Shri Vikram Bhatia L/H of Shri Ratan Kumar Bhatia, Kanpur V. The Commissioner of Income Tax (A)-II, Kanpur

ITA 779/LKW/2013

• Counselvise Citation: 77923714 RSA 2013
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 12-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K DEY
• Assessee Lawyers: S K JAINSWARN SINGH ADVO
• Section: 68

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH B, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.779/LKW/2013 A.Y.:2005 - 2006 SHRI VIKRAM BHATIA, L/H OF SHRI RATAN KUMAR BHATIA, 2/71, KRISHNA NAGAR, KANPUR. PAN:ABXPB3549H VS. INCOME TAX OFFICER - 1(3), KANPUR. (APPELLANT) (RESPONDENT) APPELLANT BY S/SHRI S. K. JAIN/SWARN SINGH, ADVO. RESPONDENT BY SHRI P. K. DEY, D.R. DATE OF HEARING 08/01/2014 DATE OF PRONOUNCEMENT 3 0 /01/2014 O R D E R PER A. K. GARODIA, A.M. THIS IS ASSESSEES APPEAL DIRECTED AGAINST THE ORDER OF LEARNED CIT ( A) - II, KANPUR DATED 07/10/2013 FOR THE ASSESSMENT YEAR 2005 - 2006. 2. THE ASSESSEE HAS RAISED VARIOUS GROUNDS OF APPEAL AND HAS ALSO RAISED SOME ADDITIONAL GROUNDS ON TECHNICAL ASPECT BUT THE MAIN GRIEVANCE OF THE ASSESSEE IS REGARDING CONFIRMATION OF THE PENALTY IMPOSED BY THE ASSESSING OFFICER OF RS.3,65,548/ - U/S 271(1)(C ) OF THE ACT. 3. WE FIRST DECIDE THE APPEAL ON MERIT AS TO WHETHER THE PENALTY IMPOSED BY THE ASSESSING OFFICER IS JUSTIFIED AND IF WE FIND THAT THE ASSESSEE IS NOT SUCCEEDING ON MERIT THEN WE WILL CONSIDER THE TECHNICAL ASPECT RAISED BY THE ASSESSEE. 4 . REGARDING THE MERIT OF THE PENALTY, IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT THE ONLY ADDITION MADE BY THE ASSESSING OFFICER FOR WHICH 2 PENALTY HAS BEEN IMPOSED BY THE ASSESSING OFFICER IS THE ADDITION OF RS.10.86 LACS MADE BY THE ASSESSING O FFICER U/S 68 OF THE ACT AS CAN BE SEEN IN THE ASSESSMENT ORDER. HE SUBMITTED THAT THE ASSESSEE HAS FURNISHED THE CONFIRMATION ETC. REGARDING THESE LOANS AND THE SAME ARE AVAILABLE ON PAGES 127 TO 129 OF THE PAPER BOOK. HE SUBMITTED THAT FOR SUCH ADDITIO N MADE BY THE ASSESSING OFFICER U/S 68, PENALTY IS NOT JUSTIFIED. IN SUPPORT OF T HIS CONTENTION , HE PLACED RELIANCE ON THE TRIBUNAL DECISION RENDERED IN THE CASE OF DCIT VS. K. BHANJI VANMALIDAS & CO. IN I.T.A. NO.743/RJT/2010. HE SUBMITTED THAT THE COPY OF THE TRIBUNAL DECISION IS AVAILABLE ON PAGE 120 TO 126 OF THE PAPER BOOK. 5. LEARNED D.R. OF THE REVENUE SUPPORTED THE PENALTY ORDER. 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. WE FIND THAT THE ONLY ADDITION MADE BY THE ASSESSING OFFICER FOR WHIC H PENALTY IS IMPOSED IS THE ADDITION ON ACCOUNT OF TWO UNSECURED LOANS AND THE ADDITION WAS MADE U/S 68 OF THE ACT. WE ALSO FIND THAT BOTH THE PERSONS HAVE GIVEN CONFIRMATION, WHICH IS AVAILABLE IN THE PAPER BOOK. IT IS TRUE THAT THE UNSECURED LOAN, CLAI MED TO HAVE BEEN RECEIVED BY THE ASSESSEE, WAS NOT ACCEPTED BY THE REVENUE, BUT PRESENT PROCEEDINGS ARE PENALTY PROCEEDINGS AND THEREFORE, WE HAVE TO SEE AS TO WHETHER THERE IS POSSIBILITY OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME OR NOT. IN THE CASE OF DCIT VS. K. BHANJI VANMALIDAS & CO. (SUPRA), IT IS OBSERVED BY THE TRIBUNAL IN PARA 6 THAT ALTHOUGH IT IS TRUE THAT MAJORITY OF THE CASH CREDITS WERE NOT ACCEPTABLE EVEN TO THE TRIBUNAL, THIS ALONE CANNOT BE THE FOUNDATION FOR HOLDING THE ASSESSEE GUILTY OF CONCEALMENT. THE TRIBUNAL FURTHER NOTED THAT THE ASSESSEE HAS REASONABLY EXPLAINED THAT THE ADDITION WAS MADE AND CONFIRMED AS THE ASSESSEE COULD NOT DISCHARGE THE PRIMARY ONUS WHICH LAY ON IT UNDER THE LAW. THE TRIBUNAL FURTHER O BSERVED THAT THE VARIOUS EVIDENCES SUBMITTED BY IT WERE NOT CONSIDERED AS SUFFICIENT TO PROVE THE CASH CREDIT AND AVOID THE DEEMING FICTION 3 PROVIDED IN SECTION 68 OF THE ACT. THEREAFTER, THE FINDING IS GIVEN THAT THERE IS NOTHING ON RECORD TO PROVE THAT T HE ADDITION REPRESENTS THE CONCEALED INCOME AND THAT THE SAME IS CONSCIOUSLY CONCEALED. AFTER MAKING THESE OBSERVATIONS, THE I.T.A.T. DELETED THE PENALTY IN THAT CASE. WE ALSO FIND THAT IN THE PRESENT CASE ALSO, THE ASSESSEE HAS SUBMITTED CONFIRMATION. IN THE PRESENT CASE ALSO, THE ASSESSEE COULD NOT PROVE INGREDIENTS OF SECTION 68 IN RESPECT OF THESE TWO LOANS BUT THE EXPLANATION OF THE ASSESSEE COULD NOT BE DISPROVED ALSO BY THE REVENUE. UNDER THESE FACTS, WE ARE OF THE CONSIDERED OPINION THAT ALTHOUG H THE ADDITION IS FINALIZED BUT PENALTY IS NOT JUSTIFIED BECAUSE THE ASSESSEE HAS SUBMITTED EXPLANATION REGARDING THESE CASH CREDITS AND THE SAME COULD NOT BE ESTABLISHED TO BE NON BONAFIDE AND THEREFORE, IN OUR CONSIDERED OPINION, THE PENALTY IS NOT JUSTI FIED. WE DELETE THE SAME. 7. IN VIEW OF OUR DECISION IN ABOVE PARA, AS PER WHICH , WE HELD THAT THE PENALTY IS NOT JUSTIFIED, THE TECHNICAL GROUND S RAISED BY THE ASSESSEE DO NOT CALL FOR ANY ADJUDICATION. 8. IN THE RESULT, THE APPEAL IS ALLOWED IN THE TERMS INDICATED ABOVE. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 3 0 T H JANUARY, 2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR