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Income Tax Appellate Tribunal, “C” BENCH, MUMBAI
Before: SHRI M. BALAGANESH, AM & SHRI AMARJIT SINGH, JM
O R D E R
PER AMARJIT SINGH, JM:
The assessee has filed the present appeal against the order dated 30.12.2015 passed by the Commissioner of Income Tax (Appeals)-45, Mumbai [hereinafter referred to as the “CIT(A)”] relevant to the A.Y. 2009-10 in which the penalty levied by the AO has been ordered to be confirm.
The assessee has raised the following grounds: -
2. “1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in treating Rs.25,66,301/- speculation loss as Concealment of Income and as such may be deleted.
2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in treating Business Creditor of Rs.62,64,440/- as Concealment of Income and as such may be deleted. A.Y. 2009-10 On the facts and in the circumstances of the case and in law, the 3. Ld. CIT(A) erred in treating Loan Creditor of Rs.140,13.680/- as Concealment of Income and as such may be deleted.
4. The appellant prays that the order of the Ld. CIT(A) on the above grounds be set aside.
5. The appellant craves leave to amend or alter any ground or add a new ground." The brief facts of the case are that the assessment of the 3. assessee was completed u/s 143(3) of the I.T. Act, 1961 on 16.12.2010 assessing the total income to the tune of Rs.2,31,02,130/- as against the returned income in sum of Rs.79,590/-. The following addition was made:
(i) Speculation loss Rs.25,66,301/- (ii) Business creditors Rs.62,64,440/- (iii) Loan creditors Rs.1,40,13,680/- At the time of assessment, it was found that the share trading loss was camouflaged in the total profit of the business ie speculation loss of Rs.25,66,301/- was set-off against the business. The said speculation loss was disallowed and added to the income of the assessee. The assessee was having the credit balance of Rs.62,64,440/- but the assessee failed to prove the purchase from M/s. Radhe Enterprises, hence, entire purchase of Rs.62,64,440/- was disallowed and added to the income of the assessee. So far as the loan creditors of Rs.1,40,13,680/- was concerned, the assessee failed to prove the creditworthiness of the lender, therefore, the loan of Rs.1,40,13,680/- was added to the income of the assessee. Thereafter, the penalty proceeding u/s 271(c) of the Act was initiated on the said disallowance. Notice was issued and after the reply of the assessee, 2 A.Y. 2009-10 the penalty to the tune of Rs.69,61,366/- was levied. Feeling aggrieved, the assessee filed an appeal before the CIT(A) who confirmed the penalty, therefore, the assessee has filed the present appeal before us.
ISSUE Nos. 1 to 3
All the issues are in connection with the confirmation of the penalty upon the addition of speculation loss, business credit in connection with the purchase of Rs.62,64,440/- from M/s. Radhe Enterprises and loan credit in sum of Rs.1,40,13,680/-. At the very outset, the Ld. Representative of the assessee has argued that the Hon’ble ITAT has restored the quantum before the AO in dated 16.05.2019, therefore, in the said circumstances, no penalty is liable to be leviable in accordance with law. However, on the other hand, the Ld. Representative of the Department has refuted the said contention. The copy of order dated 16.05.2019 is on the file in which the relevant finding has been given in para no. 6 which is reproduced as under:-
6. We find that Mr. Khushal Shah, Ld. counsel of the assessee has filed an application before the ITAT on 20.07.2018 regarding nonappearance and non-receipt of notices. Therein, he has stated that : “The appellant due to his family issues and depression could not provide the consultants with any information needed for completing the assessment and Ld. Assessing Officer passed the Assessment order accordingly. The Ld. CIT(A) has passed a non- speaking order. The documents and submissions were not considered by the Ld. CIT(A). The appellant was not giving an opportunity of being heard even after submission of documents.