TMI Blog2017 (2) TMI 855X X X X Extracts X X X X X X X X Extracts X X X X ..... anation is false or that the assessee had failed to substantiate the explanation offered, the officer cannot proceed to hold that there has been concealment of income attracting levy of penalty. Thus it is not a fit case for imposing penalty under section 271(1)(c) of the Act. - Decided in favour of assessee - ITA Nos. 541 to 543/VIZ/2014 - - - Dated:- 17-2-2017 - SHRI V. DURGA RAO, HON BLE JUDICIAL MEMBER For The Assessee : Shri G.V.N. Hari Advocate. For The Department : Shri R.S. Aravindaksham-JCIT ORDER These are the appeals filed by the assessee against the separate orders passed by the Commissioner of Income Tax (Appeals), Visakhapatnam, dated 24/07/2014 28/07/2014 for the Assessment Years 2000-01, 2001-02 2004-05. 2. There is a delay of 26 days in filing these appeals. The assessee has filed a condonation application along with affidavit wherein he stated that he was diagnosed the problem as internal derangement in the left knee. The Doctor advised him not to move and take complete rest. To that effect, he filed a medical certificate issued by the concerned Doctor. Keeping in view of the explanation given by the assessee and also certificate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wals, the Assessing Officer was of the opinion that it would reasonable to arrive at the peak credit during the previous year and and subjected the same to tax. 4. On appeal, Commissioner of Income Tax (Appeals) has observed that the assessee having an agricultural land to the extent of 10 acres. There was a possibility for saving some accumulated amount of ₹ 1 lac, so as to, allow credit against peak credit of ₹ 2,84,517/-. The peak credit amount of ₹ 2,84,517/- needs to be set off of such accumulated agricultural income of ₹ 1 lac. and only balance amount of ₹ 1,84,517/- needs to be treated as peak credit investment from the explained source to the Assessment Year 2000-01. Subsequently, the Assessing Officer issued notice under section 274 r.w.s. 271(1)(c) for an amount of ₹ 1,84,517/-, as the amount has been concealed and asked the assessee why penalty cannot be levied. The assessee has submitted a detailed explanation, which reads as under:- During the relevant previous year, peak credit appeared in the bank a/c. is ₹ 2,84,517/- and assessing officer opted the method of taxing the peak credit. Assessee during the assessment pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eals), Rajahmundry, and in appeal got part relief to the tune Rs.l,00,000/-towards agricultural income that is eligible for set off against the peak credit. Further assessee preferred second appeal before the Hon'ble ITAT, Visakhapatnam, and case is yet to be heard. In this connection the assessee may be permitted to cite the following case laws. The fact that the assessee's explanation regarding a cash credit or other receipt is disbelieved and the amount is assessed in his hands, does not by itself justify the department in imposing a penalty, the circumstances of the case must be such as to lead to the reasonable and positive conclusion that the amount represents the assessee's income. - Vide CIT v.Anwar AH (1970) 76 ITR 696 (SC) and Anantharam veerasingaiah Co. v.CIT (1980) 123 ITR 457 (SC) and CIT v.Ramaswamy Naidu . v.(1994) 208 ITR 377 (MAD). 5. The Assessing Officer has considered the explanation given by the assessee and came to the conclusion that Shri Korata Srinivasa Rao who is the partner of the assessee not admitted that he was in the business along with the assessee and, therefore, assessee concealed income of ₹ 1,83,213/- and impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ta Srinivasa Rao carrying on the finance business on behalf of HUF and the deposits in the bank account were not related to in his individual capacity, no returns were filed because tax liability is below the tax limit. The Assessing Officer after examining the assessee s partner, he came to the conclusion that the deposits are belonging to the assessee. Accordingly, he made addition in the hands of the assessee as unexplained investment. However, keeping in view of the withdrawals, he made a peak credit in the hands of the assessee. On appeal, Commissioner of Income Tax (Appeals) by considering the explanation of the assessee and also keeping in view of the agricultural land to the extent of 10 acres, he estimated the accumulated agricultural income of ₹ 1 lac and accordingly he reduced to ₹ 1,84,517/- part relief was granted. Subsequently, the Assessing Officer initiated the penalty proceedings by calling explanation from the assessee. The assessee by filing detailed note before the Assessing Officer submitted that he neither concealed the income nor filing inaccurate particular of income. However, Assessing Officer mainly keeping in view of the statement of assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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