BHARAT J GUPTA, MUMBAI v. ITO 25(3)(1), MUMBAI

ITA 3263/MUM/2016 | 2004-2005
Pronouncement Date: 29-11-2017 | Result: Dismissed

Appeal Details

RSA Number 326319914 RSA 2016
Assessee PAN AAFPG8171R
Bench Mumbai
Appeal Number ITA 3263/MUM/2016
Duration Of Justice 1 year(s) 6 month(s) 20 day(s)
Appellant BHARAT J GUPTA, MUMBAI
Respondent ITO 25(3)(1), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 29-11-2017
Appeal Filed By Assessee
Tags No record found
Order Result Dismissed
Bench Allotted H
Tribunal Order Date 29-11-2017
Date Of Final Hearing 29-06-2017
Next Hearing Date 29-06-2017
First Hearing Date 29-06-2017
Assessment Year 2004-2005
Appeal Filed On 09-05-2016
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES H MUMBAI BEFORE S HRI B.R. BASKARAN (AM) AND SHRI RAM LAL NEGI (JM) ITA NO. 3263 /MUM/20 1 6 ASSESSMENT YEAR: 2004 - 2005 SHRI BHARAT J GUPTA 1/1 CHHABARIA NAGAR OPP. TELEPHONE TELEPHONE EXCH A N GE KAN DIVALI (WEST) MUMBAI - 400067 PAN: AAFPG8171R VS. THE ITO 25(3)(1) MUMBAI (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI M.C. OMI NINGSHEN (D R) DATE OF HEARING: 2 2/11 /201 7 DATE OF PRONOUNCEMENT: 29 / 11 /201 7 O R D E R PER RAM LAL NEGI JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST ORDER DATED 22/02/2016 PASSED BY LD. C OMMISSIONER OF INCOME TAX (APPEALS ) - 45 MUMBAI PERTAINING TO THE A S S ESSMENT YEAR 20 04 - 2005 WHEREBY THE LD. CIT(A) HAS DISMISSED THE APPEAL FILED BY THE ASSESSEE AGAINST PENALTY ORDER PASSED U/S 271(1)(C) OF THE INCOME TAX ACT 1961 (FOR SHORT THE ACT). 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2004 - 05 DECLARING THE TOTAL INCOME OF RS.93 838/ - . SUBSEQUENTLY THE CASE WAS REOPENED U/S 147 OF THE ACT ON THE BASIS OF INFORMATION RECEIVED FROM DDIT(INV) MUMBAI TO THE EFFECT THAT THE ASSESSEE 2 ITA NO. 3263 /MUM/2016 ASSESSMENT YEAR: 2004 - 2005 HAD TAKEN BOGUS BILLS FROM M/S MIHIR AGENCIES PVT. LTD. ONE OF THE GROUP CONCERNS WHICH WAS INDULGED IN ISSUING BOGUS BILLS AND PROVIDING BOGUS SPECULATION/PROFIT/LOSS SHORT TERM/LONG TERM CAPITAL LOSS/GAIN ETC. FOR RS. 6 59 400/ - IN THE NAME OF A SCRIP BUNIYAD CHEMICAL AND CLAIMED THE SAME AS LONG TERM CAPITAL GAIN. IT WAS ESTABLISHED DURING THE ASSESSMENT PROCEEDINGS THAT THE TRANSACTION WAS NEVER ENTERED IN TO THE STOCK EXCHANGE AND THE SAID AMOUNT WAS THE INCOME FROM UNDISCLOSED SOURCE. FURTHER AN AMOUNT OF RS.32 790/ - BEING 5% OF THE AMOU NT FOR PROCURING THE BOGUS ENTRIES WAS ADDED U/S 69C OF THE ACT. AO ALSO TREATED THE LOAN AMOUNTING TO RS. 5 34 452/ - AS UNPROVED LOAN. HENCE THE INCOME OF THE ASSESSEE WAS DETERMINED AT RS. 13 57 401/ - . APPEAL FILED BY THE ASSESSEE AGAINST THE ASSESSMENT ORDER WAS DISMISSED BY THE LD. CIT(A). 3. ACCORDINGLY THE AO INITIATED PROCEEDINGS U/S 271(1)(C) OF THE ACT. THE ASSESSEE FAILED TO FURNISH ANY EXPLANATION IN RESPONSE TO THE SHOW CAUSE NOTICE THE AO LEVIED PENALTY OF RS. 4 11 257/ - U/S 271(1)(C) OF TH E ACT FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. IN APPEAL THE LD. CIT(A) CONFIRMED THE PENALTY LEVIED BY THE AO. 4. AGGRIEVED BY THE IMPUGNED ORDER PASSED BY THE LD. CIT (APPEALS) THE ASSESSEE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNA L ON THE FOLLOWING EFFECTIVE GROUND S : - 1. THE PRESENT APPEAL FILED BY THE APPELLANT IS AGAINST THE CIT (A) 45/ITO 25(3)(1)/ITA 338/10 - 11 DATED 22 - 02 - 2016 FOR THE PERIOD 01.04.2003 TO 31 - 03 - 2004 PASSED BY THE CIT (A) - 45/ITO 33 (1)(2)/ITA 277/2013 - 14. 2. THE C IT (A) HAS ERRED IN NOT GIVING REASONABLE PROPER AND SUFFICIENT OPPORTUNITIES TO THE APPELLANT FOR EXPLAINING AND ADDING THE INCOME UNDER THE VARIOUS HEADS. 3 ITA NO. 3263 /MUM/2016 ASSESSMENT YEAR: 2004 - 2005 3. THE CIT (A) HAS NOT GIVEN PROPER OPPORTUNITY OF HEARING TO THE APPELLANT BEFORE MAKING HUGE ADDITI ON UNDER VARIOUS HEADS. 4. THE CIT (A) HAS NOT JUSTIFIED IN ESTIMATION OF HOUSE PROPERTY INCOME OF RS. 50 400/ - AS NOTIONAL RENT SINCE THE APPELLANTS SELF OCCUPIED PROPERTY FLAT AT KANDIVALI WHOSE NOTIONAL RENT WAS CONSIDERED BY THE A.O. AND THE CIT (A) WI THOUT CONSIDERING THE FACT OF CASE WHERE THE NOTIONAL INCOME OF SOP OF THE APPELLANT SHALL BE NIL. THERE IS NO QUESTION OF CONCEALMENT OF ANY INCOME SINCE IT IS REFLECTED IN THE APPELLANTS BALANCE SHEET AND HIS BOOKS OF ACCOUNTS RELATED TO PREVIOUS YEAR. 5. THE CIT (A) HAS NOT JUSTIFIED IN TREATING THE ENTIRE SALE PROCEEDS OF SHARES OF RS. 659400/ - AS INCOME FOR UNDISCLOSED SOURCES FOR WHICH THE WRITTEN SUBMISSION AND EXPLANATION WERE SUBMITTED BEFORE THE A.O AND CIT (A) AT THE TIME OF HEARING WHICH SHOWS A ND REFLECTS IN THE BOOKS OF ACCOUNT THAT THE APPELLANT HAD RECEIVED THE ACTUAL CONTRACT NOES FROM THE BROKER AND ALL THE TRANSACTIONS WERE DEALT WITH CHEQUES ONLY. THERE IS NO QUESTION OF CONCEALMENT OF ANY INCOME SINCE IT IS REFLECTED IN THE APPELLANTS B ALANCE SHEET AND HIS BOOKS OF ACCOUNTS RELATED TO PREVIOUS YEAR. 6. THE CIT (A) NOT JUSTIFIED IN ESTIMATION OF EXPENSES @ 5% ON RS. 6 59 000/ - (AMOUNTING TO RS. 32 