Dr. Harenedra Kumar Gupta, Agra v. ITO.,4(2), Agra

ITA 127/AGR/2003 | 1997-1998
Pronouncement Date: 17-09-2010 | Result: Allowed

Appeal Details

RSA Number 12720314 RSA 2003
Assessee PAN ABPPG0980M
Bench Agra
Appeal Number ITA 127/AGR/2003
Duration Of Justice 7 year(s) 5 month(s) 20 day(s)
Appellant Dr. Harenedra Kumar Gupta, Agra
Respondent ITO.,4(2), Agra
Appeal Type Income Tax Appeal
Pronouncement Date 17-09-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 17-09-2010
Date Of Final Hearing 13-09-2010
Next Hearing Date 13-09-2010
Assessment Year 1997-1998
Appeal Filed On 27-03-2003
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AGRA BENCH AGRA BEFORE SHRI R.K. GUPTA JUDICIAL MEMBER AND SHRI P.K. BANSAL ACCOUNTANT MEMBER ITA NOS.125 TO 128/AGR/2003 ASST. YEARS: 1995-96 TO 1998-99 DR. HARENDRA KUMAR GUPTA VS. INCOME-TAX OFFICER WARD 4 (2) E-2 KAMLA NAGAR AGRA. AGRA. (PAN : ABPPG 0980 M). (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI RAJENDRA SHARMA ADVOCATE RESPONDENT BY : SHRI VINOD KUMAR JR. D.R. ORDER PER P.K. BANSAL A.M.: ALL THESE APPEALS FILED BY THE ASSESSEE RELATE TO T HE SUSTENANCE OF THE PENALTY BY THE CIT(A) IMPOSED BY THE A.O. UNDER SECTION 271(1)(C) OF THE INCOME-TAX ACT 1961 (THE ACT HEREINAFTER) FOR THE ASSESSMENT YEARS 1995-96 TO 19 98-99 VIE ORDER DATED 24.01.2003. 2. AT THE TIME OF HEARING THE LD. A.R. CONTENDED T HAT THE FACTS INVOLVED IN ALL THESE APPEALS ARE COMMON. ALTHOUGH THE APPEALS ARE AGAINST THE P ENALTY IMPOSED UNDER SECTION 271(1)(C) OF THE ACT THE PENALTY IN ALL THE ASSESSMENT YEARS HA S BEEN IMPOSED BY THE A.O. VIDE RESPECTIVE ORDERS DATED 27.09.2002. NOTICES HAVE BEEN ISSUED IN THE SAME MANNER. EVEN THE PENALTY HAS BEEN IMPOSED ON THE SAME BASIS. THUS IT WAS CONTE NDED THAT IF THE FACTS FOR THE ASSESSMENT YEAR 1995-96 ARE TAKEN ALL THESE APPEALS CAN BE DI SPOSED OF AS FACTS IN ALL THE APPEALS ARE 2 COMMON EXCEPT CHANGE IN THE FIGURES. THE LD. D.R. ALSO AGREED TO THE SAME. WE ARE THEREFORE DECIDING ALL THESE APPEALS ON THE BASIS OF THE FACT S FOR THE A.Y. 1995-96. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ORIGINA L RETURN WAS FILED BY THE ASSESSEE WHEREIN THE INCOME FROM PROFESSION AND AGRICULTURAL INCOME WAS SHOWN. THE REVENUE CAME TO KNOW THAT THE ASSESSEE HAS INVESTED AMOUNTS IN FDRS. IN THESE YEARS IN HIS NAME AND IN THE NAME OF HIS FAMILY MEMBERS. ON THE BASIS OF THIS INFORMATION NOTICES UNDER SECTION 148 OF THE ACT WERE ISSUED. THE ASSESSEE SUBMITTED THE RETURN AND IN T HE RETURN THE ASSESSEE HAS SURRENDERED THE FOLLOWING INVESTMENT IN THE RESPECTIVE ASSESSMENT;- ASSESSMENT YEAR INVESTMENT SURRENDERED 1995-96 RS.4 00 000/- 1996-97 RS.2 30 000/- 1997-98 RS.10 06 655/- 1998-99 RS.4 00 000/- RS.20 36 655/- 4. THE INTERESTS EARNED ON THESE FDRS WERE ALSO OFF ERED FOR TAXATION. IT WAS CONTENDED THAT INVESTMENT IN THESE FDRS WERE MADE OUT OF MONEY GIV EN BY VARIOUS PERSONS TO THE ASSESSEE FOR SAFE CUSTODY. EVEN THE ASSESSEE PRODUCED THE AFFID AVITS FROM SOME OF THE PERSONS BUT FOR THE SAKE OF CONVENIENCE THESE INVESTMENTS WERE SURRENDE RED IN HIS HAND WITH THE CONDITION THAT NO PENALTY UNDER SECTION 271(1)(C) BE IMPOSED ON THE A SSESSEE. MOST OF THE FDRS ARE NOT IN THE NAME OF THE ASSESSEE. THE A.O. MADE THE ADDITION IN EACH OF THE ASSESSMENT YEARS AND SUBSEQUENTLY AFTER INITIATING PENALTY UNDER SECTIO N 2711(C) OF THE ACT IMPOSED THE PENALTY UNDER SECTION 271(1)(C) BY OBSERVING AS UNDER :- 3 IN THE LIGHT OF THESE FACTS IT IS CLEAR THAT THE A SSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME FURNISHED INACCURATE PAR TICULARS OF SUCH INCOME AND RENDERED HIMSELF LIABLE FOR PENALTY U/S 271(1)(C) F OR CONCEALING THE CORRECT PARTICULARS OF HIS INCOME. THE MINIMUM AND MAXIMUM PENALTY WORKS OUT TO RS.1 69 326/- AND RS.5 07 978/- RESPECTIVELY. CONS IDERING ALL THE FACTS AND CIRCUMSTANCES OF THE CASE MINIMUM PENALTY OF RS.1 6 9 326/- IS IMPOSED UPON THE ASSESSEE. ISSUE NOTICE OF DEMAND AND CHALLAN. 5. PENALTY HAS BEEN IMPOSED IN OTHER ASSESSMENT YEA RS ALSO ON THE SAME BASIS. WHEN THE MATTER WENT BEFORE THE CIT(A) THE CIT(A) CONFIRMED THE PENALTY SO IMPOSED. 6. THE LD. A.R. BEFORE US CONTENDED THAT THE A.O. W AS NOT CORRECT IN IMPOSING THE PENALTY UNDER SECTION 271(1)(C). HE REFERRED TO THE NOTICE ISSUED UNDER SECTION 271(1)(C) OF THE ACT AND POINTED OUT THAT THE A.O. HAS NOT MADE OUT THE SPEC IFIC CHARGE FOR WHICH THE PENALTY HAS BEEN LEVIED. HE HAS ALSO DRAWN OUR ATTENTION TOWARDS TH E PENALTY ORDER PASSED UNDER SECTION 271(1)(C) OF THE ACT. RELIANCE WAS PLACED IN THIS REGARD BY HIM ON THE FOLLOWING DECISIONS:- 1) CIT VS. MANU ENGINEERING WORKS 122 ITR 306 (GUJ ) 2) NEW SORATHIA ENGINEERING CO. VS. CIT 282 ITR 64 2 (GUJ) 3) MUKESH CHANDRA A. LAKDAWALA VS. ITO (2010) 4 ITR (TRIB) 307 (AHMEDABAD) 4) NAVINBHAI M. PATEL VS. ITO 31 TTJ (AHD) 40 5) DECISION OF ITAT AGRA BENCH IN THE CASE OF SATNA M KALRA VS. ACIT IN ITA NO.53/AGRF/2006 6) DECISION OF ITAT AGRA BENCH (SMC) IN THE CASE OF MAHESH CHAND GUPTA VS. ITO 4(2) IN ITA NO.118/AGRF/2006 7. SECONDLY HE CONTENDED THAT THE ASSESSEE HAS SUR RENDERED THE FDRS. WHICH WERE NOT IN HIS NAME BUT WERE IN THE NAME OF OTHER PERSONS ALSO JUST TO HAVE