TMI Blog2023 (2) TMI 519X X X X Extracts X X X X X X X X Extracts X X X X ..... not disputed by the Revenue with respect to the factum of advance given by the assessee. The only reason for rejecting the explanation is that it was found unacceptable since advance was given in preceding year. Therefore clearly all particulars relating to the source of investment were furnished by the assessee which were not found to be inaccurate or even incorrect by the Revenue. Even the explanation of the source of investment was not found to be false by the Revenue. As merely found to be unacceptable since advance was given by assessee to co-owner in preceding year. It is settled law that mere rejection of a claim of the assessee will not invite levy of penalty u/s 271(1)(c) - The assessee in such circumstances, we hold, cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he income of the assessee and confirmed by the ld.CIT(A) and the ITAT, relating to the investment in property amounting to Rs.22,85,528/-source of which remained unexplained. The impugned addition was made as per provision of section 69A of the Act. 4. The argument of the ld.counsel for the assessee before us against the levy of penalty in the present case is that, he had duly explained source of investment and the same was not found to be false/untrue, and therefore, there was no case for levy of penalty. The ld.counsel for the assessee pointed out that during quantum appellate proceedings, details had been furnished to the ld.CIT(A) reproduced at para-12 of his ordershowing that during the impugned year, an amount of Rs.32,82,538/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d amount was advanced in the preceding year. 6. The contention of the ld.counsel for the assessee was that as long as entire source of investment in the property stood explained, and no infirmity was found in the same, though, the addition might have been confirmed in the quantum proceedings, there was no case for levy of penalty at all for concealing or furnishing of inaccurate particulars of income, since the particulars relating to the source of investment were not found to be false. 7. The ld.DR on the other hand relied on the order of the ld.CIT(A) at para 4.2 of his order as under: 4.2 I have considered the facts of the case, penalty order and submissions made by the appellant. It is noted that the AO has imposed the penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rce thereof. Before the ld.CIT(A) in quantum proceedings, the assessee furnished source of entire investment of Rs.1.08 crores in the said property as being invested by both the co-owners with Shri Rashmikant C. Patel investing an amount of Rs.98,85,528/- out of his bank account in Union Bank of India, C.G. Road, Ahmedabad while the assessee investing Rs.10 lakhs out of bank account in State Bank of India. The details also revealed that out of total investment of Rs.1,08,85,528/- only Rs.32,82,538/- was made in the impugned year, while the balance had all being made in earlieryears; that out of Rs.32,82,538/- invested during the year, Rs.10 lakhs had been invested by the assessee from his bank account in State Bank of India and the balance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakhs on the ground that the assessee has failed to explain the source of that income. From the details furnished by the appellant, it is found that the appellant has paid Rs.24 laksh to the other co- owner Shri Rashmikant C, Patel in earlier year and paid Rs.10 lakhs to the seller during the year. It is further found that during the year only investment was made of an amount of Rs.32,85,528/-. The contention of the appellant that out of 'his Rs.22,85,5287- were invested by Shri Rashmikant C. Patel to whom appellant had advanced a sum of Rs.24 lakhs in earlier, year cannot be accepted as the assessee has advanced the amount of Rs.24 lakhs in earner years and not during the year. Therefore, the assessee has failed to explain the source ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that out of total investment of Rs. 1,08,85,528/- payment of Rs. 76 lacs was made in earlier years and the remaining amount of Rs. 32,82,528/- was only paid during the year under consideration. Therefore, it was contended that Rs. 76 lacs was opening investment made in the earlier years which cannot be added u/s.69 of the Act during the year under consideration. In the light of the above facts and circumstances, we observe that assessee had tried to explain the part investment made out of Rs. 76 lacs in the earlier years which had already been deleted by the ld. CIT(A). However, in respect of payment made during the previous year relevant to the year under consideration, the assessee had only explained the source of payment of Rs. 10 lacs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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