JUSTIFIED THE FINDINGS OF THE CIT(APPEALS) AND HAD DISALLOWED THE APPEAL OF THE APPELLANT VIDE ORDER IN ITA NO.193/MDS/08/(A.Y.2002-03)-SMT. R.GEETHA. THE FOLL OWING OBSERVATIONS WERE MADE BY THE ITAT: 'AFTER HEARING BOTH SIDES, WE ARE ALSO OF THE SAME VIEW. THERE IS NO MERIT IN ASSESSEE'S EXPLANATION. SHE HA D STATED THAT THE SOURCE OF DEPOSIT WAS FROM HER MOTHER'S SA VINGS. BUT NO PROOF THEREOF WAS GIVEN. INSTEAD SHE CHANGED HER STANCE BEFORE THE ID. CIT(A) OTHERWISE THAN BY WAY OF PRODUCING ADDITIONAL EVIDENCE. IN OUR OPINION, THE EXPLANATION TENDERED BY THE ASSESSEE IS NOT WHOLEHE ARTED AND, THEREFORE, THE ADDITION DESERVES TO BE CONFIRM ED'. . 6. FROM THE ABOVE OBSERVATION OF THE ITAT, IT IS C LEAR THAT THE ASSESSEE HAS CONCEALED PARTICULARS OF INCOME AS PRO VIDED IN 271 (1 )(C) OF THE IT. ACT, 1961. THE CONTENTION OF TH E APPELLANT DURING THE PENALTY PROCEEDINGS HAVE BEEN REBUTTED IN DETAI L BY THE ASSESSING OFFICER. FURTHER, THE JUDGEMENT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS (P) LTD. REPORTED IN 36 DTR 449 [SC] WILL I.T.A.NO. 724 TO 728/12 :- 6 -: NOT COME TO THE RESCUE OF THE APPELLANT AS THE SAME WAS REGARDING PENALTY ON DISALLOWANCE OF EXPENDITURE. I HAVE NO DOUBT THAT THE DEPOSIT OF RS.1,25,000/- IN THE SB ALC OF THE APPELLANT WHICH IS NOT INCLUDED IN THE CASH FLOW ST ATEMENT AND ADDED TO THE TOTAL INCOME REPRESENTS A CLEAR CASE O F CONCEALMENT OF INCOME .. THEREFORE, THE PENALTY U/S 271(1 )(C) IS CONFIRMED IN THE HANDS OF THE APPELLANT. A.Y 2004-05 6. THE RIVAL SUBMISSIONS ARE CONSIDERED . IT IS IMPORTANT TO NOTE THAT WHEN THE APPELLANT WENT ON APPEAL BEFORE THE H ON'BLE ITAT , ' C' BENCH, CHENNAI ON THIS ISSUE , THE HON'BLE ITAT HAD JUSTIFIED THE FINDINGS OF THE CIT(APPEALS) AND HAD DISALLOWED THE APPEAL OF THE APPELLANT VIDE ORDER IN ITA NO . 668/09/MDS/08/(A . Y . 2004-05)- SMT . RGEETHA . THE FOLLOWING OBSERVATIONS WERE MADE BY THE ITAT : ' AS A RESULT OF SEARCH ACTION IN THIS GROUP , DEPOSIT FOUND TO THE TUNE OF RS . 3,68 , 700/- IN THE JOINT ACCOUNT IN CENTRAL BANK OF INDIA , SIDDAPUDUR AND AN AMOUNT OF RS . 35 , 000/- IN CORPORATION BANK AT BODIPATTI . THE ASSESSEE STATED THAT THESE AMOUNTS WERE DEPOSITED BY HER MOTHER. LA TER ON, SHE SHIFTED HER EXPLANATION STATING THAT IT WAS JOINT ACCOUNT . AGAIN , BEFORE THE ASSESSING OFFICER , THE ASSESSEE COULD NOT PROPERLY EXPLAIN THE SOURCE OF T HIS DEPOSIT AND BEFORE THE ID . CIT(A) CHANGED THE EXPLANATION THAT TOO WITHOUT RESORTING TO THE RULES OF ADDITIONAL EVIDENCE . HENCE, THE ID . CIT(A) IGNORED THE SAME AND HAS CONFIRMED BOTH ADDITIONS . NOW , THE ASSESSEE IS IN SECOND APPEAL BEFORE US . WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO THE F ACTS, EVIDENCES AND OTHER MATERIALS AVAILABLE ON RECORD. WE DO NOT FIND ANY MERIT IN THE SUBMISSIONS OF THE ID . AR. WE ARE IN