Sh. Rajan Setia, Mukatsar V. ACIT, Ludhiana

ITA 839/CHANDI/2011

• Counselvise Citation: 83921514 RSA 2011
• Duration Of Justice: 1 year(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-08-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 01-09-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Search and seizure; Document seized; Question of law; Revised return; Documents seized
• Section: 147; 148; 132; 142(1); 153A; 234B; 139(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE MS.SUSHMA CHOWLA, JUDICIAL MEMBER AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO. 835 TO 839/CHD/2011 A.Y. 2002-03, 2003-04, 2004-05, 2005-06 & 2006-07 SHRI RAJAN SETIA, V ACIT, CC-III, PROP. M/S SETIA TRADERS, LUDHIANA. MUKTSAR. PAN: ADCPB-8052A (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SUDHIR SEHGAL RESPONDENT : SHRI AKHILESH GUPTA DATE OF HEARING : 28.08.2012 DATE OF PRONOUNCEMENT : 14.09.2012 ORDER PER MEHAR SINGH, AM THESE FIVE APPEALS HAVE BEEN FILED BY THE ASSESSEE APPELLANT, AGAINST THE SEPARATE ORDER, EACH DATED 15.06.2011, PASSED BY THE LD. CIT(A), U/S 250(6) OF THE INCOME-TAX ACT,1961 (IN SHORT 'THE ACT') FOR ASSESS MENT YEAR 2002-03 TO 2006-07 RESPECTIVELY, WHEREIN THE CIT(A) UPHELD THE LEVY OF PENALTY, U/S 271(1)(C) OF THE ACT, BY T HE AO, FOR SUCH ASSESSMENT YEARS. 2. THE APPELLANT HAS RAISED THREE GROUNDS OF APPEAL , IN EACH APPEAL, FILED BY THE ASSESSEE, FOR VARIOUS ASS ESSMENT YEARS, WITH IDENTICAL GROUND OF APPEALS, EXCEPT CER TAIN VARIATIONS IN THE AMOUNT, PERTAINING TO RESPECTIVE ASSESSMENT YEAR. HOWEVER, AS AN ILLUSTRATIVE CASE, THE GROUNDS OF APPEAL AS RAISED IN ITA NO. 835/CHD/2011 ARE 2 REPRODUCED HEREUNDER : 1. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APP EALS)-L, LUDHIANA HAS ERRED IN CONFIRMING THE PENALTY OF RS. 1 5,77,430/- LEVIED BY THE ASSESSING OFFICER U/S 271 (1) ( C) OF THE INCOM E TAX ACT. 2. THAT THE CONFIRMATION OF PENALTY U/S 271(1)(C) IS A GAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THAT THE APPELLANT CRAVES LEAVE TO ADD OR A MEND ANY GROUNDS OF APPEAL BEFORE THE APPEAL IS FINALLY HEARD OR DISPOS ED OFF. 3. IN THE COURSE OF PRESENT APPELLATE PROCEEDINGS, LD. 'AR' STATED THAT TWO DAYS DELAY IN FILING EACH OF THE A PPEAL MAY BE CONDONED, IN VIEW OF THE CIRCUMSTANCES AND FACTS , EXPLAINED BY THE APPELLANT IN THE AFFIDAVIT. FURTH ER. LD. 'AR' GAVE FACTUAL HISTORY OF THE CASE AND STATED TH AT THE SURRENDER MADE IN THE REVISED RETURN HAS BEEN MADE WITH A VIEW TO BUY PEACE AND SETTLE INCOME-TAX DISPUTES. HE, REFERRED TO THE PENALTY ORDER PASSED BY THE AO AND THE APPELLATE ORDERS PASSED BY THE CIT(A), IN RESPECT O F SUCH APPEALS. LD. 'AR' PLACED RELIANCE ON THE DECISION OF RADHESHYAM SARDA V ACIT (ITA NO.222/INDORE/2012, IT AT INDORE BENCH), P.V.RAMANA REDDY V ITO (ITA NO. 1852/HYD/2011, ITAT HYDERABAD BENCH), CIT V M/S KAK A IRON STORE, ITC NO. 156/1996, HON'BLE PUNJAB & HARY ANA HIGH COURT AT CHANDIGARH & CIT V SUBHASH CHANDRA MI TTAL, 335 ITR 364 (P&H). 4. LD. 'DR', ON THE OTHER HAND, SUPPORTED THE FINDI NGS OF THE LOWER AUTHORITIES AND CONTENDED THAT THE SURREN DER HAS BEEN MADE IN THE REVISED RETURN, AFTER THE CONCEALE D INCOME WAS DETECTED BY THE REVENUE, IN THE FORM OF TRANSAC TIONS CONTAINED IN THE INCRIMINATING DOCUMENTS, SEIZED AT THE 3 TIME OF SEARCH & SEIZURE OPERATION, AT THE RESIDENT IAL AND BUSINESS PREMISES OF THE ASSESSEE. LD. 'DR', FURTH ER, STATED THAT THE CASE-LAWS RELIED UPON BY THE LD. 'AR', ARE NOT APPLICABLE TO THE FACT-SITUATION OF THE PRESENT CAS E, BEING FACTUALLY DIFFERENT AND DISTINGUISHABLE. 5. LD. 'DR' PLACED RELIANCE ON THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF RAJESH CHA WLA V CIT 154 TAXMAN 364 AND CONTENDED THAT ALL THE CASE-LAWS RELIED UPON BY THE LD. 'DR' HAVE BEEN DULY DISCUSSED AND CONSIDERED BY THE JURISDICTIONAL HIGH COURT, IN IDE NTICAL FACT-SITUATION OF THE CASE. THEREFORE, LD. 'DR' WA S OF THE OPINION, THAT AFTER DETECTION OF CONCEALED INCOME I N THE FORM OF INCRIMINATING DOCUMENTS AND ISSUANCE OF DET AILED QUESTIONNAIRE, THE DECLARATION MADE BY THE ASSESSEE OF SUCH CONCEALED INCOME, IN THE REVISED RETURN, FALLS BEYO ND THE PALE OF PROVISIONS OF SECTION 139(5) OF THE ACT AND THE REVENUE AUTHORITIES HAVE VALIDLY LEVIED AND UPHELD THE IMPUGNED PENALTY. 6. WE HAVE CAREFULLY PERUSED THE RIVAL SUBMISSIONS, FACTS OF THE CASE AND THE RELEVANT RECORD, INCLUDING THE JUDICIAL PRECEDENTS CITED BY THE CONTENDING PARTIES. A BARE PERUSAL OF THE AFFIDAVIT FILED BY THE ASSESSEE APPELLANT, R EVEALS THAT THE DELAY IN FILING THE APPEALS OCCURRED BECAUSE OF POOR COURIER SERVICES, IN THAT AREA, WHERE HE RESIDES AN D, HENCE, THE DELAY OCCURRED IN TRANSIT. 7. HAVING REGARD TO THE REASONS ASSIGNED BY THE APP ELLANT IN THE MATTER OF TWO DAYS DELAY IN FILING THESE AP PEALS, WE 4 ARE OF THE CONSIDERED OPINION THAT THE DELAY ITSELF IS INSIGNIFICANT, BEING OF TWO DAYS ONLY AND THE REAS ON ASSIGNED BY THE APPELLANT, APPEARS TO BE PLAUSIBLE. ABOVE ALL, JUSTICE CANNOT BE DENIED AT THE THRESHOLD STAG E, MERELY ON TECHNICAL GROUNDS. 7(I) IN VIEW OF THE ABOVE, DELAY IS CONDONED IN ALL THESE APPEALS. HOWEVER, AFFIDAVIT, FILED BY THE ASSESSEE IS REPRODUCED HEREUNDER : 1. THAT THE APPEAL FILED BY THE ASSESSEE BEFORE THE CIT(A) WAS DISPOSED OF BY ORDER DATED 15.6.2011 PASSED BY CIT(A)-I LUDHIANA (ORDER RECEIVED ON 1.7.2011). 2. THAT THE TIME FOR FILING OF THE APPEAL BEFORE TH E TRIBUNAL WAS TO EXPIRE ON 29.08.2011. 3. THAT THE ASSESSEE RESIDING AT MUKTSAR AND THE CO UNSEL WAS RESIDING AT LUDHIANA. DUE TO POOR COURIER SERVICE, THE DOCUMENTS WERE DELAYED IN TRANSIT, THEREFORE, APPEA L COULD NOT BE FILED IN TIME. 4. THAT THE MEMO OF APPEAL HAS BEEN FILED ON 01.09. 2011 IN THE OFFICE OF THE TRIBUNAL. 8. THE BRIEF AND UNDISPUTED FACTS OF THE CASE, AS C ULLED OUT FROM THE RELEVANT RECORDS ARE THAT A SEARCH & S EIZURE OPERATION U/S 132(1) OF THE ACT WAS CARRIED OUT, AT THE RESIDENTIAL AND BUSINESS PREMISES, BELONGING TO SHR I RAJAN SETHIA, ON 24.10.2007. CONSEQUENTLY, LARGE NUMBER OF INCRIMINATING DOCUMENTS WERE SEIZED, IN THE COURSE OF SEARCH OPERATIONS. THE ASSESSEE FILED HIS RETURN OF INCOME ON 31.10.2002, FOR THE ASSESSMENT YEAR 2002-03, DEC LARING INCOME OF RS.1,57,670/- PLUS AGRICULTURE INCOME OF 5 RS.7,50,000/-. THE AO, ISSUED NOTICE U/S 153A OF T HE ACT FOR THE ASSESSMENT YEAR IN QUESTION, ON 27.6.2008 A ND CONSEQUENTLY, ASSESSEE APPELLANT FILED RETURN IN RE SPONSE TO THE SAID NOTICE, RETURNING THE SAME INCOME AS DISCLOSED IN THE ORIGINAL RETURN FILED BY HIM. THE AO, ISSUED NOTICE U/S 143(2) AND 142(1) ALONGWITH DETAILED QUESTIONNAIRE DATED 17.2.2009 FIXING THE HEARING OF THE CASE FOR 6.3.2009. IN RESPONSE TO SUCH NOTICES, LD. COUNSEL FOR THE AS SESSEE ATTENDED ASSESSMENT PROCEEDINGS. A BARE PERUSAL OF THE NOTICES U/S 143(2) ACCOMPANIED BY DETAILED QUESTION NAIRE CLEARLY REVEALS THAT THE AO HAS RAISED AS MANY AS 3 2 QUERIES, IN THE QUESTIONNAIRE UNDER REFERENCE, SPEC IFICALLY HIGHLIGHTING THE DOCUMENTS SEIZED AND CONTENTS RECO RDED THEREIN, FOR THE PURPOSE OF SEEKING ASSESSEE'S EXPL ANATION, IN RESPECT OF TRANSACTIONS AND CONSEQUENT CONCEALED INCOME CONTAINED THEREIN. IN A NUT-SHELL, THE DEPARTMENT CONDUCTED SEARCH & SEIZURE OPERATION AT THE PREMISE S, BELONGING TO THE ASSESSEE APPELLANT, FOR THE PURPOS E OF GATHERING RELEVANT EVIDENCES, TO THE EFFECT OF PROV ING THE UNACCOUNTED TRANSACTIONS AND CONCEALED INCOME. SUBSEQUENTLY, AO ISSUED DETAILED QUESTIONNAIRE, AS MENTIONED EARLIER. AT THIS STAGE, THE APPELLANT CH OSE TO REVISE HIS RETURN OF INCOME BY DISCLOSING AN ADDITI ONAL INCOME OF RS.51,55,000/-, ACCOMPANIED BY LETTER, WH EREIN IT WAS SUBMITTED THAT THE INCOME HAD BEEN DISCLOSED, E VEN THOUGH THE SAME MAY NOT CONSTITUTE THE REAL INCOME, SUBJECT TO SETTLE THE CASE, WITH THE DEPARTMENT. I T IS, PERTINENT TO MENTION HERE THAT THE APPELLANT HAS MA DE THE 6 SUBMISSION IN A LETTER ADDRESSED, TO THE AO, IN THE COURSE OF ASSESSMENT PROCEEDINGS. SIMILAR LETTER HAS ALSO BEEN SUBMITTED BY THE ASSESSEE, IN THE COURSE OF OTHER A SSTT. YEARS UNDER APPEAL. AS AN ILLUSTRATIVE CASE, CONTE NTS OF THE SAID LETTER ARE REPRODUCED HEREUNDER : NOVEMBER 20, 2009 THE ASSISTANT COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-ILL, LUDHIANA SIR, REG: SHRI RAJ AN SETIA, MUKTSAR. SUB: FILING OF RETURN U/'S 153 A OF THE INCOME TAX ACT, 1961. ASSTT. YEAR 2003-04 - I HAVE TO SUBMIT THAT I AM ENCLOSING HEREWITH RETUR N OF INCOME FOR THE ASSESSMENT YEAR 2003-04 AND OFFERING SUBSTANTIAL-IN COME VOLUNTARILY AND IN GOOD FAITH AND THE ABOVE RETURN 'IS BEING FILED FOR LIMITED PURPOSES OF SETTLING MY SEARCH CASES OF THE GROUP IN AN AMICABLE AND COO PERATIVE MANNER WITH THE DEPARTMENT AND TO EARN PEACE OF MIND SUBJECT TO NO PENALTY U/S 271(L)(C) OF THE ACT. ALONG WITH THE RETURN, 1 AM ALSO ENCLOSING HEREWITH THE PROOF OF PAYMENT OF TAXES IN THE ABOVE SAID CASE IS RS.27,45,084/- AND FROM THE ABOVE YOUR GOODS ELF SHALL APPRECIATE THAT THE PAYMENT OF TAXES IS A BOUT RS.2 CRORES AND EARLIER ALSO 1 HAVE MADE SUBSTANTIAL PAYMENT OF TAXES. IT IS PERTINENT TO MENTION HERE THAT I HAVE DISCLOS ED THE INCOME IN RETURN THOUGH IN STRICT SENSE, THAT MAY NOT CONSTITUTE THE INCOME IN REAL TERMS. EVEN IF, THERE HAS BEEN ROUGH NOTINGS OR CERTAIN CALCULA TIONS IN THE LOOSE DOCUMENTS, I HAVE INCLUDED THE SAME AS INCOME IN THE RETURN OF INCOME TO AVOID PROTRACTED PROCEEDINGS AND FOR ULTIMATE AIM OF SETTLING MY ABO VE SAID SEARCH CASE WITH DEPARTMENT ONCE OF ALL. IT IS PERTINENT TO MENTION HERE THAT I HAVE NOT BEE N KEEPING GOOD HEALTH AND. EVEN MY MOTHER HAD- ALSO EXPIRED A FEW MONTHS AGO AND WHICH ALSO HAD BEEN BEARING UPON ME/MY MIND AND HAD CAUSED LOT OF TENSIONS TO MY FAMILY AND, AS SUCH, IN AN EARNEST DESIRE TO SETTLE MY SEA RCH CASES, IT IS PRAYED THAT THE ABOVE RETURNS MAY BE ACCEPTED SUBJECT TO NO PEN ALTY U/S 271 (I)(C) AND OBLIGE. THANKING YOU, YOURS FAITHFULLY, SD/- (RAJAN SETIA ) 7 9. THE AO, ON RECEIPT OF SUCH LETTER OF SURRENDER, INFORMED THE ASSESSEE VIDE ORDER-SHEET ENTRY DATED 20.11.2009 THAT BY REVISING RETURN OF INCOME, AND A DMITTING UNDISCLOSED INCOME, WOULD NOT CONFER IMMUNITY FROM LEVY OF PENALTY U/S 271(1)(C) OF THE ACT, AS THE SAID SURRE NDER HAS NOT BEEN MADE IN ACCORDANCE WITH THE PROVISIONS OF SECTION 132(4) OF THE ACT. ACCORDINGLY, THE AO COMPLETED TH E ASSESSMENT AT THE INCOME, AS SHOWN IN THE REVISED R ETURN. CONSEQUENTLY, U/S 271(1)(C) OF THE ACT WERE INITIAT ED AND PASSED PENALTY ORDER DATED 29.06.2010 U/S 271(1)(C) OF THE ACT BY THE AO, FOR THE ASSESSMENT YEAR UNDER REFERE NCE. SIMILAR PENALTY ORDERS HAVE BEEN PASSED BY THE AO, IN RESPECT OF OTHER ASSESSMENT YEARS UNDER REFERENCE. HOWEVER, FOR THE SAKE OF READY REFERENCE, RELEVANT PART OF THE PENALTY ORDER IS REPRODUCED, AS AN ILLUSTRATIVE CASE IN THIS APPEAL : VIDE ORDER SHEET ENTRY DATED 20/11/2009 THE COUNSEL OF THE ASSESSES WAS INFORMED THAT BY REVISING THE RETURN OF INCOME AND ADMITTING UNDISCLOSED INCOME IN IL DOES NOT GIVE IMMUNITY FROM PENALTY U/ S 271(L)(C) AS THIS DOES NOT CONSTITUTE A SURRENDER WITHIN THE MEANING OF SECTIO N 132(4), THEREAFTER THE ASSESSMENT OF THE ASSESSEE WAS COMPLETED AT THE INC OME SHOWN IN THE REVISED RETURN AND PENALTY PROCEEDINGS WERE INITIATED. 