TMI Blog2014 (10) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... le settlement", to explain away its conduct. The assessee has not produced cogent and reliable evidences, as desired by the Hon’ble Apex court in the case of Mak Data [2013 (11) TMI 14 - SUPREME COURT], to explain the difference about the trade liability that were part of his books of accounts - penalty confirmed - Decided against assessee. - ITA No. 6020/Mum/2010 - - - Dated:- 17-9-2014 - Sh. Joginder Singh And Rajendra,JJ. For the Petitioner : Sameer G. Dalal For the Respondent : Shri Jeevanlal Lavadiya ORDER Per Rajendra, AM Challenging the order dt. 08. 06. 2010 of the CIT(A)-26, Mumbai, Assessee has raised following Grounds of Appeal: 1. The Ld. CIT(A) erred in confirming levying penalty of ₹ 17. 50. 320 - u/s 271( I )(c) or the Act without appreciating the fact that the assessee has neither concealed nor filed inaccurate particulars in the return of income. Hence the penalty u/s 271(1 )(c) may be deleted. 2. The Ld CIT(A) failed to appreciate the fact that, in reply to notices u/ 133(6), the creditors had filed the duly signed confirmations letters, and therefore, there was no concealment or income nor furnishing of inacc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been shown to examine their capacity. On 06. 09. 2008, he further asked the assessee to furnish details of payments made up to 31. 06. 06, as it had shown the purchase either in the month of February or prior to it. At the request of the assessee, the matter was adjourned. Even on the next date the assessee did not produce any meat suppliers. It worked out the liabilities outstanding as on 30. 06. 2006 at ₹ 51. 98 Lakhs. He requested the AO to add amount of ₹ 52 Lakhs to his income for the year under consideration. In the meanwhile, the ACIT, Bareily had forwarded a report to the AO and contents of the report were shown to the assessee. Vide its letter dated 21. 11. 2008 the assessee accepted that payments to two of the suppliers were paid through bearer cheque. As per the AO the assessee kept mum over the reply filed by one of the supplier i. e. Shakeel Qureshi who had stated that he had supplied goods on commission basis @2%. He found that the assessee had not claimed commission in the books of accounts. Considering the report and the reply filed by the assessee and the fact that assessee had not maintained the stock register, the AO held that provisions of secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of ₹ 51. 98 lakhs only during the course of assessment proceedings, that the AO issued notice u/s. 142(1)of the Act specifically asking the assessee to produce the persons along with their bank statements, that the assessee did not produce the parties, that the assessee accepted the incorrectness of such outstanding liability, that the assessee was confronted with the findings of the ACIT Bareily, that it had submitted the return of income by concealing the taxable income and has furnished inaccurate particulars of income, that the assessee had accepted the liability, that nothing was left for the department to prove that the assessee had concealment of income, that it had made a wrong claim of trade liability. Relying upon the judgment of Dharmendra Textile Processors(306ITR277), Nayantara G Agarwla(207ITR639), Vidya Sagar Oswal(108ITR861)and Krishnakumari Chamanlal(217ITR645), he held that the AO was justified in levying penalty u/s. 271(1)(c)of the Act. 4. Before us, Authorised Representative(AR) argued that the assessee had surrendered the disputed liability voluntarily and to buy peace of mind, that it had produced the confirmation letters from the suppliers of me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of this sub-section be deemed to represent the income in respect of which particulars have been concealed . A reading of the aforesaid section along with Explanation 1(A) and (B) makes it clear that if the AO in the course of assessment proceedings, is satisfied that the assessee has concealed the particulars of his income or furnished inaccurate particulars of such income, he is empowered to levy penalty subject to the explanation given by the assessee found to be false or not bona fide. In short, if the explanation filed by the assessee is not substantiated by it or it fails to prove the bona fide of the explanation penalty can be levied by the AO u/s. 271(1)(c)of the Act. As the facts of each case are different, so one has to see that whether the assessee was successful in substantiating the explanation filed by it or had proved the bona fide of the explanation. In the case under consideration the AO had directed the assessee to prove the genuineness of the trade creditors and made carried out sustained investigation about them. He also issued commission to make o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure , buy peace , avoid litigation , amicable settlement , to explain away its conduct. The question is whether the assessee has offered any explanation for concealment of particulars of income or furnishing inaccurate particulars of income. We find that the assessee has not produced cogent and reliable evidences, as desired by the Hon ble Apex court in the above referred paragraph, to explain the difference about the trade liability that were part of his books of accounts. We would like to discuss the cases relied upon by the assessee. We find that in the case of Mathura Commercial Company(supra)the Hon ble Allahabad High Court was dealing with a matter where a revised return was filed. The assessee had filed original return in October 1991 showing twenty outstanding entries, but the assessee could not prove genuineness of the five parties. Later on the assessee filed a revised return and deleted the five entries about which it could file confirmation. It was found that the five dealers had left the town after riots or otherwise refused to give confirmations. Not only this the FAA had held that the AO had not proper inquiries. The Tribunal has confirmed his order consid ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
