Satish Kumar, Bangalore v. ACIT, Bangalore

ITA 1105/BANG/2009 | 2000-2001
Pronouncement Date: 03-03-2010 | Result: Partly Allowed

Appeal Details

RSA Number 110521114 RSA 2009
Assessee PAN ECTOF3250G
Bench Bangalore
Appeal Number ITA 1105/BANG/2009
Duration Of Justice 3 month(s) 13 day(s)
Appellant Satish Kumar, Bangalore
Respondent ACIT, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 03-03-2010
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted B
Tribunal Order Date 03-03-2010
Date Of Final Hearing 24-02-2010
Next Hearing Date 24-02-2010
Assessment Year 2000-2001
Appeal Filed On 20-11-2009
Judgment Text
THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH B BEFORE DR. O.K NARAYANAN VICE PRESIDENT AND SHRI GEORGE GEORGE K JUDICIAL MEMBER ITA NOS.1104 TO 1110/BAN G/2009 (ASST. YEARS -1999 -00 TO 2005-06) SHRI SATISH KUMAR SITE NO.31 KARANJIA GRACE III FLOOR S-2 T.P VENUGOPAL LAYOUT ANANDANAGAR . APPELLANT VS. THE ASST. COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE-1(2) BANGALORE. . RESPONDENT APPELLANT BY : NONE RESPONDENT BY : SMT. V.S SREELEKHA O R D E R PER GEORGE GEORGE K JUDICIAL MEMBER 1. THESE ARE SEVEN APPEALS PREFERRED BY THE ASSESS EE WHICH ARE DIRECTED AGAINST THE CONSOLIDATED ORDER OF THE CIT( A)-VI BANGALORE IN ITA NOS: 122 121 120 123 119 114 & 115/ACIT-CC 1(2)/CIT(A)-V I/07-08 DATED: 23.9.2009 CONFIRMING THE PENALTY IMPOSED U/S 271(1 )(C) OF THE ACT FOR THE ASSESSMENT YEARS (AYS) 1999-00 TO 2005-06. ITA NOS.1104 TO 1110/B/09 2 2. THE ASSESSEE HAS RAISED SEVEN IDENTICAL GROUNDS FOR ALL THE AYS UNDER DISPUTE. ON A PERUSAL GROUND NOS: 1 AND 7 W ERE GENERAL IN NATURE AND NO SPECIFIC ISSUES INVOLVED AND AS SUCH THEY WERE CO NSIDERED AS NON-CONSEQUENTIAL. IN THE REMAINING GROUNDS THE CRUXES OF THE ISSUES RAISED ARE TWO-FOLDS VIZ. (I) THE AO ERRED IN ASSUMING JURISDICTION U/S 271(1)(C) OF THE ACT AND BEING NO PROPER JURISDICTION THE IMPUGNED ORDERS WERE BAD IN LAW AND LIABLE TO BE QUASHED; (II) THE CIT(A) HAS ERRED IN PASSING THE IMPUGNED ORDER WITHOUT APPRECIATING THE FACTS AND ERRED IN HOLDING THAT THE LEGALITY OF THE ASSESSMENT ORDERS WERE NOT AN I SSUE DURING THE PENALTY PROCEEDINGS. 3. AS THE ISSUES RAISED FOR ALL THE AYS UNDER DISP UTE WERE IDENTICAL THESE APPEALS WERE HEARD CONSIDERED TOGETHER AND D ISPOSED OFF IN THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE AND CLARITY. 4. BRIEFLY STATED THE FACTS ARE AS FOLLOWS : THE ASSESSEE AN INDIVIDUAL WAS CARRYING ON T HE BUSINESS IN JEWELLERY AND PAWN BROKING. THERE WAS AN ACTION U /S 132 OF THE ACT ON 23.7.2004 IN THE PREMISES OF THE ASSESSEES FATHER S.P.NARASIMHULU AND HIS ASSOCIATES. DURING THE COURSE OF SEARCH OPERATION VARIOUS INCRIMINATING DOCUMENTS SUCH AS BOOKS OF ACCOUNT DOCUMENTS CASH AND JEWELLERY BELONGING TO THE ASSESSEE WERE UNEARTHED. ON VERIFICATION OF TH E SEIZED MATERIALS IT WAS ALLEGED THAT THE ASSESSEE HAD MADE CERTAIN INVESTME NTS IN THE FORM OF DEPOSITS WITH MARGADARSHI CHIT FUNDS AND ALSO CERTAIN ADVANC ES. IN COMPLIANCE TO THE NOTICE U/S 153C RWS 153A THE ASSESSEE HAD FURNISHE D RETURNS OF INCOME FOR THE AYS UNDER DISPUTE DISCLOSING THE TOTAL INCOMES OF RS.46000/- RS.40000/- ITA NOS.1104 TO 1110/B/09 3 RS.40000/- RS.47000/- RS.57000/- RS.63000/- AND FOR THE AY 2005-06 IN RESPONSE TO NOTICE U/S 142(1) OF THE ACT ADMITTING A TOTAL INCOME OF RS.115500/- RESPECTIVELY. AFTER DELIBERATING THE ISSUES AT LEN GTH AND ALSO TAKING INTO ACCOUNT THE ASSESSEES CONTENTIONS THE AO HAD CONCLUDED TH E ASSESSMENT ORDERS BRINGING TO TAX UNDER THE HEADS INCOME FROM OTHER SOURCE INVESTMENT IN DEPOSITS/IN THE FORM OF ADVANCE INTEREST ON DEPOSITS UNACCOUNTED GOLD/SILVER ETC. - FOR THE REASONS SET-OUT IN THE RESPECTIVE ASSESSMENT ORDERS FOR THE AYS UNDER DISPUTE. SIMULTANEOUSLY HE HAD ALSO INITIATED PENAL PROCEED INGS U/S 271(1)(C) OF THE ACT FOR THE AYS UNDER CHALLENGE. 5. AFTER ANALYZING THE CONTENTIONS MADE BY THE ASS ESSEE DURING THE COURSE OF PENALTY PROCEEDINGS THE AO WENT AHEAD WI TH IMPOSING OF PENALTIES U/S 271(1)(C) OF THE ACT FOR THE REASONS RECORDED IN TH E IMPUGNED PENALTY ORDERS FOR ALL THE AYS UNDER CHALLENGE. 6. AGITATED THE ASSESSEE TOOK UP THE TWIN ISSUES (I) CHALLENGING THE ASSUMPTION OF JURISDICTION BY THE AO AND (II) IMPOS ING OF PENALTIES U/S 271(1)(C) OF THE ACT BEFORE THE LD. CIT(A) FOR REDRESSAL. I. LET US NOW PROCEED TO ANALYZE THE TWIN ISSUES SER IALLY. 7. AFTER GIVING DUE WEIGHT-AGE TO THE SUBMISSION OF THE ASSESSEE THE RELEVANT PORTIONS OF THE OBSERVATION OF THE CIT (A) ARE EXTRACTED AS UNDER - 3.2.IT IS NOTICED THAT THE AO IN THE ASST. ORDER SERVED TO THE APPELLANT HAS INITIATED THE PENALTY PROCEEDINGS BY MENTIONING THAT PENALTY PROCEEDINGS U/S 271(1)(C) INITIATED SEPARATELY. IT IS APPARENT FROM THE ASSESSMENT ORDER THAT EVEN THOUGH THE SIGNATURE OF THE AO ARE PRIOR TO THE INITIATION OF PENALTY PROCEEDINGS HOWEVER IT IS NOT IN DISPUTE THAT THE NOTICE U/S 271(1)(C) WAS ISSUED ALONG WITH THE ASSESSMENT ORDER TO THE APPELLANT. THE APPELLANT RECEIVED THE NOTICE INITIATING PENALTY ALONG WITH THE ASSESSMENT ORDER. EXTENSIVELY QUOTING THE S. 271(1)(C)OF THE ACT THE CIT (A) HAD OBSERVED THUS ITA NOS.1104 TO 1110/B/09 4 3.3. SO THE ONLY CONDITION FOR INITIATING THE PENALTY IS THE SATISFACTION OF THE AO DURING THE COURSE OF THE ASST. PROCEEDING. IN THE CASE OF APPELLANT IT IS CLEAR THAT THE AO DURING THE COURSE OF ASST. PROCEEDINGS WAS S ATISFIED IN REGARD TO THE DEFAULT COMMITTED BY THE APPELLANT UNDER CLAUSE (C) OF SUB- SECTION (1) OF S.271. HE ALSO RECORDED HIS SATISFACTION WHILE PASSING THE ASST. O RDER. HOWEVER IT APPEARS THAT AT THE TIME OF TYPING THE ORDER THE INITIATION OF THE PENALTY WAS RECORDED AFTER THE SIGNATURE OF THE AO. THIS MISTAKE IS NOT SUFFICIEN T TO PROVE THAT THE SATISFACTION WAS NOT RECORDED BY THE AO; IT IS ALSO PROVED FROM THE FACT THAT PENALTY NOTICE WAS ISSUED AND SERVED ALONG WITH THE ASSESSMENT ORDER IN QUEST ION. AFTER INSERTION OF SUB-SEC. (1B) TO S. 271 IT IS CLEAR THAT WHERE ANY AMOUNT IS ADDED OR DISALLOWED IN COMPUTING HE TOTAL INCOME OR LOSS OF AN ASSESSEE IN ANY ORDER OF ASSESSMENT OR REASSESSMENT AND THE SAID ORDER CONTAINS A DIRECTION FOR INITIATION OF PENALTY PROCEEDINGS UNDER CLAUSE (C) OF SUB-SECTION 1 OF S.271 SUCH AN ORDER OF ASS ESSMENT OR REASSESSMENT SHALL BE DEEMED TO CONSTITUTE SATISFACTION OF THE AO FOR THE IGNITION OF PENALTY PROCEEDINGS. IN THE CASE OF THE APPELLANT THE ADDITION ON ACCOUNT OF UNEXPLAINED CREDIT HAS BEEN MADE U/S 68 TO THE TOTAL INCOME AND ALSO THE DIRECTION F OR INITIATION OF PENALTY PROCEEDINGS U/S 271(1)(C) HAS BEEN RECORDED THEREFORE IT CANN OT BE SAID THAT THE NOTICE HAS BEEN ISSUED WITHOUT RECORDING THE PROPER SATISFACTION. 3.4 IN THE CASE OF THE APPELLANT THE NOTICE U/S 271(1) (C)WAS ISSUED IN CONFORMITY WITH THE PROVISIONS AND ACCORDING TO THE INTENT AND FOR THE PURPOSE OF THE I.T. ACT. THEREFORE THE SAME IS ACCORDING TO THE PROVISIONS OF THE I.T. ACT. 3.5. THE LUCKNOW TRIBUNAL IN THE CASE OF ACIT V. DE EPAK AGARWAL (2009) 17 DTR (LUCKNOW-TRIB) 220 HELD THAT IT IS NOT NECESSARY THAT THERE SHOULD BE DEFINITE W ORDS THE AO SHOULD WRITE AT THE END OF THE ASST. ORDER T HAT HE IS ARRIVING AT THE SATISFACTION ABOUT CONCEALING PARTICULARS OF INCOME OR FURNISHIN G INACCURATE PARTICULARS OF INCOME BY THE APPELLANT OR THAT CASE OF THE APPELLANT IS F ALLING WITHIN THE AMBIT OF MAIN S.271(1)(C) OR IN THE EXPLN. WHAT IS NECESSARY IS THAT IF SUCH SATISFACTION CAN BE CULLED OUT OR IS DISCERNIBLE FROM THE BODY OF THE ASST. OR DER THEN IT WOULD BE SUFFICIENT COMPLIANCE OF LAW. IF THE SATISFACTION OF THE AO I S DISCERNIBLE FROM THE BODY OF THE ASST. ORDER THEN IT WOULD BE SUFFICIENT COMPLIANCE OF LAW. IN THE PRESENT CASE SUCH ITA NOS.1104 TO 1110/B/09 5 SATISFACTION IS CLEARLY DISCERNIBLE. THEREFORE TH ERE IS NOT MERIT IN THE GROUND RAISED BY THE APPELLANT IN THIS REGARD. IN THE CASE OF THE APPELLANT ALSO THE SATISFACTION IS DISCERNIBLE FROM THE ASST. ORDER. 3.6. THE APPELLANTS ARGUMENT THAT THE ORDER PASS ED U/S 153C OF THE ACT IS ILLEGAL AND THEREFORE THE PENALTY PROCEEDINGS INITIATED I N CONSEQUENCE TO SUCH ORDER IS ALSO ILLEGAL IS NOT ACCEPTABLE IN VIEW OF THE REASONS G IVEN BELOW: (I) THE ASST. ORDER PASSED BY THE AO U/S 153 RWS 143(3) FOR AYS 99-00 TO 04-05 AND ASST. ORDER PASSED U/S 143(3 ) FOR AY 05-06 HAVE BEEN ACCEPTED BY THE APPELLANT BY N OT FILING ANY APPEAL AGAINST THE ASST. ORDER; (II) PROCEEDINGS U/S 271(1) (C) ARE IN CONSEQUENCE TO TH E SATISFACTION OF THE AO IN CONSEQUENCE TO THE PROCEE DINGS UNDER THE ACT. ONCE THE AO IS SATISFIED AND THE NOT ICE U/S 271(1)(C) IS ISSUED THE PROCEEDINGS ARE VALID; (III) THE PRESENT APPEALS ARE AGAINST THE ORDER PASSED U/ S 271(1) (C) AND NOT AGAINST THE ASST. ORDER PASSED U /S 153C RWS 143(3) OF I.T. ACT. THEREFORE THE ISSUE HERE FOR DECISION IS THE LEVY OF PENALTY U/S 271(1)(C) AND N OT THE LEGALITY OF ASST. ORDER AS THE ASSESSMENT ORDER HAS ALREADY BEEN ACCEPTED BY THE APPELLANT; & (IV) THE APPELLANTS RELIANCE ON THE DECISION IN THE CAS E OF MANISH MAHESWARI (QUOTED SUPRA) IS NO HELP TO THE APPELLANT AS THE APPELLANT HAS NEVER QUESTIONED TH E ILLEGALITY OF THE ASST. ORDER PASSED U/S 153C RWS 1 43(3) WHICH HAVE BECOME FINAL IN THE ABSENCE OF ANY APPEA L AGAINST THE SAID ORDER. IN VIEW OF THE REASONS GIVEN ABOVE THE ABOVE GROUN DS ARE NOT SUSTAINABLE IN LAW AND THEREFORE DISMISSED. ITA NOS.1104 TO 1110/B/09 6 7.1. BEFORE US THE LD. A R HAD VEHEMENTLY CONTEND ED THAT (I) THE AO HAD ERRED IN ASSUMING JURISDICTION U/S 271(1 )(C) OF THE ACT. THERE BEING NO PROPER JURISDICTION AT ALL THE IMPU GNED ORDER WAS BAD IN LAW AND WAS LIABLE TO BE QUASHED. THE LD. CIT (A) HAS INSTEAD OF QUASHING THE ORDER ERRED IN CONFIRMING THE SAME; - IN ANY CASE WITHOUT PREJUDICE INITIATION OF PEN ALTY BASED ON AN ASST. ORDER WITHOUT A PROPER SATISFACTION NOTE BECOMES BA D IN LAW AND WAS LIABLE TO BE QUASHED; (II) THE LD. CIT(A) HAS ERRED IN PASSING THE APPELL ATE ORDER- - WITHOUT FULLY APPRECIATING AND CONSIDERING THE C ONTENTIONS RAISED IN THE COURSE OF APPELLATE PROCEEDINGS AND BY WRITT EN SUBMISSION; - HOLDING THAT THE LEGALITY OF ASST. ORDER WAS NOT AN ISSUE DURING THE PENALTY PROCEEDINGS AND THE CONCLUSION DRAWN BY HIM WAS NOT SUPPORTED BY LAW; (III) WITHOUT PREJUDICE THE AO HAD ERRED IN LEVYING PENA LTY AND THE CIT(A) ALSO ERRED IN CONFIRMING THE SAME. THE ASSESSEE HAD NEITHER CONCEALED THE PARTICULARS OF INCOME NOR HAD HE FURNISHED ANY INACCURATE PARTICULARS OF INCOME. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND THE LAW APPLICABL E LEVY OF PENALTY WAS BAD IN LAW AND THE SAME WAS LIABLE TO B E CANCELLED; & (IV) IN ANY CASE THERE WAS NO DELIBERATE NOT INTENTIONA L DEFAULT. 7.2. THE LD. D R PRESENT WAS DULY HEARD. 7.3. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMIS SIONS AND ALSO PERUSED THE RELEVANT RECORDS. ITA NOS.1104 TO 1110/B/09 7 7.4. AT THE OUT-SET WE WOULD LIKE TO POINT OUT TH AT THE CONTENTION OF THE ASSESSEE IN OUR CONSIDERED VIEW IS NOT ON THE SOU ND FOOTING. ON A CLOSE READING OF THE ASSESSMENT ORDER FOR EXAMPLE FOR THE AY 19 99-2000 IT COULD BE SEEN THAT VIDE AOS LETTER DT.10.10.2006 THE ASSESSEE WAS SP ECIFICALLY GIVEN A CHANCE TO PRODUCE THE CREDITORS FOR VERIFICATION OF THEIR IDE NTITY CREDIT WORTHINESS AND GENUINENESS OF TRANSACTION ETC. FOR WHICH THE ASS ESSEE IN HIS REPLY DATED: 15.11.06 RESPONDED THAT THE CREDITORS IN THEIR BOOKS HAVE PRIMARILY AROSE B ECAUSE OF THEIR FAMILY GOODWILL IN THE VILLAGE AND MONIES WERE GIVEN BY THE FARMERS WHICH ARE NOT MORE THAN RS.20000 AS SUCH EXPRESSED HIS INABILITY TO PRODUCE THE CREDITORS FOR VERIFICATION . AFTER CAREFUL EXAMINATION OF THE ASSESSEES VERSIO N THE AO HELD THAT IT WAS THE BURDEN ON THE PART OF T HE ASSESSEE TO PRODUCE THE CREDITORS APPEARING IN THE BOOKS OF ACCOUNT FOR VER IFICATION. IN THE ABSENCE OF ANY CREDIBLE DETAILS AND ALSO THE NON-PRODUCTION OF THE ALLEGED CREDITORS THE AO HELD THAT THE CREDITORS WERE NOT GENUINE AND ACCORDINGL Y THE UNEXPLAINED CREDITS WERE BROUGHT INTO TAX NET AND SIMULTANEOUSLY INITIATED P ENAL PROCEEDINGS U/S 271 (1)(C) OF THE ACT. THUS THE ASSESSEES CONTENTION THAT T HE INITIATION OF PENALTY BASED ON AN ASSESSMENT ORDER WITHOUT A PROPER SATISFACTION N OTE BECOMES BAD IN LAW IS RATHER WANTING AND A BASELESS ALLEGATION. 