Shri Anurag Shah 2654, Shah Bhawan Ghee Wallon Ka Rasta Johari Bazar, Jaipur, Jaipur V. ITO Ward-2(1), Jaipur, Ward-2(1), Jaipur

ITA 938/JPR/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 1150 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 4 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 05-07-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RUNI PAL ACIT DHK
• Keywords: Wrong claim; Accommodation entries
• Section: 271(1)(c)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH DQY HKKJR] U;KF;D LNL; ,OA JH VKS-IH-DKA R] YS[KK LNL; DS LE{K BEFORE: SHRI KUL BHARAT, JM & SHRI O.P. KANT, AM VK;DJ VIHY LA-@ ITA NO.938/JP/2019 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2014-15 SHRI ANURAG SHAH 2654, SHAH BHAWAN, GHEE WALLON KA RASTA, JOHARI BAZAR, JAIPUR. CUKE VS. THE ITO, WARD-2(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. CGCPS 0926 H VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRHDH VKSJ LS@ ASSESSEE BY : NONE JKTLO DH VKSJ LS@ REVENUE BY : SMT. RUNI PAL (ACIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 18/11/2020 ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT: 19/11/2020 VKNS'K@ ORDER PER SHRI O.P. KANT, A.M. THIS APPEAL HAS BEEN FILED BY THE ASSESSEE CHALLENGI NG THE ORDER DATED 15/04/2019 PASSED BY THE LEARNED COMMISSIONER OF INCOME- TAX(APPEALS)-I, JAIPUR [IN SHORT THE LD. CIT(A)] FOR A SSESSMENT YEAR 2014-15 IN RELATION TO PENALTY LEVIED BY THE LD. ASSES SING OFFICER FOR FURNISHING INACCURATE PARTICULARS OF INCOME. 2. THE GROUNDS RAISED IN THE APPEAL ARE REPRODUCED A S UNDER:- ITA NO.938/JP/19 SHRI ANURAG SHAH VS. ITO 2 1. THAT THE LOWER AUTHORITIES HAS GROSSLY ERRED IN HOLDING PENALTY U/S 271(1)(C) OF THE ACT OF RS. 91000/-. 2. THAT THE ASSESSING AUTHORITY HAS GROSSLY ERRED I N IMPOSING THE PENALTY U/S 271(1)(C) OF THE ACT WITHOUT AFFORDING PROPER OPPORTUNITY OF HEARING AND WITHOUT CONSIDERING THE PROPER SERVICE OF THE NOTICE ON THE APPELLANT. 3. THAT THE LOWER AUTHORITIES HAS GROSSLY ERRED IN HOLDING THAT SURRENDER WAS NOT MADE VOLUNTARILY AND IMPOSING THE PENALTY U/S 271(1)(C) OF THE ACT OF RS. 91,000/- WHERE A SURREN DER WAS MADE IN GOOD FAITH. 4. THAT THE LOWER AUTHORITIES HAS GROSSLY ERRED IN SUSTAINING THE PENALTY THAT TOO WITHOUT CONSIDERING THE ENTIRE MAT ERIAL FACTS AS AVAILABLE ON RECORD AND WITHOUT INVESTIGATING COMPL ETE FACTS INDEPENDENTLY. 5. THAT THE ASSESSEE HAS RIGHT TO ADD ALTER OR AMEN D ANY GROUND OF APPEAL ON OR BEFORE THE DATE OF HEARING. 3. AT THE OUTSET, WE MAY LIKE TO MENTION THAT THIS APPEAL WA S FIXED FOR HEARING THROUGH VIDEOCONFERENCING FACILITY AND TH E ASSESSEE WAS INFORMED THE DATE OF THE HEARING THROUGH E-MAIL PROVID ED IN THE FORM NO. 36 I.E. ( [e-mail] ) FILED BY THE ASSESSEE. DURING THE COURSE OF THE HEARING NEITHER ANYBODY REPRESENTED ON BEHALF OF THE ASSESSEE NOR ANY ADJOURNMENT WAS SOUGHT ON BEHALF OF THE ASSESSEE. THE MATTER RELATES TO ASSESSMENT YEAR 2014-15 AND THE C ASE HAS BEEN ADJOURNED FROM TIME ON TIME REQUEST OF LD. AUTHORIZED R EPRESENTATIVE (AR) OF THE ASSESSEE. DESPITE NOTIFYING, THE ASSESSEE D ID NOT TAKE ANY ITA NO.938/JP/19 SHRI ANURAG SHAH VS. ITO 3 STEPS FOR EFFECTIVE REPRESENTATION FOR GETTING THE MATTER D ISPOSED ON MERIT. IT IS, THEREFORE APPEARS THAT ASSESSEE IS NOT INTE RESTED IN PROSECUTING THE MATTER. ACCORDINGLY, THE APPEAL IS HEAR D EX-PARTE QUA THE ASSESSEE. 