Anil Kumar Jain, JODHPUR V. ACIT, UDAIPUR

ITSSA 1/JODH/2011

• Counselvise Citation: [2013] 121 COUNSELVISE.COM (IT) 9471 (ITAT-JODHPUR)
• Duration Of Justice: 2 year(s) 5 month(s) 10 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 16-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 10-09-2013
• Assessment Year: misc
• Appeal Filed On: 06-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N A JOSHI
• Assessee Lawyers: SHAILENDRA BARDIA
• Keywords: Unexplained investment; Business income; Income from undisclosed sources

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENC H : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO.01/JODH/2011 (A.Y. 1989-90 TO 1998-99) ANIL KUMAR JAIN, VS. ACIT, CENTRAL CIRCLE-1, C/O SHAILENDRA BARDIA, UDAIPUR. CHARTERED ACCOUNTANT, 53, NEHRU PARK, JODHPUR. PAN NO. ABCPJ8433F ASSESSEE BY : SHRI SHAILENDRA BARDIA. DEPARTMENT BY : SHRI N.A. JOSHI- D.R. DATE OF HEARING : 10/09/2013. DATE OF PRONOUNCEMENT : 16/09/2013. O R D E R PER N.K.SAINI, A.M THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF LD. CIT (A), CENTRAL JAIPUR DATED 24/02/2011. THE ONLY GRI EVANCE OF THE ASSESSEE IN THIS APPEAL RELATES TO THE CONFIRMATION OF PENAL TY AMOUNTING TO RS. 5,23,160/- LEVIED BY ASSESSING OFFICER UNDER SECTIO N 158BFA(2) OF THE I.T. ACT, 1961 (HEREINAFTER REFERRED TO AS ACT, FOR BR EVITY). 2 2 THE FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESS EE IS A PARTNER IN THE FIRM M/S. PRASHANT JEWELLERS, WHICH WAS ENGAGED IN THE BUSINESS OF TRADING IN GOLD AND SILVER ORNAMENTS. THE ASSESSME NT IN THIS CASE WAS FRAMED UNDER SECTION 158BFA(2) OF THE ACT ON TOTAL UNDISCLOSED INCOME OF RS. 27,95,013/-. THE YEAR-WISE INCOME WAS DETERMIN ED AS UNDER:- PARTICULARS ASSESSMENT YEAR AMOUNT (RS.) (1) UNDISCLOSED INCOME FROM BUSINESS AS DISCUSSED AT PAGE 14 1989 - 90 15,000/ - (2) UNDISCLOSED INCOME ASSESSED ON THE BASIS OF EXHIBIT 12 & 13 OF PAGE NO. 238 & 306 RESPECTIVELY THE AMOUNT STANDS CREDIT IN THE ACCOUNT OF SH. PRASHANT JEWELLERS IN THE BOOKS OF SHRI SOHAN LAL PRAKASH CHAND SHOWING SALES AMOUNT WHICH REPRESENTED AMOUNT OF UNEXPLAINED INVESTMENT INPURCHASES AND PROFIT EARNED THEIR UPON AS DISCUSSED ON PAGE NO. 1 & 10 1998 - 99 1999-2000 7,44,947/ - 1,26,989/- (3) UNDISCLOSED INC OME ASSESSED ON THE BASIS OF EX-1 ANN. A PAGE NO. 3, 4 & 12 AS DISCUSSED ON PAGE NO. 10 1999 - 2000 4,08,077/ - UNDISCLOSED PROFIT ON ESTIMATE BASIS AS DISCUSSED ON PAGE NO.11 1999 - 2000 15,00,000/ - TOTAL UNDISCLOSED PROFIT 27,95,013/ - 3. SINCE, UNDISCLOSED INCOME ASSESSED WAS IN EXCESS T O THE UNDISCLOSED INCOME SHOWN IN THE RETURN OF INCOME FILED