AGREEMENT WITH THE ID . DR THAT THE ASSESSEE COULD NOT EXPLAIN THE SOURCE OF THIS DEPOSIT AND HA S CHANGED HER DEFENCE WH I CH I S A L SO DEVOID OF ANY MER I T . ACCO R D I NG , W E A R E IN A GR EEMENT WIT H THE FIND I NG OF THE I D . CIT(A) AND CONF I RM THE I MPUGNED F IN D ING . ' 6. F R OM THE ABOVE OBSERVAT I ON OF THE ITAT , I T I S C L EAR T HA T T H E ASSESSEE HAS CONCEALED PARTICULARS OF I NCOME AS P R OVIDED IN 271(1 )(C ) OF THE I . T . ACT , 1 96 1 . T H E CON T E NTI ON OF THE APPELLANT DUR I NG THE PENALTY PROCEED I NGS HAVE BEEN REBUTTED IN DETAI L BY THE ASSESS ING OFFICER . FURTHER , THE JUDGEMENT IN THE CASE OF C I T VS. RELIANCE PETRO PRODUCTS (P ) L T D . REPOR T ED I N 36 DTR 449 [SC] WI L L NOT COME TO THE RESCUE OF THE APPELLANT AS THE SA ME WAS REGA R D I NG PENALTY ON DISALLOWANCE OF EXPENDITURE . I HAVE NO DOUBT THAT THE DEPOS I T OF RS4 , 03 , 700 /- IN TH E SB ALC OF THE APPELLANT WHICH I S NOT I NCLUDED I N THE CASH FLOW STATEMENT AND I.T.A.NO. 724 TO 728/12 :- 7 -: ADDED TO T HE T O T A L I NCOME REPRESENTS A CLEAR CASE OF CO N CEALMENT OF INCOME . . THE R EFO R E , THE PE N ALTY U/ S 271 (1 )(C) I S CONF I RMED I N THE HANDS OF THE APPELLANT . 7. HOWEVER, IN THE PENALTY ORDER , THE ASSESSING OFFICER HAS TAKEN THE ENTIRE AMOU N T OF RS 4 , 03 , 700/- AS BEING CONF I RMED BY THE CIT(APPEALS) . ON PERUSAL O F THE ORDER , IT I ND I CATES THAT THE CI T (APPEALS) HAS ALLOWED AN AMOUNT O F RS . 1 , 50 , 000/- WH I CH HAS ALSO BEEN AG R EED IN THE ORDER OF THE ITAT I N ITA NO.668/09(A . YR . 2004-05)- SMT . R . GEETHA DATED 20 . 11 . 2 009 THEREFORE , PENALTY I S L EVIAB L E ON L Y ON THE UNEXPLAINED CASH DEPOS I T OF RS . 2 ,5 3 , 7 00 /- A ND TH E AMOUNT O F PENALTY SHOULD BE L EVIED AT RS . 76 , 110/- I NSTEAD OF RS . 1 ,1 4 , 880/- IN T H E PENAL TY O R DE R U/S 271(1)(C ) ISSUED BY THE ASSESSING OFFICER . A.Y 2005 -06 5.2 AFTER CONSIDERING THE ASSESSMENT ORDER, PENALTY ORD ER AND THE RIVAL SUBMISSION OF THE APPELLANT, IT IS SEEN THAT THE ASSESSING OFFICER HAS REBUTTED IN DETAIL THE VARIOU S CLAIM AGAIN THE PENALTY ORDER. I AM IN FULL AGREEMENT WITH THE ASSESSING OFFICER REGARDING THE REASONS CITED, BY HIM IN THE PENALTY ORDER. FURTHER, THE JUDGEMENT IN THE CASE OF CIT VS. RELIA NCE PETRO PRODUCTS (P) LTD. REPORTED IN 36 DTR 449 [SC] WILL NOT COME TO THE RESCUE OF THE APPELLANT AS THE SAME WAS REGARDI NG PENALTY ON DISALLOWANCE OF EXPENDITURE. IT IS CLEAR THAT TH E ASSESSEE HAS CONCEALED PARTICULARS OF INCOME AS PROVIDED IN 271( 1)(C) OF THE I.T. ACT, 1961. I HAVE NO DOUBT THAT THE DEPOSIT OF RS.42,500/- IN THE SB A/C OF THE APPELLANT WHICH IS NOT INCLUDED I N THE CASH FLOW STATEMENT AND ADDED TO THE TOTAL INCOME REPRESENTS A CLEAR CASE OF CONCEALMENT OF INCOME .. THEREFORE, THE PENALTY U/S 271 (1 )(C) IS CONFIRMED IN THE HANDS