ACIT, CHENNAI vs. S.SUJATHA, CHENNAI

आदेश / O R D E R

PER CHANDRA POOJARI, ACCOUNTANT MEMBER These appeals by Revenue are directed against different orders of Commissioner of Income Tax (Appeals)-I, Chennai for the above assessment years.

I.T.A.Nos.956 to 959/Mds/2013. :- 2 -:

In compliance, the assessee filed return of income for the assessment year 2005-06 admitting a total income of �2,10,000/-. The Assessing Officer made an addition of �7,39,800/- towards unexplained bank deposits. Later penalty proceedings u/s.271(1)(c) towards these additions were initiated. In the course of penalty proceedings, the assessee has not offered any explanation regarding source of bank deposits inspite of giving adequate opportunity of hearing to the assessee. The penalty of �2,46,284/- was levied u/s.271(1)(c) of the Act. Aggrieved, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals).

2.1 The Commissioner of Income Tax (Appeals) deleted the penalty by placing reliance on the judgment of the Supreme Court in the case of CIT vs. Suresh Chandra Mittal 251 ITR 9. Against this, the Revenue is in appeal before us.

I.T.A.Nos.956 to 959/Mds/2013. :- 3 -:

In the present case, the assessee is not able to explain the deposits.

According to the assessee, the assessee is not educated and return subsequent to the search was filed by a Chartered Accountant who obviously has not made out a proper disclosure. The intention of the assessee was to make a proper disclosure, come out clean and pay the taxes. However, it was submitted that it was only the mistake of the Chartered Accountant and not of the assessee in making proper disclosure. Later the assessee accepted for the addition to purchase peace and to avoid prolonged litigation. In our opinion, this contention of the assessee is totally misconceived. It is the duty of the assessee to disclose all income truly and fully while filing the return of income.

The assessee cannot shift his responsibility to his Chartered Accountant. Further, the assessee stated it was ill advised by the Chartered Accountant without mentioning the name of the Chartered Accountant. It is not brought on record what advice was given by the Chartered Accountant on this issue. In our opinion, the assessee has concealed particulars of income and also not given any bonafide explanation for this. This case is squarely covered by the judgment of Supreme Court in the case of Mak Data (Pv) Ltd. vs. CIT 358 ITR 593 wherein it was held that I.T.A.Nos.956 to 959/Mds/2013. :- 4 -:

‘’ the assessee had only stated that it had surrendered the additional sum of Rs. 40,74,000 to avoid litigation, buy peace and to channelize the energy and resources towards productive work and to make amicable settlement with the Income-tax Department. The statute did not recognize those types of defences under Explanation 1 to section 271(1)(c) of the Act. The surrender of income in this case was not voluntary in the sense that the offer of surrender was made in view of detection by the Assessing Officer in the search conducted in the sister concern of the assessee. The survey was conducted more than 10 months before the assessee filed its return of income. Had it been the intention of the assessee to make full and true disclosure of its income, it would have filed the return declaring an income inclusive of the amount which was surrendered later during the course of the assessment proceedings. Consequently, it was clear that the assessee had no intention to declare its true income. It is the statutory duty of the assessee to record all its transactions in the books of account, to explain the source of payments made by it and to declare its true income in the return of income filed by it from year to year. The Assessing Officer had recorded a categorical finding that he was satisfied that the assessee had concealed the true particulars of income and was liable for penalty proceedings under section 271 read with section 274 of the Act. There was no illegality in the Department initiating penalty proceedings’’.

Hence, we are inclined to reverse the order of the Commissioner of Income Tax (Appeals) and restore the order of the Assessing Officer in levy of penalty u/s.271(1)(c) of the Act. In result, the appeal of the Revenue in is allowed.

In this year, the facts of the case are that the assessee had deposited �11,00,000/-, out of which �6,00,000/- deposited in cash and �5,00,000/- deposited by Cheque in the ICICI bank account I.T.A.Nos.956 to 959/Mds/2013. :- 5 -: no.602601501262. The assessee failed to explain the source of deposit. An addition made on this count and later penalty u/s.271(1)(c) was levied at �3,69,947/-. Since facts in this year is similar to assessment year 2005-06, as discussed in the earlier assessment year 2005-2006, we are inclined to reverse the order of the Commissioner of Income Tax (Appeals) and restore the order of the Assessing Officer in levy of penalty u/s.271(1)(c) of the Act. In result, the appeal of the Revenue in is allowed.

The facts of the case are that the assessee filed her return of income on 31.03.2008 disclosing a total income of �6,89,650/-. The assessment was completed u/s.143(3) on 07.12.2009 assessing the total income at �47,89,652/-. The Assessing Officer made an addition of �40,00,000/- relating to credits in ICICI bank account number 602601501262. The assessee was unable to account for these credits other than to submit that this money belonged to her ex-husband Shri.

S. Sathyanarayana. Aggrieved, the assessee preferred an appeal before the Commissioner of Income Tax (Appeals).

I.T.A.Nos.956 to 959/Mds/2013. :- 6 -:

5.1 The Commissioner of Income Tax (Appeals) observed that the records relating to Shri. Sathyanarayana wase called for and examined.

As per Commissioner of Income Tax (Appeals) observation, on 17.08.2009, the Assessing Officer had called for profit and loss account, balance sheet, details relating to capital gains, evidence for agricultural income, payment of taxes from assessee. From the noting on 27.11.2009 in assessment records, it was the Commissioner of Income Tax (Appeals) observed that Shri. A. Balasubbramaniann was the authorized representative for assessee and Shri. Subramanian no longer represents the assessee. Further, the Commissioner of Income Tax (Appeals) observed that the Assessing Officer on 22.12.2009, he made a test check and the case was heard. The Chartered Accountant filed LIC receipts, TDS certificates, bank statements of ICICI, IOB bank, Municipal Tax receipts, statements of accounts and a note on agricultural income. In the statement of affairs, the Commissioner of Income Tax (Appeals) found that the last item on the asset side narrates deposit in the account of the assessee at �40,00,000/-.

Accordingly, he deleted the addition. Against this, the Revenue is in appeal before us.

I.T.A.Nos.956 to 959/Mds/2013. :- 7 -:

The is partly allowed for statistical purposes.

I.T.A.Nos.956 to 959/Mds/2013. :- 8 -:

Order pronounced on Thursday, the 9th day of July, 2015, at Chennai.