DCIT, Jaipur V. SMT VIJESH DEVI, Jaipur

ITA 941/JPR/2012

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 5610 (ITAT-JAIPUR)
• Duration Of Justice: 4 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 21-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: POONAM RAI
• Assessee Lawyers: DEV ARORA CA DHK
• Keywords: Gift; Initiation of penalty proceedings; Reasonable cause; Tax effect
• Section: 68

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA-@ ITA NO. 941/JP/2012 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 DY. COMMISSIONER OF INCOME TAX, CIRCLE-2, JAIPUR CUKE VS. VIJESH DEVI, 169, HEERA PATH, SECTOR-9, MANSAROVAR, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AFMPD 9989 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA-@ ITA NO. 36/JP/2013 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2008-09 VIJESH DEVI, 169, HEERA PATH, SECTOR-9, MANSAROVAR, JAIPUR CUKE VS. ADDL. COMMISSIONER OF INCOME TAX, RANGE-2, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AFMPD 9989 G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SMT. POONAM RAI, (DCIT). FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.L. JAIN (ADV) & SHRI DEV ARORA (CA) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 31/01/2017 MN?KKS'K.KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 31/01/2017 ITA 941/JP/2012 & 36/JP/2013_ DCIT VS. VIJESH DEVI 2 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THESE ARE THE CROSS APPEALS, ONE BY THE REVENUE AND ANOTHER BY THE ASSESSEE ARISE AGAINST THE ORDER DATED 16/10/2012 P ASSED BY THE LD CIT(A)- I, JAIPUR FOR THE A.Y. 2008-09, WHEREIN THE REVENUE AS WELL AS THE ASSESSEE HAS TAKEN ONE GROUND OF APPEAL, WHICH ARE REPRODUCED AS UNDER:- GROUND REVENUES APPEAL IN ITA NO. 941/JP/2012 WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN REDUCING THE PENALTY OF RS. 19,00,000/- IMPOSED U/S 271D TO RS. 9,00,000/-. GROUND ASSESSEES APPEAL IN ITA NO. 36/JP/2013 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AUTHORITIES BELOW HAVE GROSSLY ERRED IN LAW AND FACTS IN IMPOSING/PARTLY CONFIRMING THE PENALTY U/S 271D OF RS. 9,00,000/- WITHOUT JURISDICTION/JUSTIFICATION/BASIS. 2. FIRSTLY WE TAKE REVENUES APPEAL I.E. ITA NO. 941 /JP/2012. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MAT ERIAL AVAILABLE ON THE RECORD. IT IS OBSERVED THAT THE DEMAND/ TAX EFFECT IN THE REVENUE IN QUESTION IS ONLY RS. 10.00 LACS. UNDER THE POWERS VE STED BY SEC. 268A(1) OF THE I T ACT, CBDT HAS RECENTLY ISSUED CIRCULARNO.21 OF 2015 DATED 10.12.2015(F NO. 279/MISC. 142/2007-ITJ(PT) INSTRUC TING THE ITA 941/JP/2012 & 36/JP/2013_ DCIT VS. VIJESH DEVI 3 AUTHORITIES BELOW DEPARTMENTAL APPEAL SHOULD NOT BE FILED BEFORE ITAT WHERE THE DEMAND/TAX EFFECT DOES NOT EXCEED RS .10 LACS. THE CIRCULAR IS SPECIFICALLY MENTIONED TO BE APPLICA BLE FOR ALL PENDING APPEALS. 3. SUBJECT TO SOME EXCEPTIONS, IT IS FURTHER DIREC TED BY CBDT THAT ALL THE DEPARTMENTAL APPEALS PENDING BEFORE ITAT WHERE T HE DEMAND/TAX EFFECT IS 10 LACS OR LESS SHOULD BE EITHER WITHDRAWN OR NOT PRESSED BY THE DEPARTMENTAL REPRESENTATIVES. 