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M/s. DSP Finprint Limited Versus Dy. CIT, Circle 1 (1) , Bhopal

2016 (6) TMI 371 - ITAT INDORE

Penalty proceedings u/s 271(1)(c) - undisclosed brokerage income - Held that:- Merely because the income was offered by M/s Sandhya Prakash Ltd. in its return would not exonerate the assessee from declaring such income in its return, which was earned and received by it for the services rendered by it to the sellers for sale of their land. Transferring of money to its sister concern M/s. Sandhya Prakash Ltd. at the most can be said to be an application of income. Thus, it was an income of the ass .....

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ring the same as its taxable income in the return of income furnished for A.Y. 2008-09. Therefore, the assessee was liable for penalty u/s 271(l)(c) of the Act for concealment of its income to the tune of ₹ 1,92,00,000/- as brokerage income. - Decided against assessee. - I.T.A. No. 564/Ind/2014 - Dated:- 20-5-2016 - Shri D. T. Garasia, Judicial Member And Shri B. C. Meena, Accountant Member For the Appellants : Shri Ashish Goyal and Shri N. D. Patwa, Advocates For the Respondent : Shri Raj .....

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for scrutiny by issuing notice u/s 143(20 and assessment u/s 143(30 was completed on 30.12.2010 determining total income at ₹ 1,71,53,950/-. 3. During the assessment proceedings, it was gathered by the AO that the assessee had received brokerage income of ₹ 1,92,00,000/- in accordance with the agreement entered between the assessee and Mr. Shokat Mohd. Khan and others for the sale of land measuring 10.96 acres situated at Khasra NO.74/2/1, Prempura Gram, Bhopal owned by them. As per .....

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n the assessee was asked to explain as to why the receipt of brokerage/commission was not offered for tax, it was submitted before the AO that the assessee had done the work on behalf of its sister concern M/s. Sandhya Prakash Limited as per the MOU signed between both the parties. It was stated that the assessee company M/s. DSP Finprint Limited had the required manpower and experience in such type of brokerage business and stated that the work was actually done by the assessee on behalf of its .....

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nation of the assessee was an afterthought and unbelievable which was made to evade tax on the income. Accordingly, the AO treated the amount of brokerage/commission of ₹ 1,92,00,000/- earned by the assessee as income from other sources and added the same to the total income of the assessee. The AO also initiated penalty proceedings u/s 271(1)(c) of the Income-tax Act, 1961. 4. The matter carried to the ld. CIT(A) and the ld. CIT(A) has dismissed the appeal. 5. The ld. Authorized Represent .....

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alment is thus a direct attempt to hide an item of income or a portion thereof from the knowledge of the income tax authorities. (Webster New International Dictionary) - Extract from P Ramnatha Aiyar The Major Law Lexicon, 4th Edition, pg. 1353. In CIT vs Indian Metal & Ferro Alloys Ltd. 211ITR 35 (Orr.), it was held - The expressions 'has concealed the particulars of income' and "has furnished inaccurate particulars of income" have not been defined either in section 271(1) .....

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accounts on which such return income has been arrived at. These may be particulars as per its books of account, if it has maintained them, or any other basis upon which it had arrived at the returned figure of income. Any inaccuracy made in such books of account or otherwise which resulted in keeping off or hiding a portion of its income is punishable as furnishing inaccurate particulars of its income. Whether the burden of proof in a given case has been discharged on a set of facts is a questio .....

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comes to the conclusion that the assessee has discharged the onus, it becomes a conclusion of fact. Similarly, whether the explanation offered by the assessee was bona fide or not is a question of fact. " In the present case, all the facts were on record. Nothing was hidden. No finding was ever recorded that any evidence was hidden; no such evidence was brought on record. There is no evidence of "deliberate" act of concealment. Thus, there cannot be a "concealment" of i .....

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Same has not been doubted. Department, itself has not deleted the addition in hands of SPL. Thus, the department is following double standards by adding the amount in hands of appellant, but addition was not directed to be deleted in hands of SPL. Thus, the department is taking inconsistent view, and is not clear about the taxation of same. Penalty is not leviable. The appellant places reliance on the latest judgment of Allahabad High Court in CIT Vs Hongo India Pvt Ltd. 60 taxmann.com 478, whe .....

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. Khan, Mr. Shokat Mohd. Khan, Mr. Tajwar Mohd. Khan & Mr. Muzaffar Mohd. Khan, who were owners of the land measuring 2.192 acres each situated at Khasra No. 74/211, Prempura Gram, Bhopal. As per this agreement, these five sellers agreed to sell their land through the assessee-company as a broker and the assessee-company agreed to find a genuine purchaser to buy the said property and to carry out all sort of negotiations with the prospective buyers on behalf of the sellers' party. The as .....

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