Income Tax Appellate Tribunal - Chennai
N.R.Palanivel, By L/R P.Kailasam, ... vs Assessee on 19 March, 2013
IN THE INCOME TAX APPELLATE TRIBUNAL
'B' BENCH : CHENNAI
[BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER
AND SHRI V. DURGA RAO, JUDICIAL MEMBER]
I.T.A.Nos.61 to 67/Mds/2013
Assessment years : 2002-03 to 2008-09
Shri N.R.Palanivel vs The Income Tax Officer
By L/H P. Kailasam Ward II(2)
Ç/o M/s Kumaravel Bus Service Salem
Thottipatty Village
C.S.Puram
Rasipuram 637 408
[PAN AJTPP 3590 J]
(Appellant) (Respondent)
Appellant by : Shri T. Vasudevan, Advocate
Respondent by : Shri Guru Bhashyam, Jt. CIT
Date of Hearing : 19-03-2013
Date of Pronouncement : 21-03-2013
ORDER
PER N.S. SAINI, ACCOUNTANT MEMBER
These are the appeals filed by the assessee against separate orders of the ld. CIT(A), Salem, all dated 29.10.2012, passed in assessment years 2002-03 to 2008-09..
:- 2 -: I.T.A.No.61 to 67/13
2. The sole issue involved in all the appeals is that the ld. CIT(A) erred in confirming the order of the Assessing Officer levying penalty u/s 271(1)(c) of the Act.
3. For assessment years 2002-03 to 2007-08, the brief facts of the case are that the assessee is a transport contractor. A survey u/s 133A of the Act was conducted on 6.1.2009 in the premises of the assessee. The assessee had filed the return for assessment year 2002-03 on 29.3.2003 admitting income of `1,29,264/-, for assessment year 2003-04 on 30.3.2004 admitting income of `1,27,558, for assessment year 2004-05 on 29.3.2005 admitting income of `66,520/-, for assessment year 2005-06 on 31.3.2006 admitting income of `94,712, for assessment year 2006-07 on 23.3.2007 admitting income of ` ,48,410/-, and for assessment year 2007-08 on 28.3.2008 admitting income of `1,86,387/-. Subsequent to the survey, notice u/s 148 was issued on 4.3.2009 for the assessment year 2002-03. The assessee, in response to the notice, filed return of income offering an income of ` 3,14,164/- admitting investment in fixed deposits and interest income earned from the said deposit. Similarly, in the assessment year 2003-04, notice u/s 148 was issued on 4.3.2009 and the assessee, in response to the notice, :- 3 -: I.T.A.No.61 to 67/13 filed return of income admitting income of ` 13,04,655/- admitting investment in fixed deposits and interest income earned from the deposits. Similarly, in assessment year 2004-05, notice u/s 148 was issued on 7.1.2009 and in response to the notice, the assessee filed return of income admitting an income of ` 14,06,951/- admitting investment in fixed deposits and interest earned from the deposits. Similarly, in assessment year 2005-06, notice u/s 148 was issued on 7.1.2009 and in response to the notice the assessee filed return of income admitting income of ` 12,96,490/- admitting investment in fixed deposits and interest income earned from the deposits. Similarly, in the assessment year 2006-07, notice u/s 148 was issued on 7.1.2009. The assessee, in response to the notice, filed return of income admitting income of ` 11,97,092/- admitting investment in fixed deposits and interest income earned from the deposits. Similarly, in the assessment year 2007-08, notice u/s 148 was issued on 27.2.2009. The assessee, in response to the notice, filed return of income admitting income of ` 8,23,979/- admitting investment in fixed deposits and interest income earned from the deposits.
4. The assessments were completed and penalty proceedings were initiated u/s 271(1)(c) of the Act. The Assessing Officer rejected :- 4 -: I.T.A.No.61 to 67/13 the explanation of the assessee on the ground that revised returns were filed only after the survey when the investments were detected. But for the survey, the investments would not have been detected and the assessee would not have disclosed the income. The Assessing Officer levied penalty of ` 85,123/- in assessment year 2002-03, ` 3,68,666/- in assessment year 2003-04, ` 4,15,694/- in assessment year 2004-05, ` 3,87,223/- in assessment year 2005-06, ` 3,33,378/- in assessment year 2006-07 and ` 2,07,787/- in assessment year 2007-08.
5. The assessee, before the ld. CIT(A), filed written submissions which are quoted below:
"For the Assessment Year 2002-03 Penalty Order u/s.271(1)( c) of the Income-tax Act, 1961 was made on 01.07.2009 in the case of the assessee Late Sri N.R.Palanivel represented by his legal representative levying a penalty Rs.85,123/- at 100% of the tax sought to be evaded. The copy of the said penalty order with Demand Notice u/s.156 dated 7.7.2009 was served on the legal heirs of Late Sri N.R.Palanivel Viz 1. Sri.P.Kailasam 2.5ri P.Loganathan 3. Sri P. Venkatachalan - Sons of Late Sri N.R.Palanivel; 4. Smt.Perumayee Ammal- Wife of Late Sri N.R.Palanivel and 5. Smt.P.Alamelu - Daughter of Late Sri N.R.Palanivel.
Sri N.R. Palanivel died on 27.5.2009.
Sri.P.Kailasam is the eldest son of Late Sri.N.R.Palanivel.
The other legal heirs of Late N.R.Palanivel, Sri.P.Loganathan and Sri P.Venkatachalan - Son of Late Sri.N.R.Palanivel; Smt. Perumayee Ammal - Wife of Late :- 5 -: I.T.A.No.61 to 67/13 Sri.N.R.Palanivel and Smt.P.Alamelu - Daughter of Late sri N.R.Palanivel have authorized Sri.P.Kailasam by letter dated 30.7.2009 to file appeal against the penalty orders in the case of the assessee Sri.N.R.Palanivel relating to this Assessment Year 2002-03 and also for the other Assessment Years 2003-04 to 2008-09. The copy of the letter given by other legal heirs authorizing Sri.P.Kailasam to file appeal is enclosed herewith as"
Annexure-A".
The penalty proceedings u/s.271(1)( c) for this Assessment year 2002-03 and for the other Assessment years 2003-04 to 2008-09 were initiated in the name of Sri.N.R.Palanivel on 31.3.2009 the date on which the Assessment order was made in his name when he was alive. For the penalty proceedings initiated u/s.271(1)( c) on 31.3.2009 in the name of Late Sri.N.R.Palanivel fixing the hearing on 9.4.2009, time was sought to file the reply. In the mean time since Sri N.R. Palanivel expired on 27.5.2009. Therefore, the Assessing Officer has issued letters to all the legal heirs Sri. P.kailasam, Sri.P.Loganathan, Smt. Perumayee Ammal and Smt.P.Alamelu on 12.6.2009 fixing the hearing on 22.6.2009 to file reply for the penalty proceedings u/s.271(1)( c) initiated in the name of Late Sri.N.R.Palanivel, reply dated 25.6.2009 for the penalty notices u/s.271(1)( c) was filed by all the legal heirs jointly, on 26.6.2009 for all the Assessment years requesting to drop the penalty proceedings. The copy of the reply dated 25.6.2009 is enclosed as "Annexure-B".
In the case of Late SriN.R.Palanivel, there was a survey on 6.1.2009 on the basis of the information that Late Sri.N.R.Palanivel had Fixed Deposits with Rasipuram Co- operative Urban Bank Limited. A Sworn statement u/s.133A was obtained from Late Sri.N.R.Palanivel on the date of survey and in the Sworn statement, the Officer has informed him by Question No.9 that there are deposits with Rasipuram Co-operative Urban Bank Limited, Rasipuram in his name during the financial year 2003-04 Rs.28,60,000/-; during the financial year 2004-05 Rs.14,10,000/- and during the financial year 2005-06 Rs.27,50,000/- and wanted to give explanation for not admitting the deposits in the returns filed by him. In the reply for the said Question Late Sri.N.R.Palanivel has admitted that those deposits were not accounted in the returns. In the Sworn statement Late Sri.N.R. Palanivel has submitted that he had Agricultural income for the family prior to the partition between himself and his sons in 1996-97. He has also stated in the Sworn statement that he will verify the accounts and give details of the entire investments :- 6 -: I.T.A.No.61 to 67/13 on or before 12.1.2009. The copy of the Sworn statement is enclosed herewith as "Annexure-C", A letter date 13.1.2009 was filed by Late Sri..N.R.Palanivel in response to summon u/s.131 dated 9.1.2009 and as submitted in the Sworn Statement on 6.1.2009. In the said letter he has stated that he is not keeping good health and he is suffering with Amnesia and hence he was not able to furnish the details on the date of survey. He has filed along with the letter the list of fixed deposits with the bank amounted to Rs.90,00,000/- which were renewed from 1.12.2007 to 22.12.2008. He has also surrendered the fixed deposit receipts with the officer. In the said letter he has mentioned that he has got about Rs.20,00,000/- at the time of partition between himself and his brother in the year 1977 and that he had income from agriculture from his own lands and from the lands taken on lease. He has mentioned in the letter the Fixed deposits in the bank were from the savings from the amount of Rs.20 lakhs got in partition and subsequent earnings from Agricultural lands owned by him and lands taken on lease. He has stated that the deposits in the bank and the amounts advanced to his known persons were held as HUF assets. He also intimated in the said letter that the interest earned on the deposits were mostly saved as deposits in the said bank. He has admitted that the details of the deposits made in each year are not available with him and therefore he will collect the details of the deposits and interest from the bank, and thereafter file the returns for each year and pay the tax there on. In the said letter he has submitted that he will pay the tax immediately and requested not to levy penalty and interest for the amounts offered for assessment. The copy of the said letter dated 13.1.2009 is enclosed as "Annexure- D".
In the course of assessment proceedings he has intimated that it was diagnosed that he was suffering from cancer developed in the lungs and brain and thus he continued to be in bad health. He has confirmed to the officer that none of his family members were aware of his transactions with Bank. He has also admitted that the deposit being the HUF funds and since no TDS was made by bank he was under the belief that the filing of the returns for the said Fixed Deposits made and the interest thereon was not necessary.
For this Assessment year the original return was filed on 17.3.2009 and admitting the deposits with bank and interest accrued thereon. The assessment was completed on 31.3.2009 accepting the income offered at Rs.4,14,164/-. The notice u/s.148 was issued for this Assessment year on :- 7 -: I.T.A.No.61 to 67/13 4.3.2009 after the details furnished by your appellant in the returns filed for subsequent years and claimed that the deposits in the year were only the renewal of old deposits and thus there was no fresh deposits in the year.
However he has filed the return on 17.3.2009 admitting the deposit in the year which could not be co-related to earlier deposits. Though the deposits were made out of the amount received on partition and Agricultural income from lands owned by him and taken on lease, he had agreed to offer the Fixed Deposit amount could not be co-related to earlier deposits with specific dates of deposits and renewal. He has also submitted in the course of assessment proceedings that he is ailing and is in the last stage of life and hence the income offered for assessment may be accepted and no penalty levied.
Before the penalty proceedings be taken up by the Officer for finalization, Sri.N.R.Palanivel died and that is how the legal heirs have come in to picture for the proceedings. Sri.N.R.Palanivel had offered the income for taxation to buy peace and found it will take time to do the exercise of co-relating the deposits in the year with that in earlier year and though there was no concealment of income in the hands of the "Individual" Assessee.
The income offered for assessment for this year and for other Assessment year are more than the information about the deposits were available in the hands of the revenue in the course of survey and it shows that Sri.N.R.Palanivel had co-operated to disclose the income to buy peace and to pay the tax in full to avoid the protracted litigation and to leave the legal heirs in peace as he was expecting his end.
The income returned for this Assessment year and for all the Assessment years were accepted by the revenue without any further addition. Consequently in the light of the judgement of Hon'ble Supreme Court in the case of CIT Vs. Suresh Chandra Mittal (2001)(251 ITR 9)(SC) and CIT Vs. Pachamuthu & Another (2007)(295 ITR 502) it was submitted that no penalty was exigible. However, the Assessing Authority declined to accept the explanation offered and levied the penalty u/s.271(1)(c) of the Act being the 100% of the tax sought to be evaded. Hence the appeal".
:- 8 -: I.T.A.No.61 to 67/13
6. The ld. CIT(A) confirmed the order of the Assessing Officer levying penalty u/s 271(1)(c) of the Act, by observing as under:
"5. I have considered the penalty order and the submissions of the appellant. The only issue to be adjudicated is the levy of penalty u/s 271(1) (c) of the Income-tax Act,1961. All the grounds relate to the same issue.
5.1 The appellant, inter-alia, has relied the ratio of the apex court in the case of Commissioner vs Suresh Chandra Mittal in 241 ITR 124. The relevant portion is as below:
"We find ourselves in agreement with the view taken by the tribunal. It is well settled that under section 271(1)(c), the initial burden lies on the revenue to establish that the asseesseee had concealed the income or has furnished inaccurate particulars of income. The Burden shifts to the assessee only if he fails to offer any explanation or offers an explanation which is found to be false by the assessing authority. However, the Explanation 1, provides for the shifting of the burden again where the explanation offered by the appellant is found to be boafide."
5.2 Considering the facts and circumstances of the case, the appellant would not have offered the income but for the detection of the same by the department. The appellants' explanation that, he was of the opinion that, as there was no TDS by the bank, he was of the opinion that filing of returns for the said fixed deposits and interest thereon, was not necessary, is not acceptable. The very fact that the appellant is aware of the TDS provisions itself would mean that the appellant was very much aware of the provisions of the Income tax act. The appellant has also not provided any evidence to the agricultural income of the family prior to the partition in 1997-97. The appellant explanation is only an afterthought and not bona fide. 5.3 The appellant has, therefore failed to satisfy the condition as per Explanation "B" to section 271(1)(c) of the Act, which is as below:
:- 9 -: I.T.A.No.61 to 67/13
"Such person offers an explanation which he is not able to substantiate [and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him]."