PEACE ON THE CONDITION THAT NO PENALTY MAY BE IMPOSED ON THE ASSESSEE. HE ALSO PO INTED OUT THAT THE ASSESSEE HAS SUBMITTED 4 AFFIDAVITS OF THE OTHER PERSONS TO WHOM THE FDRS. B ELONGED. IN THE AFFIDAVITS THOSE PERSONS CATEGORICALLY STATED THAT THE DFRS. BELONGED TO THE M. EVEN SOME OF THE PERSONS STATED THAT THEY HAVE GIVEN MONEY TO THE ASSESSEE TO HOLD AS A TRUST EE. HE EVEN POINTED OUT TO US BY REFERRING TO PAGE NOS.7 & 8 OF THE PAPER BOOK THAT ONE MISS. SEE MA RANI AS SOON AS THE FDRS. WERE SEIZED WRITTEN A LETTER TO THE COMMISSIONER THAT THE FDRS. BELONGED TO HER AND DR. HARENDRA KUMAR GUPTA DID NOT HAVE ANY CONCERN WITH THE FDRS IN HIS NAME. MERELY HE SURRENDERED THE FDRS THESE DO NOT BELONG TO HIM. EVEN SHE HAS ALSO FILED A SUIT BEARING NO.187 OF 2009 BEFORE THE CHIEF JUDICIAL MAGISTRATE AGRA AGAINST THE ASSESSE E FOR RECOVERY OF THE FDRS. AND ALSO THE DAMAGES. IN THIS REGARD ATTENTION WAS DRAWN TO PA GE NOS.9 TO 11 OF THE PAPER BOOK. THUS IT WAS CONTENDED THAT THERE WAS NEITHER ANY CONCEALMEN T NOR FURNISHING OF ANY INACCURATE PARTICULARS BY THE ASSESSEE. THE FDRS. DID NOT BEL ONG TO THE ASSESSEE. THE ASSESSEE HAS DULY EXPLAINED THIS FACT. HE HAS SIMPLY SURRENDERED THE FDRS. WITH THE CONDITION THAT NO PENAL ACTION MAY BE TAKEN IN THE CASE OF THE ASSESSEE. 8. THE LD. D.R. ON THE OTHER HAND RELIED ON THE ORD ER OF THE CIT(A). 9. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND PERUSED THE MATERIAL ON RECORD ALONG WITH THE ORDERS OF THE TAX AUTHORITIES BELOW. WE NOTED THAT IN ALL THESE 4 CASES THE A.O. MADE THE ADDITION IN RESPECT OF INVESTMENT MADE IN THE PURCHASE OF FDRS AND INTEREST THEREON AS SURRENDERED BY THE ASSESSEE DETAILED AS UNDER :- ASSESSMENT YEAR INVESTMENT SURRENDERED 1995-96 RS.4 00 000/- 1996-97 RS.2 30 000/- 5 1997-98 RS.10 06 655/- 1998-99 RS.4 00 000/- RS.20 36 655/- 10. THE ASSESSEE SURRENDERED THESE FDRS BEFORE THE A.O. VIDE LETTER DATED 26.03.2002 COPY OF WHICH IS AVAILABLE AT PAGE 6 OF THE PAPER BOOK S TATING AS UNDER IN THE CONCLUDING PARAGRAPH:- IT IS FURTHER REQUESTED THAT THE INCOME DISCLOSED BY ASSESSEE MAY KINDLY BE ACCEPTED SUBJECT TO NO PENAL INTEREST AND PENAL TY AS THE ABOVE INCOME HAS BEEN DISCLOSED BY ASSESSEE TO PURCHASE THE PEACE AN D TO AVOID LITIGATION AND ALSO TO CO-OPERATE WITH DEPARTMENTAL. 