SHRI KESAMAL KHANWANI, Jaipur V. INCOME TAX OFFICER, WARD-2-4, Jaipur

ITA 949/JPR/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6242 (ITAT-JAIPUR)
• Duration Of Justice: 2 year(s) 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2006-2007
• Appeal Filed On: 11-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MONISHA CHOUDHARI JCIT A
• Keywords: Set aside
• Section: 271(1)(c); 142(1); 69A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,A JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA. NO. 949/JP/2019 FU/KZKJ.K O'K Z@ ASSESSMENT YEARS : 2006-07 SHRI KESAMAL KHANWANI 104/4, AGARWAL FARM, MANSAROVAR, JAIPUR. CUKE VS. THE ITO, WARD-2(4), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAYPK 1330 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : MISS SHIVANGI SAMDHANI (CA) JKTLO DH VKSJ LS @ REVENUE BY : SMT. MONISHA CHOUDHARI (JCIT) A LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 08/09/2021 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT :13/09/2021 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE ORDER OF LD. CIT(A)-I, JAIPUR DATED 23.04.2019 CONFIRMING THE LE VY OF PENALTY U/S 271(1)(C) OF THE IT ACT ON ADDITION OF RS. 3,00,000 /- MADE U/S 69A OF THE ACT FOR THE ASSESSMENT YEAR 2006-07. 2. DURING THE COURSE OF HEARING, THE LD. AR SUBMITT ED THAT THE ASSESSEE WAS INVOLVED IN AGRICULTURAL ACTIVITIES AN D HAS SHOWN RECEIPT FROM THE AGRICULTURAL ACTIVITIES WHICH WERE DEPOSIT ED IN THE BANK ACCOUNT, HOWEVER DUE TO NON-SUBMISSION OF THE SALE BILLS OF THE ITA NO. 949/JP/2019 SHRI KESAMAL KHANWANI VS. ITO 2 AGRICULTURAL PRODUCE, THE AO HAS NOT ACCEPTED THE A SSESSEES EXPLANATIONS AND FOUND THE DEPOSITS AS UNEXPLAINED AND THE LD. CIT(A) HAS ALSO CONFIRMED THE SAID ADDITION ON ACCOUNT OF NON VERIFICATION. IT WAS FURTHER SUBMITTED THAT ON APPEAL OF THE ASSESSE E, THE TRIBUNAL HAS SET-ASIDE THE MATTER TO THE FILE OF THE ASSESSING O FFICER AND IN THE SET-ASIDE PROCEEDINGS, THE ASSESSING OFFICER HAS AC CEPTED THE AGRICULTURAL INCOME AS SHOWN BY THE ASSESSEE AS GEN UINE AND OUR REFERENCE WAS DRAWN TO THE FINDINGS OF THE ASSESSIN G OFFICER IN THE SET-ASIDE PROCEEDINGS WHICH READ AS UNDER: CONSEQUENT TO RECEIVING THE ORDER OF ITAT, NOTICE U/S 142(1) WAS ISSUED TO THE ASSESSEE TO SUBSTANTIATE HIS CLAI M WITH REGARD TO HAVING AGRICULTURAL INCOME. IN RESPONSE TO THE S AID NOTICE, SHRI GAJANAND GUPTA, CA AND A/R OF THE ASSESSEE, ATTENDE D AND FILED WRITTEN REPLY, ALONG WITH THE REQUIRED INFORMATION. SUPPORTING PAPERS LIKE JAMABANDI AND GIRDAVRI OF THE AGRICULTU RAL LAND HELD BY HIM, COPY OF TRADING ACCOUNT OF AGRICULTURE, COP Y OF SOME SALE BILLS IN SUPPORT OF HAVING MADE SALE OF AGRICULTURA L CROP, WERE SUBMITTED, WHICH WERE EXAMINED. THE AO HAD DOUBTED THE SALES MADE TO R.K. SANKHLA, ON THE BASIS OF WHICH ADDITIO N WAS MADE. THE STATEMENTS OF SHRI R.K. SANKHLA WERE RECORDED O N OATH, WHO CONFIRMED THE FACT OF PURCHASING AMLA FROM THE ASSE SSEE. THE ASSESSEE OWNS 26 BIGHAS OF AGRICULTURAL LAND IN MAL PURA TEHSIL OF JAIPUR. HE HAD BEEN SHOWING AGRICULTURAL INCOME FR OM LAST MANY YEARS, WHICH HAD BEEN ACCEPTED BY THE DEPARTMENT. A FTER EXAMINING VARIOUS DETAILS PRODUCED DURING THE COURS E OF ASSESSMENT AND DISCUSSION MADE WITH THE AR OF THE A SSESSEE, THE ITA NO. 949/JP/2019 SHRI KESAMAL KHANWANI VS. ITO 3 AGRICULTURE INCOME OF THE ASSESSEE WHICH HAS BEEN D ISALLOWED BY THE AO AND CONFIRMED IN APPEAL BY THE CIT(APPEAL), IS ACCEPTED AS GENUINE. 3. IT WAS ACCORDINGLY SUBMITTED THAT WHERE THE EXPL ANATION IN SUPPORT OF THE SOURCE OF THE DEPOSITS IN THE BANK A CCOUNT HAS BEEN ACCEPTED BY THE REVENUE IN THE SET ASIDE PROCEEDING S, THERE IS NO BASIS FOR LEVY OF PENALTY U/S 271(1)(C) OF THE ACT AND TH E PENALTY SO LEVIED AND CONFIRMED BY THE LD CIT(A) MAY THUS BE DELETED. 