The ITO, Ward-2(3),, Bhavnagar v. Shri Raghavbhai Karshanbhai Gabani, Bhavnagar

ITA 553/AHD/2010 | 2004-2005
Pronouncement Date: 27-07-2012 | Result: Dismissed

Appeal Details

RSA Number 55320514 RSA 2010
Assessee PAN AHGPG1132N
Bench Ahmedabad
Appeal Number ITA 553/AHD/2010
Duration Of Justice 2 year(s) 5 month(s) 8 day(s)
Appellant The ITO, Ward-2(3),, Bhavnagar
Respondent Shri Raghavbhai Karshanbhai Gabani, Bhavnagar
Appeal Type Income Tax Appeal
Pronouncement Date 27-07-2012
Appeal Filed By Department
Order Result Dismissed
Bench Allotted D
Tribunal Order Date 27-07-2012
Assessment Year 2004-2005
Appeal Filed On 18-02-2010
Judgment Text
ITA NO 553/ AHD/2010 A.YR.. 2004 -05 1 IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH AH MEDABAD (BEFORE SHRI MUKUL KR.SHRAWAT JM & SHRI ANIL CHATUR VEDI A.M.) I.T.A. NO. 55 3/AHD/2010. (ASSESSMENT YEAR: 2004-05 ) THE INCOME TAX OFFICER WARD 2(3) INCOME TAX OFFICE BHAVNAGAR. (APPELLANT) VS. SHRI RAGHAVBHAI K GABANI OPP. NARI KANYASHALA NAVAPURA NARI DIST.BHAVNAGAR. (RESPONDENT) PAN: AHGPG 1132N APPELLANT BY : MR. B. L. YADAV SR. D.R. RESPONDENT BY : MR. TUSHAR HEMANI. ( )/ ORDER DATE OF HEARING : 19-6-2012. DATE OF PRONOUNCEMENT : 27-7-2012 PER: SHRI ANIL CHATURVEDI ACCOUNTANT MEMBER. THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER OF LD. CIT (A)- XX AHMEDABAD DATED 18-11-2009 FOR THE ASSESSMENT Y EAR 2004-05. 2. THE ONLY EFFECTIVE GROUND RAISED BY THE REVENUE IS REGARDING DELETION OF PENALTY U/S. 271(1)(C) OF RS.2 09 000/- OF THE I NCOME TAX ACT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E FILED THE RETURN OF INCOME ON 17-8-2004 SHOWING THE TOTAL INCOME OF RS. 43 455/- AND HAS ALSO SHOWN AGRICULTURAL RECEIPTS OF RS.3 91 830/-.THE CA SE WAS SELECTED FOR ITA NO 553/ AHD/2010 A.YR.. 2004 -05 2 SCRUTINY. THE ASSESSMENT WAS FINALIZED U/S. 143(3) OF THE ACT ON 18-12- 2006 AND THE INCOME WAS DETERMINED AT RS.7 45 430/- . THE ASSESSEE IS ENGAGED IN THE BUSINESS OF DIAMOND ASSORTING INCOME AND ALSO HAS AGRICULTURE INCOME. WHILE FRAMING THE ASSESSMENT U/ S.143(3) THE A.O. MADE AN ADDITION OF RS.4 13 575/- U/S. 68 OF THE AC T AND OF RS.2 88 404/- ON ACCOUNT OF AGRICULTURE RECEIPT TREATED AS UNACCO UNTED INCOME FROM UNDISCLOSED SOURCES. THE A.O. WAS OF THE VIEW THAT ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF INCOME AND THER EFORE INITIATED THE PENALTY PROCEEDINGS U/S. 271(1) (C) FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND LEVIED A PENALTY OF RS.2 09 000/-. 4. AGGRIEVED BY THE ORDER OF A.O. THE ASSESSEE PREF ERRED APPEAL BEFORE LD. CIT (A). 5. LD. CIT (A) AFTER CONSIDERING THE SUBMISSIONS OF THE A.R. DISMISSED THE APPEAL OF THE ASSESSEE BY HOLDING AS UNDER:- 2.3. I HAVE CAREFULLY CONSIDERED THE CONTENTIONS O F THE LD. COUNSEL FOR THE APPELLANT AND THE CASE-LAWS RELIED UPON BY HIM AND HAVE ALSO CAREFULLY GONE THROUGH THE PENALTY ORDER IN QUESTIO N PASSED BY THE A.O. IN THIS CASE THE PENALTY U/S. 271(1) (C) HAS BEEN LEVIED BY THE A.O. ON THE GROUND THAT THE APPELLANT HAS FURNISHED INACCURATE PARTICULARS OF HIS INCOME BY SHOWING FICTITIOUS OPE NING BALANCE OF RS.4 13 575/- AND BOGUS AGRICULTURAL INCOME OF RS.2 88 404/-. FROM THE FACTS OF THE CASE IT COMES OUT THAT SO FAR AS THE PENALTY PROCEEDINGS ARE CONCERNED IT IS SEEN THAT THE APPE LLANT HAS OFFERED AN EXPLANATION WHICH HAS NOT BEEN ACCEPTED BY THE A .O. AS REGARDS THE AGRICULTURAL INCOME IT IS SEEN THAT THE APPELL ANT HAD JOINT AGRICULTURAL LAND OF ABOUT 2.51.9 HACTOR FROM WHICH HE COULD HAVE EARNED THE AGRICULTURAL INCOME OF RS.2 83 404/- AS CLAIMED FROM THE TOTAL LAND. MOREOVER THE SOURCE OF AGRICULTURAL IN COME HAS ALSO BEEN ITA NO 553/ AHD/2010 A.YR.. 2004 -05 3 ACCEPTED BY THE A.O. THE APPELLANT HAS AGRICULTURAL LAND HOLDING SINCE LAST MANY YEARS. AS REGARDS THE ADDITION OF R S.4 13 575/- REPRESENTING CASH OPENING BALANCE THE A.O. HAS ACC EPTED THAT THE APPELLANT HAS FILED THE DETAILS OF OPENING BALANCE BUT AS NO BOOKS OF ACCOUNT WERE MAINTAINED FOR EARLIER YEARS AND IN AB SENCE OF ANY PROOF THAT THE APPELLANT COULD SAVE THE AMOUNT OF B ROUGHT FORWARD CAPITAL THE ADDITION HAS BEEN MADE. THE APPELLANT IS AN AGRICULTURIST WHO DOES NOT NECESSARILY REQUIRE MAINTAINING BOOKS OF ACCOUNT. MOREOVER IT SEEMS THAT THERE IS NO SPECIFIC CONCEA LMENT IN SHOWING THE OPENING CAPITAL BALANCE AT RS.4 13 575/-. THE A PPELLANT IS HOLDING THE AGRICULTURAL LAND SINCE VERY LONG TIME. THEREFO RE OPENING BALANCE OF THE CAPITAL CREATED OUT OF ACCUMULATED AGRICULTU RAL INCOME CANNOT BE CLEARLY DENIED BY TAKING THE CONTENTION THAT BOO KS OF ACCOUNT FOR THE EARLIER YEARS ARE NOT MAINTAINED. THIS MAY BE S UFFICIENT FOR HOLDING THE CASE AGAINST THE APPELLANT IN QUANTUM BUT CERTAINLY NOT WHEN IT COMES TO THE QUESTION OF LEVYING THE PENALT Y U/S.271(1) (C ) AS THE QUANTIFICATION OF PENALTY IS TO BE PRIMARILY DONE WITH REFERENCE TO THE TAX SOUGHT TO BE EVADED. SINCE ALL THE FACTS HAVE BEEN DISCLOSED BY THE APPELLANT THE PENALTY PROVISIONS FOR CONCEALMENT OF INCOME ARE NOT ATTRACTED IN THIS CASE. I WOULD LIKE HERE TO REFER THE RATIO OF THE JUDGMENT OF HONBLE SUPREME COURT IN T HE CASE OF T. ASHOK PAI VS. CIT (2007) 292 ITR 11 IN WHICH THE AP EX COURT HAS HELD THAT THE PENALTY PROCEEDINGS ARE INDEPENDENT F ROM THOSE OF THE ASSESSMENT PROCEEDINGS AND THE MATTERS HAVE TO BE C ONSIDERED AFRESH IN THE PENALTY PROCEEDINGS FROM THE ANGLE RE QUIRED BY THE LAW RELATING TO THE PENALTY AND THAT THE BURDEN OF PROO F PLACED ON THE ASSESSEE UNDER THE EXPLANATION IS SUBJECT TO THE CO NDITIONS THEREIN. HAVING CONSIDERED THE ENTIRETY OF THE FACTS I FIND THAT IN THIS CASE NO ANY SPECIFIC CONCEALMENT WITH DIRECT EVIDENCE HAS B EEN ESTABLISHED. KEEPING IN VIEW THE DISCUSSION MADE AS ABOVE AND TH E LEGAL POSITION WITH REGARD TO PENALTY FOR CONCEALMENT I HOLD THAT NO PENALTY UNDER SECTION 271(1)(C) IS WARRANTED. HENCE THE PENALTY IMPOSED UNDER THIS SECTION 271(1)(C ) OF RS.2 09 009/- IS HEREBY CANCE LLED. 6. AGGRIEVED BY THE ORDER OF CIT (A) REVENUE IS NO W IN APPEAL BEFORE US. ITA NO 553/ AHD/2010 A.YR.. 2004 -05 4 7. BEFORE US THE LD. D.R. SUBMITTED THAT THE ASSESS EE HAD DISCLOSED HIS UNACCOUNTED INCOME IN THE FORM OF AGRICULTURAL INCO ME AND THEREBY FURNISHED INACCURATE PARTICULARS OF INCOME. THE LD. D.R. FURTHER RELIED ON THE ORDER OF A.O. HE THUS URGED THAT THE ORDER OF A .O. BE UPHELD. 8. ON THE OTHER HAND LD. A.R. RELIED ON THE ORDER O F CIT (A). 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT CIT (A) HAS GIVEN A FINDING T HAT IN THE QUANTUM PROCEEDINGS THE A.O. HAS TAKEN THE PLEA THAT THE L AND FROM WHICH ASSESSEE DERIVED AGRICULTURE INCOME WAS JOINTLY HEL D BY 3 BROTHERS AND HENCE THE SHARE OF ASSESSEE COULD BE 1/3 RD ONLY AND 2/3 RD SHARE WAS OF OTHER BROTHERS. THE DISCLAIMERS FROM 2 BROTHERS WHI CH WERE FILED BY THE ASSESSEE HAS NOT BEEN CONSIDERED BY A.O. THE LD. CI T (A) WHILE DELETING THE PENALTY HAS GIVEN A FINDING THAT THE ASSESSEE H AS OFFERED AN EXPLANATION BUT THE SAME WAS NOT ACCEPTED BY A.O HE HAS ALSO OBSERVED THAT THERE IS NO SPECIFIC CONCEALMENT IN SHOWING OP ENING CAPITAL BALANCE AT RS.4 13 575/- AS THE ASSESSEE IS HOLDING AGRICULTUR E LAND SINCE VERY LONG TIME AND THEREFORE OPENING BALANCE OF THE CAPITAL C REATED OUT OF ACCUMULATED AGRICULTURAL INCOME CANNOT BE DENIED BY TAKING THE CONTENTION THAT BOOKS OF ACCOUNTS FOR EARLIER YEAR ARE NOT MAI NTAINED. HE HAS FURTHER GIVEN A FINDING THAT ALL THE FACTS HAVE BEEN DISCLO SED BY THE ASSESSEE AND THERE IS NO SPECIFIC CONCEALMENT WITH DIRECT EVIDEN CE HAS BEEN ESTABLISHED BY THE A.O. THE LD. D.R. ON THE OTHER HAND COULD N OT REBUT THE AFORESAID FINDINGS BY BRINGING ANY CONTRARY MATERIAL ON RECOR D. IN VIEW OF THESE FACTS WE ARE OF THE VIEW THAT NO INTERFERENCE IS CALLED F OR TO THE ORDER OF CIT (A). ITA NO 553/ AHD/2010 A.YR.. 2004 -05 5 WE ACCORDINGLY UPHOLD THE ORDER OF CIT (A). THUS A PPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 27 - 7 - 2012. SD/- SD/- (MUKUL KUMAR SHRAWAT) (ANIL CHATURVEDI) JUDICIAL MEMBER ACCOUN TANT MEMBER AHMEDABAD. S.A.PATKI. COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS)-XX AHMEDABAD. 4. THE CIT CONCERNED. 5. THE DR. ITAT AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT AHMEDABAD. 1.DATE OF DICTATION - -2012 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 23 / 7 / 2012 MEMBER.OTHER MEMBER . 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S - -2012. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT - -2012 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S - -2012 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK - -2012. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..