4. A NOTICE U/S 271(L)(C) THE INCOME TAX ACT, 1961 DATED 30/12/2009 WAS ISSUED 10 THE ASSESSEE AND THE CASE WAS FIXED FOR 8 /1/2010 AND SERVED UPON THE ASSESSEE ON 31.12.2009 REQUIRING TO SHOW CAUSE WHY PENALTY U/S 271(,L)(C) THE I.T.ACT.1961 SHOULD NO! BE IMPOSED. ANOTHER OPPORTU NITY WAS GIVEN VIDE LETTER DATED 17/03/201.0 AND THE CASE WAS FIXED FOR 30/03/ 2010. FURTHER A NOTICE DATED 19/05/2010 WAS ISSUED TO THE ASSESSEE FIXING THE CA SE FOR HEARING ON 26/05/2010. IN RESPONSE TO THIS LETTER THE ASSESSEE FILED A REP LY DATED 25/05/2010. THE ASSESSEE IN HIS REPLY HAS STATED :- ' I) THAT THERE WAS SEARCH AND SEIZURE OPERATIO N AT MY RESIDENTIAL AND BUSINESS PREMISES ON 2410.1007 AND AS A RESULT OF S EARCH AND SEIZURE, LATERON , THE NOTICE U/S 153A WERE ISSUED BY THE DEPARTMENT. II). THAT DURING THE COURSE OF SEARCH. 1 HAD MAD E AN OFFER OF SURRENDER OF RS.2 CRORES IN ALL THE GROUP CASES AND WHICH WAS OW NED UP BY ME AND THE TAXES WERE PAID BY ME AT THE TIME OF FILING THE RETURNS O F INCOME AND SOME TAX WAS SOUGHT TO BE ADJUSTED AGAINST THE SEIZED CASH/FDRS/ KVPS AND JEWELLERY. 8 III) THAT LATERON. 1 HAD FILED THE RETURNS IN RE SPONSE TO NOTICES U/S 153A AND THEN THOSE RETURNS WERE REVISED VOLUNTARILY AND IN GOOD FAITH, AND IN A BONAFIDE MANNER, 1 HAD OFFERED THE SUBSTANTIAL INCO ME IN MY REVISED RETURNS AND AT THE TIME OF REVISING THE RETURNS, THE TOTAL PAYM ENT OF TAX TO THE TUNE OF RS. TWO CRORES AND FIVE LACS APPROXIMATELY WAS MADE BY ME A LONGWITH INTEREST U/S 234B AND 234C. IV) THAT ALL MY ASSESSMENTS WERE FRAMED BY THE DEPARTME NT AT THE FIGURES AT WHICH 1 HAD FILED MY RETURNS AND REVISED THE SAM E VOLUNTARILY AND IN GOOD FAITH AND THERE HAS BEEN NO ADDITION, WHATSOEVER IN MY ASSESSMENTS SO FRAMED U/S 153 A/143(3). V) THAT I HAD RENDERED FULL COOPERATION TO THE AO DURI NG THE COURSE OF ASSESSMENT PROCEEDINGS AND ALSO DURING SEARCH WHICH IS EVIDENT FROM THE FACTS THAT SURRENDER OF RS.2 CRORE WAS MADE U/S 132 (4) AND LATERON AFTER THE INSPECTION OF ALL THE DOCUMENTS AND WORKING MAD E BY ME, THE FURTHER INCOME WAS OFFERED FOR DIFFERENT YEARS FOR SETTLING THE INCOME TAX CASES IN AN AMICABLE MANNER. VI) THAT ORIGINALLY WHEN THE RETURNS WERE FILE D IN RESPONSE TO NOTICES U/S 153 A, CERTAIN DOCUMENTS WERE MISSING AND ALSO THE CO MPLETE WORKING ON THE BASIS OF THE SEIZED DOCUMENTS COULD NOT BE MADE AND , THEREAFTER, AFTER THROUGH INSPECTION OF THE SEIZED DOCUMENTS, A DETAILED WORKING WAS MADE AND I.E. IN THE REVISED RETURN, THE INCOME WAS ENHANCED AND WHICH WAS MADE VOLUNTARILY. VII) THE FACT THAT THE INCOME SO OFFERED IN THE REV ISED RETURNS WAS TRUE AND FAIR IS BORNE OUT FROM THE FACT THAT NO ADDITION WA S MADE BY THE DEPARTMENT AND MY RETURNED INCOME WAS ACCEPTED. VIII) THAT AT THE TIME OF FILING THE REVI SED RETURNS, I HAD VOLUNTARILY AND IN GOOD FAITH MADE THE PAYMENT OF TAXES TO THE TUNE OF RS. TWO CRORES AND FIVE LACS APPROXIMATELY I.E. FROM THE DATE OF S EARCH TO THE DATE OF COMPLETION OF ASSESSMENTS, THE TOTAL TAX AND INT EREST PAID BY ME IS ABOUT RS. 3 CRORES. IX) THAT I, THEREFORE, APPROACH YOUR KIND HONOUR FOR TAKING A SYMPATHETIC VIEW AND ALSO SINCE I HAVE VOLUNTARILY AND ,IN GOOD FAITH COME FORWARD FOR SETTLING MY CASES AND TO EARN PEACE OF MIND, I HAD EVEN OFFERED THE INCOME IN MY REVISED RETURNS, WHICH CANNOT BE CONSI DERED AS INCOME IN REAL TERMS AND THIS PROVES MY BONAFIDE ATTEMPT TO S ETTLE MY SEARCH CASES IN AN AMICABLE AND COOPERATIVE MANNER. X) THAT ON ACCOUNT OF THE ABOVE SAID FACTS AND CIRC UMSTANCES, THE PENALTY PROCEEDINGS INITIATED U/S 271(1)(C) MAY PLEASE BE D ROPPED AND OBLIGE.' 