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2016 (9) TMI 710 - ITAT AHMEDABAD

2016 (9) TMI 710 - ITAT AHMEDABAD - TMI - Penalty proceedings u/s. 271(1)(c) - unexplained investment in a property - Held that:- There is no dispute that the sole surviving issue in the instant appeal is qua correctness of section 271(1)(c) penalty in question arising from unexplained addition amount of ₹ 17 lacs. It has already come on record that this tribunal in quantum proceedings has already held the assessee to have included impugned assessment years unaccounted income in his disclo .....

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d in survey can be reasonably treated as source of assessee’s unexplained investments in question. We reiterate that quantum and penalty are separate proceedings and each and every disallowance/addition made in former does not lead to automatic application of the latter penal provision as held by hon’ble apex court in CIT vs. RELIANCE PETROPRODUCTS PVT. LTD. (2010 (3) TMI 80 - SUPREME COURT ). We accept assessee’s arguments accordingly. The impugned penalty stands deleted - Decided in favour of .....

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ve that once the assessee has succeeded on quantum issue in preceding assessment year, the mere fact that he has not preferred any separate appeal in the impugned assessment year is not to be taken as the sole reason for confirming the penalty in question - The impugned penalty stands deleted - Decided in favour of assessee - CCIT(SS)A No. 151, ITA No. 834 & IT(SS)A No. 152/Ahd/2013 - Dated:- 5-8-2016 - Shri S. S. Godara, Judicial Member and Shri Manish Borad, Accountant Member For The Revenue : .....

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in imposing penalties of ₹ 5,21,681/- ₹ 2,27,767/- and ₹ 3,27,438/-; respectively, proceedings under section 271(1) (C) of the Income Tax Act, 1961; in short the Act . We proceed assessment year-wise for the sake of convenience and brevity. ASSESSMENT YEAR 2003-04 IT(SS)A 151/Ahd/2013 2. This assessee-an individual manages and runs tuition classes. The department carried out a search at the residence of one Shri Jitendrabhai B. Sojitra on 07-11-2006 engaged in the very vocatio .....

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in a property involving an amount of ₹ 85 lacs comprising of ₹ 40 lacs purchase price and ₹ 40 to 45 lacs spent on construction. Latter addition was of ₹ 2,47,748/- under the head of suppressed receipts from unrecorded tuition activities. These two additions aggregated to a sum of ₹ 87,47,748/-. The Assessing Officer further initiated the impugned penalty proceedings u/s. 271(1)(c) of the act alleging the assessee to have furnished inaccurate particulars of income l .....

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this tribunal. A learned co-ordinate bench in its order dated 07-03-2014 affirmed the former addition and deleted the latter one. It observed that assessee s disclosure of ₹ 31 lacs (supra) could not be taxed once again in the impugned assessment year as follows:- 5. We have considered rival submissions carefully and have perused the orders of the AO and the CIT(A) and also the copy of the statement of the assessee recorded at the time of survey on 7.11.2006 filed in the compilation before .....

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ment of the assessee was recorded nearly four years after the end of the relevant accounting period, and the assessee did not have the support or advice of his accountant or tax consultant and could not refer to his records. The figure of tuition fees for the different assessment years were provided by the assessee during the survey under section 133A purely on estimate basis. The assessee to cover up the difference found in the receipt of fees as per the statement recorded and as shown in the r .....

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f ₹ 31 lakhs was separately taxed in assessment year 2007-08, we are of the considered view that taxing the same amount of difference between the receipt of fees as per the statement recorded the survey on 7.11.2006 and the fee receipts as shown by the assessee in his return of income in the assessment years 2001-02 to 2007-08 separately, is not justified and shall amount to taxing the same figure of difference twice, which amounts to double taxation, which is not permitted under the law, .....

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e, as there is no justification in making the addition on account of difference in figures of receipt of tuition fees for the relevant assessment year separately, the same is deleted and the ground no. 1 of the assessee is allowed. Quantum proceedings seem to have attained finality at this stage. 6. We come to the impugned penalty proceedings now. The Assessing Officer in his order dated 29-03-2011 heavily relied on quantum developments upto the CIT(A) s order to conclude that the assesse had co .....

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see to have included impugned assessment years unaccounted income in his disclosure of ₹ 31 lacs made during survey and assessed in assessment year 2007-08. We accordingly are of the opinion that the assessee deserves to be given telescoping effect as he has declared the impugned assessment year income remaining unaccounted in assessment year 2007-08. Learned co-ordinate bench in quantum proceedings has already adjudicated the relevant issue. The same has become final. We conclude in these .....

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pugned penalty of ₹ 5,21,681/- stands deleted. IT(SS)A 151/Ahd/2013 is accepted. ASSESSMENT YEAR 2005-06 ITA 834/Ahd/2013 8. Both parties state at the outset that section 271(1)(c) penalty in question of ₹ 2,27,767/- emanates from suppressed receipts from un-recorded tuition classes being added to the tune of ₹ 4,13,550/- and ₹ 3,50,000/- under the head unexplained investments. 9. We put up a specific to the parties about the finality of quantum proceedings. Smt. Bhala is .....

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e impugned assessment year whereas his corresponding appeal challenging merits of the additions as well as identical penalty in preceding assessment year 2004-05 already stands accepted by the ld. c-ordinate bench on 07-03-2014. 10. Smt. Bhala at this stage reiterates her earlier arguments supporting Revenue s case in favour of the impugned penalty. 11. We have heard both sides. There is no dispute that merits of the issue forming backbone of the impugned penalty are the same in the impugned ass .....

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