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2015 (12) TMI 1506 - ITAT DELHI

2015 (12) TMI 1506 - ITAT DELHI - TMI - Penalty u/s 271(1)(c) - addition u/s 68 - Held that:- In the present case there was a change of opinion and no concealment of income or furnishing of inaccurate particulars on the part of the Assessee. Therefore, we find force in the contention of the assessor's counsel that the issue involved in the present case is squarely covered by the decision of the Hon'ble High Court of Delhi in the case of CIT vs. Aggarwal Pipe Co [1999 (7) TMI 57 - DELHI High Cour .....

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oncealed income. The surrender so made also stood accepted and the Revenue had brought no material on record, besides the factum of the assessee. The Tribunal was justified in cancelling the penalty

Assessee has not furnished inaccurate particulars of income, however, it is a case of change of opinion. Under these circumstances, in our view the penalty in dispute is totally unwarranted and deserve to be deleted. Accordingly, we delete the penalty in dispute made u/s. 271(1)(c) of the .....

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That the appellant neither concealed any income nor furnished inaccurate particulars of income. On facts and in the circumstances of the case, there was no legal warrant to invoke the provisions of section 271(1)(c) of the Income Tax Act. 2. That the initiation of proceedings u/s. 271(1)(c) and consequent levy of penalty of ₹ 1,59,500/- vide order dated 20.3.2013 u/s. 271(1)(c) of the Act and subsequently reduced to ₹ 16,090/- vide Notice of demand dated 9.5.2013 deserves to be quash .....

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0,00,000/-. The AO asked the Assessee to furnish source of cash deposits in the aforesaid bank account totalling to ₹ 10,00,000/-. However, the Assessee failed to furnish evidence regarding source of deposits. The AO also found that on the same the entire amount was transferred to one Smt. Santosh Jain. The AO initiated action u/s. 147 of the Act on 23.3.2011 by way of issue of notice u/s. 148 of the Act. In response to the same the Assessee submitted that the original return filed be trea .....

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77; 10, 00,000/- as unexplained credit u/s. 68 of the Act to the income of the assessed vide his order dated 8.12.2011 passed u/s. 143(3) of the I.T. Act, 1961. 3. Aggrieved by the assessment order dated 8.12.2011, the Assessee filed an Appeal before the Ld. CIT(A) who vide the order dated 31.8.2012 deleted the addition of ₹ 10 laces made u/s. 68 of the I.T. Act. But during the course of appellate proceedings, the Ld. CIT(A) thoroughly examined the ledger, cash book and found that peculiar .....

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s income and added as undisclosed income which tantamount enhancement of income. In response to the same Assessee filed reply which the Ld. CIT(A) has reproduced at Page 2 of the impugned order. The Assessee pleaded that all these 9 persons are small shop keepers and they deposited the money for purchase of different items. The Assessee is maintaining proper books of accounts i.e. cash book, ledger etc. All amounts in dispute are duly reflected in the cash book and verifiable. Assessee also requ .....

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e from undisclosed sources which resulted in enhancement of income and simultaneously initiated the penalty proceedings u/s. 271(1)(c) of the I.T. Act by issuing the cause notice to the Assessee. In response to the same, show cause notice to the penalty proceedings Assessee filed the reply which the Ld. CIT(A) has reproduced at page 32 of the impugned order. Assessee stated that he has surrendered the amount in dispute for his mental peace and to avoid further litigation subject to no penal acti .....

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nd he made the addition of ₹ 1,59,500/- u/s. 68 of the I.T. Act and also held that the Assessee has concealed particulars of his income or furnishing of inaccurate particulars of his income and therefore, the onus is on the Assessee to establish his to establish that his failure to return correct income did not arise from any fraud or any gross or wilful neglect on his part. He concluded that the cash deposits created as income from undisclosed sources, burden is on the assessee to prove t .....

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s in appeal before us against the aforesaid Penalty order dated 20.3.2013 passed by the Ld. CIT(A) and pleaded that there was change of opinion and thus penalty on ₹ 1,59,500/- may please be deleted. In support of his contention, Ld. Counsel for the Assessee has filed a Paper Book containing pages 1 to 24 consisting of copy of notice u/s. 271(1)(c) dated 31.8.2012; Copy of written submission filed before the Ld. CIT(A) in response to Notice u/s. 271(1)(c); copy of assessment order dated 8. .....

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CIT(A) during the appellate proceedings vide order dated 31.8.2012 and he was agreed to make the addition of ₹ 1,59,500/-. Accordingly, the Ld. CIT(A) in penalty proceedings u/s. 271(1)(c) vide order dated 20.3.2013 has imposed the penalty of ₹ 1,59,500/- which was reduced to ₹ 16,090/- by the AO on the application of the Assessee, as there was total addition of ₹ 1,59,500/- to the return income of ₹ 1,43,610/-. This penalty of ₹ 1,59,500/- was further reduce .....

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the decision of the Hon'ble High Court of Delhi in the case of CIT vs. Aggarwal Pipe Co. (240 ITR 880) [Del.] wherein the Hon'ble Court has held as under:- "Held, dismissing the application for reference, that the Tribunal had found that the assessee had furnished confirmations from the cash creditors and it was only when the Assessing Officer wanted him to produce these creditors, including Y in whose case summons sent under section 131 of the Income Tax Act, 1961, were received ba .....

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ulates imposition of penalty for furnishing of inaccurate particulars and concealment of income. In this regard, we draw our support from the decision of the CIT vs. Reliance Petroproducts Pvt. Ltd. (2010) 322 ITR-158 (SC) wherein the Hon'ble Supreme Court has held that 'where there is no findings that any details supplied by the Assessee in its return are found to be incorrect or erroneous or false, there is no question of inviting the penalty u/sec. 271(1)(c) of the Act. A mere making .....

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