7.5. LET US HAVE A GLIMPSE OF WHAT S. 271(1)(C) SAY S: 271.(1) IF THE ASSESSING OFFICER OR THE COMMISSIONE R (APPEALS) OR THE COMMISSIONER IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT IS SATISFIED THAT ANY PERSON- . (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME OR. ITA NOS.1104 TO 1110/B/09 8 7.6. THE PROVISIONS OF THE ACT ARE ABUNDANTLY CLEA R THAT IF THE AO IN THE COURSE OF ANY PROCEEDINGS UNDER THIS ACT IS SATISFIED THAT ANY PERSON HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHE D INACCURATE PARTICULARS OF SUCH INCOME HE IS WITHIN HIS REALM TO INITIATE PENAL PR OCEEDINGS U/S 271(1)(C) OF THE ACT. THUS IN OUR UNANIMOUS VIEW IN THE CASE ON H AND THE AO HAD ASSUMED THE JURISDICTION U/S 271(1)(C) OF THE ACT AFTER A PROPE R SATISFACTION THAT THE ASSESSEE HAD IN FACT CONCEALED THE PARTICULARS OF HIS INCO ME AND ALSO FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. 7.7. WITH RESPECTS WE HAVE PERUSED THE RULING OF THE HIGHEST JUDICIARY OF THE COUNTRY IN THE CASE OF MANISH MAHESWARI V. A CIT REPORTED IN (2007) 289 ITR 341 WHEREIN THE ISSUE BEFORE THE HONBLE COURT WAS THAT WHETHER THE CONDITIONS PRECEDENT FOR INVOKING THE PROVISIONS OF SECTION 158BD ARE REQUIRED TO BE SATISFIED BEFORE THE PROVISIONS OF THE CHAPTER ARE APPLIED IN RELATION TO ANY PERSON OTHER THAN THE PERSON WHOSE PREMISES HAD BEEN SEARCHED OR WHOSE DOCUMENTS AND OTHER ASSETS HAD BEEN REQUISITIONED UNDER SECTION 132A OF THE AC T? HOWEVER IN THE CASE ON HAND AS HIGHLIGHTED BY THE LD. CIT(A) IN HIS IMPUGNED OR DER WHICH IS UNDER DISPUTE IS ON THE DIFFERENT FOOTING AND AS SUCH THE ASSES SEE CANNOT TAKE SANCTUARY ON THIS RULING TO GO SCOT-FREE. 7.8 WE ARE ALSO FORTIFIED IN OUR CONCLUSION BY DRA WING SUPPORT FROM THE ORDER OF THE TRIBUNAL IN THE CASE OF ACIT VS. SHRI JOHN M OHAN REDDY IN ITA NOS.834 ITA NOS.1104 TO 1110/B/09 9 TO 838/B/09 DATED 29.1.2010. THE RELEVANT PORTION OF TRIBUNALS ORDER IS REPRODUCED BELOW FOR READY REFERENCE: 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE SHALL FIRST TAKE UP THE TEC HNICAL ISSUE VIZ. WHETHER PENALTY PROCEEDINGS WERE INITIATED DUR ING THE COURSE OF ASST. PROCEEDINGS. THE CIT(A) WAS OF THE VIEW THAT THE PENALTY PROCEEDINGS WERE NOT INITIATED DURING T HE COURSE OF ASST. FOR THE REASON THAT THE WORDS PENALTY PROCE EDINGS U/S 271(1)(C) WERE INITIATED SEPARATELY WERE MENTIONED AFTER RECORDING OF WORDS ISSUE DEMAND NOTICE AND CHALLAN . IN OTHER WORDS THE CIT(A) STATES THAT THE ASST. ORDER ENDS WITH THE WORD ISSUE DEMAND NOTICE AND CHALLAN AND ANY RECO RDING AFTER THESE WORDS ARE NOT PART OF THE ASST. PROCEED INGS. THE CIT(A)S REASONING DREW STRENGTH FROM HIS ORDER IN THE CASE OF SRINIVAS RAJU (SUPRA). HOWEVER IT IS PERTINENT TO NOTE THAT IN THE CASE OF SRINIVAS RAJU (SUPRA) THE WORDS PENA LTY PROCEEDINGS U/S 271(1)(C) WERE INITIATED SEPARATELY WERE RECORDED AFTER THE SIGNATURE OF THE CONCERNED AO. IN THE INSTANT CASE THE WORDS PENALTY PROCEEDINGS U/S 27 1(1)(C) WERE INITIATED SEPARATELY ARE RECORDED BEFORE THE SIGNATURE OF THE AO. WE ARE OF THE OPINION THAT THE CIT(A)S VI EW IS HYPER TECHNICAL AND UNTENABLE. THERE IS NO SUCH FORMAT FO R CLOSURE OF THE ASST. PROCEEDINGS. THE CIT(A)S ASSUMPTION TH AT THE ASST. IS COMPLETE WITH THE RECORD OF THE WORDS ISSUE DEM AND NOTICE AND CHALLAN IS WITHOUT ANY LEGAL BASIS. NO JUDICI AL PRONOUNCEMENT HAS BEEN BROUGHT TO OUR NOTICE TO JUS TIFY THE VIEW OF THE CIT(A). IN THE INSTANT CASE AT THE FO OT OF THE ASST. ORDER BEFORE THE SIGNATURE OF THE AO IT IS CLEARLY RECORDED THAT PENALTY PROCEEDINGS U/S 271(1)(C) WERE INITIATED S EPARATELY WHICH IN OUR VIEW IS PART OF ASST. ORDER AND VALID RECORDING OF ITA NOS.1104 TO 1110/B/09 10 SATISFACTION OF THE AO FOR INITIATION OF PENALTY PR OCEEDINGS U/S 271(1)(C) IN VIEW OF INTRODUCTION OF SUB SEC. 1B OF SEC. 271(1). MOREOVER IN THIS CASE THE ASST. ORDER THE DEMAND NOTICE AND THE SHOW CAUSE NOTICE U/S 274 READ WITH SEC. 271 HA S BEEN DULY SERVED TOGETHER WITHIN THE DUE DATE I.E BEFORE 31.1 2.06 AND THE ASSESSEE HAD COMPLIED WITH THE SHOW CAUSE NOTICE. 9. THE HONBLE SUPREME COURT IN THE CASE OF KALYANKUMAR RAY VS. CIT 193 ITR 634 WAS OF THE VIE W THAT AOS CALCULATION OF INTEREST IS PART OF THE ASST. O RDER. THE RELEVANT PORTION OF THE RULING OF THE HONBLE SUPRE ME COURT IS REPRODUCED BELOW : THE STATUTE DOES NOT HOWEVER REQUIRE THAT BOTH THE COMPUTATIONS (I.E OF THE TOTAL INCOME AS W ELL AS OF THE SUM PAYABLE) SHOULD BE DONE ON THE SAME SHEE T OF PAPER THE SHEET IS SUPERSCRIBED ASSESSMENT ORD ER. IT DOES NOT PRESCRIBE ANY FORM FOR THE PURPOSE. IT WILL BE APPRECIATED THAT ONCE THE ASSESSMENT OF THE TOTA L INCOME IS COMPLETE WITH INDICATIONS OF THE DEDUCTIO NS REBATES RELIEFS AND ADJUSTMENTS AVAILABLE TO THE ASSESSEE THE CALCULATION OF THE NEXT TAX PAYABLE I S A PROCESS WHICH IS MOSTLY ARITHMETICAL BUT GENERALLY TIME- CONSUMING. IF THEREFORE THE INCOME-TAX OFFICER F IRST DRAWS UP AN ORDER ASSESSING THE TOTAL INCOME AND INDICATING THE ADJUSTMENTS TO BE MADE DIRECTS THE OFFICE TO COMPUTE THE TAX PAYABLE ON THAT BASIS AND THEN APPROVES OF IT EITHER IMMEDIATELY OR SOME TIME LAT ER NO FAULT CAN BE FOUND WITH THE PROCESS THOUGH IT I S ONLY WHEN BOTH THE COMPUTATION SHEETS ARE SIGNED OR INITIATED BY THE INCOME-TAX OFFICER THAT THE PROCES S DESCRIBED IN SEC. 143(3) WILL BE COMPLETE. ITA NOS.1104 TO 1110/B/09 11 10. OUR VIEWS ARE ALSO SUPPORTED BY THE DECISION OF THE HONBLE HIGH COURT OF HIMACHAL PRADESH IN THE CASE OF RAJA RANA YOGENDRA CHANDRA VS. CIT 117 ITR 473 WHERE I N IT WAS HELD AS FOLLOWS : ITO AFTER RECORDING ASSESSED IN THE ASST. ORDER DIRECTING ISSUE OF NOTICE FOR PENALTY U/S 27 1(1)(A) AND SIGNING THEREAFTER; IT COULD NOT BE SAID THAT A SST. WAS FIRST COMPLETED AND DIRECTION FOR ISSUE OF NOTI CE FOR PENALTY WAS MADE THEREAFTER AND WAS AN AFTER-THOUGH T. PENALTY IMPOSED WAS VALID AND ISSUANCE OF NOTICE TW O DAYS THEREAFTER WAS IMMATERIAL. 11. IN THE LIGHT OF THE ABOVE REASONING WE HOLD TH AT THE CIT(A) IS NOT JUSTIFIED IN CANCELING THE PENALTY OR DER ON THE TECHNICAL PLEA OF THE ASSESSEE THAT NO PENALTY PROC EEDINGS ARE INITIATED IN THE COURSE OF ASST. PROCEEDINGS. 7.9. IN AN OVER ALL CONSIDERATION OF THE FACTS AN D CIRCUMSTANCES AS DELIBERATED UPON IN THE FORE-GOING PARAGRAPHS WE A RE OF THE FIRM VIEW THAT THE AO WAS JUSTIFIED IN ASSUMING THE JURISDICTION U/S 2 71(1) (C) OF THE ACT AND HENCE THE ASSESSEE FAILS ON THIS COUNT. II. LET US NOW MOVE ON TO THE OTHER GRIEVANCE OF THE AS SESSEE THAT THE AUTHORITIES BELOW ERRED IN IMPOSING THE PENALTIES F OR THE AYS UNDER DISPUTE. (1) PENALTY IMPOSED ON UNEXPLAINED CREDITS ADDED U/S 68 OF THE ACT : THE AO HAD MADE THE ADDITIONS ON ACCOUNT OF UNEXPLA INED CREDITS U/S 68 OF THE ACT FOR THE AYS UNDER DISPUTED AS UNDER: ITA NOS.1104 TO 1110/B/09 12 ASST. YEAR UNEXPLAINED CREDITS (RS) 1999-2000 85000 2000-2001 546500 2001-2002 40000 2002-2003 47000 2003-2004 82862 2004-2005 63000 2005-2006 713024 AFTER CONSIDERING THE ARGUMENTS PUT-FORTH BY THE AS SESSEE THE LD. CIT HAD OBSERVED THUS (I) IN THE CASE OF CASH CREDITS U/S 68 OF THE ACT THE ONUS LIES ON THE ASSESSEE TO PROVE THE IDENTITY CREDIT WORTHINE SS OF THE CREDITOR(S) AND GENUINENESS OF THE TRANSACTIONS WHI CH THE PRESENT ASSESSEE HAD FAILED TO DISCHARGE THE ONUS C AST UPON HIM; (II) DRAWING STRENGTH FROM THE LEGAL PRECEDENTS IN FOLLO WING CASE LAWS HE HAD OBSERVED THAT THE ASSESSEE HAD FA ILED TO PRODUCE THE CREDITORS FOR VERIFICATION: (A) KALEKHAN MOHD. HANEEF V. CIT 50 ITR 1 (SC); (B)CIT V. PRECISION FINANCE PVT. LTD. 208 ITR 465 ( CAL); (C)CIT V. KORLEY TRADING CO. PVT. LTD. 232 ITR 820 (CAL); & (D)NANAKCHANDRA LAXMANDAS V. CIT 140 ITR 151 (ALL) DURING THE COURSE OF HEARING BEFORE US THE LD. A R REITERATED WHAT HAS BEEN CONTENDED BEFORE THE FIRST APPELLATE AUTHORITY. NO CREDIBLE EVIDENCE WAS BROUGHT ON RECORD TO THWART THE FINDING OF THE CIT(A) EVEN AT THIS STAGE. WE HAVE DULY PERUSED THE CASE LAWS ON WHICH THE CIT(A) HAD LAID HIS FAITH TO DRIVE HOME HIS ITA NOS.1104 TO 1110/B/09 13 POINT NOTABLY IN THE CASE OF KALEKHAN MOHD. HANEEF V. CIT CITED SUPRA WHEREIN THE HONBLE APEX COURT WAS VERY EMPHATIC IN ITS WIS DOM THAT IT IS WELL ESTABLISHED THAT ONUS ON PROVING THE SOURCE OF SUM OF MONEY FOU ND TO HAVE BEEN RECEIVED BY THE ASSESSEE IS ON HIM. IF HE DISPUTES LIABILITY FOR T AX IT IS FOR HIM TO SHOW EITHER THAT THE RECEIPT WAS NOT INCOME OR THAT IF IT WAS IT WAS EX EMPT FROM THE TAXABLE INCOME. IN VIEW OF THE ABOVE WE ARE OF THE CONSIDERED VIEW THAT THERE IS NO INFIRMITY IN THE FINDING OF THE FIRST APPELLATE AUTHORITY WHICH REQUIRES OUR INTERFERENCE ON THIS COUNT. IT IS ORDERED ACCORDINGLY. (2) ADDITION ON ACCOUNT OF UN-EXPLAINED INVESTMENTS: THE AO MADE THE ADDITIONS OF RS.125000/- RS.37600 0/- AND RS.208636/- FOR THE AYS 2000-01 2002-03 AND 2003-04 RESPECTIVELY ON AC COUNT OF UNEXPLAINED INVESTMENTS IN THE GUISE OF DEPOSITS/ADVANCES. ON A GLANCE OF THE IMPUGNED ORDERS OF THE AO FOR TH E AYS MENTIONED ABOVE IT IS SEEN THAT THE ASSESSEE MADE INVESTMENTS OF RS.1 LAK H RS.1.41 LAKHS IN DEPOSITS FOR THE AYS 2000-01 AND 2002-03 AND A SUM OF RS.2.3 5 LAKHS DEPOSITED WITH MARGADARSHI CHIT FUNDS WHICH WERE NOT REFLECTED IN THE BOOKS OF ACCOUNTS OF THE ASSESSEE. SIMILARLY FOR THE AY 2003-04 THE ASSESSE E HAD INVESTED RS.50000/- AS DEPOSITS IN KALPATHARU DEPOSITS AND ALSO ADVANCED R S.1.58 LAKHS. AS NO SATISFACTORY EXPLANATION WAS FORTH-COMING DURING TH E COURSE OF ASSESSMENT PROCEEDINGS THE AO TREATED THE SAME AS UNEXPLAINED INVESTMENTS U/S 69 OF THE ACT. ITA NOS.1104 TO 1110/B/09 14 BEFORE THE FIRST APPELLATE AUTHORITY TOO NO TANGIB LE PROOF WAS PRODUCED TO PROVE THE SOURCE FOR SUCH DEPOSITS AND THUS HE TO OK A VIEW THAT THE DEPOSITS REMAIN UNEXPLAINED. EVEN BEFORE US ALSO NO CREDIBLE PROOF WAS PRESENTE D TO REBUT THE STAND OF THE AUTHORITIES BELOW AND AS SUCH WE HAVE BEEN L EFT WITH NO CHOICE BUT TO FALL IN LINE WITH THE FINDINGS OF THE AUTHORITIES BELOW WHO TOOK A VIEW THAT THE SOURCES FOR SUCH DEPOSITS REMAIN UNEXPLAINED. (3) ADDITIONS MADE ON ACCOUNT OF INTEREST ACCR UED ON UNDISCLOSED DEPOSITS/ADVANCES: FOR THE AYS UNDER DISPUTE (OF COURSE EXCEPT FOR TH E AY 99-00) THE AO MADE ADDITIONS ON ACCOUNT OF ACCRUED INTEREST ON THE UND ISCLOSED DEPOSITS/ADVANCES THE BREAKUP OF WHICH IS AS UNDER: ASST. YEAR ACCRUED INTEREST ON UN-DISCLOSED DEPOSITS/ADV. 2000-2001 3400 2001-2002 9300 2002-2003 38050 2003-2004 53550 2004-2005 46478 2005-2006 45332 THE AO IN HIS IMPUGNED ASSESSMENT ORDERS HAD REASON ED IN AN IDENTICAL WAY THAT ON BEING POSED WITH A QUESTION AS TO WHY THE ACCRUE D INTEREST ON THESE FIXED DEPOSITS (AND ALSO VARIOUS DEPOSITS WITH MC FINANCI ERS) SHOULD NOT BE BROUGHT TO TAX IN THE RELEVANT ASSESSMENT YEARS THE ASSESSEE HAD PERHAPS CONSENTED FOR ITA NOS.1104 TO 1110/B/09 15 TREATING THE ACCRUED INTEREST AS INCOME FROM OTHER SOURCES. AFTER CAREFUL EXAMINATION OF THE DEPOSITS HELD BY THE ASSESSEE AN D ALSO THE ACCRUED INTEREST CREDITED TO HIS ACCOUNT THE AO BROUGHT TO TAX SUCH INTERESTS EARNED ON DEPOSITS/ADVANCES AS NARRATED SUPRA IN THE RESPECTI VE ASSESSMENT YEARS. EVEN DURING THE PENAL PROCEEDINGS BEFORE THE AO THE ASS ESSEES IDENTICAL CRYPTIC CONTENTION WAS THAT CASH SYSTEM BEING FOLLOWED FOR INTEREST NO AMOUNT OF INTEREST HAS ACCRUED. HOWEVER THE ADDITION IS MADE TO INCOME. ON A GLIMPSE OF THE ORDER OF THE CIT (A) UNDER DISP UTE WE FIND THE OBSCURE REMARKS THAT THE ASSESSING OFFICER HAS ADDED THE INTEREST ACCRUE D ON THE DEPOSITS/ADVANCES WHICH WERE NOT DISCLOSED TO THE D EPARTMENT BASED ON THE EVIDENCES SEIZED DURING THE COURSE OF THE SEARCH. THE APPELLANT DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS AGREED FOR THE ADDIT ION OF INTEREST. HOWEVER IT IS EVIDENT THAT NO SUCH INTEREST WAS OFFERED IN THE RE TURN OF INCOME FILED THE INTEREST WAS ONLY AGREED TO BE ADDED AFTER THE CONCEALMENT W AS