Shri Haji Abdullah Alias Subhania, JAMNAGAR v. The Deputy Commissioner Of Income Tax, Central Circle 1, RAJKOT-GUJARAT

ITA 12/RJT/2011 | 2002-2003
Pronouncement Date: 21-07-2011 | Result: Allowed

Appeal Details

RSA Number 1224914 RSA 2011
Assessee PAN AFHPS5363J
Bench Rajkot
Appeal Number ITA 12/RJT/2011
Duration Of Justice 6 month(s) 2 day(s)
Appellant Shri Haji Abdullah Alias Subhania, JAMNAGAR
Respondent The Deputy Commissioner Of Income Tax, Central Circle 1, RAJKOT-GUJARAT
Appeal Type Income Tax Appeal
Pronouncement Date 21-07-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 21-07-2011
Date Of Final Hearing 08-07-2011
Next Hearing Date 08-07-2011
Assessment Year 2002-2003
Appeal Filed On 18-01-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH RAJKOT BEFORE SHRI A.L. GEHLOT (AM) AND SHRI N.R.S. GANESA N (JM) I.T.A. NO.12/RJT/2011 (ASSESSMENT YEAR 2002-03) SHRI HAJI ABDULLA ALIAS SUBHANIA VS THE DY.CIT CEN T.CIR.1 L/H SHRI SALIM ABDULLA SUBHANIA RAJKOT NEW VEGETABLE MARKET JAM SALAYA (GUJARAT) PAN : AFHPS5363J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AMIT GOKANI RESPONDENT BY: SHRI AVINASH KUMAR O R D E R PER N.R.S. GANESAN JM THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF CIT(A)-IV AHMEDABAD DATED 28-10-2010 AND PERTAINS TO ASSESSME NT YEAR 2002-03 CONFIRMING LEVY OF PENALTY U/S 271(1)(C) OF THE ACT . 2. SHRI AMIT GOKANI THE LD.REPRESENTATIVE FOR THE ASESSEE SUBMITTED THAT THERE WAS A SEARCH ACTION IN THE PREMISES OF THE AS SESSEE ON 29-12-2005. DURING THE COURSE OF SEARCH OPERATION THE REVENUE A UTHORITIES FOUND INVESTMENT OF RS.1 40 000 IN 13 KISAN VIKAS PATRAS (KVPS HERE AFTER). KVPS WAS IN THE NAME OF MINOR GRAND SON ARIF AND MINOR GRAND DAUGH TER SHABNAM. ACCORDING TO THE LD.REPRESENTATIVE U/S 64 OF THE INCOME-TAX ACT THE INVESTMENT FOUND IN THE NAME OF MINOR CHILDREN HAS TO BE ADDED IN THE HANDS OF PARENTS OF THE MINOR CHILDREN AND NOT GRAND PARENTS. THEREFORE THE ADD ITION ITSELF IS NOT SUSTAINABLE IN THE HANDS OF THE ASSESSEE BEING THE GRAND FATHER. THEREFORE THE LEVY OF PENALTY U/S 271(1) IS NOT JUSTIFIED. THE LD.REPRESENTATIV E FURTHER SUBMITTED THAT THE ASSESSEES WIFE MRS. KARIMABEN SUMBHANIA DESIRED T O INVEST SOME AMOUNTS IN THE NAME OF HER GRAND SON AND GRAND DAUGHTER FROM A ND OUT OF HER OWN SAVINGS. HOWEVER SHE COULD DO SO DURING HER LIFE TIME SINCE SHE EXPIRED ON 17-08-2000. ITA NO.12/RJT/2011 2 AS PER THE LAST DESIRE OF ASSESSEE WIFE THE MONEY SAVED BY HIS WIFE WAS BESTOWED ON THE GRAND SON AND GRAND DAUGHTER IN THE FORM OF INVESTMENT IN KVPS. REFERRING TO THE ORDER OF THE ASSESSING OFFI CER WHERE HE OBSERVED THAT THE ASSESSE AND HIS WIFE IS NOT A REGULAR ASSESSEE THE LD.REPRESENTATIVE SUBMITTED THAT THE ASSESSEE AND HER WIFE ARE REGULA RLY FILING RETURN OF INCOME. SINCE THE AMOUNT WAS INVESTED IN THE NAME OF GRAND CHILDREN AS DESIRED BY ASSESSES WIFE FROM HER OWN SAVINGS THERE IS NO QU ESTION OF ANY LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. 3. ON THE CONTRARY SHRI AVINASH KUMAR THE LD.DR S UBMITTED THAT HE IS PLACING RELIANCE ON THE ORDERS OF AUTHORITIES BELOW . 4. WE HAVE CONSIDERED THE RIVAL SUBMISSION AND HAVE ALSO PERUSED THE MATERIAL PLACED BEFORE US. ADMITTEDLY KVPS WERE F OUND IN THE NAMES OF ASSESSEES GRAND CHILDREN. UNDER SECTION 64 OF THE INCOME-TAX ACT THE INVESTMENT FOUND IN THE NAME OF GRAND CHILDREN HAS TO BE ADDED IN THE HANDS OF THE PARENTS. IN THIS CASE THE ASSESSEE HIMSELF CL AIMS THAT THE AMOUNTS BELONGED TO HIS WIFE WHICH WAS INVESTED IN THE NAME OF GRAND CHILDREN. THEREFORE THE TRIBUNAL WHILE CONSIDERING THE QUAN TUM APPEAL IN ITA NO.434 TO 440/RJT/2008 BY AN ORDER DATED 06-02-2009 CONFIRMED THE INVESTMENT MADE IN THE KVPS IN THE NAME OF THE ASSESSEE. HOWEVER IN RESPECT OF INTEREST ARISING OUT OF SUCH INVESTMENTS THE TRIBUNAL FOUND THAT TH E INTEREST INCOME HAS TO BE ADDED IN THE HANDS OF THE MINORS FATHER U/S 64(1)( A) OF THE ACT. IT IS SETTLED PRINCIPLES OF LAW THAT THE BURDEN OF PROOF IS SOLEL Y ON THE SHOULDERS OF THE REVENUE TO SHOW THAT THE APPARENT IS NOT REAL. IN THIS CAS E THE KVPS APPARENTLY STAND IN THE NAMES OF THE MINOR GRAND CHILDREN OF THE ASSESS EE. THEREFORE UNDER NORMAL CIRCUMSTANCES IT HAS TO BE CONSIDERED AS INCOME OF THE PARENTS AND IT WILL BE ADDED IN THE HANDS OF THE PARENT WHOSE INCOME IS G REATER SO LONG AS THE MARRIAGE SUBSISTS. IF THE MARRIAGE DOES NOT SUBSIS T IT HAS TO BE ADDED IN THE HANDS OF THE PARENT WHO IS MAINTAINING THE CHILDRE N. HOWEVER IN THIS CASE THE ASSESSEE HIMSELF CLAIMS THAT THE MONEY BELONGS TO H IS WIFE. THEREFORE THE ITA NO.12/RJT/2011 3 INVESTMENTS MADE IN THE NAME OF MINOR CHILDREN BELO NGED TO THE ASSESSES WIFE AND NOT TO THE PARENTS OF THE CHILDREN AND THEREFOR E TO THAT EXTENT THE TRIBUNAL CONFIRMED THE ADDITION MADE BY THE LOWER AUTHORITY. WHEN THE AMOUNT IS DEPOSITED IN THE KVPS IT BELONGS TO THE MINOR CHIL DREN THEREFORE THE INTEREST INCOME HAS TO BE ADDED IN THE HANDS OF THE PARENTS. THEREFORE THE TRIBUNAL HELD THAT THE INTEREST ARISING OUT OF THE SAID INVESTMEN T HAS TO BE ADDED IN THE HANDS OF PARENTS. NOW THE QUESTION ARISES FOR CONSIDERA TION IS WHETHER THERE IS ANY CONCEALMENT IN THE HANDS OF THE PRESENT ASSESSEE. THE ASSESSEE CLAIMS THAT THE ASSESSES WIFE IS FILING RETURN OF INCOME REGUL ARLY. HOWEVER NO MATERIAL IS AVAILABLE ON RECORD TO SUGGEST THAT THE ASSESSEES WIFE IS FILING RETURNS REGULARLY. NO DOCUMENT IS FILED EITHER BEFORE THIS TRIBUNAL OR BEFORE THE LOWER AUTHORITY TO SUBSTANTIATE THE CLAIM THAT THE ASSESSES WIFE IS F ILING RETURN OF INCOME. IN THE ABSENCE OF ANY MATERIAL WE CANNOT SAY THAT THE ASS ESSEES WIFE IS FILING RETURN OF INCOME. 5. FOR THE PURPOSE OF LEVYING PENALTY U/S 271(1)(C) OF THE ACT IT HAS TO BE SHOWN THAT THE ASSESSEE HAS EITHER CONCEALED THE PA RTICULARS OF HIS INCOME OR HAS FURNISHED INACCURATE PARTICULARS OF SUCH INCOME . IN THIS CASE THE ASSESSEE CLAIMS THAT THE MONEY BELONGS TO HIS WIFE. THIS FA CT WAS ACCEPTED BY THE LOWER AUTHORITIES AND UPHELD BY THE TRIBUNAL IN THE QUANT UM APPEAL. THEREFORE THE ADDITION WAS MADE IN THE HANDS OF THE ASSESSEE. TH E QUESTION ARISES FOR CONSIDERATION IS WHETHER THERE WAS A CONCEALMENT OF INCOME OR WHETHER THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF SU CH INCOME. SECTION 64 OF THE ACT NO DOUBT REQUIRES THE ASSESSEE TO INCLUDE THE INCOME OF THE SPOUSE IN HIS TOTAL INCOME. THIS IS A STATUTORY REQUIREMENT. TH E SECTION ALSO PROVIDES FOR EXCLUSION OF INCOME OF THE SPOUSE WHO POSSESSES TE CHNICAL OR PROFESSIONAL QUALIFICATION. THEREFORE WE MAY NOT ABLE TO SAY W HETHER THE AMOUNT SAID TO HAVE SAVED BY ASSESSEES WIFE WAS CONCEALED BY THE ASSESSEE WHILE FILING THE RETURN OF INCOME. IN THE ABSENCE OF ANY MATERIAL T O SHOW THAT THE ASSESSEE WIFE HAS ANY INDEPENDENT SOURCE OF INCOME THE ADDITION WAS SUSTAINED IN THE HANDS OF THE PERSON ASSESSED. HOWEVER FOR THE PURPOSE O F LEVYING PENALTY IT HAS TO BE ITA NO.12/RJT/2011 4 SHOWN THAT THE ASSESSE HAS CONCEALED HIS PARTICULAR S OF INCOME. THE FACT THAT THE ASSESSEES WIFES DESIRE WAS FULFILLED AFTER HE R DEATH BY MAKING INVESTMENT IN KVPS IN THE NAME OF GRAND CHILDREN IS NOT IN DISPU TE. IN THOSE CIRCUMSTANCES IT MAY NOT BE RIGHT TO SAY THAT THE ASSESSEE HAS CONCE ALED ANY PART OF HIS INCOME OR HAS FURNISHED INACCURATE PARTICULARS. SINCE THE ASSESSEES WIFE DESIRED TO INVEST THE MONEY IN THE NAME OF THE GRAND CHILDREN THE ASSESSEE PROBABLY UNDER THE BONA FIDE IMPRESSION THAT IT MAY NOT BE I NCLUDED IN HIS TOTAL INCOME MIGHT HAVE MADE THE INVESTMENT. THAT INTENTION APP EARS TO BE BONA FIDE. THEREFORE IN OUR OPINION THE FACTS OF THE CASE MA Y NOT WARRANT LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. ACCORDINGLY WE SET ASIDE THE ORDER OF THE LOWER AUTHORITIES AND DELETE THE PENALTY IMPOSED. 6. IN THE RESULT APPEAL FILED BY THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 21-07-2011. SD/- SD/- (A.L. GEHLOT) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT DT : 21 ST JULY 2011 PK/- COPY TO: 1. ASSESSEE 2. REVENUE 3. THE CIT(A)-IV AHMEDABAD 4. THE CIT CENTRAL-II AHMEDABAD 5. THE DR I.T.A.T. RAJKOT (TRUE COPY) BY ORDER ASSTT.REGISTRAR ITAT RAJKOT