IN FORM NO. 2B, THEREFORE, PENALTY PROCEEDINGS UNDER SECTION 158BFA(2) OF THE ACT WERE INITIATED AND THE ASSESSEE WAS ASKED TO SHOW-CAUSE AS TO WHY AN ORDER FOR IMPOSING PENALTY UNDER SECTION 158BFA(2) OF THE ACT SHOULD NOT BE MADE 3 AFTER GIVING EFFECT TO THE APPELLATE ORDER OF ITAT, JODHPUR BENCH, JODHPUR. IN RESPONSE TO THE ABOVE, ASSESSEE SUBMIT TED TO THE ASSESSING OFFICER AS UNDER:- A) BEFORE SUBMITTING AGAINST THE LEVY OF PENALTY W E LIKE TO BRING YOUR KIND NOTICE THE FOLLOWING FEW FACTS AND CIRCUMSTANCES OF THE CASE. THAT THE PROVISIONS FOR LEVY OF PENALTY U/S 158BFA( 2) OF THE ACT ARE NOT APPLICABLE IN THIS CASE AS THE ABOVE SAID ASSESSEE HAS NOT CONCEALED THE PARTICULARS OF HIS INCOME AND HAS NOT FURNISHED DEL IBERATELY ANY INACCURATE PARTICULARS OF INCOME IN THE RETURN FILED AGAINST N OTICE U/S L58BC/158BD. THE ADDITIONS MADE IN THE ASSESSMENT ARE BASED ON E ITHER ESTIMATES OR ON ACCOUNT OF NON-ACCEPTANCE OF BONAFIDE EXPLANATIONS FURNISHED BY HIM. THE ASSESSEE HAS DISCLOSED ALL RELEVANT INFORMATION AND FACTS RELATING TO THIS INCOME AND EXPLAINED HIS POSITION FROM THE MATERIAL FOUND AND SEIZED DURING THE COURSE OF SEARCH PROCEEDINGS AT THE BUSINESS AND RESIDENTI AL PREMISES OF SHRI SOHAN LAL SISODIA PROP. M/S SOHANLAL PRAKASH CHANDRA SISODIA, SARAFA BAZAR, NATHDWARA AND SHRI LAXMAN SINGH SISODIA PROP M/S BALAJI JEWEL LERS OF BOHRAWADI, NATHDWARA. THE ASSESSEE HAS OBJECTED THE PROCEEDINGS U/S 158BC /BD INITIATED AGAINST HIM SINCE BEGINNING AND CLAIM THAT ALL PROCEEDINGS OF A SSESSMENT U/S 158BD AGAINST HIM WAS WITHOUT JURISDICTION. HOWEVER, THE LEARNED A.O. HAS MADE ASSESSMENT U/S 158BD REJECTING THE OBJECTION AND ARGUMENTS OF THE ASSESSEE. THE ASSESSMENT MADE IS ARBITRARY, CONTRARY TO THE FACT OF THE CASE. AGGRIEVED WITH THE ASSESSMENT, THE ASSESSEE HAS PREFERRED APPEAL B EFORE THE CIT(APPEALS) CENTRAL, JAIPUR. THE VARIOUS ADDITIONS MADE IN THE HANDS OF THE ASSE SSEE WERE RIGHTLY DELETED BY THE CIT(APPEALS)CENTRAL, JAIPUR CONSIDERING AND APP RECIATING THE TRUE AND REAL FACTS OF THE CASE. THE CIT(APPEALS) CENTRAL HAD ALS O APPRECIATED THE FACT THAT THE ASSESSEE HAD DECLARED AND OFFERED UNDISCLOSED I NCOME FOR TAXATION DURING THE COURSE OF SURVEY IN THE RELEVANT ASSESSMENT YEA R. FURTHER THE INCOME IN QUESTION ARRIVED AT BY APPRECIATING THE NOTING ON R EGISTERS (EXHIBIT-12 AND 13) AND DIARY (EXHIBIT I OF THE-ANNEXURE-A) FOUND DURIN G THE COURSE OF SEARCH FROM THE POSSESSION OF SEARCHED PERSONS HAVE ALREADY BEE N CONSIDERED IN THE HANDS OF SEARCH PERSONS ALSO AS IS REFLECTED FROM THEIR A SSESSMENT U/S 158BC OF BOTH PERSONS, THE ADDITION OF INCOME IN THE