TMI Blog2017 (5) TMI 1037X X X X Extracts X X X X X X X X Extracts X X X X ..... (c) for concealment of particulars of income or furnishing of inaccurate particulars of income. We accordingly delete the penalty imposed under Section 271(1)(c) for all the three years calculated on the sustained addition on account of unexplained expenses for earning agricultural income. Unaccounted profit/unexplained investment in share business - Held that:- Most of the additions which have been scaled down by the CIT(A) were on the basis of verification of bank statement showing amount received from other parties which were enough to cover the unaccounted investment. In these total series of facts, there is no firm conclusion drawn by the AO in order to satisfy the conditions for imposing penalty under Section 271(1)(c). We are, therefore, of the considered view that the assessee, in the given case, has furnished details which were mostly found correct by ld. CIT(A) and the additions of concealed income was mainly made on hypothetical basis and also not firmly concluded by giving set off of the loss in share trading business appearing in the seized documents. We are, therefore, of the view that the penalty imposed under Section 271(1)(c) of the Act on the sustained addition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated order for the sake of convenience. ITA Nos. 1034 to 1036/Ahd/2013 Revenue s appeals 2. First we deal with Revenue s appeal for AYs 2004-05, 2009-10 2010-11 vide ITA Nos. 1034 to 1036/Ahd/2013. 3. We find that the Revenue is in appeal before us for the respective assessment years being aggrieved by the order of ld. CIT(A) in deleting the addition of ₹ 30,00,000/- (unaccounted income) for AY 2004-05, ₹ 15,00,000/- (unaccounted investment) for AY 2009-10 and ₹ 19,06,800/- (unaccounted commission income) for AY 2010-11. We find that prima-facie these appeals of the Revenue are not maintainable in view of CBDT Circular No. 21/2015 in F.No.279/Misc. 142/2007-ITJ (Pt) dated 10th December 2015, vide which it has been provided that if the tax effect by virtue of the Commissioner of Income-tax (Appeals) s order is below ₹ 10 lacs, then that order would not be challenged before the Tribunal in further appeal. The Board has provided exemptions at clause (8) of the Instructions wherein it has been provided that these instructions will not be applicable, if vires of any provisions has been quashed by impugned order or addition was made on some audit obje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal in IT(SS)A No 1036/Ahd/2013 on 12.04.2013 and I was told by my accountant that since Assessing Officer has preferred an appeal, issues arising from the order of the Ld. CIT (A) could be argued before the Hon'ble Tribunal as and when the hearing of the department's appeal is fixed. Due to these reasons, I could not prefer appeal to the Hon'ble Tribunal before the due date. Later on when penalty orders were received and when I approached the chartered accountant for filing of appeal before the Ld. CIT (A) against penalty orders, the chartered accountant inquired as about the appeal before the Hon'ble Tribunal and at this stage he informed me that irrespective of department's appeal, separate appeal was required to be filed against the additions sustained by the Ld. CIT (A) and he advised me to file appeal before the Tribunal. Accordingly, appeal in IT(SS)A No 155/Ahd/20-14 has been preferred by me albeit after the expiry of the specified time period. I submit that I am not a literate person and have no knowledge of the taxation law and was solely dependent on the accountant who is also not conversant with the appellate procedures due to which due to whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shadow of doubt that the assessee was diligent and was not guilty of negligence whatsoever. The sufficient cause within the contemplation of the limitation provision must be a cause which is beyond the control of the party invoking the aid of the provisions. In the case of Ramlal v. Rewa Coalfields Ltd. AIR 1962 SC 361, the Hon'ble Apex Court held that the cause for the delay in filing the appeal, which by due care and attention, could have been avoided, cannot be a sufficient cause within the meaning of the limitation provision. The rule of limitation also contains a rule of justice, especially where a person chooses not to take up requisite legal remedies for an inordinate length of time and without reasonable cause, the Tribunal should apply the rule of limitation. Seekers of justice must come with clean hands. In the instant case, we do not find any reasonable cause for condoning the delay. 4. In the light of aforesaid decisions, the burden is on the party claiming condonation of delay to place before the court, in clear and explicit terms, all facts on which the party relies, so that the court can come to the conclusion that it is not a case of want of diligence or i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was told by his consultant that since the Assessing Officer has preferred an appeal, issues arising from the order of ld. CIT(A) could be argued as and when the hearing of the Department s appeal is fixed do not stand for the reason that the assessee is now at the second stage of filing the appeal. He was very well assisted by the consultant to file the appeal before the ld. CIT(A) against the order of the ld. AO. The reason said by the assessee cannot stand for in this circumstances and it is just an afterthought to get immunity from the delay the appeal. We, therefore, respectfully following the foresaid decision of the Tribunal in the case M/s. Shree Balaji Woollen Mills (supra), our discussion made above and in view of the fact that the assessee has failed to establish with cogent and proper evidence that there existed sufficient cause for not presenting the appeal within the stipulated period, delay of 351 days in filing the appeal cannot be condoned; thus, we reject the application for condonation of delay. Since we have rejected the assessee's condonation application, the appeals of the assessee are dismissed in limine . We are not expressing any opinion on the meri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee should not be penalized under Section 271(1)(c) of the Act as the disallowances are made merely on estimated basis. Secondly, with regard to the additions sustained on account of investment in AY 2004-05, the ld. CIT(A) has upheld the addition of ₹ 5,00,000/- and penalty has been imposed on this amount for the alleged addition in investment in trading of shares. The quantum addition was made by completely ignoring the fact, repeatedly submitted before the lower authorities, that the assessee was never engaged in the share trading business either in the year prior to the year under consideration and in subsequent years and the confusion arose only because of resemblance of name with that of the appellant in the seized document which led to the conclusion that the appellant was indulged in share trading. Further, no enquiries whatsoever nature was made by the Assessing Officer with the share-broker, with whom the transactions were affected in order to establish that the appellant was the person who carried out the trading in shares. Ld. Counsel further added that if the addition was made for unexplained investment in shares for the unaccounted profits, then the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tract before the assessing authority. The ld. Assessing Officer called for the evidence in respect of bills and vouchers for expenses incurred for cultivation. In absence of such evidence, ld. Assessing Officer made lump-sum disallowance of 20% of the agricultural income shown by the assessee. When the matter came up before the ld. CIT(A), this addition was scaled down again on lump-sum basis to 10% of the agricultural income. From going through these series of facts, we notice that nowhere any details filed by the assessee has been held to be incorrect by the lower authorities with the support of any evidence which can show that the assessee has concealed any particulars of income or furnished inaccurate particulars of income. It is evident that if an assessee who is holding agricultural land and has earned income and if such net agricultural income is not disputed, then certainly some expenses must have been incurred to earn the agricultural income. It is well known fact that the agriculturists are not so well-versed in keeping the regular accounting of day-to-day expenses of agricultural operations, but that does not mean that the expenses have not been incurred. In the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nts seized do not pertain to him as his name is Raghubhai B. Vaghela and the name appearing in the seized documents relating to share business is Shri Raghuvirsingh D. Vaghela. Further, the ld. Assessing Officer in order to ride over the provisions of Section 271(1)(c) of the Act should have collected some more evidence like copy of demat account, proof of share trading business in earlier or subsequent years, linkage of share trading transactions in the bank account etc. Further it is also well evident that the major additions made by the ld. Assessing Officer has either been deleted by ld. CIT(A) or sustained to a very little extent, which proves that ld. Assessing Officer s working of calculating the unaccounted income was not up to the mark. Most of the additions which have been scaled down by the ld. CIT(A) were on the basis of verification of bank statement showing amount received from other parties which were enough to cover the unaccounted investment. In these total series of facts, there is no firm conclusion drawn by the ld. Assessing Officer in order to satisfy the conditions for imposing penalty under Section 271(1)(c) of the Act. We are, therefore, of the considered vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elf has mentioned the rate of commission between 1 to 2% and 1% of the alleged land deal amount of ₹ 2.97 crores, which assessee has calculated at ₹ 3,00,000/- only, then the amount worked out by him at ₹ 5,93,200/- by applying 2% is a mere estimation. Therefore, no penalty should have been imposed under Section 271AAA of the Act. 29. On the other hand, ld. Departmental Representative supported the orders of the lower authorities. 30. We have heard the rival contentions and perused the record placed before us. The issue before us relates to penalty under Section 271AAA of the Act at ₹ 29,300/- by ld. Assessing Officer on the sustained addition of ₹ 2,93,000/- by ld. CIT(A). From the perusal of provision of Section 271AAA of the Act, we find that provision of Section 271AAA(1) relating to computation of penalty amount @ 10% will not apply to the assessee if he has fulfilled three conditions mentioned in sub-clause (2) of Section 271AAA of the Act, viz, firstly he admits the undisclosed income during the course of search and specifies the manner in which such income has been earned; secondly he substantiates the manner in which the undisclosed inco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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