11. THE A.O. ON THE BASIS OF SURRENDER MADE BY THE ASSESSEE AND IN CONSEQUENCE OF THE PROCEEDINGS INITIATED UNDER SECTION 148 IMPOSED PEN ALTY UNDER SECTION 271(1)(C) ON THE ASSESSEE IN EACH OF THE A.Y. ON THE TAX SOUGHT BE EVADED. I N THE PENALTY ORDER THE AO FOR THE AY 1995-96 HAS HELD AS UNDER :- IN THE LIGHT OF THESE FACTS IT IS CLEAR THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME FURNISHED INACCURATE PAR TICULARS OF SUCH INCOME AND RENDERED HIMSELF LIABLE FOR PENALTY U/S. 271(1)(C) FOR CONCEALING THE CORRECT PARTICULARS OF HIS INCOME. THE MINIMUM AND MAXIMUM PENALTY WORKS OUT TO RS.1 69 326/- AND RS.5 07 978/- RESPECTIVELY. CONS IDERING ALL THE FACTS AND CIRCUMSTANCES OF THE CASE MINIMUM PENALTY OF RS.1 6 9 326/- IS IMPOSED UPON THE ASSESSEE. ISSUE NOTICE OF DEMAND AND CHALLAN. 12. EXCEPT CHANGE IN THE FIGURES SIMILAR FINDING W AS GIVEN IN ALL THE OTHER ASSESSMENT YEARS 1996-97 TO 1998-99. 13. THE RELEVANT PROVISIONS OF SECTION 271(1)(C) AR E LAID DOWN AS UNDER :- 271.(1) IF THE ASSESSING OFFICER OR THE COMMISSION ER (APPEALS) [OR THE COMMISSIONER] IN THE COURSE OF ANY PROCEEDINGS UNDE R THIS ACT IS SATISFIED THAT ANY PERSON - 6 (A) .. (B) .. (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME OR (D) .. HE MAY DIRECT THAT SUCH PERSON SHALL PAY BY WAY OF PENALTY - EXPLANATION 1- WHERE IN RESPECT OF ANY FACTS MATERI AL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT - (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OF FERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMMISSIONER (APPEA LS) OR THE COMMISSIONER TO BE FALSE OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS N OT ABLE TO SUBSTANTIATE AND [FAILS TO PROVE THAT SUCH EXPLANATION IS BONA FIDE AND THA T ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAV E BEEN DISCLOSED BY HIM] 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. 14. FROM THE PERUSAL OF SECTION 271(1)(C) IT IS NE CESSARY THAT THE SATISFACTION SHOULD HAVE BEEN ARRIVED AT BY THE A.O. OR THE COMMISSIONER (AP PEALS) OR THE COMMISSIONER DURING THE COURSE OF PROCEEDINGS UNDER THE INCOME-TAX ACT THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULAR OF SU CH INCOME. THE PENALTY UNDER THIS SECTION CAN BE LEVIED ON TWO CHARGES I.E. FOR CONCEALMENT OF PA RTICULARS OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. IF THE PENALTY P ROCEEDINGS ARE INITIATED ON THE CHARGE OF CONCEALMENT OF PARTICULARS OF INCOME THEN PENALTY C ANNOT BE LEVIED FOR CHARGE OF FURNISHING OF INACCURATE PARTICULARS OF INCOME AND VISE VERSA. T HIS WAS SO HELD BY THE HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. LAKHDIR LALJI 85 ITR 77 (GUJ.). IN VIEW OF PROVISIONS OF SECTION 271(1)(C) WE ARE OF THE VIEW THAT THERE MUST BE CL EAR FINDING ABOUT THE CHARGE OF THE PENALTY. IT IS INCUMBENT ON THE A.O. OR THE OFFICER IMPOSING TH E PENALTY TO STATE WHETHER THE PENALTY WAS BEING LEVIED FOR CONCEALMENT OF PARTICULARS OF INCO ME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. IN THE ABSENCE OF SUCH A FINDING AN OR DER PASSED BY THE CONCERNED AUTHORITY 7 IMPOSING PENALTY UNDER SECTION 271(1)(C) WILL BE VO ID. THIS VIEW HAS BEEN TAKEN IN THE FOLLOWING CASE BY THE HIGH COURTS :- I) CIT VS. MANU ENGINEERING WORKS 122 ITR 306 (GUJ ) II) NEW SORATHIA ENGINEERING CO. VS. CIT 282 ITR 6 42 (GUJ) III) PADMA RAM BHARALI VS. CIT 110 ITR 54 (GAUHATI ) 15. IN THIS CASE WE NOTED FROM THE PENALTY ORDER P LACED BEFORE US THAT THE A.O. HAS NOT BROUGHT OUT ANY SPECIFIC CHARGE FOR WHICH THE PENAL TY HAS BEEN IMPOSED ON THE ASSESSEE UNDER SECTION 271(1)(C). HE HAS SIMPLY MENTIONED THAT TH E ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME FURNISHED INACCURATE PARTICULARS OF SUCH IN COME AND RENDERED HIMSELF LIABLE FOR PENALTY UNDER SECTION 271(1)(C) FOR CONCEALING THE CORRECT PARTICULARS OF HIS INCOME. THIS FACT IS APPARENT FROM THE FINDING OF THE A.O. GIVEN IN THE LAST PARA GRAPH OF THE ORDER REPRODUCED HEREINABOVE. THE WORD CONCEAL AS PER WEBSTER DICTIONARY MEANS TO HIDE WITH DRAW OR REMOVE FROM OBSERVATION COVER OR KEEP AWAY FROM SIGHT TO KEEP SECRET TO AVOID DISCLOSING OR DIVULGING. THAT MEANS NON-DISCLOSURE OF PARTICULARS OF INCOME ON THE OTHER HAND WHERE THE PARTICULARS ARE DISCLOSED BUT SUCH DISCLOSURE IS NOT CORRECT AND TR UE OR ACCURATE IT WOULD AMOUNT TO FURNISHING OF INACCURATE PARTICULARS OF INCOME. FOR EXAMPLE IN A CASE OF A BUSINESSMAN EVEN THE PARTICULAR TRANSACTION OF SALE IS NOT SHOWN IN THE BOOKS IT WO ULD AMOUNT TO CONCEALMENT OF PARTICULARS OF INCOME WHILE THE SALE IS SHOWN BUT ADDED A LESSER V ALUE IT WOULD AMOUNT TO FURNISHING OF INACCURATE PARTICULARS OF INCOME. IT IS PERTINENT TO NOTE THAT THRUST OF LEVY IS UPON THE PARTICULARS OF INCOME WHICH ARE EITHER CONCEALED OR FURNISHED I NACCURATELY BY THE ASSESSEE. THE EXPRESSION PARTICULARS REFER TO THE FACTS DETAILS SPECIFIC O R THE INFORMATION ABOUT SOMEONE OR SOMETHING. THUS THE DETAILS OR INFORMATION ABOUT THE INCOME W OULD DEAL WITH FACTUAL DETAILS OF THE INCOME AND CANNOT BE UNDERSTOOD TO AREAS WHICH ARE SUBJECT IVE SUCH AS STATUS OF TAXABILITY OF AN INCOME 8 ADMISSIBILITY OF DEDUCTION AND INTERPRETATION OF LA W. THE HONBLE SUPREME COURT IN THE DECISION OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. 322 IT R 158 (SC) HAS LAID DOWN THAT AS PER LAW LEXICON THE MEANING OF THE WORD PARTICULARS IS DE TAIL OR DETAILS (IN PLURAL SENSE) THE DETAILS OF A CLAIM OR SUPPORTING ITEMS OF AN ACCOUNT. THUS IT WAS HELD THAT THE MEANING OF THE WORD PARTICULARS USED IN SECTION 271(1)(C) WOULD EMBRA CE THE DETAILS OF THE CLAIM MADE. 16. WE MAY POINT OUT AT THIS STAGE THAT THE EXAPLAN ATION-1 TO SECTION 271(1)(C) IS APPLICABLE ONLY FOR CONCEALMENT OF PARTICULARS OF INCOME. IT CANNOT BE APPLIED WHERE CHARGE AGAINST THE ASSESSEE IS FOR FURNISHING OF INACCURATE PARTICULAR S OF INCOME. WHERE THE CHARGE AGAINST THE ASSESSEE IS CONCEALMENT OF PARTICULARS OF INCOME T HE ONUS IS ON THE A.O. TO ESTABLISH EITHER THAT THE ASSESSEE HAS NOT DISCLOSED THE PARTICULARS OF I NCOME UNDER THE MAIN PROVISIONS OR THE CASE OF THE ASSESSEE FALLS WITHIN THE EXPLANATION GIVEN UND ER SECTION 271(1)(C). EXPLANATION 1 TO SECTION 271(1)(C) STATES THAT THE AMOUNT ADDED OR DISALLOWE D IN COMPUTING THE TOTAL INCOME OF THE ASSESSEE SHALL BE DEEMED TO BE THE INCOME IN RESPEC T OF WHICH PARTICULARS HAVE BEEN CONCEALED. THIS DEEMING PROVISION IS NOT ABSOLUTE ONE BUT IS R EBUT TABLE ONE. IT ONLY SHIFTS THE ONUS ON THE ASSESSEE. EXPLANATION 1 REFERS TO THE TWO SITUATIO NS IN WHICH PRESUMPTION OF THE CONCEALMENT OF THE PARTICULARS OF INCOME IS DEEMED. THE FIRST SIT UATION IS WHERE THE ASSESSEE IN RESPECT OF ANY FACT MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOM E FAILS TO OFFER AN EXPLANATION OR OFFERS AN EXPLANATION WHICH IS FOUND BY THE A.O. OR THE COMM ISSIONER TO BE FALSE. THE SECOND SITUATION IS WHERE THE ASSESSEE IN RESPECT OF ANY FACTS MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME OFFERS AN EXPLANATION WHICH THE ASSESSEE IS NOT ABLE TO SUBSTANTIATE AND ALSO FAILS TO PROVE THAT SUCH EXPLANATION WAS BONAFIDE ONE AND THAT ALL THE FACTS RELATING TO THE COMPUTATION OF TOTAL INCOME HAVE BEEN DISCLOSED BY HIM. THE PRESUMPTION AVAILA BLE UNDER EXPLANATION TO SECTION 271(1)(C) 9 CANNOT BE DRAWN UNLESS THE CASE OF THE ASSESSEE FAL LS UNDER EITHER OF THE CLAUSES (A) OR (B). THIS EXPLANATION THEREFORE DOES NOT AND CANNOT APPLY T O THE CASE WHERE ADDITION/DISALLOWANCE HAS BEEN MADE BY REJECTION OF LEGAL CLAIM MADE BY THE A .O. BONAFIDE OF LEGAL CLAIM IS NOT THE SUBJECT MATTER OF THE EXAPLANATION-1. THEREFORE H ONBLE SUPREME COURT IN THE CASE OF RELIANCE PETROPRODUCTS (SUPRA) HAS HELD THAT MERE REJECTION OF LEGAL CLAIM WOULD NOT INVITE PENALTY. THIS WOULD ALSO APPLY WHERE THE CHARGE AGAINST THE ASSES SEE IS CONCEALMENT OF PARTICULARS OF INCOME. IF WE LOOK AT THE PROVISIONS OF SECTION 271(1)(C) A ND EXPLANATION-1 FROM A DIFFERENT ANGLE THE A.O. IS BOUND TO BRING ON RECORD SPECIFIC CHARGE AG AINST THE ASSESSEE WHETHER THE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME OR FURNISHED IN ACCURATE PARTICULARS OF INCOME. IN THE CASE OF CONCEALMENT OF PARTICULARS OF INCOME INITIAL ONUS WILL GET SHIFTED ON THE ASSESSEE TO PROVE THAT HE HAS NOT CONCEALED THE PARTICULARS OF INCOME DUE TO THE APPLICABILITY OF EXPLANATION I. WHILE IN THE CASE OF FURNISHING OF INACCURATE PARTICULARS OF INCOME THE ONUS REMAINS ON THE REVENUE TO PROVE THAT THE ASSESSEE HAS FURNISHED INACCURATE PA RTICULARS OF INCOME. IF THE A.O. FAILED TO BRING OUT OR LEVY SPECIFIC CHARGE ON THE ASSESSEE THE PE NALTY IMPOSED CANNOT BE SUSTAINED. OUR AFORESAID VIEW IS DULY SUPPORTED BY THE DECISION OF THE HONBLE GUJARAT HIGH COURT IN THE CASE OF NEW SORATHIA ENGINEERING CO. LTD. 282 ITR 642 IN W HICH IT WAS HELD AS UNDER :- IT IS INCUMBENT UPON THE ASSESSING OFFICER TO STAT E WHETHER THE PENALTY WAS BEING LEVIED FOR CONCEALMENT OF PARTICULARS OF INCOME BY THE ASSESSEE OR WHETHER ANY INACCURATE PARTICULARS OF INCOME HAD BE EN FURNISHED BY THE ASSESSEE. --------------------------------------------------- ------------------------ --------------------------------------------------- ------------------------ HELD THAT THE PENALTY ORDER AND THE ORDER OF THE C OMMISSIONER (APPEALS) SHOWED THAT NO CLEAR CUT FINDING HAD BEEN REACHED. THE TRI BUNAL HAD FAILED TO APPRECIATE THIS LEGAL. ISSUE. THE RATIO IN CIT V. MANU ENGINE ERING WORKS 122 ITR 306(GUJ) WAS APPLICABLE AND THE ORDER OF PENALTY COULD NOT B E UPHELD BY THE TRIBUNAL. THE ORDER WAS INVALID. SIMILAR VIEW HAS BEEN TAKEN BY THE TRIBUNAL IN THE FOLLOWING CASES :- 10 I) ITO VS. SMT. LALITA IN ITA NO.433/AGR/2009 FOR A .Y. 1998-99 II) KM. RUCHI RATHORE VS. ITO IN ITA NO.97/AGR/2007 FOR A.Y. 1998-99 III) SMT. RAJ RANI MITTAL VS. ITO IN ITA NO.2275/DE L/2009 OF ITAT DELHI BENCH A IV) ACIT VS. DR. S.D. MAURYA IN ITA NO.619/AGR/2008 FOR A.Y. 2003-04 V) MUKESH CHANDRA A. LAKDAWALA VS. ITO (2010) 4 ITR (TRIB) 307 (AHMEDABAD) VI) NAVINBHAI M. PATEL VS. ITO 31 TTJ (AHD) 40 VII) DECISION OF ITAT AGRA BENCH IN THE CASE OF SA TNAM KALRA VS. ACIT IN ITA NO.53/AGRF/2006 VIII) DECISION OF ITAT AGRA BENCH (SMC) IN THE CAS E OF MAHESH CHAND GUPTA VS. ITO 4(2) IN ITA NO.118/AGRF/2006 IX) DECISION OF ITAT AGRA BENCH IN THE CASE OF M/S . BAJWA RUBBER INDUSTRIES VS. DCIT IN ITA NOS.01/AGR/2010 & 478/AGR/2009 17. ON THE BASIS OF THE AFORESAID CASES WE ARE OF THE VIEW THAT THE PENALTY IS LIABLE TO BE ANNULLED. WE ACCORDINGLY CANCEL THE PENALTY IMPOSE D UNDER SECTION 271(1)(C). 18. COMING TO THE MERIT OF THE CASE WE NOTED THAT IN THIS CASE THE ASSESSEE HAS MADE A CONDITIONAL OFFER THAT NO PENALTY SHOULD BE IMPOSED ON THE ASSESSEE. WE NOTED THAT THE ASSESSEE HAS CATEGORICALLY STATED BEFORE THE AUTHORITIES BEL OW THAT THE FDRS WHICH ARE IN THE DIFFERENT NAMES I.E. THE ASSESSEE HIS WIFE HIS FATHER HIS BROTHER HIS BROTHERS WIFE CHILDREN AND ALSO IN THE NAME OF MISS. SEEMA RANI ARE NOT ACTUALLY OWNED BY THE ASSESSEE. THE ASSESSEE SURRENDERED THESE FDRS AS THE ASSESSEE COULD NOT PRODUCE THE EV IDENCE TO THE SATISFACTION OF THE A.O. AND ALSO THE FACT THAT THE ASSESSEE DOES NOT WANT TO BO THER OTHER FAMILY MEMBERS. EVEN IN ONE CASE MISS. SEEMA RANI HAS GONE TO THE COURT AND HAS TAKE N PENAL ACTION AGAINST THE ASSESSEE FOR THE RECOVERY OF THE FDR AS WELL AS DAMAGES FROM THE ASS ESSEE. IN SUPPORT OF HIS CONTENTION THAT ALL THE FDR DOES NOT BELONG TO THE ASSESSEE AS HE COULD COLLECT AFFIDAVIT AND SOME OF THE AFFIDAVIT WERE SOLEMNIZED ON OATH THAT THEY HAVE GIVEN AMOUNT FOR DEPOSIT IN FDR TO DR. HARENDRA KUAMR GUPTA I.E. THE ASSESSEE FOR SAFE CUSTODY AND THE AM OUNT ACTUALLY BELONGED TO THEM. THIS IS THE SETTLED LAW THAT THE ASSESSMENT AND PENALTY PROCEED INGS BOTH ARE DIFFERENT. IF THE ADDITION IS 11 MADE IN THE ASSESSMENT DOES NOT IPSO FACTO MAKE THE ASSESSEE LIABLE FOR THE PENALTY. IF THE ASSESSEE FAILED TO FILE THE EVIDENCE DURING THE ASS ESSMENT PROCEEDINGS HE CAN ALWAYS FILE THE EVIDENCE DURING THE COURSE OF PENALTY PROCEEDINGS. THE EXPLANATION FILED BY THE ASSESSEE IN OUR OPINION WAS A BONAFIDE ONE. THIS FACT IS ON RECORD THAT MOST OF THE FDRS WERE IN THE NAME OF THE OTHER PERSONS. MERELY THE ASSESSEE SURRENDERED THE AMOUNT DOES NOT MEAN THAT THE ASSESSEE HAS CONCEALED THE PARTICULARS OF HIS INCOME. ONCE THE ASSESSEE HAS SUBMITTED THE EXPLANATION AND THE AFFIDAVIT WHICH PROVE THAT E ALL THE FDRS DOES NOT BELONGED TO THE ASSESSEE IN OUR OPINION THE ASSESSEE CANNOT BE MADE LIABLE UNTIL AND UNLESS THE A.O. PROVES THAT THE EXPLANATION GIVEN BY THE ASSESSEE WAS FALSE. NO SUCH EVIDENCE OR MATERIAL I S BROUGHT ON RECORD. EVEN OTHERWISE THE ASSESSEE HAS SURRENDERED THE INCOME SUBJECT TO THE CONDITION THAT NO PENALTY BE IMPOSED ON THE ASSESSEE. WE ACCORDINGLY DELETE THE PENALTY IMPOSE D ON THIS BASIS ALSO. 19. IN THE RESULT ALL THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED. (ORDER PRONOUNCED IN THE OPEN COURT ON 17.09.2010). SD/- SD/- (R.K. GUPTA) (P.K. BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE: AGRA DATE: 17 TH SEPTEMBER 2010. PBN/* 12 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT BY ORDER 3. CIT CONCERNED 4. CIT (APPEALS) CONCERNED 5. DR ITAT AGRA BENCH AGRA 6. GUARD FILE ASSIST ANT REGISTRAR INCOME-TAX APPELLATE TRIBUNAL AGRA TRUE COPY