SH. GURPINDER SINGH RANDHAWA,LUDHIANA vs. ITO, W-6(5), LUDHIANA

आदेश/Order

The present appeal has been preferred by the assessee against the order dated 20.07.2018 of the Commissioner of Income Tax (Appeals)-3, Ludhiana [hereinafter referred to as ‘CIT(A)’].

ITA No. 1570-Chd-2018- Shri Gurpinder Singh Randhawa, Ludhiana 2 3. The appeal is time barred by limitation period of 39 days. The

assessee has moved a separate application pleading therein that the

assessee who is NRI, though, tried to arrange for / sent the necessary

papers for filing the appeal in time to his counsel, however, in the

process, the delay of 39 days has occurred which was beyond the

control of the assessee.

Considering the above submissions of the assessee and the

shortness of the delay in filing the appeal, the delay of 39 days is hereby

condoned.

assessee is engaged in the business activity of sale and purchase of old

cars / vehicles. That certain amounts were found deposited in the

account of the assessee. On being asked to explain in this aspect, the

assessee explained to the Assessing Officer that the said amount

belonged to the clients / intending purchasers who used to handover

certain amounts for the purchase of the vehicles of their choice through

the assessee and as and when such vehicles are found available for the

sale. However, the Assessing Officer did not get satisfied with the above

explanation of the assessee and made the addition of Rs. 8.41 lacs

taking the figure of peak cash credited in the account of the assessee.

Apart from that, the Assessing Officer estimated 10% of the profits on

the total amount found deposited in the bank account of the assessee.

ITA No. 1570-Chd-2018- Shri Gurpinder Singh Randhawa, Ludhiana 3 5. In appeal, the Ld. CIT(A) after considering the submissions of

the assessee in respect of the income already declared as well as source

of certain deposits, reduced the addition in respect of peak cash credit to

Rs. 4.91 lascs. He also restricted the addition to Rs. 1.14 lacs as against

2.30 lacs made by the Assessing Officer on account of estimated 10%

profits. Separate penalty proceedings u/s 271 (1)(c) were also initiated

by the Assessing Officer, whereupon, the Assessing Officer had levied

the impugned penalty in respect of the additions so confirmed by the

Ld. CIT(A).

The assessee did not prefer appeal against the order of the Ld.

CIT(A) in relation to the quantum additions, however, in the present

appeal, the assessee has contested the levy of penalty u/s 271 (1)(c) of

the Act.

for the assessee has explained that the assessee was engaged in the

activity of sale and purchase of old vehicles and that the customers used

to deposit certain amounts with the assessee so that the assessee may

immediately book / purchase vehicles of their choice as and when the

same are found available for purchase. The above contention of the

assessee has not been totally rejected by the Revenue, that is why the

Assessing Officer apart from making the addition’s on peak cash credit

also estimated the unaccounted profits on the deposits found in the bank

ITA No. 1570-Chd-2018- Shri Gurpinder Singh Randhawa, Ludhiana 4 account of the assessee. If the Assessing Officer was of the view that

such deposits were out of unaccounted income of the assessee, there was

no reason with the Assessing Officer to estimate profits on such deposits

on the basis of the turnover. The Ld. CIT(A) has also given relief to the

assessee observing that the assessee himself has also declared certain

profits in respect of its activities of sale / purchase of vehicles. Under

the circumstances, it is apparent that the impugned additions have been

made by the lower authorities on estimation basis. However, there was

no reliable or un-rebutted evidences on the file to prove that the

assessee had actually furnished inaccurate particulars of income or

concealed particulars of his income. Though, the additions have been

made by the Assessing Officer and further confirmed by the Ld. CIT(A)

on the basis of estimation / preponderance of possibilities of

introducing some unaccounted income into the bank account of the

assessee, however, after appreciating the facts and circumstances of the

case, I do not find it a fit case for levy of penalty u/s 271 (1)(c) of the

Act and the same is accordingly ordered to be deleted.

In the result, the appeal of the assessee is treated as allowed.

Order dictated and pronounced in the Open Court immediately on

completion of hearing.

Sd/- (संजय गग� / SANJAY GARG) �या�यक सद�य/ Judicial Member Dated : 10. 06.2019 “आर.के.”

ITA No. 1570-Chd-2018- Shri Gurpinder Singh Randhawa, Ludhiana 5

आदेश क� ��त�ल�प अ�े�षत/ Copy of the order forwarded to : 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent 3. आयकर आयु�त/ CIT 4. आयकर आयु�त (अपील)/ The CIT(A) 5. �वभागीय ��त�न�ध, आयकर अपील�य आ�धकरण, च�डीगढ़/ DR, ITAT, CHANDIGARH 6. गाड� फाईल/ Guard File

आदेशानुसार/ By order, सहायक पंजीकार/ Assistant Registrar