SHRI VINOD SINGH,JAIPUR vs. INCOME TAX OFFICER, WARD-5-1, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR Jh jes’k lh0 ’kekZ] ys[kk lnL; ,oa Jh fot; iky jko] U;kf;d lnL; ds le{k BEFORE: SHRI RAMESH. C. SHARMA, AM & SHRI VIJAY PAL RAO, JM vk;dj vihy la-@ITA No. 177/JP/2019 fu/kZkj.k o"kZ@Assessment Year : 2010-11 cuke Shri Vinod Singh, The ITO, Vs. P.No. 13-14, Om Colony, Delhi Ward-5(1), By Pass, Jai Singh Pura, Jaipur. Khore, Jaipur- 302002. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ANWPS 6841 C vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by: Shri Yogesh Kumar Sharma (FCS.) jktLo dh vksj ls@ Revenue by : Shri A.K. Mahla (JCIT) lquokbZ dh rkjh[k@ Date of Hearing : 12/04/2019 mn?kks"k.kk dh rkjh[k@Date of Pronouncement: 20/06/2019 vkns'k@ ORDER PER: VIJAY PAL RAO, J.M. This appeal by the assessee is directed against the order dated 16.11.2018 of the ld. CIT(A), Jaipur arising from penalty order passed U/s 271(1)(c) of the IT Act for the assessment year 2010-11. The assessee has raised the following grounds:- Shri Vinod Singh vs. ITO Shri Vinod Singh vs. ITO

8. That the Appellant prays that the penalty of Rs. 6,50,000 made in respect of Section 271(1)(c) be deleted. 3 Shri Vinod Singh vs. ITO

2. The assessee is an individual and filed his return of income on 16.08.2010 declaring total income of Rs. 1,45,250/-. The scrutiny assessment was completed U/s 143(3) of the Act on 19.03.2013. During the assessment proceeding the AO noted that the assessee has deposited cash of Rs. 25,85,000/- in the saving bank account of Standard Chartered Bank, M.I. Road, Jaipur. The AO made an addition of peak balance of Rs. 15,79,000/- as unexplained investment in the bank account and interest on bank deposits of Rs. 28,418/- was also added to the income of the assessee. Further, the AO has also made addition on account of capital gain of Rs. 4,38,579/- and unexplained investment in shares and Mutual Funds of Rs. 5,00,000/-. In the quantum appeal, the ld. CIT(A) has confirmed the addition made by the AO except on account of investment in shares and Mutual Funds which was restricted to Rs. 3,30,000/- as against Rs. 5,00,000/- made by the AO. Subsequently, the AO initiated the penalty proceedings U/s 271(1)(c) of the Act and levied the penalty of Rs. 6,50,000/- in respect of the additions sustained by the ld. CIT(A). The assessee challenged the action of the AO imposing the penalty U/s 271(1)(c) of the Act before the ld. CIT(A) but could not succeed. 4 Shri Vinod Singh vs. ITO

3. Before us, the ld. AR of the assessee has submitted that the addition on account of cash deposit in the bank account is based on estimation as the AO has taken the peak balance of bank account therefore, on such addition no penalty U/s 271(1)(c) of the Act can be levied. The ld. AR has relied upon the various decisions and submitted that the assessee has explained the source of cash deposit in the bank as well as investment in shares and Mutual Funds. Further, even though the said explanation was not found to be satisfactory but the same is reasonable bonafide explanation and consequentially no penalty U/s 271(1)(c) of the Act is leviable. He has reiterated its contention raised before the authorities below.

4. On the other hand, the ld. DR has submitted that this is not a case of estimation of income of the assessee but the specific amount was found deposited in the bank and the assessee failed to explain the source of the same. The assessee has shown very meager income in the return of income at Rs. 1,45,245/- therefore, the benefit of withdrawal of money from the bank account by the AO would not be treated as estimation of income. He has relied upon the order of the authorities below.

5. We have considered the rival submissions as well as the relevant material on record. The assessee has not disputed the fact that the total Shri Vinod Singh vs. ITO sum of Rs. 25,85,000/- was found deposited in cash in the bank of the assessee. The AO after allowing the benefit of opening balance and withdrawal has made the addition of Rs. 15,79,000/- being peak balance/credit in the bank account. Therefore, giving the credit of withdrawals from the bank account to arrive the correct deposit made by the assessee without having any source would not amount estimation of income because the unexplained deposit in the bank account has been taken at the peak credit instead of the total deposit. The other additions are interest in the bank deposit is otherwise is not in dispute as the assessee has not included the said amount in the return of income. Except part relief was granted by the ld. CIT(A) regarding the mistake in the amount of investment in Mutual Funds taken by the AO all the additions were sustained by the ld. CIT(A) as well as this Tribunal. The ld. CIT(A) has considered this issue in para 2.3 is as under:-

“2.3 I have perused the facts of the case, the penalty order and the submissions of the appellant. It is seen that the penalty of Rs. 6,50,000/- was imposed in respect of the following- (1) peak deposit in bank accounts (2) interest on bank deposit Shri Vinod Singh vs. ITO Shri Vinod Singh vs. ITO Shri Vinod Singh vs. ITO Shri Vinod Singh vs. ITO In view of the above facts and circumstances of the case, when the addition was made on account of unexplained deposits, unexplained investment, income from interest on deposit and income from share trading not disclosed in the return of income clearly attracts the provisions of Section 271(1)(c) of the Act. Accordingly, we do not find any reasons to interfere with the impugned order of the ld. CIT(A). Shri Vinod Singh vs. ITO In the result, the appeal filed by the assessee is dismissed.

Order pronounced in the open court on 20/06/2019.

Sd/- Sd/- ¼ jes’k lh0 “kekZ ½ ¼fot; iky jko½ (Ramesh. C. Sharma) (Vijay Pal Rao) ys[kk lnL;@Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 20/06/2019. *Santosh. आदेश की प्रतिलिपि अग्रेf’ात@ब्वचल वf जीम वतकमत वितूंतकमक जवरू 1. vihykFkhZ@The Appellant- Shri Vinod Singh, Jaipur. 2. izR;FkhZ@ The Respondent- ITO, Ward 5(1), Jaipur. 3. vk;dj vk;qDr@ CIT 4. vk;dj vk;qDr@ CIT(A) 5. विभागीय प्रतिनिधि] आयकर अपीलीय अधिकरण] जयपुर@क्त्ए प्ज्Aज्ए Jंपचनत. 6. xkMZ QkbZy@ Guard File {ITA No. 177/JP/2019} vkns'kkuqlkj@ By order,

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