TMI Blog2017 (12) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... edit of ₹ 5,50,000/- as concealed income is not in accordance with law. 2. The assessee, during the year under consideration, was engaged in the business of running a Xerox machine. He admitted total income of ₹ 7,57,350/- on 30-06-1999 which was accepted by A.O. Subsequently it came to the notice of the department that the assessee made a number of transactions by cash deposits and withdrawals in the financial year. It was found that there were total deposits of ₹ 10,49,150/- in Canara Bank at Kundhanbagh, Hyderabad, which were not reflected in the balance sheet of the assessee. Under these circumstances the A.O re-opened the assessment by issuing a notice u/s 148 of the IT Act. In response to the notice assessee filed revised return on 25-02-2005 declaring total income of ₹ 12,07,352/-. In other words, the assessee admitted additional income of ₹ 5,50,000/- only as against ₹ 10,49,150/- which was not reflected in the balance sheet. The A.O therefore, added total cash deposits of ₹ 10,49,150/- and completed the assessment. The ITAT, however set aside the case to work out the peak credit. As per the direction of the Tribunal A.O complete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after issue of notice u/s 147 and not voluntarily. Even after filling revised return, the assessee did not reveal the other two accounts at any stage of assessment as well as appellate proceedings earlier. Reliance is placed in this regard in the case of CIT Vs Usha International Ltd. In ITA No. 1696/2006. 9. As the assessee has concealed and furnished inaccurate particulars of income and thereby concealed income to the extent of ₹ 5,50,000/- and evaded tax of ₹ 1,40,000/-. The minimum and maximum penalty to be levied is ₹ 1,40,000/- and ₹ 4,20,000/- respectively. However, considering the facts and circumstances of the case, I levy a penalty of ₹ 2,00,000/- u/s 271(1)(c) of the IT Act, 1961. 5. Before the Ld CIT (A) it was contended that there is no basis for the Assessing Officer to arrive at the concealed income as the Hon ble ITAT directed AO to verify the peak credit. It was also contended that levy of penalty of ₹ 2 lakhs is excessive. 6. Ld CIT (A) observed that in the light of the following decisions the revised return filed by the assessee, after issuance of notice u/s 148, cannot be said to be voluntary. ( 1) CIT vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 25.02.2005 and the assessment was completed on 29.03.2006 by merely adding further amount of ₹ 4,99,150/- and thus the admitted income achieved finality; if at all the Assessing Officer is of the view that ₹ 5,50,000/- represents concealed income, penalty should have been levied with reference to the assessment order and not with reference to the order passed on 19.03.2014. By referring to the additional ground the Ld Counsel submitted that the Assessing Officer did not strike off the inappropriate portion in the notice issued u/s 274 and thus the notice is invalid and consequent proceedings deserve to be quashed. Reliance was placed upon the decision of the jurisdictional High Court (supra) to submit that it is the duty of the Assessing Officer to specify as to whether the penalty proceedings are initiated on account of concealment or furnishing of inaccurate particulars of income as otherwise the proceedings arising therefrom deserve to be quashed. The judgment also states that the person who is accused of the conditions mentioned in section 271 should be made aware of the grounds on which imposition of penalty is proposed as he has a right to contest such pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the assessee was not put to notice about the reasons for issuance of notice. In fact the order levying penalty clearly specifies that it was for non-furnishing of bank accounts, in ING Vysya Bank, resulting in furnishing inaccurate particulars and thereby concealment of income. 13.1. Ld Departmental Representative thus sought to distinguish the judgment of the jurisdictional High Court by contending that in the aforecited judgment the Hon ble Court had taken note of the fact that there was ambiguity in the show cause notice which was further compounded by the confused finding of the Assessing Officer whereas, in the instant case, the finding was categorical that there was concealment of income on account of the fact that the assessee furnished inaccurate particulars of income which resulted in concealment of income. He relied upon the following judgments wherein the Courts have held that even if an additional income is offered in response to a notice u/s 148, it cannot be said to be voluntary if it is noticed that the additional income was offered consequent to the detection of income by the Assessing Authority. ( 1) 323 ITR 527 (Kerala) in the case of P. Rajaswamy, Raj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment order or in the penalty notice, which may impair the chances of the assessee to respond to the notice issued by the Assessing Officer appropriately. In the instant case, the assessment order itself makes it clear since the AO specified that the assessee concealed particulars of income and furnished inaccurate particulars of income; therefore the A.O did not find it necessary to strike off one of the reasons in the printed format. The only mistake, if any, is retaining the word or . However, such trivial omission should not be considered in isolation, so long as the reasons for issuance of notice are made known to the assessee. 17. In the instant case, the assessment order categorically indicates that penalty is leviable on both counts and even penalty order details the nature of default on the part of the assessee, followed by a specific conclusion that the assessee has concealed income and furnished inaccurate particulars of income. Under these circumstances, it cannot be assumed that the assessee was not given a proper opportunity of responding to the notice by virtue of not striking off the word or in the penalty notice. 18. Assessee, in his reply, responded to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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