4. BRIEFLY STATED FACTS OF THE CASE ARE THAT AGAINST THE R ETURN OF INCOME FILED BY THE ASSESSEE ON 07/03/2016 DECLARING TOTAL INCOME OF RS. 1,08,350/-, SCRUTINY ASSESSMENT UNDER SECTION 143( 3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WAS COMPLETED ON 20/10/2016 AFTER DISALLOWING CLAIM OF EXEMPTION OF L ONG-TERM CAPITAL GAIN OF RS. 6,82,863/- ON SALE OF SHARES OF M/S KA PPAC FARMA. SIMULTANEOUSLY, PENALTY PROCEEDINGS UNDER SECTION 271 (1)(C) OF THE ACT WERE INITIATED FOR FURNISHING INACCURATE PARTICULARS O F THE INCOME. THE ASSESSING OFFICER AFTER PROVIDING OPPORTUNITY AND C ONSIDERING SUBMISSION OF THE ASSESSEE HELD THAT THE ASSESSEE HAS MADE WRONG CLAIM OF EXEMPTION UNDER SECTION 10(38) OF THE ACT AND THEREBY EVADED TAXES. HE ACCORDINGLY, LEVIED PENALTY UNDER SECTION 2 71(1)(C ) OF THE ACT VIDE ORDER DATED 22/03/2017. ON FURTHER APPEAL, THE LD. CIT(A) UPHELD THE ORDER OF THE ASSESSING OFFICER. AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL (IN SHORT THE TRIBUNAL) RAISING THE GROUNDS AS REPRODUCED ABOVE . 5. WE HAVE HEARD THE LD. DEPARTMENTAL REPRESENTATIVE THRO UGH VIDEO CONFERENCE FACILITY AND PERUSED THE RELEVANT MA TERIAL ON RECORD. ITA NO.938/JP/19 SHRI ANURAG SHAH VS. ITO 4 BEFORE THE LD. CIT(A) THE ASSESSEE CONTENDED THAT HE HAS VOLUNTARILY AND IN GOOD FAITH OFFERED THE INCOME FROM LONG-TERM CA PITAL GAIN FOR TAXATION AND THEREFORE NO PENALTY SHOULD BE LEVIED. T HE LD. CIT(A), HOWEVER OFFERED THAT THE ASSESSEE HAS OFFERED THE SAID LONG-TERM CAPITAL GAIN FOR TAX DURING THE SCRUTINY ASSESSMENT PRO CEEDING ONLY. THE RELEVANT FINDING OF THE LD. CIT(A) IS REPRODUCED AS UNDER:- (III) IT IS SEEN THAT THE INCOME DISCLOSED UNDER T HE HEAD 'LONG TERM CAPITAL GAIN' IN THE RETURN OF INCOME WAS NOT GENUINE. THE APPELLANT HAS TAKEN ACCOMMODATION ENTRIES AND T O AVOID TAXES SHOWED SUCH INCOME UNDER THE HEAD 'LONG TERM CAPITAL GAIN' AND CLAIMED EXEMPTION U/S 10(38) OF THE ACT. IT IS ALSO SEEN THAT THE SIMILAR INCOME WAS OFFERED BY THE APP ELLANT UNDER THE IDS-2016 FOR AY 2015-16. ALL THIS SHOWS T HAT ONLY AS A RESULT OF SCRUTINY ASSESSMENT, ON BEING QUESTIONI NG BY THE AO, THE APPELLANT CAME FORWARD TO OFFER THE ABOVE INCOME FO R TAXATION. THE ATTENTION IS INVITED TO JUDGMENT OF HON'BLE APEX CO URT IN THE CASE OF UNION OF INDIA VS. DHARAMENDRA TEXTILE PROCESSORS 2 93 ITR 584 (SC), WHEREIN AFTER QUOTING FROM SECTION 271 EXTENS IVELY AND ALSO CONSIDERING SECTION 271(1)(C), THE HON'BLE COURT CA ME TO THE CONCLUSION THAT SINCE SECTION 271(1)(C) INDICATES T HE ELEMENT OF STRICT LIABILITY ON THE ASSESSEE FOR THE CONCEALMENT OR FO R GIVING INACCURATE PARTICULARS WHILE FILING RETURN, THERE WAS NO NECES SITY OF MENS REA. THE COURT WENT ON TO HOLD THAT THE OBJECTIVE BEHIND ENACTMENT OF SECTION 271(1)(C) READ WITH EXPLANATIONS INDICATED WITH THE SAID SECTION WAS FOR PROVIDING REMEDY FOR LOSS OF REVENUE AND SUCH A PENALTY WAS A CIVIL LIABILITY AN D, THEREFORE, WILLFUL CONCEALMENT IS NOT AN ESSENTIAL ITA NO.938/JP/19 SHRI ANURAG SHAH VS. ITO 5 INGREDIENT FOR ATTRACTING CIVIL LIABILITY AS WAS TH E CASE IN NE MATTER OF PROSECUTION UNDER SECTION 276C OF THE ACT. IN OUR OPINION, THE LD. CIT(A) IS JUSTIFIED IN UPHOLD ING THE PENALTY IN VIEW OF WRONG CLAIM BY THE ASSESSEE WITHOUT ANY BONAF IDE EXPLANATION IN TERMS OF EXPLANATION-1 TO SECTION 271(1)(C ) OF THE A CT. WE DO NOT FIND ANY ERROR IN THE ORDER OF THE LD. CIT(A) ON THE I SSUE IN DISPUTE AND ACCORDINGLY, WE UPHELD THE SAME. THE GROUNDS RAI SED BY THE ASSESSEE ARE DISMISSED IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 19/11/20120 SD/- SD/- DQY HKKJR VKS-IH-DKAR (KUL BHARAT) (O.P. KANT) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER JAIPUR DATED:- 19/11/2020 SANTOSH* /DRAGON SOFTWARE VKNS'K DH IZFRFYFI VXZSF'KR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI ANURAG SHAH, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-2(1), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDRVIHY@ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, 6. XKMZ QKBZY@ GUARD FILE (ITA NO.938/JP/2019) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR.