SMT. HANSABEN HASMUKHBHAI PATEL,,ANAND vs. THE INCOME TAX OFFICER, WARD-2,, ANAND

आदेश / O R D E R

PER SHRI MAHAVIR PRASAD, JUDICIAL MEMBER : This is an appeal by the assessee against the order of the Commissioner of Income Tax(Appeals)-IV, Baroda, dated 27/10/2014 for the Assessment Year (AY) 2008-09, on the following Grounds: The assessing officer has levied penalty U/S 271(1)(c) of the Act on account of disallowance made U/S 68 of the act Vide Order Dated 11/10/2010. The assessing Officer had levied penalty U/S.271(1)(c) as we could not establish identity, genuineness and creditworthiness of the persons from whom we had taken loans to run business. Your honour, the loans which were taken by us were utilized for business expenses, No business expenses were disallowed. We had

ITA No.205/Ahd/2015 Hansaben Hasmukhbhai patel vs. ITO Asst.Year –2008-09 - 2 - pleaded the assessing officer of genuineness of transactions. The facts of the case are there were 22 known people I had taken loans from and paid interest to them. The department had called upon maximum people and they had appeared appeal in department and confirmed the genuineness of transaction. The assessing officer was not satisfied with creditworthiness. I preferred an appeal which was dismissed on similar grounds. Notice for penalty was served upon me and this penalty was upheld. I have already paid the taxes. It would be very harsh on me if I have to pay penalties on the amount of loans I have obtained for running business, pay the loans back and even interest to people I have taken loans from. There is no concealment of Income. Creditworthiness could not be established by me, does not mean that the transactions are not genuine and there concealment of income. In a decision by Ahmedabad Bench of ITAT reported as Yogeshkumar Chhotalal Shah vs. ITO ((2013) 36 CCH 003 (Ahd), there were addition u/s 68 of the Act was made in respect of unsecured loans taken in cash and the evidences of Assessee were not accepted by the department. Since no appeal was preferred against quantum expectantly penalty was followed with. On such facts even though no appeal was filed against the quantum order, penalty was deleted by the Tribunal holding that If Assessee gives an explanation which is unproved but not disproved, i.e., it is not accepted but circumstances do not lead to reasonable and positive inference that assessee's case is false, explanation cannot help Department because there will be no material to show that amount in question was income of assessee. It was also held that No penalty can be imposed if the facts and circumstances are equally consistent with the hypothesis that it does. Similar views have been taken in following precedents: • DCIT vs. Max India Ltd. (ITA 94/Asr/2011) • C. Basker (2013- TIOL – 39- ITAT - MAD) • Gulshan Rai v. ITO (ITA 1098/Del/2012) My case is similar in nature where in spite of giving all the evidences of indentify, genuineness only creditworthiness was not accepted by department. There is no evidence of concealment of income. In such circumstances I pleat your honor to squash the order of penalty of Rs.1,20,970/- u/s.271(1)(c) and

ITA No.205/Ahd/2015 Hansaben Hasmukhbhai patel vs. ITO Asst.Year –2008-09 - 3 - save me from financial hardship. I am a senior citizen with no business and no income at this point of time. 2. The relevant facts as culled out from the materials on record are as under:- In this case, Assessing Officer has levied the penalty u/s. 271(1)(c) of the Act on account of disallowance made u/s.68 of the Act vide order dated 11/10/2010. The additions made by the Assessing Officer were subsequently challenged by the appellant before the CIT(A)-VI, Baroda who vide order dated 26/11/2010 dismissed the appeal of the appellant. Hence, the Assessing Officer had levied the penalty u/s.271(l)(c) of the Act as the same was initiated at the time of assessment order. The appellant has not appeared during the course of appellate proceedings in spite of several notices given enumerate above.

2.2 On perusal of the penalty order, it was seen that there have been large number of persons from whom cash deposits were shown to have been credited by the appellant in her books. At the time of assessment, the appellant could not prove the requirements u/s.68 of the Act to establish the identity, genuineness and creditworthiness of the persons. The Assessing Officer, therefore, went on to consider the cash credits of Rs.3,83,780/- and the interest thereon amounting to Rs.23,175/- as unexplained deposits and added the same to the income of the appellant. The finding of the Assessing Officer were upheld by the CIT(A). As no submissions have been made during the appellate proceedings. Therefore, penalty levied by the Assessing Officer was confirmed by the ld. CIT(A).

ITA No.205/Ahd/2015 Hansaben Hasmukhbhai patel vs. ITO Asst.Year –2008-09 - 4 - 3. We have gone through the relevant record and impugned order. Undisputedly, ld.CIT(A) sent several notices as follows: Sr. Date of Date of Remarks No. notice hearing 1. 25.03.2014 10.04.2014 None attended 2. 11.04.2014 22.04.2014 Seek adjournment 3. 22.04.2014 28.04.2014 None attended 4. 07.05.2014 15.05.2014 None attended 5. 19.06.2014 08.07.2014 Adjourned to 24.07.2014 as per appellant’s request 6. 24.07.2014 None attended 7. 26.08.2014 01.09.2014 None attended 8. 04.09.2014 11.09.2014 None attended 9. 10.10.2014 27.10.2014 None attended

3.2 But appellant could not pursue his matter before the ld. CIT(A). In the interest of the justice, we remit this matter back to the file of the CIT who will decide this matter afresh after giving opportunity of being heard to the assessee.

This Order pronounced in Open Court on 22/11/2017

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ITA No.205/Ahd/2015 Hansaben Hasmukhbhai patel vs. ITO Asst.Year –2008-09 - 5 -

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)-IV, Baroda �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, स�या�पत ��त //True Copy//

उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad True Copy 1. Date of dictation 03/11/2017 (dictation-pad 1 pages attached at the end of this appeal-file) 2. Date on which the typed draft is placed before the Dictating Member 13/11/2017 3. Other Member… 4. Date on which the approved draft comes to the Sr.P.S./P.S…………….. 5. Date on which the fair order is placed before the Dictating Member for pronouncement…… 6. Date on which the fair order comes back to the Sr.P.S./P.S……. 7. Date on which the file goes to the Bench Clerk………………… 8. Date on which the file goes to the Head Clerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signature on the order…………………….. 10. Date of Despatch of the Order………………