Shri Ashok Agarwal, Indore V. The I.T.O., Indore

ITA 85/IND/2010

• Counselvise Citation: 8522714 RSA 2010
• Duration Of Justice: 1 year(s) 1 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 04-04-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 17-02-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P K MITRA
• Assessee Lawyers: H P VERMA
• Keywords: Reopening of assessment; Gift; Wrong claim
• Section: 142(1); 148

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER 1. ITA NO.84/IND/2010 A.Y.2003-04 2. ITA NO.85/IND/2010 A.Y.2003-04 1. OMPRAKASH AGRAWAL INDORE PAN AFRPA-3609G 2. ASHOK AGRAWAL INDORE PAN AGEPA0483B APPELLANTS VS INCOME TAX OFFICER 2(2), INDORE RESPONDENT APPELLANTS BY : SHRI H.P. VERMA AND SHRI ASHISH GOYAL RESPONDENT BY : SHRI P.K.MITRA O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER BOTH THESE APPEALS ARE BY DIFFERENT ASSESSEES CHALL ENGING THE IMPOSITION OF PENALTY AMOUNTING TO RS. 1,62,900 /- EACH U/S 271(1) OF THE ACT. 2 2. DURING HEARING WE HAVE HEARD THE RIVAL SUBMISSIO NS OF THE PARTIES AND HAVE GONE THROUGH THE MATERIAL AVAILABL E ON THE FILE. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEES IS THAT THE ASSESSEES SHOWN TO HAVE RECEIVED GIFT AMOUNTING TO RS.5,63,000/- EACH RECEIVED FROM FOUR PERSONS SHRI MANISH BANSAL, SHRI RAMESH BANSAL, SHRI KAMAL GOYAL AND SH RI PAVAN AGRAWAL. THE GIFT FROM SHRI MANISH BANSAL, AN NRI, AMOUNTING TO RS.2 LAC EACH WAS ARGUED TO BE DECLARED IN THE R ETURN FOR WHICH OUR ATTENTION WAS INVITED TO PAGE 10 OF THE P APER BOOK. IT WAS CLAIMED THAT THESE GIFTS WERE RECEIVED FROM BAN KING CHANNEL. RELIANCE WAS PLACED ON THE DECISION OF THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI BAL BIR SINGH; 214 CTR 147, SANTOSH NARAIN KAPOOR, 25 SOT 26 (LUCK NOW), ITO V. SMT. SANTOSH AGRAWAL; 13 ITJ 27 (INDORE), A. RAJENDRAN; 134 TTAJ 498 (CHENNAI) AND VIKRAM CHADHA ; 115 TTJ 123 (AMRITSAR). ON THE OTHER HAND, THE LEARNED SENIOR DEPARTMENTAL REPRESENTATIVE STRONGLY DEFENDED THE I MPOSITION OF PENALTY ON TWO COUNTS, FIRSTLY THAT THE TRIBUNAL WHILE DECIDING THE QUANTUM APPEAL CONCLUDED THAT THE ASSESSEE COUL D NOT 3 PROVE THE GENUINENESS OF THE GIFT AND SECONDLY THE ASSESSEE DELIBERATELY CONCEALED ITS INCOME BY FURNISHING INA CCURATE PARTICULARS AND HAS TRIED TO MISLEAD THE DEPARTMENT WITH THE INTENTION TO EVADE TAX. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. BRIEF FACTS ARE THAT IN THE C ASE OF SHRI OMPRAKASH AGRAWAL, HE DECLARED TOTAL INCOME OF RS.1 .35,861/- IN ITS RETURN FILED ON 11.11.2003. NOTICE U/S 143( 2) WAS ISSUED AND SERVED ON THE ASSESSEE. AGAIN NOTICE U/S 143(2 ) AND 142(1) ALONG WITH QUESTIONNAIRE WERE SERVED UPON TH E ASSESSEE ON 22.9.2005 TO WHICH THE ASSESSEE ATTENDE D THE PROCEEDINGS. IT WAS NOTICED BY THE ASSESSING OFFICE R THAT THE ASSESSEE HAS CREDITED RS. 5,43,000/- IN HIS CAPITAL ACCOUNT CLAIMED TO BE RECEIVED AS GIFT. THE AMOUNT OF RS. 2 LACS WAS CLAIMED TO BE RECEIVED FROM AN NRI SHRI MANISH BANS AL AND THE AMOUNT OF RS. 1,21,000/- EACH RECEIVED TO BE DOMES TIC GIFT FROM SHRI AMIT AGRAWAL AND RAJKUMAR MITTAL AND FURT HER THE AMOUNT OF RS. 1,01,000/- FROM SHRI SURESH AGRAWAL. THE 4 ASSESSEE WAS ASKED TO PROVE THE GENUINENESS OF THE TRANSACTION IN RESPECT OF THESE GIFTS. ULTIMATELY IT WAS NOTICED THAT THE IDENTICAL AMOUNT WAS DEPOSITED IN CASH IN THE ACCOUNTS OF THE DONOR ONE DAY PRIOR TO MAKING THE GIFT TO TH E PRESENT ASSESSEES. THE ASSESSING OFFICER ADDED THESE ALLEG ED GIFTS AS INCOME OF THE ASSESSEE. ON APPEAL, THE LEARNED COM MISSIONER OF INCOME TAX (APPEALS) VIDE ORDER DATED 15.6.2007 AFFIRMED THE STAND OF THE ASSESSING OFFICER. ON FURTHER APP EAL BEFORE THE TRIBUNAL, THE GENUINENESS OF THE GIFT WAS HELD TO BE NOT PROVED AND THE DECLARATION WAS ALSO FILED WITHOUT M ENTIONING ANY DATE EITHER BY THE DONOR OR THE DONEE, CONSEQUE NTLY, THE STAND OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) WAS AFFIRMED. PURSUANT TO CONFIRMATION OF THE ADDIT ION BY THE TRIBUNAL VIDE ORDER DATED 25 TH JANUARY, 2008, THE LEARNED ASSESSING OFFICER IMPOSED PENALTY U/S 271(1) VIDE ORDER DATED 22.8.2008. IDENTICAL ARE THE FACTS IN THE CA SE OF SHRI ASHOK AGRAWAL, THEREFORE, THE SAME ARE NOT BEING RE PEATED FOR THE SAKE OF BREVITY. EVEN OTHERWISE, BOTH THE LEARN ED 5 REPRESENTATIVES, DURING HEARING, ALSO CONTENDED THA T THE FACTS ARE IDENTICAL IN BOTH THE CASES. 4. UNDER THE AFOREMENTIONED FACTS NOW THE QUESTION ARISES WHETHER THE PENALTY WAS RIGHTLY IMPOSED/CONF IRMED. BEFORE COMING TO ANY CONCLUSION, WE ARE SUPPOSED TO ANALYSE THE CASES RELIED UPON BY THE LD. COUNSEL FOR THE AS SESSEE. THE FOREMOST CASE, RELIED UPON, IS FROM HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF SHRI BALBIR SINGH(SUPRA) . IN THAT CASE, THERE WAS RECORDING OF FACT THAT THE ASSESSEE DISCL OSED ALL DETAILS AND THERE WAS NO EVIDENCE WITH REGARD TO CO NCEALMENT BROUGHT ON RECORD BY THE REVENUE. HOWEVER, THE FAC TS ARE DISTINGUISHABLE IN THE PRESENT APPEAL AS IDENTICAL AMOUNT WAS DEPOSITED IN CASH, ONE DAY PRIOR TO ISSUANCE OF CHE QUE, IN THE ACCOUNTS OF THE DONOR, THEREFORE, THE GENUINENESS O F TRANSACTION IS ITSELF UNDER DOUBT. MERE DISCLOSURE IN THE RETURN OF THE ASSESSEE, IN ITSELF, IS NOT A SUFFICIENT PRO OF THAT THE TRANSACTION IS GENUINE. THE ASSESSEE HAS KNOWINGLY