HANDS OF THE ASSESSEE TANTAMOUNT TO 4 DOUBLE TAXATION OF THE SAME INCOME ONCE IN THE HAND S OF SEARCHED PERSONS AND SECONDLY IN THE HANDS OF THE ASSESSEE. NO DOUBT, THE HON'BLE ITAT, JODHPUR BENCH, JODHPUR HAD DECIDED ONE OF THE ISSUE IN FAVOUR OF THE DEPARTMENT 'I.E. CONFIRMED T HE ADDITION BY THE AO BUT IT APPEARS THAT TRUE AND CORRECT FACTS WERE NOT BROUGH T AND PROPERLY EXPLAINED BEFORE THE ITAT. SPECIFICALLY THE FACT THAT THIS I NCOME HAD ALREADY BEEN ASSESSED IN THE HANDS OF SEARCH PERSONS ALSO. AGGR IEVED WITH THE ORDER OF THE ITAT, THE ASSESSEE HAS PREFERRED TO FILE M.A. (MISC . APPLICATION) AGAINST SUCH ORDER BEFORE THE TRIBUNAL, AS WELL AS THE ASSESSEE HAS ALSO PREFERRED TO APPROACH THE HIGH COURT IN THE MANNER. B) UNDER THE ABOVE FACTS AND CIRCUMSTANCE OF THE C ASE THE PENALTY PROCEEDINGS AT YOUR END IS BEING OBJECTED ON THE FOLLOWING LEGA L GROUNDS AS WELL AS ON MERITS. 1) THE PENALTY U/S 158BFA(2) CANNOT BE IMPOSED IN T HIS CASE ON THE BASIS OF NOTICE ISSUED ON 21/03/2002. THE ISSUE OF NOTIC E FOR LEVY OF PENALTY U/S 158BFA(2) BEFORE FINALIZATION OF QUANTU M OF INCOME AND WITHOUT RECORDING OF SATISFACTION OF DELIBERATE CO NCEALMENT OF INCOME OR FURNISHING OR INACCURATE PARTICULARS BY T HE ASSESSEE. AS NO SATISFACTION ABOUT CONCEALMENT BEING FOUND RECORDED IN THE ORDER OF ASSESSMENT SERVED ON THE ASSESSEE, AN ORDER IMPOSIN G PENALTY U/S 158BFA(2) WILL BE WITHOUT JURISDICTION. THE NOTING ON THE ASSESSMENT ORDER THAT PENALTY PROCEEDINGS U/S 158BFA HAVE BEE N SEPARATELY INITIATED' DOES NOT AMOUNT TO RECORDING OF VALID SA TISFACTION, WHICH PLEASE NOTE. SIMILARLY, THERE IS NO DISCUSSION IN ASSESSMENT ORDER THAT THE ASSESSEE HAD FURNISHED INACCURATE PARTICULARS W ITH MALA FIDE INTENT TO EVADE TAX OR THE EXPLANATION GIVEN BY THE ASSESSEE WAS NOT BONAFIDE OR FALSE. 2) PENALTY U/S 158BFA(2) IS NOT WARRANTED MERELY B ECAUSE THE ASSESSMENT WAS MADE ON ADDITIONAL INCOME AS HAS BEE N DISCLOSED IN HIS RETURN. IT IS WELL SETTLED PRINCIPLE OF LAW TH AT IN ORDER TO JUSTIFY LEVY OF PENALTY, THE FOLLOWING FACTORS MUST CO-EXIT : I. THERE MUST BE SOME MATERIAL OR CIRCUMSTANCES LE ADING TO THE REASONABLE CONCLUSION THAT THE AMOUNT DOES REPRESEN T THE INCOME OF THE ASSESSEE, AND II. THE MERE FACT THAT THE AMOUNT HAS BEEN ASSESSE D AS AN COME IS NOT SUFFICIENT FOR THE PURPOSE OF LEVYING PENALTY B UT THE CIRCUMSTANCES MUST SHOW THAT THERE WAS CONSCIOUS AN D 5 DELIBERATE CONCEALMENT OF INCOME OR CONSCIOUS FURNI SHING OF INACCURATE PARTICULARS THEREOF ON THE PART OF THE A SSESSEE WITH A VIEW TO EVADE TAX. IN THE CASE OF THE ASSESSEE NEITHER OF THE ABOVE F ACTS EXISTED. THERE WAS NO