DETECTED BY THE ASSESSING OFFICER. DURING THE COURSE OF HEARING BEFORE US T OO NO TANGIBLE EVIDENCE WAS BROUGHT ON RECORD TO REBUT THE FINDINGS OF THE LOWE R AUTHORITIES. IN THESE CIRCUMSTANCES WE ARE IN AGREEMENT WITH THE STAND O F THE AUTHORITIES BELOW ON THIS COUNT. ITA NOS.1104 TO 1110/B/09 16 (4) UNEXPLAINED INVESTMENT IN GOLD JEWELLERY/SIL VER ARTICLES AY 2005-06: WITH REGARD TO UNEXPLAINED INVESTMENTS IN GOLD JEWELLERY AND SILVER ARTICLES FOR THE REASONS RECORDED IN THE ASSESSMEN T ORDER THE AO MADE ADDITIONS TO THE EXTENT OF RS.219760/- AND RS.28600/- RESPECT IVELY. DURING THE PENALTY PROCEEDINGS THE ASSES SEES CONTENTION WAS THAT THERE WAS NO UNACCOUNTED GOLD AND UNACCOUNTED SILVER. HO WEVER THE EXPLANATION IS NOT ACCEPTED AND THE SAME IS ADDED TO INCOME. ACTU ALLY THERE IS NO INCOME ELEMENT THEREON..HOWEVER THE ADDITIONS ARE ACCEPT ED ONLY TO BUY PEACE AND TO HAVE THE MATTER CLOSED. BRUSHING ASIDE THE ASSESSEES CONTENTION THE AO HAD REASONED THAT AFTER EXAMINING THE PROOF GIVEN AND THE EXPLANATION GIVEN 536 GRAMS OF JEWELLERY WAS TREATED AS EXCESS AS THE ASSESSEE WAS NOT ABLE TO EXPLAIN SATISFACTORILY WITH DOCUMENTARY EVIDENCE. IN RESPECT OF SILVER ARTICLES THE AO HAD RECORDED THAT THE ASSESSEE WAS NOT ABLE TO EXPLAIN IN RESPECT OF 3250 GRAMS OF SILVER ARTICLES. THE SAME WAS TREATED AS EXCESS SILVER ARTICLES AND PROPOSED TO BRING TO TAX FOR WHICH THE ASSESSEE HAS AGREED . THIS CLEARLY SHOWS THAT THE INVESTMENT ON THIS IS OUT OF INCOME EARNED BY THE A SSESSEE AND THE INCOME IS NOT SHOWN TO THE DEPARTMENT. THE LD. CIT (A) TOOK A VIEW THAT T HE INVESTMENT IN THE GOLD JEWELLERY AND SILVER ARTICLES TO THE EXTENT OF ADDITION MADE BY THE AO REMAIN UNEXPLAINED FOR THE REASONS THAT ITA NOS.1104 TO 1110/B/09 17 THE APPELLANT DURING THE COURSE OF THE APPELLATE P ROCEEDINGS STATED THAT THERE WAS NO UNACCOUNTED GOLD AND UNACCOUNTED SILVER. THE AR GUMENT CANNOT BE ACCEPTED IN VIEW OF THE FACT THAT BEFORE THE AO THE APPELLANT A CCEPTED THE EXCESS GOLD AND SILVER ARTICLES. EVEN DURING THE COURSE OF APPELLATE PROC EEDINGS NO SUCH EVIDENCES ARE PRODUCED TO PROVE THAT THE SOURCE OF THE ABOVE GOLD AND SILVER ARTICLES IS EXPLAINED. WE HAVE DULY PERUSED THE RELEVA NT ASSESSMENT ORDER IN WHICH THE AO WAS MAGNANIMOUS IN ACCEPTING THE EVIDENCES PRODUCED BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS. WHILE DOING SO HE HAD QUANTIFIED THE EXCESS GOLD TO THE EXTENT OF 536 GRAMS. HOWEVER WE FIND THAT IN RESPECT OF 242 GRAMS CLAIMED TO BE BELONGING TO SMT.PRASANNA LAKSHMI IT WAS NOT CLEAR WHETHER THE SAID PRASANNA LAKSHMI WAS EXAMINED AND IF SO THE CONCLUSION SO ARRIVED AT WAS NOT FINDING A PLACE IN THE ORDER. THUS WE SAFELY ASSUME THAT THIS 242 GRAMS GOLD SAID TO BE BELONGING TO PRASANNA LAKSHMI HAS ALSO B EEN CONSIDERED AS EXCESS GOLD WITHOUT A PROPER VERIFICATION. WE ARE THEREFORE OF THE CONSIDERED VIEW THAT THE BENEFIT OF DOUBT SHOULD GO IN FAVOUR OF THE ASSESSE E AS FAR AS THE PENALTY PROCEEDINGS FOR THE AY UNDER DISPUTE ARE CONCERNED. THUS THE ASSESSING OFFICERS STAND IN THE PENALTY PROCEEDINGS IN RESPE CT OF ADDITION OF THE COST OF 242 GRAMS OF GOLD IN OUR VIEW IS NOT JUSTIFIED. WE ARE THEREFORE NOT IN AGREEMENT WITH THE STAND OF THE AUTHORITIES BELOW I N RESPECT OF LEVY OF PENALTY (FOR THE EXCESS GOLD OF 536 GRAMS) CONSIDERING THE ADDI TION ON ACCOUNT OF COST OF 242 GRAMS OF GOLD SAID TO BE BELONGING TO PRASANNA LAKS HMI WHICH HAS NOT BEEN PROPERLY EXAMINED. ITA NOS.1104 TO 1110/B/09 18 (5) NON-GENUINE AGRICULTURAL INCOME OF RS.75000 /- AY 2005-06: THE ASSESSEE HAD CLAIMED AGRICU LTURAL INCOME OF RS.75000/-. IN THE ABSENCE ANY PROOF THAT THE ASSESSEE OWNED AGRICULTU RAL LANDS THE AO ADDED THE SAME AS INCOME OF THE ASSESSEE UNDER THE HEAD OTHE R SOURCES. THE CIT (A) REJECTED THE ASSESSEES CLAIM OBSERVING THAT MERELY FURNISHING AN EXPLANATION WITHOUT PRODUCING ANY EVIDENCE TO SUPPO RT THE CLAIM CANNOT BE ACCEPTED. THE APPELLANT DURING THE COURSE OF THE ASSESSMENT P ROCEEDING AS WELL AS APPELLATE PROCEEDING FAILED TO PRODUCE ANY EVIDENCE TO PROVE THAT HE ACTUALLY EARNED THE INCOME FROM AGRICULTURE. THERE WAS NO ANY MATERIAL CHANGE IN THE SITUATION W HEN THE LD. A R CHALLENGED THE FINDING OF THE LD. CIT (A) BEFORE US. AS NO EV IDENCE WAS FORTH-COMING TO DERAIL THE STAND OF THE LOWER AUTHORITIES ON THIS C OUNT WE HAVE TO CONCUR WITH REASONING OF THE LD. CIT (A). 