5. IN RESPONSE TO THE ASSESSEE REPLY AGAIN AN OPPOR TUNITY WAS GIVEN TO THE ASSESSEE VIDE THIS OFFICE LETTER DATED 17/06/2010 T O PRESENT HIS CASE AS ACTION UNDER EXPLANATION 5A OF 271(1)(C) WAS BEING CONTEMP LATED IN THE CASE OF THE ASSESSEE AND ASSESSEE WAS ASKED TO EXPLAIN HIS CASE IN VIEW OF THAT. THE ASSESSEE IN HIS REPLY SUBMITTED IN THIS OFFICE ON 28/06/2010 HAS STATED :- 1. IT IS BEING SUBMITTED THAT THERE WAS SEARCH AND SEI ZURE OPERATIONS AT MY RESIDENTIAL AND BUSINESS PREMISES AND DURING THE CO URSE OF ASSESSMENT PROCEEDINGS U/S 153 A, I HAD RENDERED FULLEST COOPE RATION AND EVEN PRIOR TO ISSUE OF ANY OF ANY SHOW CAUSE NOTICE, 1 1 HAD VOLUNTARILY AND IN GOOD FAITH REVISED MY RETURN OF INCOME U/S 153A AND PAID THE T AXES OF MORE THAN RS.2.5 CRORES IN ORDER TO SETTLE MY CASE AND AVOID LITIGATION WITH THE DEPARTMENT. WHILE FILING THE RETURN OF INCOME. I HA D TAKEN CARE TO COME OUT WITH CLEAN BREAST OF EVERYTHING AND THIS IS EVI DENT FROM THE FACT THAT MY ASSESSMENTS HAD BEEN FRAMED AT THE INCOME WHICH WAS RETURNED BY ME AND NO FURTHER ADDITIONS HAVE BEEN MADE. THIS PROVE S MY BONAFIDE ATTEMPT TO SETTLE THE CASE IN AN AMICABLE MANNER. 2. YOUR GOODSELF SHALL APPRECIATE THE FACT THAT NO APP EAL HAD BEEN FILED 9 AGAINST THOSE ORDER GOES TO PROVE THE BONAFIDE EVEN CONTENTION OF THE ASSESSEE AND. THEREFORE, BEFORE LEVYING PENALTY, AL L SUCH FACTS AND CIRCUMSTANCES MAY PLEASE, BE CONSIDERED IN TOTALIT Y AND OBLIGE. 3. BESIDES, THAT, IT IS SUBMITTED THAT I HAVE ALREADY MOVED A PETITION FOR WAIVER OF PENALTY U/S 271(L)(C) TO THE WORTHY COMMI SSIONER OF INCOME TAX (CENTRAL), LUDHIANA AND, THUS, IN VIEW OF THESE FACTS AS WELL THE PENALTY PROCEEDINGS MAY BE FILED AND OBLIGE.' THE REPLIES SUBMITTED BY THE ASSESSEE ARE NOT ACCEP TABLE BECAUSE THE SURRENDERED OF UNDISCLOSED INCOME BY REVISING HIS R ETURN OF INCOME DOES NOT CONSTITUTE A VOLUNTARY ACT AS A QUESTIONNAIRE D ATED 17/02/2009 WAS ISSUED TO THE ASSESSEE, IN WHICH ALL THE SEIZED MAT ERIAL WAS CONFRONTED TO THE ASSESSEE. THE ASSESSEE DID NOT SUBMIT ANY REPLY TO THIS. THEREAFTER NOTICES U/S 143(2) WERE ISSUED TO THE ASSESSEE ON 08/04/2009,13/07/2009, 29/07/2009 REFIXING THE CASE OF THE ASSESSEE ON VARIOUS DATES, HOWEVER THE ASSESSEE DID NOT COMPLY WITH THESE. IT WAS ONLY ON 20/1 1/2009 THAT THE ASSESSEE FILED HIS REV ISED RETURN OF INCOME AND AT THAT TIME ALSO THE ASSESSEE WAS INFORMED VID E ORDER SHEET ENTRY THAT THE FILING OF REVISED RETURN DOES NOT CONSTITUTE SU RRENDER AND DOES NOT ENTITLE THE ASSESSEE TO IMMUNITY FROM PENALTY. THE PERUSAL OF EXPLANATION 5A TO S.271(1)(C) IS VER Y CLEAR ON THIS ASPECT WHEREBY IT HAS BEEN STATED THAT IF IN THE CO URSE OF SEARCH ANY UNDISCLOSED INCOME OF THE ASSESSEE IS DISCOVERED IN ANY FORM AND SUCH INCOME HAS NOT BEEN DECLARED BY THE ASSESSEE IN HIS ORIGINAL RETURN OF INCOME THAN EVEN IF THE ASSESSEE DECLARES THIS INCO ME IN AN\ RETURN FILED AFTER THE DATE OF SEARCH THAN FOR THE PURPOSE OF PE NALTY U/S 271( 1)(C) SHALL BE DEEMED TO HAVE CONCEALED THE PARTICULARS O F HIS INCOME OR FILED INACCURATE PARTICULARS OF INCOME. MERELY MOVING A P ETITION FOR WAIVER OF PENALTY DOES NOT ENTITLE THE ASSESSEE TO RELIEF FRO M PENALTY. 6. IN. VIEW OF THE FACTS MENTIONED ABOV E THE REPLY OF THE ASSESSEE IS NOT ACCEPTABLE. HENCE THE ASSESSEE IS HELD LIABLE FOR P ENALTY' U/S 271 (1)( C) OF THE INCOME TAX ACT. 1961. AFTER GOING THROUGH THE F ACTS AND CIRCUMSTANCES OF THE CASE, A PENALTY @ 100% OF RS. 15,77,430/- IS IMPOSED ON CONCEALED INCOME. PENALTY IMPOSED AT RS. 15,77,430/- THE ABOVE PENALTY HAS BEEN LEVIED ALTER OBTAINING P RIOR APPROVAL OI THE ADDL. COMMISSIONER OF INCOME-TAX, CENTRAL RANGE , LUDHIANA CONVEYED VIDE HIS OFFICE LETTER NO,. 242 DATED 29/0 6/2010. 10. THE CIT(A), UPHELD THE PENALTY ORDER IN RESPECT OF EACH ASSESSMENT YEARS VIDE ORDER DATED 15.6.2011, SEPARA TELY PASSED IN EACH APPEAL. 