MATERIAL OR CIRCUMSTANCES, WHICH COULD LEAD TO ANY REASONABLE CONCLUSION THAT THE AMOUNT OF ADDITI ON SUSTAINED REPRESENTED REAL INCOME OF THE ASSESSEE T HERE IS NO EVIDENCE THAT THERE IS CONSCIOUS OR DELIBERATE CONC EALMENT OF INCOME' OR CONSCIOUS FURNISHING OF INACCURATE PARTI CULARS THEREOF BY THE APPELLANT WITH A VIEW TO EVADE TAX. III. IT IS A SETTLED LAW THAT BOTH ASSESSMENT AND PENALTY PROCEEDINGS ARE SEPARATE AND INDEPENDENT PROCEEDINGS THOUGH THE REASONING GIVEN IN THE ASSESSMENT ORDER CONSTITUTES EVIDENCE AND BASE FOR LEVY OF PENALTY UNDER SECTION 158BFA(2). HOWEVER, THE FINDINGS RECORDED IN THE ASSESSMENT ARE NOT CONCLUSIVE FOR T HE PURPOSE OF LEVY PENALTY UNDER SECTION 158BFA(2). IN THE P RESENT CASE THE TRUE AND REAL FACTS WERE NOT BROUGHT BEFORE THE NOTICE OF ITAT. THE ASSESSEE IS PREPARED TO EXPLAIN THE TRUE AND REAL FACT IN THE PENALTY PROCEEDINGS TO YOUR GOODSELF. QUANTUM PROCEEDINGS AND PENALTY PROCEEDINGS BEING ALTOGETHER DIFFERENT PENALTY U/S 158BFA(2) CANNOT BE LEVIED S IMPLY ON ACCOUNT OF THE FACT THAT AN ADDITION HAS BEEN SUSTA INED IN QUANTUM APPEAL. ACCORDING TO US, THERE WAS NO SUCH INCOME ACTUALLY EARNED BY THE ASSESSEE. THEREFORE, WHATEVER MIGHT BE THE CLA IM OF THE AO IN THE ASSESSMENT; NO PART OF SUSTAINED ADDITION COULD BE REGARDED REAL UNDISCLOSED INCOME OF THE ASSESSEE, W HICH WOULD QUALIFY FOR LEVY OF PENALTY UNDER SUB-SECTION(2) OF SECTION 158BFA OF THE ACT. IV. IN THIS CASE, THE LEARNED CIT(A) HAS RIGHTLY DELETED THE ADDITIONS, BUT THERE IS NO DOUBT CERTAIN ADDITIONS, WHICH WERE MADE BY THE AO IN THE ASSESSMENT ORDER WERE UPHELD BY THE TRIBUNAL. THE PENALTY UNDER SUB-SECTION(2) OF SECTION 158BFA IS OPTIONAL UNLIKE THE INTEREST CHARGEABLE UNDER SUB-SECTION( 1 ) SINCE THE WORD USED IN SUB-SECTION (2) IS 'MAY': UNLIKE THE WORK 'SHALL' USED IN SUB-SECTION (1). HENCE, LEVY OF PENALTY IS UNWARRANTED 6 IN THIS CASE LOOKING THE OVERALL FACTS AND CIRCUMST ANCES OF THE CASE. THE DISCRETION MAY BE USED IN FAVOUR OF ASSES SEE JUDICIOUSLY. V. THE LEVY OF PENALTY BY NOW IS BARRED BY LIMITATI ON OF TIME ALLOWED OF SUCH LEVY. C) WITHOUT PREJUDICE TO OUR ABOVE LEGAL ARGUMENTS A GAINST THE LEVY OF PENALTY ON MERITS TOO WE HAVE TO RESPECTFULLY SUBMIT AS UND ER:- AS REGARDS THE ADDITION SUSTAINED BY THE ITAT ON AC COUNT OF UNEXPLAINED INVESTMENT, THE LEARNED A.O. HAS NOT IN ASSESSMENT ORDER RECORDED THAT THE EXPLANATION OF THE ASSESSEE IN REGARD TO SOURCE OF INVESTMENT WAS EITHER FALSE OR NOT BONAFIDE NOR ANY FINDING HAS BEEN RECORDED T HAT IT WAS A DEVICE OF CANALIZING ASSESSEES UNACCOUNTED INCOME. IN FACT THERE WAS NO SUCH INVESTMENT BY THE