Anant Himatsingka, Kolkata v. Addl. CIT, Range - VI(C), Kolkata, Kolkata

ITA 331/KOL/2010 | 2003-2004
Pronouncement Date: 25-11-2011 | Result: Allowed

Appeal Details

RSA Number 33123514 RSA 2010
Assessee PAN AAMPH8028H
Bench Kolkata
Appeal Number ITA 331/KOL/2010
Duration Of Justice 1 year(s) 9 month(s) 10 day(s)
Appellant Anant Himatsingka, Kolkata
Respondent Addl. CIT, Range - VI(C), Kolkata, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 25-11-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 25-11-2011
Assessment Year 2003-2004
Appeal Filed On 15-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA () BEFORE . . !' # # # # /AND $# !' ) [BEFORE HONBLE SHRI S. V. MEHROTRA AM & HONBLE S RI MAHAVIR SINGH JM] #% #% #% #% / I.T.A NOS. 331 & 332/KOL/2010 $&' () $&' () $&' () $&' ()/ // / ASSESSMENT YEARS: 2003-04 & 2004-05 ANANT HIMATSINGKA VS. ADDL. COMMISSIONER OF IN COME-TAX (PAN-AAMPH 8028 H) RANGE-VI (C) KOLKATA. (+ /APPELLANT ) (-.+ / RESPONDENT ) DATE OF HEARING: 11.11.2011 DATE OF PRONOUNCEMENT: 25.11.2011 FOR THE APPELLANT: SHRI SUBASH AGARWAL FOR THE RESPONDENT: SHRI S. K. MALAKAR !/ / ORDER PER MAHAVIR SINGH JM ( $# $# $# $# !' !' !' !' ) THESE APPEALS BY ASSESSEE ARE ARISING OUT OF SEPARA TE ORDERS OF CIT(A) CENTRAL-1 KOLKATA IN APPEAL NO.93/94/ADDL. CIT R-VI(C)/CIT(A) C-I/08-09 VIDE DATED 14.12.2009. ASSESSMENTS WERE FRAMED BY ACIT C.C-1 KOLKATA U/S . 153A/143(3) OF THE INCOME TAX ACT 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR ASS ESSMENT YEARS 2003-04 AND 2004-05 VIDE HIS SEPARATE ORDERS DATED 31.12.2007. THE PENALTIES IN DISPUTE WERE LEVIED BY ADDL. CIT RANGE- VI(C) KOLKATA U/S 271D OF THE ACT VIDE HIS SEPARAT E ORDERS DATED 20.02.2008. 2. THE ONLY COMMON ISSUE IN THESE TWO APPEALS OF AS SESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING LEVY OF PENALTY BY ADDL. CIT U/S. 271D O F THE ACT FOR VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT. FOR ASSESSMENT YEAR 2003 -04 IN ITA NO. 331/K/2010 ASSESSEE RAISED FOLLOWING TWO EFFECTIVE GROUNDS: 1) FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE 1D. C.I.T.(APPEALS) ERRED IN CONFIRMING THE PENALTY OF RS.5 00 000/- IM POSED BY THE ADDITIONAL CIT U/S. 271D BY WRONGLY INVOKING THE PROVISIONS OF SECTION 269SS OF THE ACT. 2) FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE PENALTY U/S. 271D WAS NOT IMPOSABLE AND THE SAME IS LIABLE TO BE DELETED. IN ITA NO.332/K/2010 FOR ASSESSMENT YEAR 2004-05 A SSESSEE RAISED FOLLOWING TWO GROUNDS: 2 ITA 331 & 332/K/2010 ANANT HIMATSINGKA. A.Y.03-04 & 04-05 1) FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE 1D. C.I.T.(APPEALS) ERRED IN CONFIRMING THE PENALTY OF RS.3 00 000/- IM POSED BY THE ADDITIONAL CIT U/S. 271D BY WRONGLY INVOKING THE PROVISIONS OF SECTION 269SS OF THE ACT. 2) FOR THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE PENALTY U/S. 271D WAS NOT IMPOSABLE AND THE SAME IS LIABLE TO BE DELETED. 3. THE FACTS AND CIRCUMSTANCES ARE EXACTLY IDENTICA L AND EVEN ARGUMENTS ARE SAME HENCE THESE TWO APPEALS OF THE ASSESSEE ARE DECIDED BY TH IS CONSOLIDATED ORDER. 4. THE BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE T HAT SEARCH AND SEIZURE OPERATION WAS CARRIED OUT IN GKB GROUP OF CASES U/S. 132 OF THE A CT ON 15.2.2006 AND CONSEQUENT SEARCH WAS ALSO CONDUCTED IN THE CASE OF SHRI R. K. GUPTA ASS ESSEES FATHER IN LAW. AS SHRI R. K. GUPTA WAS COVERED ASSESSEES CASES WERE ALSO COVERED U/S . 153A OF THE ACT AND CONSEQUENTLY ASSESSEE WAS REQUIRED TO FILE RETURN U/S. 153A OF T HE ACT FOR BOTH THE ASSESSMENT YEARS. THE ASSESSEE FILED HIS RETURNS OF INCOME U/S. 153A OF T HE ACT DISCLOSING INCOME AT RS.85 980/- AND RS.1 27 110/- FOR ASSESSMENT YEARS 2003-04 AND 2004 -05 RESPECTIVELY. ASSESSMENTS WERE COMPLETED U/S. 153A R.W.S. 143(3) OF THE ACT ON 31. 12.2007 ACCEPTING THE RETURNED INCOME. DURING THE COURSE OF ASSESSMENT PROCEEDINGS ASSESS ING OFFICER NOTICED THAT ASSESSEE HAS RECEIVED LOAN IN CASH AMOUNTING TO RS. 5 LACS AND R S.3 LACS IN ASSESSMENT YEARS 2003-04 AND 2004-05 RESPECTIVELY FROM SHRI R. K. GUPTA WHO IS FATHER IN LAW OF THE ASSESSEE IN VIOLATION OF THE PROVISIONS OF SECTION 269SS OF THE ACT. ACCORD INGLY ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS U/S. 271D OF THE ACT AND PENALTY WAS RE FERRED TO ADDL. CIT FOR LEVY OF PENALTY U/S. 271D OF THE ACT FOR CONTRAVENTION OF PROVISIONS OF SECTION 269SS OF THE ACT FOR THESE TWO ASSESSMENT YEARS I.E. 2003-04 AND 2004-05. ASSESSIN G OFFICER NOTICED THE FOLLOWING RECEIPT OF CASH LOAN FROM SHRI R. K. GUPTA SHRI AJAY GUPTA AN D SHRI VINAY GUPTA (BUT ACTUALLY THESE AMOUNTS WERE RECEIVED ONLY FROM SHRI R. K. GUPTA) A S UNDER: DATE RECEIPT IN THE NAME OF RUPEES 01.08.2002 04.04.2003 04.04.2003 SHRI R. K. GUPTA SHRI AJAY GUPTA SHRI VINAY GUPTA 5 00 000 2 00 000 1 00 000 LD. COUNSEL FOR THE ASSESSEE NOW BEFORE US STATED T HAT ADDL. CIT RANGE-VIC KOLKATA LEVIED PENALTY FOR BOTH THE ASSESSMENT YEARS AT RS.5 LACS AND RS.3 LACS U/S. 271D OF THE ACT FOR VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT BY ACCEPTING A SUM OF RS.5 LACS AND RS.3 LACS OTHERWISE THAN BY ACCOUNT PAYEE CHEQUE OR BANK DRAFT I.E. ACCEPTED ONLY IN CASH. ACCORDING TO ADDL. CIT RANGE-VI-C KOLKATA THIS IS A LOAN R ECEIVED BY ASSESSEE IN CASH HENCE HE LEVIED PENALTIES IN THESE TWO ASSESSMENT YEARS. AGGRIEVED ASSESSEE PREFERRED APPEAL BEFORE CIT(A) 3 ITA 331 & 332/K/2010 ANANT HIMATSINGKA. A.Y.03-04 & 04-05 WHO ALSO CONFIRMED THE ACTION OF ASSESSING OFFICER. AGGRIEVED NOW ASSESSEE IS IN APPEALS BEFORE US. 5. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. IT IS A FACT THAT IN ASSESSMENT YEAR 2003-04 THE A SSESSEE HAS RECEIVED CASH LOAN OF RS. 5 LACS IN VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT FROM SHRI R. K. GUPTA WHO IS FATHER IN LAW OF ASSESSEE. SIMILARLY ASSESSEE HAS RECEIVED A SU M OF RS.2 LACS ON 04.04.2003 AND RS.1 LAC ON 04.04.2003 RECEIVED IN THE NAME OF SHRI AJAY GUPTA AND SHRI VINAY GUPTA BUT ACTUALLY THIS WAS TRANSACTED BY SHRI R. K. GUPTA. THIS LOAN WAS ADMI TTEDLY IN CASH. IT IS ALSO AN ADMITTED POSITION THAT THESE CASH LOANS WERE ACCEPTED BY ASS ESSEE AND CONFIRMED UPTO TRIBUNAL B BENCH IN THE CASE OF SHRI R. K. GUPTA VS. ACIT IN I TA NOS. 2142&2143/K/2010 ASSESSMENT YEAR 2003-04 AND 2004-05 VIDE ORDER DATED 12.08.201 1. THE LD. COUNSEL FOR THE ASSESSEE SHRI SUBASH AGARWAL FAIRLY POINTED OUT AND ADMITTED THAT THIS IS CASH LOAN IN VIOLATION OF PROVISIONS OF SECTION 269SS OF THE ACT BUT HE NARRATED THAT TH ERE IS A REASONABLE CAUSE FOR VIOLATION OF THIS PROVISION AS ENUMERATED IN SECTION 273B OF THE ACT WHERE PENALTY WILL NOT BE IMPOSED IN CERTAIN CASES WHERE ASSESSEE PROVES THAT THERE WAS A REASONABLE CAUSE FOR THE SAID FAILURE. IN THE PRESENT CASE LD. COUNSEL FOR THE ASSESSEE STAT ED THAT THIS TRANSACTION WAS DONE AMONG RELATIVES THAT ASSESSEE SHRI ANANT HIMATSINGKA IS S ON IN LAW OF SHRI R. K. GUPTA FROM WHOM HE HAS RECEIVED CASH LOAN BUT THIS IS NOT A CASH LOAN RATHER THIS IS A FINANCIAL SUPPORT TO ASSESSEE. LD. SR. D. R. HOWEVER ON THE OTHER HAND HAS NOT D ISPUTED THE FACT THAT THIS TRANSACTION IS NOT AMONG RELATIVES HE ADMITTED THIS POSITION. WE FIN D THAT HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. NATVARLAL PURSHOTTAMDAS PAREKH (200 8) 303 ITR 5 (GUJ) HAS NOTED THE FACT AND GIVEN FINDING THAT AMOUNTS WHICH ARE MERE BOOK ENT RIES AND TRANSACTIONS ON BEHALF OF FAMILY MEMBERS DOES NOT VIOLATE THE PROVISIONS OF SECTION 269SS AND 269T AND PENALTY CANNOT BE IMPOSED U/S. 269SS FOR VIOLATION OF SECTION 269SS & 269T OF THE ACT I.E. PENALTIES U/S. 271D AND 271E OF THE ACT. HONBLE GUJARAT HIGH COURT HA S CONFIRMED THE FINDING OF TRIBUNAL WHEREIN TRIBUNAL HELD THAT ASSESSEE WAS PREVENTED B Y REASONABLE CAUSE IN THE LIGHT OF THE AFFIDAVIT OF ONE SHRI J. B. SHAH THE