8. CONCLUSION: ON A CAREFUL READING-THROUGH THE IMPUGNED ORDERS (ASSESSMENT ORDERS AS WELL AS THE PENALTY ORDERS) O F THE AOS AND ALSO THE LD. CIT(A) UNDER DISPUTE WE FIND THAT THE ASSESSEE HAD FAILED TO PROVE WITH DOCUMENTARY EVIDENCE THE GENUINENESS OF THE ALLEGED CREDITS SOURCES FOR INVESTMENTS IN DEPOSITS/ADVANCES SILVER ARTICLES IN RESPECT OF LAND HOLDINGS NO DETAILS SUCH AS THE SURVEY NUMBERS EXTENT OF LAND- HOLDING CROPS GROWN YIELD SALE PATTIES ETC. ARE FORTH-COMING. ITA NOS.1104 TO 1110/B/09 19 HOWEVER IN RESPECT OF EXCESS GOLD OF 536 GRAMS WE HAVE RESTRICTED THE PENALTY TO THE EXTENT OF THE ADDITION MADE WITH REGARD TO THE COST OF 294 GRAMS INSTEAD OF 536 GRAMS [536 242 GRAMS] OF GOLD ONLY FOR THE RE ASONS RECORDED IN THE FOREGOING PARAGRAPH. 8.1. IN CONCLUSION IN THE ABSENCE OF ANY PROOF AS MENTIONED ABOVE THERE WOULD BE NO BUYERS OF THE ASSESSEES THEORY T HAT (I) THE CREDITORS WERE NOT CALLED FOR VERIFICATION (PRE CISELY THE ASSESSEE HIMSELF HAD FAILED TO DISCHARGE THE O NUS OF FURNISHING THE IDENTITY OF THE CREDITOR THEIR CRED IT WORTHINESS AND GENUINENESS OF THE TRANSACTION ETC.) ; (II) THERE WAS NO UNACCOUNTED GOLD/SILVER ARTICLES ETC. & (III) HE OWNED AGRICULTURAL LAND AND THAT THE AGRICULTUR AL PRODUCES WERE SOLD TO THE SMALL BUSINESSMEN WHO PUR CHASE THE AGRICULTURAL PRODUCE IN THE VILLAGE ITSELF ETC. 8.2. LET US NOW TURN TO EXPLANATION 1 OF S.271 OF THE ACT WHICH MAKES IT EXPLICITLY THAT WHERE IN RESPECT OF ANY FACTS MATERIAL TO THE COMP UTATION OF TOTAL INCOME OF ANY PERSON UNDER THIS ACT - (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OFFERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMMISSIONER(APPEALS) OR THE COMMISSIONER TO BE FAL SE OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS N OT ABLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXPLANATI ON IS BONA FIDE AND THAT ALL THE FACTS RELATING TO THE SAME AND MATERIA L TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM ITA NOS.1104 TO 1110/B/09 20 THEN THE AMOUNT ADDED OR DISALLOWED IN COMPUTING T HE TOTAL INCOME OF SUCH PERSON AS A RESULT THEREOF SHALL FOR THE PURPOSES OF CLAUSE (C ) OF THIS SUB-SECTION BE DEEMED TO REPRESENT THE INCOME IN RESPECT OF WHICH PARTICULAR S HAVE BEEN CONCEALED. 8.3. IN AN OVERALL CONSIDERATION OF THE FACTS AND CIRCUMSTANCES OF THE ISSUE AS DELIBERATED UPON IN THE FORE-GOING PARAGRA PHS AND ALSO IN CONFORMITY WITH THE PROVISIONS OF S. 271(1) (C) OF THE ACT WE ARE OF THE UNANIMOUS VIEW THAT THE ASSESSEE HAD IN FACT CONCEALED THE PARTICULARS OF HIS INCOME AND HAD FURNISHED INACCURATE PARTICULARS OF INCOME FOR THE ASSESSMENT YEARS UNDER DISPUTE AND THAT HIS CASE DOES FALL WITHIN THE AMBIT OF THE PROVISIO NS OF S. 271(1) (C) OF THE ACT. 8.4. IN A NUT-SHELL THE FINDING OF THE LD. CIT (A)S ORDER WHICH IS UNDER DISPUTE DOESNT REQUIRE ANY INTERFERENCE AT T HIS STAGE EXCEPT WITH REFERENCE TO THE RESTRICTING OF THE PENALTY IMPOSED FOR THE A Y 2005-06 ON ACCOUNT OF THE ADDITION MADE TO THE ASSESSEES INCOME ONLY TO THE EXTENT OF THE COST OF 294 GRAMS OF GOLD (INSTEAD OF 536 GRAMS) FOR THE REASON S SET-OUT SUPRA . 9. IN THE RESULT THE ASSESSEES APPEALS FOR THE AYS 1999-00 2000- 01 2001-02 2002-03 2003-04 AND 2004-05 ARE DISMI SSED AND FOR THE AY 2005-06 THE APPEAL IS PARTLY ALLOWED. ORDER PRONOUNCED ON -------------- THE ---- DAY O F MARCH 2010. (DR. O.K NARAYANAN) (GEORGE GEORGE K) VICE PRESIDENT JUDICIAL MEMBER PLACE : BANGALORE DATE : /03/2010 ITA NOS.1104 TO 1110/B/09 21 VMS. COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3.THE CIT CONCERNED. 4.THE CIT(A) CONCERNED. 5.DR 6.GF 7..GF ITAT NEW DELHI. BY ORDER ASST. REGISTRAR ITAT BANGALOR E.