ASSESSEE. THE TRUE AND REAL FACT S OF THE CASE WERE NOT APPRECIATED DURING THE ASSESSMENT PROCEEDINGS. FUR THER UNDISCLOSED INCOME FROM THE NOTING IN THE REGISTER/DIARY HAVE ALREADY BEEN ASSESSED AS INCOME IN THE HANDS OF THE PERSONS SEARCHED SO THERE IS NO QU ESTION TO FURTHER ASSESSED THE SAME INCOME IN THE HANDS OF THE ASSESSEE. THIS VITAL ISSUE WAS NEVER CONFRONTED OR BROUGHT TO THE NOTICE OF THE TRIBUNAL . THE CIT (APPEALS) CENTRAL JAIPUR HAD APPRECIATED THE REAL FACTS AND HAS RIGHT LY DELETED THE ADDITION MADE BY THE AO LOOKING TO THE FACT THAT THE PENALTY U/S 158BFA(2) CANNOT BE LEVIED BY THE A.O. OR THE CIT (APPEALS) THERE WAS NO SCOPE TO LEVY SUCH PENALTY AFTER FIRST APPEAL. THE COPY OF SUBMISSION PLACED BEFORE THE CIT (APPEALS) ARE ENCLOSED HEREWITH FOR YOUR READY REFERENCE AND CONS IDERATION OF THE FACT OF THE CASE BEFORE LEVY OF PENALTY U/S 158BFA(2) OF THE I. T. ACT, 1961. THE ASSESSEE HAS PREFERRED TO TAKE FURTHER LEGAL AC TION AVAILABLE AS PER LAW AGAINST THE ADDITION SUSTAINED BY THE ITAT AND HENC E THE QUANTUM OF ASSESSMENT IS NOT YET FINAL. COPY OF MA FILED BEFORE THE ITAT, JODHPUR BENCH, JO DHPUR IS ENCLOSED HEREWITH WHICH PROVES THAT THE ADDITION SUSTAINED BY THE ITA T IS NOT ACCEPTABLE TO THE ASSESSEE. MERELY BECAUSE THE ADDITIONS HAVE BEEN UPHELD DOES NOT IPSO FACTO ATTRACT LEVY OF PENALTY U/S 158BFA(2). THE VERY EXPRESSION OF CO NCEALMENT IMPLIES THAT IT MUST SHOW MALAFIDE INTENT ON THE PART THE ASSESSEE TO HIDE OR SUPPRESS HIS INCOME WITH A VIEW TO EVADE TAX. HENCE, THIS ALSO APPEARS TO BE A BONAFIDE EXPLANATI ON AND PENALTY WAS NOT LEVIABLE IN THIS CASE. THEREFORE, THE PENALTY UND ER SECTION 158BFFA(2) IS NOT EXCISABLE/LEVIABLE IN THIS CASE EVEN ON MERITS. 7 THEREFORE, IT IS RESPECTFULLY REQUESTED THAT THE PE NALTY PROCEEDINGS SO INITIATED MAY PLEASE BE DROPPED. 4. THE ASSESSING OFFICER, HOWEVER, DID NOT FIND ANY MERIT IN THE EXPLANATION GIVEN BY THE ASSESSEE AND OBSERVED AS U NDER:- A) THE ADDITION MADE TO THE EXTENT OF RS. 7,44,94 7/- FOR A.Y. 1989-99 AND RS. 1,26,989/- FOR A.Y. 1999-2000 AS ST ATED ABOVE WERE CONFIRMED BY THE HON'BLE ITAT VIDE ITS APPELLATE OR DER DATED 22/09/2006. THESE WERE TO BE DISCLOSED BY THE ASSE SSEE IN HIS RETURN OF INCOME. A) THE DIFFERENCE IN BLOCK RETURN CANNOT BE SAID DU E TO INADVERTENT IN TAKING UP THE PHOTOCOPIES OF THE SEI ZED PAPERS. AS A RESULT OF ADDITION SUSTAINED OF RS. 8,71,935/ - TO THE DECLARED UNDISCLOSED INCOME AT NIL AFTER GIVING APPEAL EFFEC T TO THE ORDER OF HON'BLE ITAT PENALTY U/S 158BFA(2) IS LEVIABLE. TH E RELEVANT PORTION OF SECTION IS AS UNDER:- . WHERE THE UNDISCLOSED INCOME DETERMINED BY