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Mr. Kumar V. Vasani Versus Income Tax Officer-32 (2) (2) , C-13, Mumbai

2016 (10) TMI 707 - ITAT MUMBAI

Penalty u/s 271(1)(c) - conscious concealment of facts by the assessee - non disclosure of bank accounts in which cash was deposited - Held that:- The assessee was well aware that he was having three bank accounts and deposited cash therein, did not disclosed the amounts and also the accounts to the Department, therefore, it was a conscious and deliberate act on the part of the assessee to hide something, consequently, the penalty was rightly imposed. It is also noted that the addition made by t .....

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efore, in my view, the penalty was rightly imposed by the Assessing Officer and confirmed by the Ld. Commissioner of Income Tax (Appeal). - Decided against assessee. - ITA No.3119/Mum/2015 - Dated:- 3-8-2016 - Shri Joginder Singh, Judicial Member For The Assessee : Shri R. N. Vasani and Shri V.H. Vasani For The Revenue : Ms. Mahua Sarkar-DR ORDER The assessee is aggrieved by the impugned order dated 30/01/2015 of the Ld. First Appellate Authority, Mumbai. The only ground raised by the assessee p .....

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further appeal was filed. Reliance was placed upon the decision in Sir Shadilal Sugar General Mills & Ltd. vs CIT (1987) 168 ITR 705 (SC), CIT vs Somany Evergree Knits Ltd. (2013) 352 ITR 592 (Bom.), CIT vs S.L.N. Traders (2)(2012) 341 ITR 235(Karnataka) and CIT vs Careers Education & Infotech Pvt. Ltd. (2011) 336 ITR 257 (P & H). 2.1. On the other hand, the ld. DR, Ms. Mahua Sarkar, strongly defended the penalty order by contending that the assessee deposited cash in the accounts, .....

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cts, in brief, are that there was an AIR information with the Assessing Officer that the assessee has deposited cash in saving bank accounts maintained with Axis Bank Ltd. (Rs.13,46,765/-), Sarswat Cooperative Bank Ltd.(Rs.15,01,233/-) and Standard Chartered Bank (Rs.18,87,750/-). It was further notice by the Assessing Officer that none of these accounts were disclosed to the Department in the return filed by the assessee. The assessee was asked to explain the source of these deposits and other .....

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al), the factual matrix and the case laws, relied upon by the assessee, were considered and finally, the stand taken in the assessment order was affirmed. The assessee is in further appeal before this Tribunal. 2.4. If the observation made in the assessment order, leading to addition made to the total income, conclusion drawn in the impugned order, material available on record, assertions made by the ld. respective counsel, if kept in juxtaposition and analyzed, there is no dispute to the fact t .....

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by the Tribunal that there was existence of evidence in support of the claim of the assessee and in that situation, the Tribunal held that there is no concealment as such. In that situation, the Hon'ble Apex Court took a particular view. However, in the present appeal, the assessee right from assessment stage till the stage of the Tribunal, did not adduce any evidence explaining the source of cash deposits, made in the banks and more so did not disclose these accounts in the return of income .....

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in the present appeal, as discussed above, there is conscious concealment of income by the assessee, therefore, being on different facts, the decision relied upon is not applicable to the facts of the present appeal. In the case of CIT & Anors. Vs S.L. N. Traders (2012) 341 ITR 235, the explanation of the assessee was accepted by the CIT(A) as well as by the Tribunal. Whereas, in the present appeal, the ld. Assessing Officer, the Ld. Commissioner of Income Tax (Appeal) as well as the Tribun .....

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iled a revised return accordingly. There is a categorical recording of the Tribunal that there was no material to infer concealment of income but that is no so in the present appeal, thus, the cases relied upon by the assessee are not of much help to the assessee. 4. Now, I shall deal with the case, relied upon by the ld. DR in the case of MAK DATA P. LTD. vs. COMMISSIONER OF INCOME TAX (2013) 263 CTR (SC) 1: (2013) 358 ITR 593 (SC) : (2013) 94 DTR (SC) 379. The relevant observation/decision mad .....

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or offers an explanation which is found by the Assessing Officer or the Commissioner (Appeals) or the Commissioner to be false, or (B)/- Such person offers an explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him, then the amount added or disallowed in computing the total income of such person as a result thereof shall, for t .....

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rate particulars of income. Explanation to Section 271(1) raises a presumption of concealment, when a difference is noticed by the AO, between reported and assessed income. The burden is then on the assessee to show otherwise, by cogent and reliable evidence. When the initial onus TAXPUNDIT.ORG placed by the explanation, has been discharged by him, the onus shifts on the Revenue to show that the amount in question constituted the income and not otherwise. Assessee has only stated that he had sur .....

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sessee makes a voluntary disclosure of his concealed income, he had to be absolved from penalty. We are of the view that the surrender of income in this case is not voluntary in the sense that the offer of surrender was made in view of detection made by the AO in the search conducted in the sister concern of the assessee. In that situation, it cannot be said that the surrender of income was voluntary. AO during the course of assessment proceedings has noticed that certain documents comprising of .....

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sclosure of its income, it would have filed the return declaring an income inclusive of the amount which was surrendered later during the course of the assessment proceedings. Consequently, it is clear that the assessee had no intention to declare its true income. It is the statutory duty of the assessee to record all its transactions in the books of account, to explain the source of payments made by it and to declare its true income in the return of income filed by it from year to year. The AO .....

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o been elaborately discussed by this Court in Union of India vs. Dharmendra Textile Processors (2008) 13 SCC 369 and CIT vs. Atul Mohan Bindal (2009) 9 SCC 589. The principle laid down by this Court, in our view, has been correctly followed by the Revenue and we find no illegality in the department initiating penalty proceedings in the instant case. We, therefore, fully agree with the view of the High Court. Hence, the appeal lacks meri and is dismissed. There shall be no order as to costs. 4.2. .....

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particulars of such income, or xxxxxxxxxxxxxxxxxxxxxxxxxx Explanation 1.-Where in respect of any facts material to the computation of the total income of any person under this Act,- (A) such person fails to offer an explanation or offers an explanation which is found by the Assessing Officer or the Commissioner (Appeals) or the 48[Principal Commissioner or] Commissioner to be false, or (B) such person offers an explanation which he is not able to substantiate and fails to prove that such explana .....

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essment year is claimed by any person to be an amount which had been added in computing the income or deducted in computing the loss in the assessment of such person for any earlier assessment year or years but in respect of which no penalty under clause (iii) of this sub-section had been levied, that part of the amount so added or deducted in such earlier assessment year immediately preceding the year in which the receipt, deposit, outgoing or investment appears (such earlier assessment year he .....

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preceding year is not sufficient to cover the utilised amount, that part of the amount so added or deducted in the year immediately preceding the first preceding year which is sufficient to cover such part of the utilised amount as is not so covered shall be treated to be the income of the assessee, particulars of which had been concealed or inaccurate particulars of which had been furnished for the year immediately preceding the first preceding year and so on, until the entire utilised amount .....

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142 or section 148 and the Assessing Officer or the Commissioner (Appeals) is satisfied that in respect of such assessment year such person has taxable income, then, such person shall, for the purposes of clause (c) of this sub-section, be deemed to have concealed the particulars of his income in respect of such assessment year, notwithstanding that such person furnishes a return of his income at any time after the expiry of the period aforesaid in pursuance of a notice under section 148. xxxxx .....

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the provision of the Act, material facts available on record, and the ratio laid down in following cases, it can be concluded that it was a conscious act of the assessee to hide something from the Department. I. CIT vs Satish Medical Agencies 277 ITR 394 (All.) II. Jyoti Laxman Konkar vs CIT 292 ITR 163 (Bom.), III. Deepak Construction Company vs CIT 293 ITR 285(Guj.) IV. CIT vs Mahavir Prasad Bajaj 298 ITR 109(Jhar.) V. D & H Secheron Electrods Pvt. Ltd. Vs CIT 281 ITR 421 (MP.) VI. Shri N .....

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