Pravin M Choksey, Mumbai vs Assessee
- CitationI.T.A. No. 1960/Mum/2011
Ratio decidendi
The rule this decision rests on
In the penalty appeals under s. 271(1)(c), the Tribunal held that where the assessee's returns filed under s. 139(1) omitted income which was disclosed only in returns filed under s. 153A after a search, and there is nothing to show that the assessee was genuinely unable to disclose it earlier, the inference is that the additional income would not have been offered for taxation but for the search, and the assessee has therefore furnished inaccurate particulars or premeditatedly concealed income, so that penalty under s. 271(1)(c) is sustainable; a plea of ill-health not supported by evidence of incapacity during the relevant period does not displace that inference. In the addition appeal, the Tribunal held that where a bank credit is explained as sale proceeds of a vehicle belonging to a third party, the assessee bears the initial onus of establishing the source of the deposit, and an explanation unsupported by any evidence, with the alleged payment to the owner's heirs left unproved over a long intervening period, fails to discharge that onus, so that the credit may be added as income of the assessee.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
सव ी डी. म मोहन, उपा य एवं नरे कुमार ब लै या, लेखा सद य के सम
BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND
SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER
आयकर अपील सं/ I.T.A. Nos. 1959, 1961 & 1962/Mum/2011 ( नधारण वष / Assessment Years : 2002-03, 2005-06 & 2006-07 AND आयकर अपील सं/ I.T.A. No. 1960/Mum/2011 ( नधारण वष / Assessment Years : 2004-05 Mr. Pravin M. Choksey, बनाम/ The Dy. CIT (C) C/o Viren P. Choksey, Circle-45, Vs. Krishna Villa, Mumbai Linking Road, Santacruz (W), Mumbai-400 054 थायी ले खा सं . /जीआइआर सं . /PAN/GIR No. : AAEPC 1292J (अपीलाथ /Appellant) .. ( यथ / Respondent) अपीलाथ ओर से/ Appellant by: None यथ क ओर से/Respondent by: None
सन ु वाई क तार ख / Date of Hearing :13.05.2015 घोषणा क तार ख /Date of Pronouncement :20.05.2015
आदे श / O R D E R
PER N.K. BILLAIYA, AM:
These four appeals by the assessee pertain to four different assessment years i.e. A.Y. 2002-03, 2005-06, 2006-07 and 2004-05 respectively. ITA Nos. 1959, 1961 & 1962/M/2011 pertain to levy of 2 Mr. Pravin M. Choksey
penalty u/s. 271(1)(c) of the Act and ITA No. 1960/M/2011 is against the order made u/s. 143(3) read with Sec. 153A of the Act. All these appeals were heard together and dispose of by this common order for the sake of convenience.
2. First we take up the appeal against levy of penalty u/s. 271(1)(c) pertaining to A.Yrs 2002-03, 2005-06 & 2006-07. The Ld. CIT(A)-38, Mumbai has disposed of these appeals by a common order dt. 31.12.2010.
3. Briefly stated the facts of the case are that the income returned in the original return filed u/s. 139(1) of the Act was enhanced in the return filed u/s. 153A of the Act subsequent to receiving the notice after the search conducted on 5.10.2007. The additional incomes disclosed in the returns filed u/s. 153A are as under:
2003-03 2005-06 2006-07 Income from Salary Rs. 24,000/- Rs. 88,000/- - Income from Business Rs. 71,218/- Rs.1,02,218/- - Income from Capital gains - (Rs.30,653/-) Rs. 11,895/- Income from other sources Rs. 46,757/- Rs.1,57,775/- Rs.2,46,261/- Total Rs.1,41,975/- Rs.3,17,359/- Less Deduction u/s. chapter VI- Rs. 8,913/- Rs. 12,000/- A u/s. 80L Total Rs.1,33,062/- Rs.3,05,359/- Rs.2,58,156/-
3.1. The AO was of the firm belief that but for the search action against the assessee, he would not have offered the additional incomes which are made part of the returns of income filed u/s. 153A of the Act.
4. Before the First Appellate authority, the assessee took the plea that he was of the age of about 80 years suffering from Alzamiers disease and because of his health condition he could not include certain incomes in 3 Mr. Pravin M. Choksey
the original return filed u/s. 139(1) of the Act. It was further explained that even the accountant have left the job. It was contended that the penalty levied u/s. 271(1)(c) of the Act is not justified.
5. The Ld. CIT(A) was not convinced with the reply made by the assessee. While confirming the penalty order, the Ld. CIT(A) observed that " the manner in which the assessee has not disclosed the correct income in the returns of income filed u/s. 139(1) of the Act leads to a inference that although the appellant was aware of the full particulars of income, he had failed to submit returns of income by disclosing the entire income earned by him under different heads of income."