4. THE PRESENT APPEAL IS NOT COVERED BY ANY EXCEPTIO NS MENTIONED IN THE SAID CBDT CIRCULAR. SINCE THE TAX DEMAND IN DISP UTE IN THIS DEPARTMENTAL APPEAL IS BELOW THE LIMIT SET OUT BY CB DT FOR THE APPEAL THE SAME IS NOT MAINTAINABLE IN VIEW OF FORE GOINGS. ACC ORDINGLY THE APPEAL OF THE DEPARTMENT IS DISMISSED AS NOT MAINTAINABLE. 5. IN THE RESULT, APPEAL OF REVENUE IS DISMISSED. 6. NOW WE TAKE ASSESSEES APPEAL. IN THIS APPEAL, THE ONLY ISSUE INVOLVED IS AGAINST SUSTAINING THE PENALTY LEVIED U /S 271D OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) OF RS. 9,00,000/-. THE ADDL. CIT, RANGE-2, JAIPUR HAD LEVIED THE PENALTY OF RS. 19,00,000/- LA CS BY VIOLATING THE PROVISIONS OF SECTION 269SS OF THE ACT. ITA 941/JP/2012 & 36/JP/2013_ DCIT VS. VIJESH DEVI 4 7. IN FIRST APPEAL, THE LD. CIT(A) DELETED THE PENAL TY OF RS. 10.00/- LACS INSTEAD OF RS. 19.00 LACS MADE BY THE ASSESSING OFF ICER ON THE GROUND THAT WHICH WAS RECEIVED AS GIFTS BY THE ASSESSEE FROM FOUR PERSONS. HOWEVER, THE PENALTY WAS SUSTAINED ON THE ADVANCES RECEIVED F ROM THREE PERSONS NAMELY SHRI BHERURAM CHAUDHARY, SHRI RAMNIWAS CHOPRA AND SHRI RAJVEER SINGH. 8. NOW THE ASSESSEE IS IN APPEAL BEFORE ME. THE LD AR HAS REITERATED THE SUBMISSIONS AS MADE BEFORE THE LD. CIT(A). ON TH E CONTRARY, THE LD DR HAS VEHEMENTLY SUPPORTED THE ORDERS OF THE AUTHORIT IES BELOW. SHE ALSO SUBMITTED THAT THERE IS CONTRADICTION IN THE SUBMIS SIONS MADE IN THE FORM OF AFFIDAVIT AT THE TIME OF QUANTUM PROCEEDINGS AND PENALTY PROCEEDINGS. SHE ALSO VEHEMENTLY PLEADED THAT THESE PERSONS WERE LOCATED IN THE CITY LIKE JAIPUR AND THERE WAS NO DEARTH OF BANKING SYSTE M. THEREFORE, THESE ARE NOT COVERED BY THE EXCEPTIONS WHERE CASH LOANS A RE ACCEPTED AND SHE ALSO PLEADED TO SUSTAIN THE PENALTY LEVIED U/S 271D OF THE ACT. 9. I HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE P ARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IT IS VERY PE RTINENT TO NOTE THAT IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS TAKEN T WO VIEWS REGARDING THESE AMOUNTS. HE HAS MADE ADDITION BY INVOKING THE PROVISIONS OF SECTION 68 OF THE ACT TREATING THE AMOUNT AS BOGUS CASH CRE DITS AND HOLDING THE AMOUNT AS ASSESSEES OWN. ON THE OTHER HAND, THE ASS ESSING OFFICER HAS ITA 941/JP/2012 & 36/JP/2013_ DCIT VS. VIJESH DEVI 5 ALSO INVOKED THE PROVISIONS OF SECTION 269SS OF THE ACT TREATING THE AMOUNT AS CASH LOANS RECEIVED. THE RELEVANT PARA IN RESPECT OF SHRI RAMNIWAS CHOPRA IS AS UNDER:- FURTHER, ASSESSEE HAS TAKEN LOAN OF RS. 2,50,000/- IN CASH, HENCE VIOLATED THE NORMS AS PER SECTION 269SS OF I.T. ACT, 1961. FURTHER, AS CLEAR FROM STATEMENT OF SH. RAM NIWAS CH OPRA THAT LOAN WAS ALSO RETURNED BACK IN CASH, HENCE ASSESSEE HAS VIOLATED PROVISIONS OF SECTION 269T I.T. ACT, 1961. THEREFORE, MATTER IS BEING REFERRED TO ADDITIONAL COMMISSIONER OF INCOME TAX, RANGE- 2, FOR INITIATION OF PENALTY PROCEEDINGS U/S 271D A ND 271E OF THE IT ACT, 1961. SIMILAR FINDINGS HAVE BEEN ALSO RECORDED IN THE CAS E OF SHR. BHERU RAM CHOUDHARY AND SHRI RAJVEER