Rakesh Kumar Pawa, New Delhi V. ACIT, Circle-18, New Delhi

ITA 8059/DEL/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 1244 (ITAT-DELHI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-06-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 19-12-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Keywords: Search and seizure; Proportionate interest
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC: DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.8059/DEL./2018 ASSESSMENT YEAR 2009-2010 MR. RAKESH KUMAR PAWA, E-21, PARK LANE, KALINDI COLONY, NEW DELHI 025. PAN AGRPP6439R VS., THE ACIT, CENTRAL CIRCLE-18, ROOM NO.102, JHANDEWALAN EXTN., NEW DELHI. (APPELLANT) (RESPONDENT) FOR ASSESSEE : -NONE- FOR REVENUE : SHRI S.L. ANURAGI, SR.DR DATE OF HEARING : 03.06.2019 DATE OF PRONOUNCEMENT : 04.06.2019 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-16, NEW DELHI, DATED 31.10.2018, FOR THE A.Y. 2009-2010, CHALLENGING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE I.T. ACT, 1961. 2. THE ASSESSEE HAS BEEN NOTIFIED THE DATE OF HEARING, HOWEVER, NONE APPEARED ON BEHALF OF THE ASSESSEE. IT, THEREFORE, APPEARS THAT ASSESSEE IS NO MORE INTERESTED IN PROSECUTING THE APPEAL. IN THIS CASE A SEARCH AND SEIZURE 2 ITA.NO.8059/DEL./2018 MR. RAKESH KUMAR PAWA, NEW DELHI. OPERATION WAS CARRIED OUT BY THE DEPARTMENT IN THE CASE OF ASSESSEE ALONG WITH OTHERS. THE A.O. NOTED THAT ASSESSEE HAS TAKEN LOAN FROM MONEYLINE CREDIT (NBFC) AMOUNTING TO RS.1.53 CRORES. THE INTEREST PAYMENT OF RS.10,76,689/- WAS ON RS.1.53 CRORES. SINCE NET-DISBURSEMENT OF THE LOAN TO M/S. PAWA ASSOCIATES OUT OF TOTAL BORROWINGS WERE ONLY OF RS.1,27,41,453/-, THEREFORE, THE PROPORTIONATE INTEREST ON RS.1,27,41,453/- COMES TO RS.8,96,639/- CLAIMED AS EXPENSES. THE A.O. DIRECTED THE ASSESSEE AS TO WHY THE INTEREST SHOULD NOT BE DISALLOWED. THE ASSESSEE SURRENDERED THIS AMOUNT FOR TAXATION. THE A.O. ACCORDINGLY MADE THE ADDITION OF RS.8,96,639/-. THE A.O. VIDE SEPARATE ORDER LEVIED THE PENALTY ON THE SAME ADDITION. 3. THE LD. CIT(A) DISCUSSED THE ISSUE IN DETAIL AND FOUND THAT IT IS A CLEAR CASE OF SURRENDER ON ACCOUNT OF EXCESS EXPENDITURE CLAIMED BY THE ASSESSEE. THE LD. CIT(A) ACCORDINGLY DISMISSED THE APPEAL OF ASSESSEE. 4. AFTER HEARING THE LD. D.R, I AM OF THE VIEW THAT NO INTERFERENCE IS CALLED FOR IN THE MATTER. SINCE THE ASSESSEE AGREED FOR ADDITION AND SURRENDERED THE AMOUNT IN QUESTION 3 ITA.NO.8059/DEL./2018 MR. RAKESH KUMAR PAWA, NEW DELHI. FOR TAXATION, THEREFORE, PENALTY WAS RIGHTLY IMPOSED AGAINST THE ASSESSEE BECAUSE THE FACTS WERE FOUND DURING THE COURSE OF SEARCH AND SEIZURE AS WELL AS AT ASSESSMENT STAGE AND ONLY ON CONFRONTING THE FACTS TO THE ASSESSEE, THE ASSESSEE MADE THE SURRENDER OF THE AMOUNT. THEREFORE, IT IS A FIT CASE FOR LEVY OF PENALTY. THERE IS NO MERIT IN THE APPEAL OF ASSESSEE AND THE SAME IS ACCORDINGLY DISMISSED. 5. IN THE RESULT, APPEAL OF ASSESSEE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 04 TH JUNE, 2019 VBP/- COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH 6. GUARD FILE //BY ORDER// ASST. REGISTRAR : ITAT : DELHI BENCHES : DELHI.