6. Aggrieved by this, the assessee is before us. None appeared on behalf of the assessee inspite of the knowledge of the date of hearing. The ld. DR filed written submission.
7. We have carefully perused the orders of the authorities below and the written submission filed by the DR. The assessment order is dt. 24.12.2009. When the assessee was a Managing Director of M/s. Panchgani Health Resort Pvt. Ltd., from where he was drawing remuneration. In addition to that he was also carrying out investment in shares as well as commission from sale of motor car dealing. The order of the First Appellate Authority is dt. 31.12.2010 and before the First Appellate authority, the assessee took the plea of Alzamiers. There is nothing on record to suggest that in the intervening one year, the assessee was so ill that he forgot to disclose the complete details of his income. After giving a thoughtful consideration to the facts on record, we are of the considered opinion that if the search action had not been conducted, the additional income disclosed in the return filed pursuant to the notice issued u/s. 153A of the Act would not have been offered for the purpose 4 Mr. Pravin M. Choksey
of taxation by the assessee. We are therefore convinced that the assessee has filed inaccurate particulars of income/premeditatedly concealed the particulars of income for the years under consideration. We, therefore decline to interfere with the findings of the Ld. CIT(A). Penalty levied u/s. 271(1)(c) of the Act for A.Y. 2002-03, 2005-06 and 2006-07 are hereby confirmed. All these appeals are dismissed.
8. In ITA No. 1960/M/2011 for A.Y. 2004-05 the assessee has preferred the appeal against the addition of Rs. 6,50,000/- made by the AO in respect of one vehicle owned by and belonging to Shri Rajnash Bhel. While scrutinizing the return of income for the year under consideration, the assessee was asked to explain the bank credit entries on 23.5.2003 amounting to Rs. 6,50,000/-. The assessee filed following explanation:
"The above amount was received by a Demand Draft from Mr. Ketan Mehta of Seth Minaar, B Wing, 3rd floor opposite Jaslok Hospital, Pedder Road, Mumbai. As sale price of one vehicle bearing No. MZE 2002 belonging to Late Mr. Rajnash Bhel of Sagar Sangeet Bldg., Colaba. The vehicle was lying with me under repairs for long time since 2001 and unfortunately during this period Mr. Rajnash Bhel expired on 3rd August, 2004. I has informed his son Mr. Monish Bhel who due to our good relation have still not collected the same amount. Hence, the same lies deposited with me."
9. This explanation of the assessee did not find any favour with the AO, who observed that after the sale of car and before the death of Shri Rajnash Bhel and during the intervening period of 15 months, the assessee did not pay the amount to Shri Rajnash Bhel. The AO further observed that even till the date of assessment, the amount has not been paid. The AO treated Rs, 6,50,000/- as undisclosed income of the assessee.
5 Mr. Pravin M. Choksey
10. The assessee carried the matter before the Ld. CIT(A) but without any success.
11. Aggrieved by this the assessee is before us. None appeared on behalf of the assessee and the Ld. DR has filed a written submission.
12. We have considered the written submission and given a thoughtful consideration to the orders of the lower authorities. The main contention of the assessee was that the vehicle belongs to Shri Rajnash Bhel, which was sold and the sale consideration was credited in assessee's bank account. No evidence has been filed in respect of this claim of the assessee. Further, we find that the vehicle was sold in the year 2003. We are in the year 2015. Even after a lapse of 12 years, there is nothing on record to prove that the assessee has paid the amount to the legal heirs of the deceased Rajnash Bhel. As the assessee has grossly failed in discharging the initial onus cast upon him to explain the source of deposit in his bank account, we do not find any reason to interfere with the findings of the Ld. CIT(A). We, accordingly confirm the addition of Rs. 6,50,000/- and dismiss assessee's appeal.
13. In the result, the appeals filed by the assessee are dismissed.
Order pronounced in the open court on 20th May, 2015
Sd/- Sd/-
(D.MANMOHAN ) (N.K. BILLAIYA) उपा य /VICE PRESIDENT लेखा सद य / ACCOUNTANT MEMBER मंब ु ई Mumbai; दनांक Dated :20 May , 2015 th
व. न.स./ RJ , Sr. PS 6 Mr. Pravin M. Choksey
आदे श क त ल प अ े षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent.
3. आयकर आयु त(अपील) / The CIT(A)-
4. आयकर आयु त / CIT
5. वभागीय त न ध, आयकर अपील य अ धकरण, मंब ु ई / DR, ITAT, Mumbai
6. गाड फाईल / Guard file.
आदे शानस ु ार/ BY ORDER, स या पत त //True Copy// उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपील य अ धकरण, मंब ु ई / ITAT, Mumbai
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