9911796707
TMI Blog2013 (12) TMI 1000X X X X Extracts X X X X X X X X Extracts X X X X ..... .2005 admitting income of Rs. 66,520/-, for assessment year 2005-06 on 31.3.2006 admitting income of Rs. 94,712, for assessment year 2006-07 on 23.3.2007 admitting income of Rs. ,48,410/-, and for assessment year 2007-08 on 28.3.2008 admitting income of Rs. 1,86,387/-. Subsequent to the survey, notice u/s 148 was issued on 4.3.2009 for the assessment year 2002-03. The assessee, in response to the notice, filed return of income offering an income of Rs. 3,14,164/- admitting investment in fixed deposits and interest income earned from the said deposit. Similarly, in the assessment year 2003-04, notice u/s 148 was issued on 4.3.2009 and the assessee, in response to the notice, filed return of income admitting income of Rs. 13,04,655/- admitting investment in fixed deposits and interest income earned from the deposits. Similarly, in assessment year 2004-05, notice u/s 148 was issued on 7.1.2009 and in response to the notice, the assessee filed return of income admitting an income of Rs. 14,06,951/- admitting investment in fixed deposits and interest earned from the deposits. Similarly, in assessment year 2005-06, notice u/s 148 was issued on 7.1.2009 and in response to the notice the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .Palanivel have authorized Sri.P.Kailasam by letter dated 30.7.2009 to file appeal against the penalty orders in the case of the assessee Sri.N.R.Palanivel relating to this Assessment Year 2002-03 and also for the other Assessment Years 2003-04 to 2008-09. The copy of the letter given by other legal heirs authorizing Sri.P.Kailasam to file appeal is enclosed herewith as" Annexure-A". The penalty proceedings u/s.271(1)( c) for this Assessment year 2002-03 and for the other Assessment years 2003-04 to 2008-09 were initiated in the name of Sri.N.R.Palanivel on 31.3.2009 the date on which the Assessment order was made in his name when he was alive. For the penalty proceedings initiated u/s.271(1)( c) on 31.3.2009 in the name of Late Sri.N.R.Palanivel fixing the hearing on 9.4.2009, time was sought to file the reply. In the mean time since Sri N.R. Palanivel expired on 27.5.2009. Therefore, the Assessing Officer has issued letters to all the legal heirs Sri. P.kailasam, Sri.P.Loganathan, Smt. Perumayee Ammal and Smt.P.Alamelu on 12.6.2009 fixing the hearing on 22.6.2009 to file reply for the penalty proceedings u/s.271(1)( c) initiated in the name of Late Sri.N.R.Palanivel, reply dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs from Agricultural lands owned by him and lands taken on lease. He has stated that the deposits in the bank and the amounts advanced to his known persons were held as HUF assets. He also intimated in the said letter that the interest earned on the deposits were mostly saved as deposits in the said bank. He has admitted that the details of the deposits made in each year are not available with him and therefore he will collect the details of the deposits and interest from the bank, and thereafter file the returns for each year and pay the tax there on. In the said letter he has submitted that he will pay the tax immediately and requested not to levy penalty and interest for the amounts offered for assessment. The copy of the said letter dated 13.1.2009 is enclosed as "Annexure- D". In the course of assessment proceedings he has intimated that it was diagnosed that he was suffering from cancer developed in the lungs and brain and thus he continued to be in bad health. He has confirmed to the officer that none of his family members were aware of his transactions with Bank. He has also admitted that the deposit being the HUF funds and since no TDS was made by bank he was under the be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 502) it was submitted that no penalty was exigible. However, the Assessing Authority declined to accept the explanation offered and levied the penalty u/s.271(1)(c) of the Act being the 100% of the tax sought to be evaded. Hence the appeal". 6. The ld. CIT(A) confirmed the order of the Assessing Officer levying penalty u/s 271(1)(c) of the Act, by observing as under: "5. I have considered the penalty order and the submissions of the appellant. The only issue to be adjudicated is the levy of penalty u/s 271(1) (c) of the Income-tax Act,1961. All the grounds relate to the same issue. 