OF THE APPELLANT. A.Y 2006-07 5.1 THE RIVAL SUBMISSIONS ARE CONSIDERED. IT IS IMP ORTANT TO NOTE THAT WHEN THE APPELLANT WENT ON APPEAL BEFORE THE H ON'BLE ITAT, 'C' BENCH, CHENNAI ON THE ISSUE OF CASH DEPOSIT AMOUNT ING TO RS .3,00,000/- WHICH WAS BROUGHT TO TAX U/S 69, THE HON'BLE ITAT HAD JUSTIFIED THE FINDINGS OF THE CIT(APPEALS) AND HAD DISALLOWED THE APPEAL OF THE APPELLANT VIDE ORDER IN ITA O.669 /MDS/(A.Y.2006- 07)-SMT. R.GEETHA. 'THE EXPLANATION OF THE ASSESSEE COULD BE SUBS TANTIATED BEFORE US ALSO. THEREFORE, WE ARE OF THE CONSIDERE D OPINION THAT THE FINDING OF THE ID. CIT(A) IS QUITE JUSTIFIED I.T.A.NO. 724 TO 728/12 :- 8 -: AND NO INTERFERENCE IS WARRANTED THEREIN. HENCE, WE CAN NOT ALLOW THIS APPEAL OF THE ASSESSEE. IN THE RESULT, APPEAL OF THE ASSESSEE IN ITA NO. 669/MDS/09 STANDS DISMISSED.' 5.2. FROM THE ABOVE OBSERVATION OF THE ITAT, IT IS CLEAR THAT THE ASSESSEE HAS CONCEALED PARTICULARS OF INCOME AS PRO VIDED IN 271 (1 )(C) OF THE IT. ACT, 1961. THE CONTENTION OF THE AP PELLANT DURING THE PENALTY PROCEEDINGS HAVE BEEN REBUTTED IN DETAIL BY THE ASSESSING OFFICER. FURTHER, THE JUDGEMENT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS (P) LTD. REPORTED IN 36 DTR 449 [SC] WILL NOT COME TO THE RESCUE OF THE APPELLANT AS THE SAME WAS REGA RDING PENALTY ON DISALLOWANCE OF EXPENDITURE. I HAVE NO' DOUBT THAT THE DEPOSIT OF RS.3,OO,OOOI- IN THE SB A/C OF THE APPELLANT WHICH IS NOT INCLUDED IN THE CASH FLOW STATEMENT AND ADDED TO TH E TOTAL INCOME REPRESENTS A CLEAR CASE OF CONCEALMENT OF IN COME .. THEREFORE, THE PENALTY U/S 271(1 )(C) IS CONFIRMED IN THE HANDS OF THE APPELLANT. A.Y 2007-08 5. THE ASSESSING OFFICER HAD ADDED RS.1,30, 000/- AS UNEXPLAINED CASH CREDITS U/S 68 OF THE I.T.ACT. TH E ASSESSING OFFICER CONTENDS THAT EVEN THOUGH THE APPELLANT WAS ASKED TO EXPLAIN THE SOURCE, IDENTITY AND CAPAC ITY OF THE PERSON WHO HAD GIVEN THE ABOVE AMOUNT, THE APPELLA NT WAS NOT ABLE TO EXPLAIN THE SOURCE OF THE ABOVE TRANSACTION FOR RS.1 ,30,000/-. THIS ADDITION WAS ACCEPTED BY THE APPELLANT AND HAD NOT FILED APPEAL BEFORE THE CIT(APPEALS) OR ITAT. 5.1 THE ASSESSING OFFICER HAS GIVEN DETAILED REASONS IN REJECTING THE SUBMISSIONS PUT FORTH BY THE APPELLANT FOR NOT LEVYING THE PENALTY. I AM IN FULL AGREEMENT FOR THE REASONS CIT ED BY THE ASSESSING OFFICER FOR LEVY OF PENALTY AS IT IS EVID ENT THAT RS.1 ,30,000/- ADDED U/S 68 WAS CLEAR CONCEALMENT UNDER THE PROVISIONS OF THE I.T. ACT. FURTHER, THE JUDGEMENT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS (P) LTD. REPORTED I N 36 DTR 449 [SC] WILL NOT COME TO THE RESCUE OF THE APPELLANT A S THE SAME WAS REGARDING PENALTY ON DISALLOWANCE OF EXPENDITUR E. THEREFORE, THE PENALTY LEVIED AT RS.31,234/- U/S 271 (1)(C) IS CONFIRMED IN THE HANDS OF THE APPELLANT. I.T.A.NO. 724 TO 728/12 :- 9 -: 