970/ - ) U/S 69C OF I. TAX ACT 1961. SINCE THE SAID ADDITION WAS NOT ACCEPTED BY THE APPELLANT AS IT WAS WRONGFULLY ADDED IN THE HANDS OF THE INCOME OF THE APPELLANT. WITHOUT PREJUDICE THE ESTIMATION OF EXPENSES @ 5% IS VERY HIGH AND NOT ACCEPTED BY THE APPELLANT. THERE IS NO QUESTION OF CONCEALMENT OF ANY INCOME SINCE IT IS REFLECTED IN THE APPELLA NTS BALANCE SHEET AND HIS BOOKS OF ACCOUNTS RELATED TO PREVIOUS YEAR. 7. THE CIT (A) NOT JUSTIFIED IN MAKING ADDITION ON ACCOUNT OF UNPROVED LOANS OF RS. 5 34 452/ - AS THE SAME LOANS WERE ACCEPTED AND ALLOWED IN THE PREVIOUS ASSESSMENT YEAR BY THE THAN A.O AND ALL THE LOANS CONFIRMATIONS WITH RELEVANT DOCUMENTS TO SHOW THE GENUINENESS OF THE TRANSACTIONS I.E. ALL THE LOANS 4 ITA NO. 3263 /MUM/2016 ASSESSMENT YEAR: 2004 - 2005 WERE OPENING BALANCE OF CURRENT FINANCIAL YEAR RELEVANT TO ASSESSMENT YEAR ONLY. THERE IS NO QUESTION OF CONCEALMENT OF ANY INCOME SINCE IT IS REFLECTED IN THE APPELLANTS BALANCE SHEET AND HIS BOOKS OF ACCOUNTS RELATED TO PREVIOUS YEAR. 8. THE CIT (A) NOT JUSTIFIED IN LEVYING INTEREST/PENALTY U/S 234A 234B & 234C OF THE I. TAX ACT 1961. 9. THE CIT (A) NOT JUSTIFIED IN INITIATING PENALTY PROC EEDINGS U/S 271 (1)(C ) OF THE I. TAX ACT 1961. 5. THIS APPEAL WAS FIXED FOR HEARING ON 22.11.17. ON THE SAID DATE WHEN THE CASE WAS CALLED FOR HEARING NEITHER THE APPELLANT/ ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE APPEARED NOR ANY APPLICATION WAS RECEIVED FOR ADJOURNMENT. WE NOTICED THAT THE ASSESSEE HAS NOT APPEARED SUCCESSIVELY FOR MORE DATES WHEN THE CASE WAS FIXED FOR HEARING. PRIOR TO THAT THE ASSESSEE HAS TAKEN ADJOURNMENTS FOR THREE OCCASIONS. THE LD. AUTHORIZED REPRESENTATIVE HAS WITHDRAWN THE LETTER OF AUTHORITY FROM THE CONDUCT OF THE ASSESSEE AND THE CIRCUMSTANCES WE ARE CONVINCED THAT THE ASSESSEE IS NOT INTERESTED IN PURSUING ITS APPEAL. ACCORDINGLY WE DECIDED TO DISPOSE OF THE APPEAL ON THE BASIS OF MATERIAL ON RECORD AFTER HEARING THE DEPARTMENTAL REPRESENTATIVE (DR). 6. BEFORE US THE LD. DR RELYING ON THE CONCURRENT FINDINGS OF THE AUTHORITIES BELOW SUBMITTED THAT SINCE THE EXPLANATION OFFERED BY THE ASSESSEE WAS FOUND TO BE FALSE BY THE AO THE LD. CIT(A) HAS RIGHTLY CONFIRMED THE PENALTY IMPOSED BY THE AO U/S 271 (1)(C) OF THE ACT. 7. WE HAVE CAREFULLY GONE THROUGH THE MATERIAL ON RECORD INCLUDING THE ORDERS PASSED BY THE AUTHORITIES BELOW AND THE CASES RELIED UPON BY THE ASSESSEE BEFORE THE AUTHORITIES BELOW. THOUGH THE ASSES SEE HAS RAISED 9 GROUNDS OF APPEAL BUT THE ONLY GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) 5 ITA NO. 3263 /MUM/2016 ASSESSMENT YEAR: 2004 - 2005 WRONGLY CONFIRMED THE PENALTY ORDER PASSED BY THE AO. WE NOTICE THAT T HE LD. CIT(A) HAS CONFIRMED THE PENALTY LEVIED BY THE AO AFTER TAKING INTO CONSIDERATION THE SUBMISSIONS MADE BY THE ASSESSEE DURING THE APPELLATE PROCEEDINGS. THE OPERATIVE PART OF THE ORDER READS AS UNDER: 6. I HAVE CONSIDERED THE PENALTY ORDER AND THE SUBMISSIONS OF THE APPELLANT. IT IS SEEN THAT DURING THE ASSESSMENT ADDITION OF RS. 32 790/ - HAS BEEN MADE BY DENYING CAPITAL GAIN AFTER ENQUIRIES WERE MADE BY THE INCOM E TAX DEPARTMENT. THE COMMISSION PAID FOR ENTRIES PASSED IN ORDER TO EARN CAPITAL GAIN WAS ALSO ADDED. LOAN CONFIRMATIONS WHICH WERE NOT PROVIDED DURING THE ASSESSMENT PROCE EDINGS WERE ALSO ADDED BACK TO THE INCOME OF THE APPELLANT. CONSIDERING THE FACTS AND CIRCUMSTANCES WHICH LED TO LEVY OF PENALTY I AM INCLINED TO AGREE WITH THE ASSESSING OFFICER THAT INCOME WAS CONCEALED. THE JUDICIAL PRONOUNCEMENTS RELIED UPON BY THE A PPELLANT DIFFER IN FACTS AND CIRCUMSTANCES. IN NONE OF THE CASES CITED CAPITAL GAINS WERE EARNED THROUGH FRAUDULENT SHARE TRANSACTIONS AND LOAN CONFIRMATION NOT PRODUCED. HENCE PENALTY LEVIED IS CONFIRMED. GROUND NOS 1 - 4 ARE THUS DISMISSED. 8. IN OUR CONSIDERED OPINION THE FINDINGS OF THE LD. CIT(A) ARE BASED ON THE EVIDENCE ON RECORD. SINCE THE ASSESSEE HAS FAILED TO PROVE THE GENUINENESS OF THE TRANSACTION TO CLAIM CAPITAL GAIN AND FURTHER FAILED TO PROVE THE GENUINENESS OF THE LOAN TRANSACTION THE ADDITION WAS MADE TO THE INCOME OF THE ASSESSEE. DURING THE PENALTY PROCEEDINGS THE EXPLANATION OFFERED BY THE ASSESSEE WAS FOUND TO BE FALSE BY THE AUTHORITIES BELOW. UNDER THESE CIRCUMSTANCES THE FINDINGS OF THE LD. CIT(A) CANNOT BE HELD TO BE ERRONEOU S TO INTERFERE WITH THE SAME. MOREOVER NO NEW FACTS CAME TO OUR NOTICE. HENCE WE UPHOLD THE FINDINGS OF THE LD CIT(A) AND DISMISS ALL THE GROUNDS OF THE APPEAL OF THE ASSESSEE. 6 ITA NO. 3263 /MUM/2016 ASSESSMENT YEAR: 2004 - 2005 IN THE RESULT APPEAL FILED BY THE ASSESSEE FOR THE ASSESSMENT YEAR 2004 - 2005 IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH NOVEMBER 2017 . SD/ - SD/ - ( B.R. BASKARAN ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MU MBAI ; DATED: 29 / 11 / 2017 ALINDRA PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. / DR ITAT MUMBAI 6. / GUARD FILE . / BY ORDER //TRUE COPY// / (DY./ASSTT. REGISTRAR) / ITAT MUMBAI