5.1 The appellant, inter-alia, has relied the ratio of the apex court in the case of Commissioner vs Suresh Chandra Mittal in 241 ITR 124. The relevant portion is as below: "We find ourselves in agreement with the view taken by the tribunal. It is well settled that under section 271(1)(c), the initial burden lies on the revenue to establish that the asseesseee had concealed the income or has furnished inaccurate particulars of income. The Burden shifts to the assessee only if he fails to offer any explanation or offers an explanation which is found to be false by the assessing authority. However, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alty u/s 271(1)(c) of the Act was not leviable. He further relied on the decision of the Hon'ble Delhi High Court in the case of CIT vs Sas Pharmaceuticals [2011] 335 ITR 259(Del), wherein it was held as under: "It is to be kept in mind that s. 271(1)(c) is a penal provision and such a provision has to be strictly construed. Unless the case falls within the four corners of the said provision, penalty cannot be imposed. Sub-s. (1) of s. 271 stipulates certain contingencies on the happening whereof the AO or the CIT(A) may direct payment of penalty by the assessee. Sec. 271(1)(c) authorizes imposition of penalty when the AO is satisfied that the assessee has either : (a) concealed the particulars of his income; or (b) furnished inaccurate particulars of such income. It is not the case of furnishing inaccurate particulars of income, as in the IT return, particulars of income have been duly furnished and the surrendered amount of income was duly reflected in the IT return. The question is whether the particulars of income were concealed by the assessee or not. It would depend upon the issue as to whether this concealment has reference to the IT return filed by the assessee, viz., whet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. He relied on the decision of the Hon'ble Karnataka High Court in the case of CIT vs Sangmeshwara Associates [2012] 345 ITR 396(Kar), wherein it was held that in situation where issue is not contested, but admitted, production of proof is neither necessary nor warranted in law before levying penalty u/s 271(1)(c). Penalty is imposable u/s 271(1)(c) of the Act where assessee himself admitted his failure to furnish true or full disclosure of income. It was submitted that in the case of the assessee, after the survey, in pursuance of notice issued u/s 148 of the Act by the Assessing Officer, the assessee came forward to disclose the additional income by filing return of income. 9. He further relied on the decision of the Hon'ble Delhi High Court in the case of CIT vs Usha International Ltd. [2013] 212 Taxman 519 (Delhi) wherein it was held that the Tribunal was not right in upholding the cancellation of penalty. It cannot be denied that there were searches and investigations which resulted in the income-tax authorities unearthing a concerted design to enable the reduction of the taxable income of the assessee by making use of the provisions of section 35(2A), section 35(1)(ii ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deration and in pursuance to which the assessee filed return for each of the years disclosing additional income. The Assessing Officer levied penalty u/s 271(1)(c) of the Act for all the years under consideration in respect of this additional income which was not disclosed in the original returns filed by the assessee and was only disclosed in the returns which were filed in pursuance to notices issued u/s 148 of the Act. 13. The ld. CIT(A) confirmed the action of the Assessing Officer. 14. Before us, the ld. A.R of the assessee contended that as the assessee could not file evidences to show that investment in FDRs was in fact, renewal of old FDRs and therefore, the assessee admitted the same as his income which was accepted by the Department. Therefore, penalty should not have been levied in respect of the amount which represents investment in FDRs. The assessee also relied upon the decision of the Amritsar Bench of the Tribunal in the case of ITO vs Fashionways(supra) and the decision of the Hon'ble Delhi High Court in the case of CIT vs Sas Pharmaceuticals (supra). 15. We find that the assessee had produced absolutely no material before us or before any of the lower authoriti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal of the assessee for the years under consideration are dismissed. 19. For assessment year 2008-09, the undisputed facts of the case are that the assessee filed return of income on 26.2.2009 admitting income from bus business of Rs. 1,81,971/-, investment in fixed deposits made during the year of Rs. 18,20,000/- and interest on fixed deposit of Rs. 2,72,272/-, thereby showing total income of Rs. 22,74,243/-. The assessment was completed by the Assessing Officer at the returned income of the assessee. Thereafter, the Assessing Officer issued notice u/s 271(1)(c) of the Act and levied penalty of 100% of the tax sought to be evaded amounting to Rs. 7,00,053/- on the ground that the investment made in FDRs and interest income earned on FDRs prior to the date of survey were not disclosed in the return of income filed by the assessee. 20. Being aggrieved, the assessee filed appeal before the ld. CIT(A), who confirmed the action of the Assessing Officer. 21. Before us, the ld. A.R of the assessee submitted that as the assessee could not file evidences to show that investment in FDRs was in fact, renewal of old FDRs and therefore, the assessee admitted the same as his income which was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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