4. PER CONTRA, THE LD. DR SUBMITTED THAT THERE WERE TWO GROUNDS OF APPEAL BEFORE THE TRIBUNAL. ONE WAS RELATING TO GE NUINENESS OF THE AGRICULTURE PRODUCE AND THE SECOND ONE WAS RELATING TO SOURCE OF DEPOSITS IN THE BANK ACCOUNT WHICH WAS CLAIMED BY T HE ASSESSEE AS DEPOSITS RECEIVED FROM SALE OF AGRICULTURE PRODUCE. IT WAS SUBMITTED THAT FIRST GROUND WAS SET-ASIDE BY THE TRIBUNAL TO THE FILE OF THE ASSESSING OFFICER, HOWEVER, THE SECOND GROUND OF AP PEAL WAS DISMISSED BY THE TRIBUNAL. IT WAS ACCORDINGLY SUBMITTED THAT WHERE THE ADDITION HAS BEEN SUSTAINED BY THE TRIBUNAL IN THE QUANTUM P ROCEEDINGS, THE AO HAS RIGHTLY LEVIED THE PENALTY U/S 271(1)(C) OF THE ACT. THE LD. DR HAS THUS RELIED ON THE FINDINGS OF THE LOWER AUTHORITIE S. 5. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ASSESSEE HAS GIVEN THE NECESSARY EXPLANATION IN SUPPORT OF THE CASH DEPOSITS IN HIS BANK ACCOUNT BEING RECEIPT FROM THE SALE OF THE AGRICULTURAL PRODUCE A ND DURING THE COURSE OF SET-ASIDE PROCEEDINGS, THE AO HAS CARRIED OUT TH E NECESSARY ITA NO. 949/JP/2019 SHRI KESAMAL KHANWANI VS. ITO 4 VERIFICATION INCLUDING EXAMINATION OF SHRI R. K. SA NKLA WHO HAS PURCHASED THE AGRICULTURE PRODUCE AND HAS ALSO GONE THROUGH THE JAMABANDI AND GIRDAVRI REPORTS SO SUBMITTED BY THE ASSESSEE. WE THEREFORE, FIND THAT WHERE THE EXPLANATION SO FURNI SHED BY THE ASSESSEE HAS BEEN ACCEPTED AND FOUND GENUINE IN SUPPORT OF A GRICULTURE INCOME AND THE RECEIPTS THEREOF HAS BEEN EXPLAINED AS THE SOURCE OF DEPOSITS IN THE BANK ACCOUNT, THERE IS NO BASIS FOR LEVY OF PEN ALTY U/S 271(1)(C) OF THE ACT AS THE EXPLANATION SO FURNISHED HAS BEEN AC CEPTED BY THE REVENUE. 6. REGARDING THE CONTENTION ADVANCED BY THE LD DR T HAT THERE WERE SEPARATE GROUNDS OF APPEAL WHEREIN ONE GROUND OF AP PEAL HAS BEEN SET- ASIDE AND THE SECOND GROUND OF APPEAL HAS BEEN DISM ISSED, WE FIND THAT THOUGH SEPARATE GROUNDS OF APPEAL WERE TAKEN B EFORE THE TRIBUNAL, HOWEVER, THE OUTCOME OF THE SECOND GROUND OF APPEAL WAS DEPENDENT ON OUTCOME OF THE FIRST GROUND OF APPEAL AS THE EXP LANATION FOR SOURCE OF DEPOSITS HAS BEEN STATED TO BE OUT OF RECEIPTS F ROM SALE OF THE AGRICULTURE PRODUCE. THEREFORE, WITHOUT GETTING IN TO THE REASONS WHY THE TWO GROUNDS OF APPEAL WERE TREATED DIFFERENTLY BY THE COORDINATE BENCH AS THE QUANTUM PROCEEDINGS HAVE ATTAINED FINA LITY IN ABSENCE OF ANY FURTHER APPEAL BY EITHER OF THE PARTIES, THE EX PLANATION SO FURNISHED BY THE ASSESSEE CONTINUES TO BE RELEVANT BEFORE ANY ACTION IS TAKEN IN TERMS OF LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THE EXPLANATION OF THE ASSESSEE, AS WE HAVE NOTED ABOVE, HAS SINCE BEE N ACCEPTED BY THE REVENUE IN SUPPORT OF GENUINENESS OF AGRICULTURE PR ODUCE, THE SAME EXPLANATION HOLDS GOOD IN SUPPORT OF SOURCE OF DEPO SITS IN THE BANK ACCOUNT AS THE SAME IS THE CONSISTENT STAND OF THE ASSESSEE FROM THE ITA NO. 949/JP/2019 SHRI KESAMAL KHANWANI VS. ITO 5 BEGINNING AND THUS, WHERE THE EXPLANATION HAS BEEN DULY ACCEPTED, THERE IS NO BASIS FOR LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. 7. IN LIGHT OF AFORESAID DISCUSSIONS AND IN THE ENT IRETY OF FACTS AND CIRCUMSTANCES OF THE CASE, WE HEREBY DIRECT THE DEL ETION OF PENALTY IMPOSED U/S 271(1)(C) OF THE ACT. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWE D. ORDER PRONOUNCED IN THE OPEN COURT ON 13/09/2021. SD/- SD/- LANHI XKSLKBZ FOE FLAG ;KNO ( SANDEEP GOSAIN ) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 13/09/2021. *SANTOSH VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI KESAMAL KHANWANI, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD- 2(4), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE { ITA NO. 949/JP/2019} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR