Shri Baldevbhai Becharbhai Patel, Nadiad v. The Income tax Officer,Ward-1,, Nadiad

ITA 3324/AHD/2010 | 2003-2004
Pronouncement Date: 25-10-2013 | Result: Allowed

Appeal Details

RSA Number 332420514 RSA 2010
Assessee PAN ADOPP3708P
Bench Ahmedabad
Appeal Number ITA 3324/AHD/2010
Duration Of Justice 2 year(s) 10 month(s) 10 day(s)
Appellant Shri Baldevbhai Becharbhai Patel, Nadiad
Respondent The Income tax Officer,Ward-1,, Nadiad
Appeal Type Income Tax Appeal
Pronouncement Date 25-10-2013
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 25-10-2013
Date Of Final Hearing 15-10-2013
Next Hearing Date 15-10-2013
Assessment Year 2003-2004
Appeal Filed On 15-12-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A BENCH AHMADABAD BEFORE SHRI N. S. SAINI ACCOUNTANT MEMBER AND SHRI KUL BHARAT JUDICIAL MEMBER ITA NO. 3324/AHD/2010 ASSESSMENT YEAR :2003-2004 BALDEVBHAI BECHARBHAI PATEL NR. SUCHI BUNGALOW COLLEGE ROAD VANIA VAD KISAN SAMOSA KANCHO NADIAD V/S . INCOME-TAX OFFICER WARD.1 NADIAD. PAN NO. A DOPP3708P (APPELLANT) .. (RESPONDENT) BY APPELLANT SHRI SUNIL TALATI A.R. /BY RESPONDENT SHRI O. P. BATHEJA SR. D.R. /DATE OF HEARING 15.10.2013 /DATE OF PRONOUNCEMENT 25.10.2013 O R D E R PER : SHRI N. S. SAINI ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-IV BARODA DATED 25.10.2010. 2. THE SOLE ISSUE INVOLVED IN THIS APPEAL THAT THE LD. CIT(A) EARNED IN CONFIRMING THE PENALTY OF RS.51 340/- U/S. 271(1)(C ) OF THE INCOME TAX ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IN THE RETURN OF INCOME FILED AGRICULTURE INCOME OF RS.2 90 250/-. THE AS SESSING OFFICER OBSERVED THAT A COPY OF BANK ACCOUNT FILED BY THE ASSESSEE D OES NOT REFLECT SUBSTANTIAL DEPOSIT. THE A.O. OBSERVED THAT THE ASSESSEE IS HO LDING AGRICULTURAL LAND AND ITA NO. 3324/AHD/10 A.Y. 2003-04 PAGE 2 IT IS NOT UNLIKELY THAT HE DID NOT CARRY OUT CERTAI N AGRICULTURAL ACTIVITIES. ACCORDING TO HIM THE INCOME GENERATED FROM SUCH ACT IVITIES COULD BE JUST SUFFICIENT TO MEET HOUSEHOLD EXPENSES OF THE ASSESS EE. THEREFORE HE HELD THAT ACCORDING TO THE AGRICULTURAL INCOME AT RS.60 000/-. HE THEREFORE ADDED RS. 2 30 250/- TO THE INCOME OF THE ASSESSEE AS UND ISCLOSED INCOME. 4. THEREFORE THE A.O. ISSUED NOTICE U/S. 271(1)(C) OF THE ACT ON 17.09.2007 FOR LEVY OF PENALTY FOR CONCEALMENT OR F URNISHING INACCURATE PARTICULARS OF INCOME. IN RESPONSE TO THE SAME TH E ASSESSEE SUBMITTED THAT HE HAS FILED THE APPEAL BEFORE THE TRIBUNAL AGAINST THE ORDER OF THE LD. CIT(A) AND REQUESTED TO KEEP IN ABEYANCE THE PENALTY PROCE EDINGS TILL THE DECISION OF THE TRIBUNAL. IT WAS ALSO STATED THAT INCOME SHOWN AS AGRICULTURE INCOME WAS CONSIDERED BY THE DEPARTMENT AS UNDISCLOSED INCOME AND THEREFORE THE PENALTY PROCEEDING SHOULD BE WITHDRAWN. 5. THE ASSESSING OFFICER AFTER CONSIDERING THE SUBM ISSIONS OF THE ASSESSEE OBSERVED THAT THE ASSESSEE HAS FURNISHED I NACCURATE PARTICULARS OF INCOME BY NOT DECLARING HIS FULL AND TRUE INCOME DU RING THE COURSE OF ASSESSMENT PROCEEDINGS AS WELL AS APPELLATE PROCEED INGS AND LEVIED PENALTY OF RS.51 340/- BEING 100% OF THE AMOUNT ON TAX SOUG HT TO BE EVADED. 