SINGH. THUS, THE ASSESSI NG OFFICER HIMSELF WAS NOT IN BELIEF WHETHER THE AMOUNT WAS A BOGUS CASH CR EDIT OR IT WAS A LOAN RECEIVED IN CASH IN VIOLATION OF SECTION 269SS OF T HE ACT. THE LD AR OF THE ASSESSEE IN HIS WRITTEN SUBMISSIONS HAS STATED THAT ASSESSEES HUSBAND WAS AN ARMY OFFICER, WHO WAS DECLARED MARTYR DURING THE K ARGIL WAR AND THE GOVERNMENT OF INDIA AWARDED HIM GALLANTRY AWARD POS THUMOUSLY AND ALLOTTED A PETROL PUMP FOR HER LIVELIHOOD AND HER C HILDREN IN THE YEAR 2001. BUT SHE FACED LOTS OF PROBLEMS IN RUNNING OF PETROL PUMP DUE TO PAUCITY OF FUNDS. THEREFORE, HER RELATIVES HELPED HER. IN SECTI ON 269SS OF THE ACT, IT IS HELD THAT NO PERSON SHALL TAKE OR ACCEPT FROM ANY O THER PERSON ANY LOAN OR ITA 941/JP/2012 & 36/JP/2013_ DCIT VS. VIJESH DEVI 6 DEPOSIT OR ANY SPECIFIED SUM, OTHERWISE THAN BY AN A CCOUNT PAYEE CHEQUE OR ACCOUNT PAYEE BANK DRAFT OR USE OF ELECTRONIC CL EARINGS SYSTEM THROUGH A BANK ACCOUNT, BUT IN THE PRESENT CASE, THE PERSONS, WHO HELPED HER, ARE HER RELATIVES OR NEIGHBOURS, WHO WERE ALSO AGRICULTUR ISTS HAVING NO BANK ACCOUNTS AT THE TIME OF FUNDS GIVEN. THE ASSESSEE HA S FILED AN AFFIDAVIT BY STATING THAT SHE HAS RECEIVED THE AMOUNTS AS GIFTS AND ADVANCES. THE ASSESSEE IS A WIDOW OF AN ARMY OFFICER AND SHE WAS NO T EDUCATED. THE ALLOTMENT OF THE PETROL PUMP WAS GIVEN BY THE GOVERN MENT OF INDIA BUT SHE WAS NOT PERFECT IN CONDUCTING THE BUSINESS DUE T O ILLITERACY. ALL THESE FACTS MAKE A REASONABLE CAUSE WHERE THE ASSESSEE SHO ULD NOT BE VISITED BY THE PENALTY U/S 271D OF THE ACT TOWARDS THE LOANS AN D DEPOSITS ACCEPTED FROM THE KNOWN PERSONS AND CLOSE RELATIVES IN THE H OURS OF DISTRESS. FURTHER IT IS ALSO CLEAR FROM THE DWELL STAND TAKEN BY THE A SSESSING OFFICER AND FURTHER RELIEF GRANTED IN THE QUANTUM APPEAL BY THE HIGHER AUTHORITIES THAT THE ASSESSEE HAS NOT ADOPTED THIS PROCEDURE TO AVOI D OR EVADE THE TAX. THEREFORE, CONSIDERING THE VARIOUS CASE LAWS ON THIS ISSUE, NO PENALTY SHOULD BE IMPOSED ON THE ASSESSEE FOR CONTRAVENTION OF SECTION 271D OF THE ACT. THE ABOVE VIEW ALSO GET SUPPORTS FROM THE VA RIOUS CASE LAWS RELIED BY THE LD AR OF THE ASSESSEE INCLUDING DECISION OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. RAJ KUMAR SHARMA (2007) 294 ITR 131 (RAJ) AND DECISION OF ITAT, JAIPUR BENCH IN THE CASE OF SM T. KUSUM DHAMANI VS ITA 941/JP/2012 & 36/JP/2013_ DCIT VS. VIJESH DEVI 7 ADDL.CIT IN ITA NO. 847/JP/2011. THEREFORE, BY CONSID ERING THE TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE, I DELETE THE P ENALTY SUSTAINED BY THE LD. CIT(A). 10. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED AND APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 31/01/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 31 ST JANUARY, 2017 *RANJAN VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE DCIT, CIRCLE-2, JAIPUR 2. IZR;FKHZ @ THE RESPONDENT- SMT. VIJESH DEVI, 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, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 941/JP/2012 & 36/JP/2013) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR