TaxTMI 
TaxTMI 
TaxTMI 
2019 (2) TMI 281
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....on order. For the sake of convenience the facts are narrated from the appeal of assessee in ITA No. 1162/PUN/2015 for assessment year 2004-05. 2. The brief facts of the case as emanating from records are : A search and seizure action u/s. 132(1) of the Act was carried out at the residential premises of the assessee on 06-01-2010 and survey action u/s. 133A of the Act at the office premises of the assessee on the same date. During search certain books of account and other documents were seized. The assessee declared additional income of Rs. 10,35,950/- in the return of income filed u/s. 153A of the Act for the assessment year 2004-05. During assessment proceedings, the assessee further offered rental income Rs. 18,000/- per annum from his Malegaon house property and Rs. 6,000/- per annum from shop at Nashik aggregating rental income to Rs. 24,000/-. The Assessing Officer initiated penalty proceedings u/s. 271(1)(c) r.w. Explanation 5A of the Act in respect of above two incomes of the assessee. The penalty proceedings were initiated for 'concealing the particulars' of income within the meaning of Explanation 5A to section 271(1)(c) of the Act. Thereafter, the Assessing Officer vi....
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....et. In the statement recorded u/s. 132(4), the assessee admitted that he was not in a position to furnish documentary evidences in support of the above amounts reflected in Balance Sheet, therefore, the assessee offered these amounts shown as advances/gifts in the Balance Sheet as his (additional) 'income'. Thus, these amounts were already introduced and reflected in the Balance Sheet filed prior to search. It is not a case that these amounts were not at all reflected in the Balance Sheets or that they were kept hidden/ outside the books of accounts of the assessee and as a result of certain loose papers etc. seized in the course of search, it was found that the assessee had concealed this income. Therefore, if at all penalty u/s. 271(1)(c) was to be levied, then the same should have been initiated and levied on the charge of 'furnishing of inaccurate particulars of income' and certainly not on the charge of 'concealment of income'. The penalty proceedings u/s. 271(1)(c) initiated and levied by the Assessing Officer on the wrong charge of 'concealment of income' are bad in law. The ld. AR to buttress his submissions placed reliance on the decision o....
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....ainst sale of plots/flats credited to Balance Sheet Rs.7,25,500/-. ii. Gift from relatives credited to Capital Account In Balance Sheet Rs.3,10,450/- Total Rs.10,35,950/- The contention of the assessee is that since, the aforesaid amounts have already been reflected in the Balance Sheet, it is not a case wherein the amounts have not been disclosed or have been concealed in the regular books of account. The said amounts have been offered as additional income, as the assessee failed to furnish documentary evidences in support of the above amounts reflected in the Balance Sheet. We find merit in the submissions of ld. AR of assessee. 10. The Hon'ble Supreme Court of India in the case of T. Ashok Pai Vs. Commissioner of Income Tax reported as 292 ITR 11 has held : "24. "Concealment of income" and "furnishing of inaccurate particulars" carry different connotations. Concealment refers to a deliberate act on the part of the assessee. A mere omission or negligence would not constitute a deliberate act of suppressio veri or suggestio falsi." Thus, these two expressions having different meanings cannot be used interchangeably or can be substituted for each other. 11. The ....
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.... "inaccurate" and "particulars" in conjunction, they must mean the details supplied in the return, which are not accurate, not exact or correct, not according to truth or erroneous. The court noted that it was an admitted position that no information given in the return was found to be incorrect or inaccurate." 10. The Co-ordinate Bench of the Tribunal in the case of Anand Vipin Sanghavi Vs. Deputy Commissioner of Income Tax in ITA Nos. 2183 to 2185/PUN/2014 for assessment years 2007-08 to 2009-10 decided on 31- 10-2017 while explaining these two expressions has observed as under : "11. The law laid down by the Hon'ble Apex Court and Hon'ble High Court clearly establishes that 'furnishing inaccurate particulars of income' and 'concealment of income' are two different charges. There should be no ambiguity in the mind of Assessing Officer at the time of recording satisfaction and thereafter, at the time of levying penalty with respect to the charge for levying penalty u/s. 271(1) (c) of the Act. The Assessing Officer should be clear in his mind at the time of recording satisfaction the limb of clause (c) of sub section (1) of Section 271 that has to be invoked. The wo....
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....s not sustainable. It is a well settled law that penal provisions are to construed strictly and there is no margin of error when penalties are to be levied. Thus, in our considered view penalty on the addition of Rs. 10,35,950/- is bad in law and deserves to be deleted. We hold and direct accordingly. 13. In so far as levy of penalty on rental income Rs. 24,000/- is concerned, we find that the Tribunal in the appeal by the Department in ITA Nos.1251 to 1254/PN/2013 (supra) has upheld the order of Commissioner of Income Tax (Appeals) in deleting penalty. Following the order of Co-ordinate Bench on the issue of penalty on rental income, the penalty levied on addition of Rs. 24,000/- is deleted. 14. In the result, the appeal of assessee in ITA No. 1162/PUN/2015 is allowed. ITA No. 1163/PUN/2015 (A.Y. 2005-06) 15. The penalty u/s. 271(1)(c) r.w. Explanation 5A in assessment year 2005-06 has been levied in respect of additional income declared Rs. 11,53,000/- in statement recorded u/s. 132(4) of the Act. Both the sides are unanimous in stating that the facts in assessment year 2005-06 are identical to assessment year 2004-05. The amount of Rs. 11,53,000/- was reflected in the Balanc....