6. THE ASSESSEE FILED THE APPEAL AGAINST THIS ORDER OF THE A.O. BEFORE THE CIT(A). IT WAS ARGUED THAT AGRICULTURAL INCOME SHO WN IN THE PAST WAS ACCEPTED BY THE DEPARTMENT WHEREAS IN THE YEAR UNDE R APPEAL OUT OF NET AGRICULTURAL INCOME OF RS.2 30 250/-. THE ASSESSIN G OFFICER ACCEPTED INCOME OF RS.60 000/- TO BE GENUINE AND ASSESSED BALANCE R S.2 30 250/- AS ITA NO. 3324/AHD/10 A.Y. 2003-04 PAGE 3 UNDISCLOSED INCOME. IT WAS SUBMITTED THAT THE ADDI TION WAS ON ACCOUNT OF DIFFERENCE OF OPINION THOUGH THE ASSESSEE FILED FUL L DETAILS IN RESPECT OF AGRICULTURAL INCOME BY WAY OF COPY OF 7/12 FOR OWNE RSHIP OF AGRICULTURAL LAND AGRICULTURAL INCOME ACCOUNTS AND COPY OF BILLS. 7. THE LD. CIT(A) AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE OBSERVED THAT AS RECORDED IN THE ASSESSMENT ORDER ASSESSEE COULD NOT FURNISH ANY DETAILS BY WAY OF SALE BILLS OR QUANTIT Y OF VARIOUS AGRICULTURAL PRODUCE IN RESPECT OF GROSS AGRICULTURAL INCOME CLA IMED AT RS.4 53 500/-. FURTHER THERE WAS DISCREPANCY IN LAND OWNERSHIP AL SO. THERE WERE NO DEPOSITS IN THE BANK ACCOUNT IN RESPECT OF SALE PRO CEEDS OF AGRICULTURAL INCOME. TAKING THIS INTO ACCOUNT AS WELL AS THE AS SESSEE'S OWN LAND HOLDING THE ASSESSING OFFICER ASSESSED AGRICULTURAL INCOME AT RS. 60 000/-. IN VIEW OF THIS IT IS CLEAR THAT THE ASSESSEE COULD NOT SUBST ANTIATE ITS CLAIM OF AGRICULTURAL INCOME AT ALL. THE ASSESSING OFFICER HAD NO OPTION BUT TO ESTIMATE THE AGRICULTURAL INCOME BUT THAT DOES NOT TAKE AWAY THE FACT THAT INACCURATE PARTICULARS OF INCOME WERE FURNISHED. FURTHER MER ELY BECAUSE THE AGRICULTURAL INCOME WAS ACCEPTED IN EARLIER YEARS DUE TO NON CON DUCTING OF INQUIRY OR SCRUTINY DOES NOT CHALLENGE THE POSITION THAT AGRIC ULTURAL INCOME SHOWN IN THE CURRENT YEAR COULD NOT BE SUBSTANTIATED. HE THERE FORE CONFIRMED THE LEVY OF PENALTY OF RS.51 340/-. 8. LD. A.R. OF THE ASSESSEE FILED BEFORE US THE COP Y OF THE ORDER OF THE TRIBUNAL PASSED IN THE QUANTUM APPEAL OF THE ASSESS EE FOR THE YEAR UNDER APPEAL IN ITA NO. 1968/AHD 2007 DATED 8TH JULY 201 1 AND SUBMITTED THAT THE ITA NO. 3324/AHD/10 A.Y. 2003-04 PAGE 4 TRIBUNAL IN THE SAID ORDER HAS HELD THAT AGRICULTUR AL INCOME IN THREE SUBSEQUENT YEARS WAS AS UNDER: 2004-05 2 70 520/- 2005-06 1 75 500/- 2006-07 1 40 225/- THE TRIBUNAL FURTHER OBSERVED THAT IT WAS NOT IN DI SPUTE THAT THE ABOVE AGRICULTURAL INCOME SHOWN BY THE ASSESSEE WAS ACCEP TED BY THE DEPARTMENT. THEREFORE THE TRIBUNAL HELD THAT THE ASSESSING OFF ICER WAS NOT JUSTIFYING IN ESTIMATING THE AGRICULTURAL INCOME TO THE TUNE OF R S.60 000/- ONLY. THE TRIBUNAL ESTIMATED THE AGRICULTURAL INCOME AT RS. 1 50 000/- AND CONFIRMED THE BALANCE AMOUNT OF ADDITION OF RS.1 40 250/-. THUS IT WAS THE SUBMISSION OF THE LD. A.R. OF THE ASSESSEE THAT THE ADDITION OF T HE AGRICULTURAL INCOME WAS MADE ON THE BASIS OF ESTIMATE ONLY AND THEREFORE N O PENALTY U/S. 271(1)(C) OF THE ACT COULD BE LEVIED ON ACCOUNT OF CONCEALMENT O F INCOME. ON THE OTHER HAND LD. SR. D.R. SUPPORTED THE ORDERS OF THE LOWE R AUTHORITIES. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF LOWER AUTHORITIES AND MATERIALS AVAILABLE ON RECORD. IN THE INSTANT CASE THE ASSESSEE HAS CLAIMED NET AGRICULTURE INCOME AT RS.2 90 250/-. THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSEE W AS HAVING 1/4TH SHARE IN THE LAND MEASURING 3 HECTOR 36 R AND 0.8 SQ. MTR. THE ASSESSEE HAS NOT MADE SUBSTANTIAL DEPOSIT IN THE BANK ACCOUNT FOR SA LE PROCEEDS OF AGRICULTURAL INCOME THE ASSESSEE WAS UNABLE TO PRODUCE THE QUAN TITY OF VARIOUS AGRICULTURAL PRODUCE DURING THE YEAR AND THE ASSESS EE HAS NOT FURNISHED ANY ITA NO. 3324/AHD/10 A.Y. 2003-04 PAGE 5 DETAIL IN RESPECT OF GROSS AGRICULTURAL INCOME CLAI MED AT RS.4 53 500/- ESTIMATED THE AGRICULTURAL INCOME OF THE ASSESSEE A T RS.60 000/- AND TREATED THE BALANCE AMOUNT OF RS.2 30 250/- AS UNDISCLOSED INCOME WHICH WAS CONFIRMED IN APPEAL BY THE LD. CIT(A). THE ASSESSI NG OFFICER THEREAFTER LEVIED PENALTY U/S. 271(1)(C) OF THE ACT OF RS.57 7 50/- BEING 100% TAX SOUGHT TO BE EVADED FOR CONCEALMENT OF INCOME OR FURNISHIN G INACCURATE PARTICULARS OF INCOME. THE LD. CIT(A) CONFIRMED THE ABOVE LEVY OF PENALTY. THEREAFTER IN QUANTUM APPEAL THE ASSESSEE CAME BEFORE THE TRIBUN AL. THE TRIBUNAL IN THE QUANTUM APPEAL VIDE ITS ORDER DATED 8 TH JULY 2011 PASSED IN ITA NO. 1968/AHD/2007 ALLOWED THE APPEAL OF THE ASSESSEE PA RTLY AND DIRECTED THE A.O. TO ACCEPT THE AGRICULTURAL INCOME AT RS.1 50 0 00/- AND THUS REDUCED THE INCOME FROM OTHER SOURCES ASSESSED BY THE LOWER AUT HORITIES TO RS.1 40 250/- IN PLACE OF RS.2 30 250/-. THUS THE PENALTY LEVIE D IN RESPECT OF AN AMOUNT EXCLUDING RS.1 40 250/- IS CLEARLY UNSUSTAINABLE. FURTHER WE FIND FORCE IN THE SUBMISSION OF THE ASSESSEE THAT INCOME OF RS.1 40 2 50/- WAS ASSESSED ONLY ON THE BASIS OF ESTIMATE AS BECAUSE THE ASSESSEE CO ULD NOT FULLY SUBSTANTIATE ITS EARNING OF AGRICULTURAL INCOME AT RS.2 90 250/- . WE FIND THAT IN THE INSTANT CASE NO POSITIVE MATERIAL WAS BROUGHT ON RECORD BY THE REVENUE TO SHOW THAT AGRICULTURAL INCOME SHOWN BY THE ASSESSEE AT RS.2 9 0 250/- WAS FALSE OR NON GENUINE. THE TREATMENT OF AGRICULTURAL INCOME AT R S.1 50 000/- AND CONSEQUENTLY ASSESSMENT OF INCOME FROM OTHER SOURCE S AT RS.1 40 250/- WAS MERELY ON ESTIMATE. IT IS A SETTLED POSITION OF LA W THAT THE CONSIDERATION WHICH APPLIES IN PENALTY PROCEEDINGS ARE DIFFERENT FROM T HE CONSIDERATIONS WHICH ITA NO. 3324/AHD/10 A.Y. 2003-04 PAGE 6 APPLIES IN ASSESSMENT PROCEEDINGS. IN SO FAR AS AS SESSMENT PROCEEDING IS CONCERNED INABILITY OF THE ASSESSEE TO SUBSTANTIATE ITS CLAIM MAY BE SUFFICIENT FOR MAKING ASSESSMENT AT A HIGHER FIGURE BUT THAT B Y ITSELF DOES NOT EMPOWER THE A.O. TO LEVY PENALTY U/S. 271(1)(C) UNLESS SOM E POSITIVE MATERIALS ARE BROUGHT ON RECORD TO SHOW THAT THE CLAIM OF THE ASS ESSEE WAS NON GENUINE OR BOGUS. IN THE ABOVE CIRCUMSTANCES IN OUR CONSIDER ED VIEW THE PENALTY U/S. 271(1)(C) IS NOT EXIGIBLE IN THE INSTANT CASE. WE THEREFORE DELETE THE PENALTY OF RS.51 340/- LEVIED U/S. 271(1)(C) OF THE ACT IN ITS ENTIRETY AND THEREBY ALLOW THE APPEAL OF THE ASSESSEE. 9 IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN THE COURT ON FRIDAY THE 25 TH OF OCTOBER 2013 AT AHMADABAD. SD/- SD/- ( KUL BHARAT ) (N. S. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER TRUE COPY S.K.SINHA ! ! ! ! '! '! '! '! / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. '(' ) * / CONCERNED CIT 4. *- / CIT (A) 5. !./ ) ) 12( / DR ITAT AHMEDABAD 6. /45 67 / GUARD FILE. BY ORDER/ 8/ 1 ': ) 12( ;