Shri Sendhabhai G.Makwana L/h of Late Gandabhai A.Makwana, Gandhinagar V. The Income Tax Officer, Ward-2, Gandhinagar

ITSSA 21/AHD/2015

• Counselvise Citation: [2017] 122 COUNSELVISE.COM (IT) 3438 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 22 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 10-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2008-2009
• Appeal Filed On: 19-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR ANUPAMA SINGALA
• Assessee Lawyers: ANKIT M TALSANIA
• Keywords: Unexplained investment

Judgement Text

, .. , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD .., , BEFORE SHRI S.S. GODARA, JUDICIAL MEMBER & SHRI PRADIP KUMAR KEDIA, ACCOUNTANT MEMBER (SS) ./ IT(SS)A NO.21/AHD/2015 ( / ASSESSMENT YEAR : 2008-09) SENDHABHAI G.MAKWANA L/H. OF LATE GANDABHAI A.MAKWANA MAHADEV VAS AT & POST: ADALAJ DIST. GANDHINAGAR / VS. THE ITO WARD(2) GANDHINAGAR $ ./ ./ PAN/GIR NO. : BALPM 7617 K ( $' / APPELLANT ) .. ( ($' / RESPONDENT ) $') / APPELLANT BY : SHRI ANKIT M. TALSANIA, AR ($'*) / RESPONDENT BY : DR.ANUPAMA SINGALA, SR.DR +,*- / DATE OF HEARING 06/11/2017 ./0*- / DATE OF PRONOUNCEMENT 10 / 11 /2017 / O R D E R PER PRADIP KUMAR KEDIA - AM: THE CAPTIONED APPEAL HAS BEEN FILED AT THE INSTAN CE OF THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)- GANDHINAGAR [CIT(A) IN SHORT] DATED 25/08/2014 RELEVANT TO ASS ESSMENT YEAR (AY) 2008-09 WHEREIN THE PENALTY IMPOSED UNDER S.271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'T HE ACT') BY THE IT(SS)A NO.21/A HD/2015 SENDHABHAI G.MAKWANA L/H. OF LATE GANDABHAI A.MAKWANA VS. ITO ASST.YEAR 2008-09 - 2 - ASSESSING OFFICER (AO) TO THE EXTENT OF ADDITION OF RS.5,33,000/- WAS SUSTAINED AND PENALTY WAS QUANTIFIED AT RS.1,32,870 /-. 2. BRIEFLY STATED, A SEARCH ACTION UNDER S.132 OF THE ACT WAS CARRIED IN THE CASE OF ASSESSEE ON 15/10/2008. A NOTICE UN DER S.153A OF THE ACT WAS ISSUED TO THE ASSESSEE. THE ASSESSMENT WAS FRA MED UNDER S.153A OF THE ACT. THE AO OBSERVED IN THE COURSE OF ASSESSME NT THAT ASSESSEE HAS MADE SUBSTANTIAL INVESTMENT IN VARIOUS ASSETS SUCH AS LIC AND CONSTRUCTION OF HOUSE ETC. THE ASSESSEE EXPLAINED BEFORE THE AO THAT AFORESAID UNEXPLAINED INVESTMENT WERE MADE FROM THE CASH PORTION OF THE SALE PRICE RECEIVED ON SALE OF AGRICULTURAL LAND BY THE ASSESSEE. THE AO, HOWEVER, FOUND THAT THE PURCHASERS OF THE LAND HAVE DENIED TO HAVE MADE ANY CASH PAYMENT FOR PURCHASE OF LAND FROM THE ASSE SSEE. NO CORROBORATIVE EVIDENCE SUCH AS CONFIRMATION FROM TH E PURCHASER WAS FOUND TO BE PLACED ON RECORD BY THE AO. THE AO ACC ORDINGLY MADE CERTAIN ADDITIONS TOWARDS UNEXPLAINED INVESTMENT AN D INITIATED PENALTY PROCEEDINGS THEREON. 