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2017 (7) TMI 1280 - ITAT DELHIPenalty u/s. 271(1)(c) - Addition u/s 68 - loan transactions were not genuine nor the creditworthiness of the creditors stood proved - whether the Assessing Officer has recorded its satisfaction specifying a particular facet of section 271(1)(c) as concealment of particulars of income or furnishing of inaccurate particulars of income before initiating the penalty proceedings. - HELD THAT:- In the instant case, a study of the assessment order as a whole indicates that the satisfaction of the AO regarding initiation of penalty proceedings for furnishing inaccurate particulars of income is quite discernible from the assessment order itself. It is no doubt true that in last para of assessment order, the AO has mentioned “Issue notice u/s. 271(1)(c), read with explanation (B) for penal proceedings which are being initiated separately”. However, at the same time, the AO has mentioned in last lines of para 5 of assessment order as under : “The assessee has failed to disclose the correct details regarding the income as well as the investments made by him, penal proceedings u/s. 271(1)(c) read with explanation (B) are being initiated against her.” AO and on composite reading of assessment order, we find that the satisfaction of AO was discernible from the assessment order that the penalty proceedings were proposed to be initiated for furnishing inaccurate particulars of income. This alludes that the assessee was aware of the facets of section 271(1)(c), under which the penalty proceedings were proposed to be initiated, as is discernible from the assessment order. As such now there lies nothing in the mouth of assessee to contend that penalty is bad in law for want of specific charge against her. Therefore, we find that the facts of the case in hand are not existing in the judicial pronouncements relied by the assessee and thus are not relevant to the context of the present appeal before us in the peculiar facts and circumstances. Therefore, the additional ground raised by the assessee deserves to fail. On going through the findings reached by the ld. Authorities below and the examinations of documentary evidence furnished by assessee made by AO, we find that the creditors had made cash deposits in their bank accounts almost equal to the amounts of unsecured loans advanced to the assessee immediately prior to issuance of cheques/DDs in favour of the assessee. CIT(A) has rightly observed that in such a scenario, cash deposits of huge amounts prior to issue of cheques cannot be a co-incidence in case of each and every creditors under consideration, particularly when no such other instances of huge cash deposit were found in the bank statements. One of the creditors, Mr. Bishan Swaroop admitted in his statement that he borrowed money from several persons to advance loan to the appellant, which also does not appear credible for want of any supporting documents on record. ITRs submitted with respect to two of the creditors showing meager income, do not justify the creditworthiness of the creditors to advance huge loans to the appellant.No cogent evidence were laid on record to prove the creditworthiness of the creditors, the onus of which lay upon the assessee u/s. 68 which he failed to discharge - AO has rightly been treated as income in respect of which particulars were concealed by the assessee within the meaning of Explanation 1(B) of Section 271(1)(c) - Decided against assessee.
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