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Late Shri Babu Bhai Versus The ACIT, Circle- 5, Jaipur

2016 (8) TMI 311 - ITAT JAIPUR

Levy of penalty u/s 271(1)( c) - benami bank account possession - Held that:- It is undisputed that the assessee filed the original return on 5-06-2006 which was selected for scrutiny u/s 143(2) of the Act by notice dtd. 21-06-2007. The ld. AR of the assessee could not reply to the query of the Bench as to what was the date of hearing fixed by notice u/s 143(2) of the Act. According to him, it was a routine notice. The revised return of income was filed on 16-10-207 i.e. after 04 months from the .....

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ment years 2004-05 and 2005-06 are pending for decision. I am of the considered opinion that the relevant facts and the issue of imposition of penalty should be decided together with earlier years. It should be duly verified from record whether any information, inquiry or query about Benami bank a/c preceded filing of the revised return by the assessee and whether owning up the said benami account was prompted by good intention or due to some information in possession of the Department. In view .....

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herein solitary ground as under:- The ld. CIT(A) has erred on facts and in law in confirming the levy of penalty of ₹ 2,30,600/- u/s 271(1)( c) of the I.T. Act. 2.1 Brief facts of the case are that the assessee runs a proprietorship concern in the name and style of M/s. Babu Bhai Rashid Bhai is engaged in the business of manufacturing and trading of Bidi. According to the AO during the course of assessment proceedings, it was found that the assessee was operating a Bank Of Baroda benami ac .....

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h the assessee neither attended nor made any representation, the penalty was imposed. 2.2 Aggrieved, the assessee preferred first appeal. The ld. CIT(A) referred to AO s observation in quantum proceedings as under:- 2.4 In order u 143(3) date4d 29-12-2008, the Assessing Officer objected to the revised return of income u/s 139(5) by observing as under:- When he was served a notice u/s 143() of the Act for scrutiny assessment, fearing the consequences he offered ₹ 6,85,000/- for taxation in .....

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sed return can be filed u/s 139(5) only if the assessee discovers any omission or wrong statement in the return originally filed. While omission denotes on unintentional act or neglect to perform what the law requires. wrong statement should include within its scope of statement which is not false to the knowledge of the person making it. The word discovers will take within its ambit tat which was hidden, concealed or unknown. Therefore, the benefit of filing a revised return cannot be claimed b .....

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ssessment of the assessee itself and is not that every incorrect statement would enable the assessee to file a revised return - Hamila Fancy Store vs. CIT (1976) 104 ITR 190 (Mad.). In view of the above, it is very much clear that no omission/ wrong statement was drawn by the assessee in its original return of income but it has intentionally concealed income. In view of above legal position ₹ 6,85,000/- are added back to the total income of assessee as unexplained deposits in his benami ba .....

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in the knowledge of the assessee. It has further been emphasized that the return of income was filed much before the issuance of notice u/s 142(1) and therefore, this is no a case where the revised return of income has been filed after detection by the Assessing Officer. 2.4 The penalty was confirmed by ld. CIT(A). Aggrieved assessee is in second appeal. 2.5 Ld. Counsel contends that the assessee filed the original return on 5-06-2006. Notice u/s 143(2) of the Act was issued on 21-06-2007 in a .....

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ised return is voluntary and penalty u/s 271(1)© cannot be imposed. Reliance is placed as under:- (i) DCIT vs. IVF Holdings (P) Ltd. Mumbai (ITA No. 4960/Mum/2010 A.Y. 2006-06 order dated 22-07-2011) (ii) ACIT vs. Ashok Raj Nath(2012) 19 ITR 070 (Del. Tribunal) (iii) ITO vs. Patil Automobiles, 79 TTJ 359 (T.M.) Pune (iv) Dr. K.C. Baruah vs. ITO, (ITA No. 196 (Gau) of 1976-77 A.Y. 1972-73 order dated 28-09-1977) - Gauhati Tribunal. It is contended that the revised return being file to correc .....

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a revised return after its coming to know that Revenue authorities had information in possession regarding concealed income of the assessee which had not been shown in the original return, would not absolve the assessee from culpability u/s 271(1) (c ) of the I.T. Act, 1961. It is contended that assessee concealed the Benami account deliberately, the plea that it was a bonafide mistake is untenable as the transactions are spanned over 3 years, it cannot be assumed that the act was mistaken or bo .....

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imilar penalties imposed in preceding years i.e. 2004-05 and 2005-06, their appeals are pending before ld. CIT(A) as they were subsequently imposed by the AO due to 148 proceedings. 2.9 I have heard the rival contentions and perused the material available on record. It is undisputed that the assessee filed the original return on 5-06-2006 which was selected for scrutiny u/s 143(2) of the Act by notice dtd. 21-06-2007. The ld. AR of the assessee could not reply to the query of the Bench as to wha .....

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