The ITO, Ward 12(4), Ahmedabad V. Shri Atushbhai B amin, Ahmedabad

ITA 889/AHD/2009

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9070 (ITAT-AHMEDABAD)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-09-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 10-09-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 20-03-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M C PANDIT
• Assessee Lawyers: DIPAK R THAK KAR
• Keywords: Unexplained cash credit
• Section: 271(1)(c); 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH C AHMEDABAD BEFORE SHRI H.L. KARWA, JUDICIAL MEMBER AND SHRI N.S. SAINI, ACCOUNTANT MEMBER DATE OF HEARING : 10.09.09 DRAFTED ON: 10.09. 2009 ITA NO.889/AHD/2009 ASSESSMENT YEAR : 2005-06 I.T.O. WARD-12(4), AHMEDABAD VS. SHRI ATUSHBHAI B. AMIN PROP OF NILA ELECTRIC, 61,JAGABHAI PARK, RAMBAUG, MANINAGAR, AHMEDABAD. PAN/GIR NO. : AAVPA 3460 D (APPELLANT) .. (RESPONDENT) APPELLANT BY : SHRI M.C.PANDIT SR. D.R. RESPONDENT BY: SHRI DIPAK R. THAKKAR O R D E R PER N.S.SAINI , ACCOUNTANT MEMBER :- THIS IS AN APPEAL FILED BY THE REVENUE AGAINST TH E ORDER OF THE LD.CIT(APPEALS)-XX, AHMEDABAD DATED 4.12.2008. 2. THE SOLE ISSUE INVOLVED IN ALL THE GROUNDS OF AP PEAL TAKEN BY THE REVENUE IS THAT THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) ERRED IN LAW AND ON FACTS IN DELETING THE PENALTY OF RS.7,33,082 /- LEVIED UNDER SECTION 271 (1)(C) OF THE INCOME TAX ACT, 1961. 3. THE BRIEF FACTS OF THE CASE ARE THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, LEARNED ASSESSING OFFICER FOUND THAT T HE ASSESSEE OBTAINED ADVANCE FROM CHAROTAR INSTITUTE OF TECHNOLOGY OF RS .21,16,129/-. DURING THE COURSE OF ASSESSMENT, THE LEARNED ASSESSING OFFICER REQUIRED THE LEARNED ITA NO .889/AHD/2009 M/S.ATUSHBHAI B. AMIN ASST.YEAR -2005-06 - 2 - AUTHORISED REPRESENTATIVE OF THE ASSESSEE TO PRODUC E DETAILS AND EXPLANATION WHY THE SAID AMOUNT BE NOT TREATED AS UNEXPLAINED C ASH CREDIT. THE LEARNED AUTHORISED REPRESENTATIVE OF THE ASSESSEE INFORMED THE LEARNED ASSESSING OFFICER THAT HE IS IN U.S. AND IN HIS ABSENCE, IT I S DIFFICULT TO GET CONFIRMATION FROM THE INSTITUTE AND AGREED TO ADDITION BEING MAD E AS UNEXPLAINED CASH CREDIT. THE LEARNED ASSESSING OFFICER ACCORDINGLY M ADE ADDITION OF CASH CREDIT OF RS.21,16,129/- TO THE INCOME OF THE ASSESSEE AND THEREAFTER, IMPOSED PENALTY UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 OF RS.7,33,082/- BEING 100% OF THE TAX EVADED ON RS.21,16,129/-. IN APPEAL, THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) OBSERVED THAT F ROM THE EVIDENCES AND SUBMISSION FILED BY THE LEARNED AUTHORISED REPRESEN TATIVE OF THE ASSESSEE, IT CAN BE SAFELY SAID THAT AMOUNT SHOWING CREDIT OF RS .21,16,129/- IN THE NAME OF CHAROTAR INSTITUTE OF TECHNOLOGY IS GENUINE AND NOT BOGUS. THE FACTS SHOW THAT WHENEVER ADVANCE WAS RECEIVED BY THE ASSESSEE FROM CHAROTAT INSTITUTE OF TECHNOLOGY HAVE BEEN SETTLED IN SUCCEEDING ASSESSME NT YEAR. THE RELEVANT EVIDENCES BY WAY OF BALANCE SHEET AS ON 31.03.2006, 31.03.2007 AND 31.03.2008 FILED BY THE ASSESSEE CLARIFIES IT AND P ARTICULARLY THE BALANCE SHEET AS ON 31.03.2008 IN WHICH BALANCE OF CHAROTAR INSTI TUTE OF TECHNOLOGY IS CLARIFIED UNDER ETH HEAD OF SUNDRY DEBTORS AT RS.29 ,19,228/- WHICH MEANS THAT LIABILITY OF ADVANCES HAS BEEN GRADUALLY ADJUSTED A GAINST THE BUSINESS CARRIED ON BY THE ASSESSEE IN THE SUCCEEDING ASSESSMENT YEA R. THE FACTS OF ADVANCE BEING RECEIVED BY THE ASSESSEE ARE NOT PROVED TO BE INCORRECT. THE LEARNED ASSESSING OFFICER FAILED TO PROVE THAT THE TRANSACT IONS ARE BOGUS AND THAT ADDITION MADE UNDER SECTION 68 OF THE ACT DOES NOT AUTOMATICALLY ATTRACT PENALTY PROVISIONS. ACCORDINGLY, IT WAS HELD BY TH E LEARNED COMMISSIONER OF INCOME TAX(APPEALS) THAT LEVY OF PENALTY IS NOT JUS TIFIED AND NEEDS TO BE ITA NO .889/AHD/2009 M/S.ATUSHBHAI B. AMIN ASST.YEAR -2005-06 - 3 - CANCELLED AS THERE IS NO SPECIFIC CONCEALMENT ON TH E PART OF THE ASSESSEE OR FURNISHING OF ANY INACCURATE PARTICULARS OF INCOME. HENCE, HE DELETED THE LEVY OF PENALTY. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE RELIED O N THE ORDER OF THE LEARNED ASSESSING OFFICER WHEREAS THE LEARNED AUTHO RISED REPRESENTATIVE OF THE ASSESSEE SUPPORTED THE ORDER OF THE LEARNED COM MISSIONER OF INCOME TAX(APPEALS). 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE LOWER AUTHORITIES AND THE MATERIALS AVAILABLE ON RE CORD. IN THE INSTANT CASE, THE ASSESSEE HAS SHOWN ADVANCE RECEIVED FROM CHAROTAR I NSTITUTE OF TECHNOLOGY OF RS.21,16,129/-. AS THE ASSESSEE COULD NOT FILE NECE SSARY EVIDENCE AND CONFIRMATION FROM THE SAID PARTY, THE LEARNED ASSES SING OFFICER MADE ADDITION OF THE SAME TO THE INCOME OF THE ASSESSEE AS UNEXPL AINED CASH CREDIT. THEREFORE, LEARNED ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271(1)(C) IN RESPECT OF THE ABOVE ADDITION OF RS.21,16,129/-. I N APPEAL, THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) DELETED THE PEN ALTY OBSERVING THAT FROM THE EVIDENCES FILED IN THE FORM OF BALANCE SHEET OF SUCCEEDING YEARS AS ON 31.03.2006, 31.03.2007 AND 31.03.2008 SHOWS THAT TH E ADVANCE RECEIVED FROM THE SAID PARTY WAS GRADUALLY ADJUSTED IN THE BUSINE SS OF THE ASSESSEE AND IN THE YEAR ENDING 31.03.2008, THE SAID PARTY WAS DEBTOR T O THE ASSESSEE FOR RS.29,94,228/-. THIS SHOWS THAT THE FACT OF ADVANC E RECEIVED BY THE ASSESSEE FROM THE SAID PARTY IS NOT INCORRECT. FURTHER, THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) HAS OBSERVED THAT THE LEARNED A SSESSING OFFICER HAS NOT BROUGHT ANY EVIDENCE ON RECORD TO SHOW THAT THE ADV ANCE WAS NOT GENUINE OR BOGUS. THE LEARNED DEPARTMENTAL REPRESENTATIVE COUL D NOT CONTROVERT THE ITA NO .889/AHD/2009 M/S.ATUSHBHAI B. AMIN ASST.YEAR -2005-06 - 4 - ABOVE FINDINGS OF THE LEARNED COMMISSIONER OF INCOM E TAX(APPEALS) BY BRINGING ANY COGENT OR RELEVANT MATERIAL ON RECORD. WE FIND THAT THE ASSESSEE HAD BUSINESS TRANSACTION WITH THE PARTY FROM WHOM IT CLAIM TO HAVE RECEIVED ADVANCE IS NOT IN DOUBT. IT IS NOT THE CASE OF THE REVENUE THAT THE IDENTITY OR ADDRESS OF THE PERSON WHO AS PER THE CLAIM OF THE A SSESSEE ADVANCED TO IT WAS NOT AVAILABLE WITH THE DEPARTMENT. IN THE ABOVE CIR CUMSTANCES, WE FIND THAT NO POSITIVE MATERIAL WAS BROUGHT ON RECORD BY THE REVE NUE TO SHOW THAT THE ADVANCE AMOUNT CLAIMED BY THE ASSESSEE WAS BOGUS OR FACTIOUS WITH REFERENCE TO WHICH IT LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE ACT. ON THE ABOVE FACTS, IN OUR CONSIDERED OPINION, LEARNED COMMISSIO NER OF INCOME TAX(APPEALS) WAS FULLY JUSTIFIED IN DELETING THE LE VY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. WE THEREFORE, DISMISS THE GRO UNDS OF APPEAL OF THE REVENUE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER SIGNED, DATED AND PRONOUNCED IN THE COURT ON 11/09/2009. SD/- SD/- ( H.L. KARWA ) ( N.S. SAINI ) JUDICIAL MEMBER ACC OUNTANT MEMBER AHMEDABAD; DATED 11/09/2009 PARAS# COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT(APPEALS)- 5. THE DR, AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT.REGISTRAR), ITAT, AHMEDABAD