ADVOCATE AND THE INCOME-TAX PRACTITIONER HAVING STANDING OF 33 YEARS AS HE OPINED THAT THE ASSESSEE WOULD NO T VIOLATE THE PROVISIONS OF SECTIONS 269SS AND 269T OF THE ACT IF THE ASSESSEE RECEIVES AMOUNT S FROM THE FAMILY MEMBERS AND REPAYS TO DIFFERENT FAMILY MEMBERS. HONBLE GUJARAT HIGH COU RT HAS CONFIRMED THAT THIS IS A REASONABLE CAUSE EVEN THOUGH ASSUMING THAT THERE WAS VIOLATION BY ASSESSEE UNDER SECTIONS 269SS AND 269T OF THE ACT. EVEN OTHERWISE SIMILARLY TRANSAC TIONS AMONG SISTER CONCERNS WAS HELD TO BE OUT OF THE PURVIEW OF SECTION 269SS IN VIEW OF THE DECISION OF HONBLE MADRAS HIGH COURT IN THE CASE CIT VS. IDHAYAM PUBLICATIONS LTD. (2006) 2 85 ITR 221 (MAD) WHEREIN HONBLE HIGH 4 ITA 331 & 332/K/2010 ANANT HIMATSINGKA. A.Y.03-04 & 04-05 COURT HAS CONFIRMED THE FINDINGS OF TRIBUNAL AS TH E TRIBUNAL FOUND THAT M THE PROPRIETOR OF SISTER CONCERN WAS ONE OF THE DIRECTORS OF THE COMP ANY AND THERE WAS A RUNNING ACCOUNT IN HIS NAME AND IT DOES NOT ATTRACT PROVISIONS OF SECTION 269SS OF THE ACT. HONBLE HIGH COURT ALSO DISMISSED THE APPEAL OF REVENUE BY HOLDING THAT THE TRANSACTION BETWEEN THE ASSESSEE AND THE DIRECTOR CUM SHAREHOLDER WAS NOT THAT OF LOAN OR DE POSIT AND IT WAS ONLY A CURRENT ACCOUNT IN NATURE AND NO INTEREST WAS BEING CHARGED IN THE ABO VE TRANSACTION. GOING THROUGH THE FACTS OF CASE BEFORE US WE ARE OF THE VIEW THAT THE TRANSAC TION BETWEEN SON IN LAW AND FATHER IN LAW FOR GIVING A SUPPORT AND HELP AS CONTENDED BY LD. COUNS EL AND NOT DENIED BY REVENUE IN LAW WAS NOT A LOAN OR DEPOSIT IN STRICTER SENSE OF SECTION 269SS OF THE ACT AND IT WAS ONLY A FINANCIAL SUPPORT. EVEN IT IS NOT THE ALLEGATION THAT THE FA THER IN LAW OF ASSESSEE HAS CHARGED ANY INTEREST ON THE ABOVE LOAN AND HENCE THIS IS MERELY A FINAN CIAL SUPPORT TO SON IN LAW BY HIS FATHER IN LAW. ONCE THIS IS THE POSITION THE TRANSACTION DO ES NOT FALL IN THE AMBIT OF SECTION 269SS OF THE ACT. ACCORDINGLY THESE APPEALS OF THE ASSESSEE ARE ALLOWED. 6. IN THE RESULT APPEALS OF THE ASSESSEE ARE ALLOW ED. 7. ORDER PRONOUNCED IN OPEN COURT ON 25.11.2011. SD/- SD/- . . !' $# $# $# $# !' (S. V. MEHROTRA (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER ( 0 0 0 0 ) )) ) DATED : 25 TH NOVEMBER 2011 12 $&34 $5 JD.(SR.P.S.) !/ 6 -$$ 7(8- COPY OF THE ORDER FORWARDED TO: 1 . + / APPELLANT SHRI ANANT HIMATSINGKA PALLAVI APARTME NTS 17 BALLYGUNGE PARK ROAD KOLKATA-19. 2 -.+ / RESPONDENT ADDL. CIT RANGE-VI(C) KOLKATA. 3 . $/& ( )/ THE CIT(A) KOLKATA 4. $/& / CIT KOLKATA 5 . $> -$& / DR KOLKATA BENCHES KOLKATA . -$/ TRUE COPY !/&?/ BY ORDER #4 /ASSTT. REGISTRAR .