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE, PENALTY U/S 271(1)(C) OF THE ACT WA S LEVIED FOR ASSESSMENT YEARS 2002-03, 2004-05, 2005-06, 2006-07 AND 2007-08. THE PENALTY SO LEVIED RELATES TO TWO SETS OF ADDITI ONS. FIRSTLY, THE ADDITION U/S 69 OF THE ACT ON ACCOUNT OF UNEXPLAIN ED DEPOSITS IN CENTRAL BANK OF INDIA, SIDDAPUDUR AND CORPORATION B ANK, BODIPATTI. THE SECOND CLASS OF ADDITION IN RESPECT OF WHICH PE NALTY U/S 271(1)(C) OF THE ACT WAS LEVIED RELATES TO ADDITION OF ` 1,30,000/- MADE U/S 69 OF THE ACT. WE FIND THAT THE ASSESSING OFFICER LEV IED PENALTY U/S 271(1)(C) OF THE ACT ON THE GROUND THAT ADDITION MA DE IN THE ASSESSMENT WAS CONFIRMED IN APPEAL OR NOT CONTESTED IN APPEAL AND THEREFORE, IN VIEW OF THE DECISION OF THE HON'BLE S UPREME COURT IN THE CASE OF UOI VS DHARMENDRA TEXTILES PROCESSORS & OTH ERS [2008] 306 ITR 277(SC), PENALTY U/S 271(1)(C) OF THE ACT IS LEVIABLE. 11. ON APPEAL, THE CIT(A) CONFIRMED THE ABOVE ACTION OF THE ASSESSING OFFICER. 12. BEFORE US, THE A.R. OF THE ASSESSEE SUBMITTED THAT IT WAS EXPLAINED TO THE ASSESSING OFFICER DURING THE COURS E OF PENALTY PROCEEDINGS THAT THE BANK ACCOUNT MAINTAINED WITH C ENTRAL BANK OF I.T.A.NO. 724 TO 728/12 :- 10 -: INDIA, SIDDAPUDUR WAS SITUATED AT COIMBATORE. THE ASSESSEE, AFTER MARRIAGE, SHIFTED TO COIMBATORE IN THE YEAR 1994. THEREAFTER, THE DEPOSIT IN THE SAID BANK ACCOUNT WAS MADE BY THE AS SESSEES FATHER FROM HIS INCOME. THE ASSESSEE HAS NOT MADE ANY DEP OSIT IN THE SAID ACCOUNT FROM HER INCOME. FURTHER, IN RESPECT OF BA NK ACCOUNT MAINTAINED WITH CORPORATION BANK, BODIPATTI, WAS EX PLAINED TO THE ASSESSING OFFICER THAT THE SAID BANK ACCOUNT IS IN THE JOINT NAME OF THE ASSESSEES HUSBAND, SHRI RAMESH CHANDRA AND THE AS SESSEE IN WHICH THE HUSBAND IS THE FIRST NAME HOLDER OF THE SAID AC COUNT. THE DEPOSIT IN THE SAID BANK ACCOUNT WAS MADE BY HER HUSBAND OU T OF HIS OWN INCOME AND THE ASSESSEE NEVER MADE ANY DEPOSIT IN T HE SAID BANK ACCOUNT. THE A.R CONTENDED THAT THE ABOVE EXPLANAT ION OF THE ASSESSEE WAS NOT FOUND FALSE BY THE ASSESSING OFFIC ER AND IT IS NOT THE CASE OF THE REVENUE THAT THE ASSESSEE WAS NOT ABLE TO SUBSTANTIATE THE ABOVE EXPLANATION. ACCORDING TO HIM, THE ASSESSING OFFICER WAS OF THE VIEW THAT PENALTY IS AUTOMATIC ON ADDITION BEING MA DE AND CONFIRMED IN APPEAL. HE CONTENDED THAT THE ABOVE ACTION OF T HE ASSESSING OFFICER IS CLEARLY UNSUSTAINABLE IN LAW. THE CIT(A) WAS NO T JUSTIFIED IN CONFIRMING SUCH AN ACTION OF THE ASSESSING OFFICER. 