TaxTMI 
TaxTMI 
TaxTMI 
2019 (2) TMI 275
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....ccordingly questioned by the Assessing Officer (AO). Cash deposits to the extent of Rs. 22.10 lacs were explained to be out of cash advanced by his younger brother, Shri Babu Singh, who had sold lands for Rs. 8.51 lacs during October/November, 2008. The purpose of the 'advance' was stated to be 'safe custody'. Another Rs. 3 lacs was stated to be similarly received from Shri Harjeet Singh, the assessee's brother-in-law. Both were summoned by the AO to verify the assessee's claims, and examined on oath in the presence of the assessee and his counsel (on 28/ 01/2014), who also identified them. Shri Babu Singh, an agriculturist, stated to be maintaining a bank account (with PNB), in which he would deposit Rs. 3-4 lacs cash on the sale of crop. He had sold some lands during the year 2010, proceeds of which were used by him for agricultural activities, i.e., purchase of agricultural inputs; maintenance; making payments to the landlord/s toward lease of land. Giving and receiving money to/from the assessee was admitted by him, i.e., as and when required, without charging any interest. He, however, did not remember the amount given by him to the assessee. Sh. Harjeet Singh, who again had ....
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....., concealment of particulars of income or furnishing inaccurate particulars of income, in the notice u/s. 274, as bad in law, gets accordingly upheld. I shall take up the assessee's legal argument first, which is to the effect that the notice u/s. 274, not specifying the limb under which the penalty is being proposed, is invalid, and the consequent penalty proceedings bad in law. The said notice is not on record. How could in its' absence, then, the assessee's legal plea, taken before the tribunal for the first time, be admitted? Reference in this context be made to the decision in NTPC Ltd. v. CIT [1998] 229 ITR 383 (SC), wherein it stands clarified that a legal ground could be admitted by an appellate authority even if taken before it for the first time provided the facts necessary for its' adjudication are on record and not disputed. The least the assessee was required to do was to place the said notice on record, and take a specific ground in its' respect. The assessee's plea is, accordingly, inadmissible. Without prejudice, the claim is untenable. The satisfaction recorded by the AO in the assessment proceedings, separately for Rs. 22.10 lacs and Rs. 3 lacs, toward initiati....
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.... ITR 751 (Pat); CIT v. Chandulal [1985] 152 ITR 238 (AP); CIT vs. Kaushalya & Ors. [1994] 216 ITR 660 (Bom), holding it to be of little consequence, also clarifying the import of the notice u/s. 274. Again, it may be noted that these decisions are either under the 1922 Act or prior to the insertion of section 292B on the statute-book w.e.f. 1/10/1975 saving any omission in the notice. Further, reference in this context may also be made to decisions in H. P. State Forest Corporation Ltd. v. CIT [2004] 267 ITR 285 (HP) and CIT v. Maharaj Krishnan [2000] 246 ITR 327 (Del), rendered without noticing s. 292B. That substance is to prevail over form is even otherwise trite law. The decision by the Hon'ble High Court in SSA's Emrald Meadows' case, which stands not interfered with by the Apex Court by dismissing the Revenue's SLP, is rendered following the decision by the same court in CIT v. Manjunatha Cotton & Gaining Factory [2013] 359 ITR 565 (Kar). The same is, firstly, without reference to the judicial precedents, some of which are cited above. Two, as explained by the Tribunal in many case, as in Earthmoving Equipment Service Corporation vs. Dy. CIT (in ITA No. 617/Mum/ 2014, dated ....
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....1, i.e., where the assessee either fails to furnish an explanation or renders one which is found false, becomes applicable as the assessee has not, at any stage of the proceedings, either in quantum or penalty, explained as to why the bank account was not disclosed to the Revenue. None of the transactions for nearly Rs. 50 lacs in this bank account are claimed to have been reported or otherwise disclosed to the Revenue. The disclosure of the account in the assessment proceedings cannot be regarded as 'voluntary' inasmuch as the assessee knew that his return (for the relevant year) has been subject to the verification proceedings under the Act under CASS; the Revenue having specific information on cash deposits in his bank account (refer para 1 of the assessment order). All the cash transactions are through this account, further suggesting of being transactions which were not intended to be disclosed to the Revenue. The explanation is, further, false. The assessee states of his brother, Babu Singh, giving him money for safe custody as he did not have a bank account for want of PAN. The source of money is stated to be the sale of lands by his brother in 2008, i.e., two years earlier,....
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....t was for the purchase of the tractor, his co-brother would have asked back the amount for acquiring it, rather than leaving it with the assessee to use the same and return it on his whim and fancy. The return of money, as it's giving, is without evidence. The statements of both, the assessee and Shri Harjeet Singh, are totally unconvincing, besides being contrary. Finally, the very fact that the assessee seeks a telescoping benefit, which he is allowed by the first appellate authority, again, strongly suggests of the money deposited in the account being kept out of books for being utilized for personal purposes or for rotation in his business. The decisions relied upon are not applicable in the facts & circumstances of the case. In Agrochemicals (India) (supra) the Honb'le Court declined to interfere as in it's view no substantial question of law arose for its determination. In the facts of National Textiles (supra) the Revenue had no positive evidence, as in the form of statements of the stated lenders in the present case, that the explanation furnished by the assessee was false, so that the Hon'ble Court found it to be a case where the facts and circumstances were equally consi....