T HE AO IS IN EXCESS OF THE INCOME SHOWN IN THE RETURN AND IN SUC H CASES THE PENALTY SHALL BE IMPOSED ON THAT PORTION OF UNDISCL OSED INCOME DETERMINED WHICH IS IN EXCESS OF THE AMOUNT OF UNDI SCLOSED INCOME SHOWN IN THE RETURN. ON CAREFUL ANALYSIS OF SECTION 271(1) (C) VIS-A-VI S SECTION 158BFA, IT TRANSPIRES THAT OBJECTIVE SATISFACTION OF A.O. REQU IRING CONCEALMENT OF INCOME IS NECESSARY IN PROCEEDINGS U/S 271(1)(C) . THE WORDS IF THE A.O. IN THE COURSE OF ANY PROCEEDING UNDER THE ACT IS SATISFIED THAT ANY PERSON HAS CONCEALED.. AS PREVALENT IN SECTION 271(1)(C) ARE MISSING IN SECTION 158BFA OF THE ACT. THE ONLY REQUIREMENT FOR LEVY OF PENALTY U/S 158BFA IS THAT UNDISCLOSED INCO ME DETERMINED BY THE A.O. IS IN EXCESS OF THE INCOME SHOWN IN RETURN . THEREFORE THE LAWMAKERS IN THEIR WISDOM HAVE USED FOLLOWING TERMS IN UNAMBIGUOUS MANNER. .. AND IN SUCH CASES THE PENALTY SHALL BE IMPO SED ON THAT PORTION OF UNDISCLOSED INCOME DETERMINED WHICH IS I N EXCESS OF THE AMOUNT OF UNDISCLOSED INCOME SHOWN IN THE RETURN. (REFERENCE IS INVITED TO SECOND PROVISO OF SUB-SEC TION (2) OF SECTION 158BFA OF THE ACT) 8 KEEPING IN VIEW LEGAL POSITION DISCUSSED AS ABOVE, PENALTY U/S 158BFA (2) IS LEVIABLE ON THE UNDISCLOSED INCOME DE TERMINED BY THE A.O. WHICH IS IN EXCESS OF THE INCOME SHOWN IN THE RETURN. THE ASSESSEE HAS SHOWN UNDISCLOSED INCOME AT RS. N IL IN HIS RETURN. HOWEVER, AFTER GIVING THE EFFECT TO THE HON'BLE ITA T, JODHPUR BENCH, JODHPURS ORDER DATED 22/09/2006 REFERRED AB OVE, THE UNDISCLOSED INCOME WAS DETERMINED AT RS. 8,71,935/- . IN VIEW OF ABOVE FACT I HOLD THAT ASSESSEE HAS COM MITTED DEFAULT AS ENVISAGED BY SECTION 158BFA(2) AND FOR THIS DEFAULT PENALTY IS LEVIABLE. I AM OF THE OPINION THAT THERE IS CONSCI OUS CONCEALMENT ON THE PART OF THE ASSESSEE WHICH IS NOT ACCIDENTAL OR UNINTENTIONAL BUT CONCEALMENT OF THE INCOME WITH A GUILTY MIND TO EVA DE OR AVOID TAX. IT AROSE FROM WILLFUL NEGLECT ON HIS PART WHICH WAS DISCOVERED BY ACTION 132 AND OTHERWISE IT COULD HAVE NEVER BEEN D ISCLOSED BY THE ASSESSEE, THEREFORE HE HAD CONCEALED THE TRUE PARTI CULARS OF HIS INCOME. THEREFORE THE ASSESSEE IS HELD GUILTY OF CONCEALME NT OF INCOME TO THE EXTENT OF RS. 8,71,935/- BY CONCEALING THE PART ICULARS OF INCOME AND LIABLE FOR PENALTY U/S 158BFA(2)F OF THE ACT. THE PENALTY IMPOSABLE IS @ 100% OF AMOUNT OF TAX LEVIABLE I.E. RS. 5,23,160/- TO 300% I.E. RS. 15,69,480/- IN THE FACTS OF THE CASE. I IMPOSE PENALTY OF RS. 5,23,160/- WHICH IS EQUAL TO AMOUNT OF TAX L EVIABLE AS PER PROVISIONS OF SECTION 158BFA (2) OF I.T.ACT AFTER P ROVIDING HIM DUE AND REASONABLE OPPORTUNITIES OF BEING HEARD TO THE ASSESSEE AS DISCUSSED ABOVE IN THIS PENALTY ORDER. CHARGE PENA LTY OF RS. 5,23,160/- U/S 158BFA (2) OF THE ACT FOR A.Y. 1989- 90 TO 1998-99 AND UPTO 18/12/1998. 5. BEING AGGRIEVED, ASSESSEE CARRIED THE MATTER TO TH E LEARNED CIT(A), WHO OBSERVED THAT AFTER TRAVELLING THROUGH THE APPE AL CHANNEL AND GIVING EFFECT TO THE ORDER OF ITAT JODHPUR BENCH, JODHPUR DATED 22/09/2006, FINALLY THE UNDISCLOSED INCOME WAS DETERMINED AT RS . 8,71,935/-, WHICH WAS CONSIDERED BY THE ASSESSING OFFICER AS CONCEALE D INCOME AND PENALTY 9 OF RS. 5,23,160/- BEING 100% OF THE TAX LEVIABLE WA S IMPOSED. HE FURTHER OBSERVED THAT THE ONLY REQUIREMENT FOR LEVY OF PENA LTY UNDER SECTION 158BFA(2) OF THE ACT WAS THAT NON-DISCLOSED INCOME DETERMINED BY THE ASSESSING OFFICER WAS IN EXCESS OF THE INCOME SHOWN IN THE RETURN. HE FURTHER OBSERVED THAT ASSESSING OFFICER HAD CORRECT LY HELD THAT THE ASSESSEE HAD CONCEALED THE INCOME TO THE EXTENT OF RS. 8,71,935/- AND WAS JUSTIFIED IN IMPOSING PENALTY OF RS. 5,23,160/- . ACCORDINGLY, PENALTY LEVIED BY THE ASSESSING OFFICER WAS CONFIRMED. NOW , ASSESSEE IS IN APPEAL. 6. LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SU BMISSIONS MADE BEFORE THE AUTHORITIES BELOW AND FURTHER SUBMITTED THAT AGAINST THE ORDER OF ITAT DATED 22/09/2006, ASSESSEE PREFERRED A MISC ELLANEOUS APPLICATION, WHEREIN MISTAKE RELATING TO THE ADDITI ON ON ACCOUNT OF TOTAL SALES OUT OF THE BOOKS OF ACCOUNTS WAS RECTIFIED AN D ONLY GP RATE ON THE UNDISCLOSED SALES WAS DIRECTED TO BE ADDED ON ESTIM ATE BASIS. IT WAS ALSO SUBMITTED THAT NOW, THE ADDITION REMAINED ONLY ON E STIMATE BASIS, THEREFORE, THE PENALTY UNDER SECTION 158BFA(2) OF T HE ACT WAS NOT LEVIABLE. RELIANCE WAS PLACED ON THE JUDGMENT OF H ON'BLE JURISDICTION OF HIGH COURT IN THE CASE OF CIT VS. D.R. GIRIRAJ AGARWAL GIRI REPORTED IN (2012) 253 CTR (RAJ) 109 . ANOTHER RELIANCE WAS PLACED ON THE DECISION OF 10 ITAT JAPUR BENCH IN THE CASE OF SADHU RAM GOYAL VS. DCIT REPORTED IN (2012) 144 TTJ (JP) 111. 7. IN HIS RIVAL SUBMISSIONS, LD. D.R. ALTHOUGH SUPPOR TED THE ORDER OF THE AUTHORITIES BELOW, BUT COULD NOT CONTROVERT THE AFO RESAID CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE. 8. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PA RTIES AND CAREFULLY PERUSING THE MATERIAL AVAILABLE ON RECORD, IT APPEA RS THAT NOW THE ADDITION SUSTAINED REMAINED ONLY ON ESTIMATE BASIS ON ACCOUNT OF GP ON SALES OUTSIDE THE BOOKS OF ACCOUNTS. ON A SIMILAR ISSUE, THEIR LORDSHIPS OF THE HON'BLE JURISDICTIONAL OF HIGH COURT IN THE CAS E OF CIT VS. D.R. GIRIRAJ AGARWAL GIRI REPORTED IN (2012) 253 CTR (RAJ) 109 OBSERVED IN PARA 9 OF THE SAID ORDER AS UNDER:- 9. SO FAR AS THE CASE LAW REFERRED BY THE LEARNED COUNSEL FOR APPELLANT IS CONCERNED, IT IS SUFFICIENT TO MENTION THAT THE HON'BLE APEX COURT IN UNION OF INDIA VS. DHARAMENDRA TEXTIL E PROCESSORS (SUPRA), WAS DEALING WITH THE PROVISIONS OF CENTRAL EXCISE ACT, 1944 AND LEARNED COUNSEL FOR APPELLANT IS UNABLE T O POINT OUT THAT THE PROVISIONS OF S. 11AC OF CENTRAL EXCISE ACT, 19 44 AND S. 158BFA(2) OF THE IT ACT ARE PARI MATERIA. THAT APA RT, IT IS ALSO RELEVANT TO MENTION THAT IMPOSITION OF PENALTY DEPE NDS ON FACTS AND CIRCUMSTANCES OF EACH CASE. IN THE PRESENT CAS E, THE AO IMPOSED THE PENALTY ON SO-CALLED THREE ITEMS OF SO- CALLED CONCEALED INCOME. EACH ITEM WAS EXAMINED, THOROUGH LY AND IN DETAIL, BY THE CIT(A) AS WELL AS THE TRIBUNAL AND B Y A REASONED ORDER, BOTH CAME TO A CONCLUSION THAT ADDITIONS ARE BASED ON 11 ESTIMATION ONLY. A FACT OR ALLEGATION BASED ON ESTI MATION, CANNOT BE SAID TO BE CORRECT ONLY, IT CAN BE INCORRECT ALS O. THEREFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, PENALTY WA S WRONGLY IMPOSED BY THE AO. IN THESE CIRCUMSTANCES, WE FIND THAT THE JUDGMENT OF HON'BLE APEX COURT, REFERRED BY THE LEA RNED COUNSEL FOR APPELLANT, IS NOT APPLICABLE, IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. 9. ON A SIMILAR ISSUE, THE ITAT JAIPUR BENCH, JAIPUR IN THE CASE OF SADHU RAM GOYAL VS. DCIT REPORTED IN (2012) 144 TT J (JP) 111 (SUPRA) HELD THAT THE TRIBUNAL HAVING CONFIRMED THE ADDITIO N MADE BY THE ASSESSING OFFICER ON ACCOUNT OF ESTIMATED GROSS PRO FIT MERELY ON THE BASIS THAT THE ENTRIES FOUND IN THE LEDGER ACCOUNT FOUND IN THE POSSESSION OF THE THIRD PARTY PERTAINS TO THE ASSESSEE AND NOT ON THE BASIS OF ANY MATERIAL FOUND IN THE POSSESSION OF THE ASSESSEE DU RING THE SEARCH, PENALTY UNDER SECTION 158BFA(2) OF THE ACT WAS NOT LEVIABLE. IN THE PRESENT CASE ALSO, SINCE THE REMAINING ADDITION AFT ER THE ORDER OF THIS BENCH OF THE TRIBUNAL DATED 30/08/2013 IN M.A.NO. 3 0/JODH/2013 FILED AGAINST THE ORIGINAL ORDER, REMAINED ON ESTIMATE BA SIS, THEREFORE, PENALTY UNDER SECTION 158BFA(2) OF THE ACT WAS NOT LEVIABLE . 10. CONSIDERING THE TOTALITY OF THE FACTS AS NARRAT ED HEREIN ABOVE, THE PENALTY LEVIED BY THE ASSESSING OFFICER AND SUSTAIN ED BY THE LEARNED CIT(A) IS DELETED. 12 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. (ORDER PRONOUNCED IN THE COURT ON 16 TH SEPTEMBER, 2013). (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 16 TH SEPTEMBER, 2013. VR/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE LD.CIT 4. THE CIT(A) 5. THE D.R ASSISTANT REGISTRAR, ITAT, JODHPUR.