11. THE MATERIAL AND RELEVANT DETAILS IN RESPECT OF ALL ASSESSMENT YEARS INVOLVED IN SUCH APPEALS, IN TABLE FORM, IS MADE PART OF THIS ORDER AS ANNEXURE-A. 10 12. A BARE PERUSAL OF THE RELEVANT DATA (ANNEXURE-A ) REVEALS THAT ASSESSEE HAD FILED ORIGINAL RETURN OF INCOME, ON VARIOUS DATES, AS INDICATED IN THE CHART, DECLARING CERTAIN INCOME. THE AO, ISSUED NOTICE DATED 27.6.2008 U/S 1 53A OF THE ACT IN RESPECT OF ALL THE ASSESSMENT YEARS UNDE R REFERENCE. IN RESPONSE TO SUCH NOTICE U/S 153A, AP PELLANT FILED RETURN(S) OF INCOME, ON 22.9.2008, FOR ALL TH E ASSESSMENT YEARS FROM 2002-03 TO 2006-07, DECLARING THE SAME RETURNED INCOME AS SHOWN IN THE ORIGINAL RETUR N(S) OF INCOME, FILED BY THE ASSESSEE. THE AO, ISSUED DETA ILED QUESTIONNAIRE ALONGWITH STATUTORY NOTICE U/S 143(2) AND 142(1) OF THE ACT DATED 17.2.2009, AS INDICATED EAR LIER, SEEKING EXPLANATION OF THE ASSESSEE IN RESPECT OF T HE CONTENTS RECORDED IN THE SEIZED INCRIMINATING DOCUM ENTS. THE APPELLANT FILED REVISED RETURNS OF INCOME, ON 20.11.2009, FOR ALL THE ASSESSMENT YEARS DECLARING SUBSTANTIAL INCOME IN EACH ASSESSMENT YEAR, ACCOMPA NIED BY A LETTER OF SURRENDER, AS REPRODUCED ABOVE. APP ELLANT PAID THE ADDITIONAL TAX ON SUCH DECLARATION MADE IN THE REVISED RETURNS OF INCOME. 13. IT IS SELF-EVIDENT THAT THE ASSESSEE DID NOT MA KE A SURRENDER IN THE COURSE OF SEARCH OPERATION, IN THE DEPOSITION U/S 132(4) READ WITH EXPLANATION 5(A) TO SECTION 271(1)(C) OF THE ACT. THE ASSESSEE FILED RETURN(S) OF INCOME FOR ALL THE ASSESSMENT YEARS UNDER REFERENCE, WITHO UT REVISING RETURN OF INCOME, AS DISCLOSED IN THE ORIG INAL RETURN(S) OF INCOME. HOWEVER, SUBSEQUENTLY, ON REC EIPT OF DETAILED QUESTIONNAIRE, IN RESPECT OF THE INCRIMINA TING 11 DOCUMENTS, SEIZED IN THE COURSE OF SEARCH OPERATION , CONDUCTED, ON 24.10.2007, THE APPELLANT OPTED TO MA KE A SURRENDER, IN THE REVISED RETURNS OF INCOME, RELEVA NT FOR VARIOUS ASSTT. YEARS. IN SUCH A FACT-SITUATION, THE APPELLANT CANNOT BE EXONERATED FROM LEVY OF PENALTY U/S 271(1 )(C) OF THE ACT MERELY BECAUSE UNDISCLOSED INCOME OR CONCEA LED INCOME, HAS BEEN DISCLOSED BY HIM, IN THE REVISED R ETURNS OF INCOME AFTER DETECTION OF CONCEALED INCOME BY THE D EPTT. 14. THE RELIANCE PLACED BY THE APPELLANT ON CERTAIN CASE LAW IS MISPLACED, AS THE FACTS AND THE CIRCUMSTANCE S OF THE CASE UNDER REFERENCE, ARE DIFFERENT AND DISTINGUISH ABLE VIS- -VIS THE JUDICIAL PRECEDENTS, RELIED UPON BY THE A PPELLANT. THE RATIO OF THE DECISION RELIED UPON BY THE LD. 'D R' IN THE CASE OF RAJESH CHAWLA V CIT (SUPRA) SUPPORTS THE CA SE OF THE REVENUE AND THE JURISDICTIONAL HIGH COURT HAS ADDRESSED THE ISSUE IN GREATER DETAIL, CONSIDERING THE CASE LAWS RELIED UPON BY THE APPELLANT. THE RELEVANT PAR T OF THE DECISION IS REPRODUCED HEREUNDER : 4. THE ABOVE DISCUSSION BY THE TRIBUNAL CLEARLY SH OWS THAT IT WAS NOT A CASE OF BONAFIDE VOLUNTARY DISCLOSURE BUT ONLY TO AVOID CONSEQUENCES OF LAW. IT IS NOT POSSIBLE TO HOLD THA T IN EVERY CASE, MERE SURRENDER OF INCOME WILL FORECLOSE ANY ACTION FOR CONCEALMENT OF INCOME. JUDGMENTS OF THE HON'BLE SUP REME COURT IN SIR SHADI LAI AND CIT VS. SURESH CHANDRA MITTAL (2001) 170 CTR (S.C) 182 (2001) 251 ITR 9 (S.C) HAVE RIGHTLY BEEN DISTINGUISHED BY THE TRIBUNAL. FINDINGS RECORDED BY THE TRIBUNAL CAN NOT BE HELD TO BE PERVERSE IN ANY MANNER, THE SAME BEING BASED ON REL EVANT MATERIAL. THE ASSESSEES HAVE BEEN HELD TO BE MEMBER S OF THE SAME FAMILY AND IT HAS ALSO BEEN FOUND THAT REVISED RETURNS WERE FILED ON COMING TO KNOW ABOUT DETECTION OF CON CEALMENT. A DIVISION BENCH OF THIS COURT IN PADAM KUMAR GARG VS. ITO & 12 ANR. (2005) 26 IT REP 26 (P&H), HELD THAT ASSESSEE COULD NOT ESCAPE PENALTY MERELY ON THE GROUND THAT HE HAD SUR RENDERED THE AMOUNT. SIMILAR VIEW HAS BEEN TAKEN IN P.C. JOSEPH & BROS. VS. CIT (2000) 158 CTR (KER) 104 : (2000) 240 ITR 818 ( KER) AND CIT VS. SUDHARSHAN SILKS & SAREES (2001) 171 CTR (KAR) 256 : (2002) 253 ITR 145 (KAR). ACCORDINGLY, NO SUBSTANTIAL QUESTION OF LAW ARISES . THE APPEALS ARE DISMISSED. 15. THE FISCAL SIN OF CONCEALMENT OF INCOME COMMITT ED BY THE ASSESSEE APPELLANT, FOR ASSESSMENT YEARS UNDER REFERENCE, CANNOT BE WASHED BY A DIP, IN THE SO CAL LED HOLY WATER OF REVISED RETURNS OF INCOME, FILED BY THE AP PELLANT, WHEREIN SURRENDER HAS BEEN MADE. NEEDLESS TO SAY T HAT THE APPELLANT HAS NOT DISCLOSED THE SURRENDER MADE FOR ASSESSMENT YEARS IN THE ORIGINAL RETURNS OF INCOME UNDER REFERENCE AND IN THE RETURN(S) OF INCOME FILED IN R ESPONSE TO NOTICE U/S 153(A) OF THE ACT. IT IS A CLEAR CASE, WITHOUT ANY AMBIGUITY OF MAKING SURRENDER IN THE REVISED RETURN S OF INCOME, AFTER DETECTION OF CONCEALMENT BY THE DEPAR TMENT, AS A RESULT OF SEIZURE OF INCRIMINATING DOCUMENTS, IN THE COURSE OF SEARCH & SEIZURE OPERATION AND ISSUE OF D ETAILED QUESTIONNAIRE PURSUANT THERETO. FURTHER, DECLARATIO N HAS NOT BEEN MADE, IN ACCORDANCE WITH THE PROVISIONS OF SECTION 134(4) OF THE ACT READ WITH EXPLANATION 5(A) OF SEC TION 271(1)(C) OF THE ACT. THE RETURN(S) OF INCOME FILE D BY THE ASSESSEE, VIOLATES THE EXPRESS PROVISIONS OF SECTIO N 139(5) OF THE ACT. THIS VIEW HAS BEEN UPHELD BY THE HON'B LE SUPREME COURT, IN THE CASE OF G.C.AGGARWAL V CIT (1 990) 186 ITR 571 (S.C), WHEREBY DECISION OF THE GAUHATI HIGH COURT, IN THE CASE OF F.C.AGGARWAL V CIT (1976) 102 ITR 408 13 (GAU) WAS AFFIRMED. THE HEAD-NOTE OF THE SAME IS REPRODUCED HEREUNDER : PENALTY-EXPLANATION TO SECTION 271(1)(C)-PRESUMPTI ON-BURDEN OF PROOF-ASSESSEE FILING REVISED RETURNS SHOWING MU CH LARGER INCOME-NOT ABLE TO ESTABLISH INADVERTENT MISTAKE OR OMISSION IN ORIGINAL RETURNS-DECISION OF TRIBUNAL ON FACTS THAT PENALTY WAS JUSTIFIED-QUANTUM-DIFFERENCE BETWEEN TAX ASSESSED I N FIRST RETURNS AND THE TAX ON THE INCOMES ASSESSED SHOULD BE TAKEN AS THE TAX WHICH WOULD HAVE BEEN EVADED-INCOME-TAX ACT ,1961, SS. 139(5), 271(1)(C), EXPLN. FROM THE DECISION OF THE GAUHATI HIGH COURT IN F.C. AGGARWAL V CIT (1976) 102 ITR 408 TO THE EFFECT THAT THE APPEL LATE TRIBUNAL WAS CORRECT IN HOLDING ON THE FACTS (I) THAT PENALT IES UNDER SECTION 271(1)(C) OF THE INCOME-TAX ACT,1961, READ WITH THE EXPLANATION THERETO, WERE JUSTIFIED IN RESPECT OF T HE ASSESSMENT YEARS IN QUESTION, SINCE THE ASSESSEE HAD FILED REV ISED RETURNS DISCLOSING MUCH LARGER INCOMES THAN THOSE DISCLOSED IN THE ORIGINAL RETURNS BUT WAS UNABLE TO DISCHARGE THE BU RDEN OF PROOF UNDER THE EXPLANATION AND (II) THAT FOR THE PURPOSE OF CALCULATION OF PENALTY THE DIFFERENCE BETWEEN THE T AX ON THE INCOMES SHOWN IN THE FIRST RETURNS AND THE TAX ON T HE INCOMES ASSESSED SHOULD BE TAKEN AS THE AMOUNT OF TAX THAT WOULD HAVE BEEN EVADED, THE APPELLANT PREFERRED APPEALS TO THE SUPREME COURT. THE SUPREME COURT DISMISSED THE APPEALS HOLD ING THAT THERE WAS NO ERROR OF LAW IN THE ORDER OF THE HIGH COURT. DECISION OF THE GAUHATI HIGH COURT IN F.C.AGGARWAL V CIT (1976) 102 ITR 408 AFFIRMED. 15(I) THE ALLAHABAD HIGH COURT DEFINED DETECTIO N IN MOOL CHAND (1978) MAHESH CHAND V CIT 115 ITR 1 (ALL .) AND HELD THAT EVEN IN A CASE WHERE THE ITO STARTS INVESTIGATION BY LAYING OPEN, WHAT WAS LYING CONCEA LED OR HIDDEN OR WHAT CONTINUED TO ELUDE OBSERVATION WOULD ALSO BE COVERED IN A CASE OF DETECTION. DETECTION IS AN TERIOR TO PROVED OR ESTABLISHED. THUS, CONCEALMENT OF IN COME COMMITTED IN THE ORIGINAL RETURN, WILL NOT GET ABSO LVED BY FILING REVISED RETURNS. ADMITTING CONCEALMENT OR UNDISCLOSED CONCEALED INCOME, EITHER U/S 139(5) OR 147 OF THE ACT WOULD NOT GRANT IMMUNITY TO THE APPELLANT F ROM LEVY 14 OF PENALTY U/S 271(1)(C) OF THE ACT. IT IS A CASE OF ESTABLISHED CASE OF CONCEALMENT. 16. THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CA SE OF PREM PAL GANDHI V CIT (2001) 335 ITR 23, UPHELD THE SIMILAR VIEW THAT WHERE REVISED RETURN, SHOWING HIG HER INCOME IS FILED AFTER DETECTION OF CONCEALED INCOME BY THE AUTHORITIES, IMPOSITION OF PENALTY WOULD BE JUSTIFI ED. FURTHER, IT IS STATED THAT IF THE ACT OF CONCEALMEN T OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PART ICULARS OF INCOME, WITHIN THE MEANING OF SECTION 271(1)(C) OF THE ACT IS COMMITTED, IN THE ORIGINAL RETURN, THE REVIS ED RETURN BY ITSELF WOULD NOT MITIGATE THE DEFAULT. IN THE P RESENT CASE, REVISED RETURN HAS NOT BEEN FILED VOLUNTARILY , AND PRIOR TO THE DETECTION OF THE CONCEALMENT OF INCOME BY THE DEPARTMENT. IN FACT, APPELLANT HAS FILED ORIGINAL RETURN(S) OF INCOME, AND ON ISSUANCE OF NOTICE U/S 153A OF THE A CT, FILED RETURNS SHOWING SAME INCOME AS SHOWN IN THE ORIGINA L RETURNS OF INCOME. THIS ACT OF REVISION OF RETURN(S ) OF INCOME BY THE APPELLANT, WAS SUBSEQUENT TO THE FILING OF R ETURNS IN RESPONSE TO NOTICE U/S 153A OF THE ACT AND SUCH REV ISION OF INCOME DISCLOSING SUBSTANTIAL UNDISCLOSED INCOME, C ANNOT BE TERMED AS VOLUNTARY ACT, BASED ON BONAFIDE BELIE F, BUT IS THE CONSEQUENCE OF SEARCH OPERATION AND SUBSEQUENT DETAILED QUESTIONNAIRE ISSUED BY THE AO. 17. THE APPELLANT PLACED RELIANCE ON THE DECISION O F THE HON'BLE SUPREME COURT IN THE CASE OF CIT V SURESH C HANDER 15 MITTAL 251 ITR 9 (S.C). IN THIS CONTEXT, IT IS PERT INENT TO HIGHLIGHT THAT IN THE CASE OF SURESH CHANDER MITTAL 241 ITR 124 (MP), DISCLOSURE WAS MADE BY THE ASSESSEE IN TH E REVISED RETURN OF INCOME IN RESPONSE TO NOTICE U/S 148 OF THE ACT, AFTER SEARCH OPERATIONS. A PERUSAL OF THE FACTS REVEAL THAT RETURN(S) WERE FILED IN RESPECT OF EARL IER YEARS AND NOT IN RESPECT OF THE YEAR OF SEARCH. FURTHER, NO INCRIMINATING MATERIAL WAS FOUND IN RESPECT OF EARL IER YEARS. REVISED RETURNS WERE FILED WITH A VIEW TO AVOIDING LITIGATION. THE HON'BLE MADHYA PRADESH HIGH COURT, FOLLOWING TH E DECISION OF THE HON'BLE SUPREME COURT IN THE CASE O F SIR SHADI LAL 168 ITR 705 HELD THAT PENALTY WAS NOT LEV IABLE. IT IS PERTINENT TO MENTION HERE THAT THIS JUDGEMENT HAS BEEN AFFIRMED BY THE HON'BLE SUPREME COURT IN A SHORT OR DER IN CIT V SURESH CHANDER MITTAL 251 ITR 9 (S.C). THE A PEX COURT IN THE CASE OF K.P.MADHUSUDAN 251 ITR 99 HELD THAT DECISION IN SHADI LALS CASE IS NO MORE GOOD LAW, A FTER INSERTION OF EXPLANATION (1) TO SECTION 271(1)(C). IN THE CASE OF G.C.AGGARWAL, 186 ITR 571 (S.C), THE HON'BL E APEX COURT HAD UPHELD THE PENALTY WHERE HIGHER INCOME WA S DISCLOSED IN REVISED RETURN, WITHOUT ANY JUSTIFICAT ION. FURTHER, THE DECISION OF HON'BLE MADHYA PRADESH HIG H COURT WAS FOUNDED ON THE DECISION OF THE HON'BLE SU PREME COURT IN THE CASE OF SIR SHADI LAL (SUPRA) WHICH HA S BEEN DECLARED AS NO MORE GOOD LAW, IN VIEW OF INSERTION OF EXPLANATION (1) TO SECTION 271(1)(C) OF THE ACT AND DECISION OF HON'BLE SUPREME COURT IN THE CASE OF K.P.MADHUSU DAN 251 ITR 99 (SUPRA). 16 18. IN VIEW OF THE ABOVE DETAILED LEGAL AND FACT UAL DISCUSSIONS AND HAVING REGARD TO THE DECISIONS OF T HE HON'BLE JURISDICTIONAL HIGH COURT AND HON'BLE SUPRE ME COURT, AS DISCUSSED ABOVE AND ALSO CONSIDERING THE RELEVANT PROVISIONS OF SECTION 139(5) READ WITH EXPLANATION 5A TO SECTION 271(1)(C) OF THE ACT, WE ARE OF THE CONSIDE RED OPINION THAT THE DECLARATION MADE BY THE ASSESSEE I N THE REVISED RETURN(S) OF INCOME IS OF NO LEGAL CONSEQUE NCE. CONSEQUENTLY, THE FINDINGS OF THE LD. CIT(A), WHERE BY LEVY OF PENALTY U/S 271(1)(C) OF THE ACT, BY THE AO WAS UPH ELD, DO NOT SUFFER FROM ANY LEGAL AND FACTUAL INFIRMITY. CONSEQUENTLY, FINDINGS OF THE CIT(A) ARE UPHELD, AN D ALL THE APPEALS OF THE ASSESSEE ARE DISMISSED. 19. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 14 TH SEPT.,2012. SD/- SD/- (SUSHMA CHOWLA) (MEHAR SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER D ATED: 14 TH SEPT.,2012. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT, CHANDIGARH