3. THE MATTER TRAVELLED UPTO ITAT IN THE QUANTUM P ROCEEDINGS WHERE THE ADDITION ON INVESTMENT TO THE EXTENT OF RS.5,33 ,000/- FROM UNEXPLAINED SOURCES WAS BROUGHT DOWN TO RS.1.83 LAK HS. IT(SS)A NO.21/A HD/2015 SENDHABHAI G.MAKWANA L/H. OF LATE GANDABHAI A.MAKWANA VS. ITO ASST.YEAR 2008-09 - 3 - 4. IN THE CAPTIONED APPEAL, THE ASSESSEE HAS CHALLE NGED THE IMPOSITION OF PENALTY OF RS.1,32,870/- ON INVESTMENT OF RS.5,3 3,000/- DETERMINED BY THE REVENUE TO HAVE BEEN MADE FROM UNEXPLAINED SOUR CES. 5. WITH THE ASSISTANCE OF THE LD.AR FOR THE ASSESSE E, WE NOTICE THAT QUANTUM APPEAL HAS BEEN PARTLY DECIDED IN FAVOUR OF ASSESSEE IN ITA NO.8/AHD/2012 & ORS. VIDE ORDER DATED 16/12/2016. AS POINTED OUT ON BEHALF OF THE ASSESSEE, UNEXPLAINED SOURCES STANDS AT RS.1.83 LAKHS ONLY AS AGAINST RS.5.33 LAKHS ON WHICH PENALTY IS APPEA LED AGAINST. THEREFORE, THE PENALTY ON THE DIFFERENTIAL AMOUNT C ANNOT BE LEVIED. THIS LEAVES US WITH THE QUESTION OF CORRECTNESS OF PENAL TY ON REMAINING AMOUNT OF RS.1.83 LAKHS. IN THIS REGARD, WE FIND T HAT ASSESSEE HAS MADE HUGE INVESTMENTS IN LIC POLICIES AND CONSTRUCTION O F HOUSE, PURCHASE OF LAND ETC. NO SATISFACTORY EXPLANATION THEREOF TOWA RDS SOURCE OF INVESTMENT WAS GIVEN BY THE ASSESSEE. THE ASSESSEE HAS FAILED TO PRODUCE ANY COGENT EVIDENCE TOWARDS SOURCE OF UNEXPLAINED I NVESTMENT. GIVING UTMOST CONSIDERATION AND LATITUDE, THE BENEFIT OF D OUBT TOWARDS POSSIBLE GENERATION OF SOURCE OF CASH WAS GIVEN HAVING REGAR D TO THE AGRICULTURAL LAND HELD BY THE ASSESSEE. IN THESE CIRCUMSTANCES, DESPITE GIVING ALL POSSIBLE ALLOWANCE AND CONCESSIONS TO THE ASSESSEE, THE UNEXPLAINED INVESTMENT TO THE EXTENT OF RS.1.83 LAKHS CONTINUES TO REMAIN UNPROVED. THERE ARE NO PLAUSIBLE EVIDENCES ON RECORD TO SUPPO RT THE INVESTMENTS FOUND TO BE MADE. UNDER THE CIRCUMSTANCES, WE DECL INE TO INTERFERE WITH IT(SS)A NO.21/A HD/2015 SENDHABHAI G.MAKWANA L/H. OF LATE GANDABHAI A.MAKWANA VS. ITO ASST.YEAR 2008-09 - 4 - THE ORDER OF THE CIT(A) CONFIRMING THE PENALTY TO T HE EXTENT OF UNEXPLAINED INVESTMENT QUANTIFIED AS A RESULT OF TR IBUNAL ORDER. THUS, THE QUANTUM OF PENALTY STANDS MODIFIED QUA THE CHAN GES IN THE QUANTUM OF THE UNEXPLAINED INVESTMENT SO DETERMINED. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED. THIS ORDER PRONOUNCED IN OPEN COURT ON 10/ 11 /2017 SD/- SD/- (..) ( ) ( S.S. GODARA ) ( PRADIP KUMAR KEDIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 10/ 11 /2017 4..+,.+../ T.C. NAIR, SR. PS !'#$%&%# / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ($' / THE RESPONDENT. 3. 567- 8- / CONCERNED CIT 4. 8- ( ) / THE CIT(A)-GANDHINAGAR 5. 9:-+67 , 670 , 5 / DR, ITAT, AHMEDABAD 6. <, / GUARD FILE. / BY ORDER, (9-- //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 9.11.17(DICTATION-PAD 8- PA GES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 10.11.17 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.10.11.17 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 10.11.17 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. IT(SS)A NO.21/A HD/2015 SENDHABHAI G.MAKWANA L/H. OF LATE GANDABHAI A.MAKWANA VS. ITO ASST.YEAR 2008-09 - 5 - 10. DATE OF DESPATCH OF THE ORDER