13. ON THE OTHER HAND, THE DR VEHEMENTLY ARGUED IN SUPP ORT OF THE ORDERS OF THE LOWER AUTHORITIES. I.T.A.NO. 724 TO 728/12 :- 11 -: 14. WE FIND THAT AFTER THE DECISION IN THE CASE OF DHAR MENDRA TEXTILES PROCESSORS AND OTHERS (SUPRA), THE HON'BLE SUPREME COURT IN A SERIES OF DECISIONS NAMELY, IN THE CASE OF RAJAS THAN SPINNING & WEAVING MILLS 224 CTR (SC) PAGE 1, ATUL MOHAN BINDA L, [2009]317 ITR 1(SC) AND IN THE CASE OF CIT VS RELIANCE PETRO PROD UCTS PVT. LTD,[2010] 322 ITR 158 (SC), THE HON'BLE SUPREME COURT HAS HEL D THAT PENALTY U/S 271(1)(C) OF THE ACT IS NOT AN AUTOMATIC CONSE QUENCE FOR ADDITION TO RETURNED INCOME. WE FURTHER FIND THAT THE ASSE SSEE HAS OFFERED A PLAUSIBLE EXPLANATION REGARDING THE SOURCE OF DEPOS IT IN BANK ACCOUNT WITH CENTRAL BANK OF INDIA, SIDDAPUDUR AND CORPORAT ION BANK, BODIPATTI, WHICH WAS NOT FOUND AS FALSE OR UNSUBSTA NTIATED BY THE REVENUE IN PENALTY PROCEEDINGS. IT IS NOT THE CAS E OF THE REVENUE THAT THE EXPLANATION OFFERED BY THE ASSESSEE WAS F OUND EITHER FALSE OR UNSUBSTANTIATED. WE FIND THAT THE HON'BLE JURISDIC TIONAL HIGH COURT IN THE CASE OF CIT VS R. RAJENDRAN, 259 ITR 109, HAS H ELD THAT WHEN AN EXPLANATION IS OFFERED BY AN ASSESSEE DURING THE C OURSE OF PENALTY PROCEEDINGS, THEN A DUTY IS CAST UPON THE ASSESSING OFFICER TO CONSIDER THE SAID EXPLANATION. WITHOUT CONSIDERING THE EXPL ANATION AND ARRIVING AT THE FINDING THAT THE EXPLANATION OFFERED IS FALS E, THE ASSESSING OFFICER CANNOT PROCEED TO HOLD THAT THERE HAS BEEN CONCEALMENT OF INCOME ATTRACTING PENALTY U/S 271(1)(C) OF THE AC T. IN THE INSTANT I.T.A.NO. 724 TO 728/12 :- 12 -: CASE, WE FIND THAT THE ASSESSEE HAS OFFERED A PLAU SIBLE EXPLANATION DURING THE COURSE OF PENALTY PROCEEDINGS IN RESPECT OF DEPOSITS IN THE TWO BANK ACCOUNTS AND THE REVENUE HAS NOT RECORDED ANY FINDING TO THE EFFECT THAT EITHER THE SAID EXPLANATION WAS FOU ND FALSE OR THE ASSESSEE WAS NOT ABLE TO SUBSTANTIATE THE SAID EXPL ANATION. THEREFORE, IN VIEW OF THE ABOVE DECISION OF THE HON'BLE JURISD ICTIONAL HIGH COURT, IN OUR CONSIDERED VIEW, THE LEVY OF PENALTY U/S 2 71(1)(C) OF THE ACT WITH RESPECT TO DEPOSITS IN CENTRAL BANK OF INDIA, SIDDAPUDUR AND CORPORATION BANK, BODIPATTI, IS UNSUSTAINABLE. WE, THEREFORE, DELETE THE PENALTY AS LEVIED U/S 271(1)(C) OF THE ACT WI TH RESPECT TO DEPOSITS IN THE TWO BANK ACCOUNTS, IN ASSESSMENT YEARS UNDER APPEAL. 15. IN RESPECT OF ADDITION MADE U/S 68 OF THE ACT OF ` 1,30,000/- IN ASSESSMENT YEAR 2007-08, WE FIND THAT THE ASSESSEE HAS NOT OFFERED EXPLANATION BEFORE THE LOWER AUTHORITIE S AND NO SUBMISSIONS WERE ALSO MADE BEFORE US. THEREFORE,, WE CONFIRM THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT WITH RESP ECT TO THE SAID ADDITION. 16. IN THE RESULT, THE APPEALS OF THE ASSESSEE FOR ASSESSMENT YEARS 2002-03, 2004-05, 2005-06 AND 2006-07 ARE ALL OWED WHEREAS APPEAL FOR ASSESSMENT YEAR 2007-08 IS DISMISSED. I.T.A.NO. 724 TO 728/12 :- 13 -: ORDER PRONOUNCED ON FRIDAY, THE 12 TH OF OCTOBER, 2012, AT CHENNAI. SD/- SD/- (V. DURGA RAO) JUDICIAL MEMBER (N.S.SAINI) ACCOUNTANT MEMBER DATED: 12 TH OCTOBER, 2012 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR