TaxTMI 
TaxTMI 
2021 (3) TMI 558
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....IT(A) was justified in law in holding that admission of additional income of Rs. 1,80,00,000/- was not discernible from statements or from impounded material found during survey out of which Rs. 1,50,00,000/- was offered as additional income during assessment did not represent specific item of unexplained/undisclosed income/investment/expenses not shown in regular books of account/return of income and was not backed by any incriminating material ignoring the direct evidence and material found during survey and accepted as unexplained by the Managing Director in his statement." 2. The assessee has raised cross-objections stating that the learned Assessing Officer has erred in law and on facts in levying the penalty u/s. 271(1)(c) on a nonspecific notice initiating the penalty. 3. Brief facts of the case are that a survey u/s.133A was carried out on 25.07.2012 at the business premises of the assessee. During the course of survey, loose papers and other documents were found which were impounded and inventorized. The assessee was confronted with the documents so found and impounded. The assessee after being confronted with the documents, had given statements and the relevant port....
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....P 474011 Sir/Madam, Whereas in the course of proceedings before me for the Assessment year 2013-14, it appears that you have concealed the particulars of your income or furnished inaccurate particulars of such income. You are hereby requested to appear before me on 21/09/2016 at 11.30 AM and show cause why an order imposing a penalty on you should not be made under section 271(1)(c) of the Income Tax Act, 1961. If no one attends this office on the said date of hearing, the case shall be decided on the basis of material available on records. Yours faithfully (Yaduvansh Yadav) Asstt. Commissioner of Income Tax, Circle 1(1), Gwalior. Dated 20/09/2016 To M/s. Fairyland Hotels and Resorts Private Limited A-225, Patel Nagar, City Center, Gwalior, MP 474011 Sir/Madam, Whereas in the course of proceedings before me for the Assessment year 2013-14, it appears that you have concealed the particulars of your income or furnished inaccurate particulars of such income. You are hereby requested to appear before me on 23/09/2016 at 11.30 AM and show cause ....
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....rect and is contrary to categorical finding recorded in the assessment order. The Assessing Officer has mentioned, in order that loose papers and other materials which were found, impounded and inventorised. She had also submitted that the judgment relied upon by the CIT(A) in the case of MAK Data vs. CIT, 38 taxman.com 448 (SC) was in fact fully applicable against the assessee and the decision of the Tribunal in the case of Arpana Tiwari vs. ITO and Uttam Value Steels Ltd vs. ACIT were on its own facts and cannot dilute the proposition laid down by Hon'ble Supreme Court. 10. Per contra, ld. AR supported the order passed by the ld.CIT(A) and had also submitted that the order passed by the CIT(A) was in accordance with law. The ld.AR has further submitted that the cross objection was filed by the assessee wherein it was submitted that the penalty order is required to be set aside not only on the ground mentioned by the CIT(A), but also on account of fact that all the three notices reproduced above were not specific on charge of penalty. He relied upon the decision of Hon'ble Karnataka High court in the case of CIT vs. Manjunatha Cotton & Ginning Factory, 359 ITR 565 (Kar) and of ....
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....igh Court in the matter of Sundaram Finance Lt. v. ACIT, 93 tamann.com 250 (Madras) and Sandeep Chandak, 93 taxman.com 405. 13. We have heard the rival contentions of the parties and perused the material before us including the judgments relied by both the parties. We'll first deal with the CO filed by the assessee whereby the assessee sought to support the order passed by the Commissioner (appeal) on the ground that the notices issued by the assessing officer were non-specific. In this regard, it would be relevant to record the facts of the present case. A survey was carried out in the premises of the assessee on 25th of July 2012 when during the survey loose papers and other materials were found, which were impounded and inventoried. The statement was also recorded and the assessee agreed to declare income of Rs. 1, 80, 00000/-as the documents were found in the hard disk which were not recorded in the books of account of the assessee, his daughters and son.(AO page 2) 14. The assessing officer noticed that the assessee had only surrendered Rs. 30.00 Lakhs instead of income of Rs. 1,80,00, 000/-. The assessee was asked by the assessing officer to furnish his explanation rega....
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....the lower authorities to prove the prejudice caused to the assessee on account of non-specific notice. In the light of the above we do not find any merit in the contention of the assessee and therefore the CO filed by the assessee is required to be dismissed as no prejudice had been caused to the assessee. Further we are also of the opinion that the charge against the assessee was known to the assessee and had filed the reply thereto setting up the plea of buying the peace and to curtail the litigation. However in the reply the assessee has not submitted that he was not aware of the charges for which the penalty notices were issued by the assessing officer. 16. Now coming to the finding of the Commissioner appeal challenged by the revenue. The Commissioner appeal had deleted the penalty by distinguishing the judgement of the honourable Supreme Court in the matter of Mak Data and relied upon the decision of Uttam Value Steels (supra). The SC in Mak Data had held as under : 9. We are of the view that the surrender of income in this case is not voluntary in the sense that the offer of surrender was made in view of detection made by the AO in the search conducted in the sis....
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....eliance was placed upon the Apex Court's decision in Price Waterhouse Coopers (P.) Ltd. v. CIT [2012] 25 taxmann.com 400/211 Taxman 40/348 ITR 306 to contend that mistakes made by an assessee cannot be the basis for imposition of penalty. In the above view, it is submitted that the appeal be admitted. 9. From the record it is clear that the notice under Sections 142(1) and 143(2) of the Act were issued to the appellant on 14th January, 2009. The notice also contains an annexure, seeking details of expenses debited to Profit and Loss Account, along with details of foreign exchange expenses. Even according to the appellant, the alleged mistake on its part was pointed out by a letter dated 23rd September, 2009 during assessment proceedings where it stated that it had committed a mistake in debiting foreign exchange loss to its determine non-tonnage income, when in fact, no foreign exchange loss was involved in respect of its non-tonnage business. Thus, it is clear that so-called mistake as claimed by the appellant-assessee, was only after notices dated 14th January, 2009 were issued under Sections 142 and 143 of the Act. It was only an attempt to pre-empt the Revenue find....
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....loss to its non-tonnage business was made on account of a mistake. Nor can it be classified as an computation error after complete disclosure. Thus, the aforesaid decision does not assist the appellant-assessee. 11. We note that all the three authorities have come to a finding of fact, adverse to the appellant, that the so-called voluntary disclosure was not voluntary, but made only in response to notices under Sections 142 and 143 of the Act. This finding of fact is not shown to be perverse and/or arbitrary, warranting interference. In view of the above, the question as framed does not give rise to any substantial question of law. 18. In the matter of Gangotri Textiles Ltd.[2020] 121 taxmann.com 171 (Madras) 4. We have carefully perused the penalty order dated 25-9-2015 and we find that the Assessing Officer considered all the factual aspects raised by the assessee and rejected the same to be absolutely without bonafides. The decisions relied on by the assessee were also taken note of and each of the decisions was dealt with. The Assessing Officer placed reliance on the decision of the Hon'ble Supreme Court in MakData (P.) Ltd. (supra) and stated that volu....
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....the Tribunal rejecting the assessee's explanation that it had claimed deduction on wrong advice given by the Chartered Accountant was dismissed. The operative portion of the judgment of the High Court of Bombay in Jivanlal& Sons v. Asstt. CIT [2019] 103 taxmann.com 207 is as follows: 2. We are unable to agree for more than one reason. The assessee is a Firm. It was throughout being advised and represented by a Chartered Accountant. The Tribunal rightly proceeded on the basis that a Chartered Accountant is deemed to be aware of the law and its intricacies. Being a professional, he could not have committed a mistake as was attributed to him. The tax paid is undisputedly an inadmissible expenditure from the profits of the business. Hence this amount should have been statutorily added back. Further, from the computation of income, the assessee added back certain inadmissible expenditure. However, he excluded the amount of income tax paid to the extent of Rs. 48,90,114/-. Thus, the addition was only partial and not full. Unless and until the legal provision then in force permitted exclusion of the amount of income tax already paid, the Chartered Accountant could not have do....
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....conduct of the assessee, it is clear that the surrender was lacking voluntariness. In our view the assessee was forced to disclose the income on account of survey and subsequent show cause notice issued by the assessing officer. In view of the above said we do not find any justification for the CIT(appeals) to delete the penalty . Hence the order passed by the CIT (appeals) is required to be annulled and the order of the assessing officer imposing the penalty is required to be confirmed. Accordingly we confirm the penalty imposed by the assessing officer. 21. In the result the appeal filed by the revenue is allowed and the CO filed by the assessee is dismissed. Order pronounced in the open court on 09/03/2021. ============= Document 1 पà¥à¤° 10 आपको और कà¥à¤› कहना है । उतà¥à¤¤à¤° मेरे यहा से पà¥à¤°à¤¾à¤ªà¥à¤¤ हारà¥à¤¡ डिसà¥à¤• व अनà¥à¤¯ कागजो व मेरे दà....