AND DELIBERATELY TRIED TO DEFRAUD THE REVENUE UNDER THE GUISE OF MAKING A FALSE CLAIM, THEREFORE, IN OUR HUMBLE OPIN ION THE 6 DECISION FROM PUNJAB & HARAYANA HIGH COURT MAY NOT HELP THE ASSESSEE. WHILE COMING TO A PARTICULAR CONCLUSION, THE HONBLE PUNJAB & HARYANA HIGH COURT PLACED RELIANCE ON THE DECISION FROM HONBLE APEX COURT IN THE CASE OF K.C. BUILDER S & BOTHERS VS. ACIT (265 ITR 562) BUT IN THAT CASE ALSO THERE WAS A FINDING OF FACT BY THE TRIBUNAL THAT THERE WAS NO CONCEALME NT AND THE PENALTY WAS CANCELLED ON THE BASIS OF ORDER OF THE TRIBUNAL WHEREAS IN THE PRESENT CASE THE TRIBUNAL, WHILE DEA LING WITH THE QUANTUM APPEAL, HAS HELD THAT THERE WAS A CONSCIOUS CONCEALMENT. SO FAR AS THE DECISION FROM HONBLE AP EX COURT IN THE CASE OF RELIANCE PETRO PRODUCT LIMITED; 189 TAX MAN 322 IS CONCERNED, IN THAT CASE THE ASSESSEE CLAIMED EXPEND ITURE WHICH WAS NOT ACCEPTED OR WAS NOT ACCEPTABLE TO THE REVENUE. THE HONBLE APEX COURT HELD THAT THAT BY ITSELF WOU LD NOT ATTRACT PENALTY U/S 271(1) OF THE ACT. T HE RELIANCE BY THE LD. COUNSEL FOR THE ASSESSEE ON THE CASE OF SMT. SANTOSH AGRAWA L (SUPRA) IS NOT ON THE POINT IN DISPUTE INASMUCH AS IN THAT CASE THE ISSUE WAS WITH REGARD TO REOPENING OF ASSESSMENT U/S 148 OF THE ACT. 7 AS SUCH, THIS CASE CANNOT BE APPLIED TO THE FACTS O F THE PRESENT CASE. SO FAR AS THE RELIANCE BY THE LD. COUNSEL FOR THE A SSESSEE ON THE CASE OF VIKRAM CHADHA (SUPRA) IS CONCERNED, WE FIND THAT THE FACTS OF THAT CASE ARE DISTINGUISHABLE AS THAT CASE WAS DECIDED ON THE QUESTION WHETHER RECORDING OF VALID SATISFACTION IN THE ASSESSMENT ORDER WAS MANDATORY WHEREAS IN TH E PRESENT CASE THIS ISSUE IS NOT THERE. SO FAR AS THE RELIANCE BY THE LD. COUNSEL FOR THE A SSESSEE ON THE CASE OF A. RAJENDRAN & OTHERS (SUPRA) IS CON CERNED, WE FIND THAT IN THIS CASE THE GIFTS WERE GIVEN BY WAY OF CHEQUES WHEREAS IN THE CASE BEFORE US IDENTICAL AMOUNT WAS DEPOSITED IN CASH IN THE ACCOUNTS OF THE DONORS ONE DAY PRIOR TO MAKING THE GIFT TO THE PRESENT ASSESSEES. AS SUCH, THE FAC TS OF THE INSTANT CASE ARE QUITE DISTINGUISHABLE. IF THE TOT ALITY OF FACTS, THE ASSERTION MADE BY THE LEARNED RESPECTIVE COUNSELS I S ANALYSED, WE FIND THAT THE ASSESSEE HAS NOT DISCHARGED THE ON US CAST UPON THEM TO PROVE THE GENUINENESS OF TRANSACTION. WE, 8 THEREFORE, CONFIRM THE STAND OF THE LEARNED COMMISS IONER OF INCOME TAX (APPEALS). FINALLY, BOTH THESE APPEALS OF THE ASSESSEES ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT 7 TH APRIL, 2011. (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 7 TH APRIL, 2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, G UARD FILE DN/- 9