5.4 In view of the above, and also in view of the ratio of the apex court in the case of the UOI vs Dharmendra Textile Processors in 306 ITR 277, the appellants grounds are not acceptable."
7. The ld. A.R of the assessee submitted before us that the fixed deposits were made in the earlier year starting from the year 1971. These fixed deposits were renewed with interest on their maturity. Since the assessee was seriously ill and the doctors have stated that he will not survive longer and in order to settle the matter with the Department, he surrendered these fixed deposits as his income in the years under consideration. The assessee was not in a position to file the required details explaining the sources of deposits to be out of his earlier renewal f fixed deposits due to his ill health. He relied on the decision of the Amritsar Bench of the Tribunal in the case of ITO vs Fashionways,[2002] 77 TTJ (Asr) 59, and submitted that the Tribunal in that case held that Department having accepted the revised return filed by the assessee declaring higher income without making any addition to the revised income, penalty u/s 271(1)(c) of the Act :- 10 -: I.T.A.No.61 to 67/13 was not leviable. He further relied on the decision of the Hon'ble Delhi High Court in the case of CIT vs Sas Pharmaceuticals [2011] 335 ITR 259(Del), wherein it was held as under:
"It is to be kept in mind that s. 271(1)(c) is a penal provision and such a provision has to be strictly construed. Unless the case falls within the four corners of the said provision, penalty cannot be imposed. Sub-s.
(1) of s. 271 stipulates certain contingencies on the happening whereof the AO or the CIT(A) may direct payment of penalty by the assessee. Sec. 271(1)(c) authorizes imposition of penalty when the AO is satisfied that the assessee has either : (a) concealed the particulars of his income; or (b) furnished inaccurate particulars of such income. It is not the case of furnishing inaccurate particulars of income, as in the IT return, particulars of income have been duly furnished and the surrendered amount of income was duly reflected in the IT return. The question is whether the particulars of income were concealed by the assessee or not. It would depend upon the issue as to whether this concealment has reference to the IT return filed by the assessee, viz., whether concealment is to be found in the IT return. The words 'in the course of any proceedings under this Act' are prefaced by the satisfaction of the AO or the CIT(A). When the survey is conducted by a survey team, the question of satisfaction of AO or the CIT(A) or the CIT does not arise. One has to keep in mind that it is the AO who initiated the penalty proceedings and directed the payment of penalty. He had not recorded any satisfaction during the course of survey. Decision to initiate penalty proceedings was taken while making assessment order. It is, thus, obvious that the expression 'in the course of any proceedings under this Act' cannot have the reference to survey proceedings in this case. It necessarily follows that concealment of particulars of income or furnishing of inaccurate particular of income by the assessee has to be in the IT return filed by it. The assessee can furnish the particulars of income in his return and everything would depend upon the IT return filed by the assessee.:- 11 -: I.T.A.No.61 to 67/13
This view gets supported by Explns. 4 as well as 5 and 5A of s. 271. Obviously, no penalty can be imposed unless the conditions stipulated in the said provisions are duly and unambiguously satisfied. Since the assessee was exposed during survey, may be, it would have not disclosed the income but for the said survey. However, there cannot be any penalty only on surmises, conjectures and possibilities. Sec. 271(1)(c) has to be construed strictly. Unless it is found that there is actually a concealment or non-disclosure of the particulars of income, penalty cannot be imposed. There is no such concealment or non-disclosure as the assessee had made a complete disclosure in the IT return and offered the surrendered amount for the purposes of tax.--CIT vs. Mohan Das Hassa Nand (1983) 34 CTR (Del) 361 :
(1983) 141 ITR 203 (Del) and CIT vs. Reliance Petroproducts (P) Ltd. (2010) 230 CTR (SC) 320 :
(2010) 36 DTR (SC) 449 : (2010) 3 SCR 510 relied on."
8. On the other hand, the ld. DR submitted that the decisions relied upon by the ld. A.R of the assessee are on the fact that the assessee had filed revised return of income wherein he additional income was disclosed by the assessee which was accepted by the Department in the assessment framed thereafter. He submitted that in the case of the assessee, additional income was disclosed in pursuance to the notice issued u/s 148 of the Act. He relied on the decision of the Hon'ble Karnataka High Court in the case of CIT vs Sangmeshwara Associates [2012] 345 ITR 396(Kar), wherein it was held that in situation where issue is not contested, but admitted, production of proof is neither necessary nor warranted in law before :- 12 -: I.T.A.No.61 to 67/13 levying penalty u/s 271(1)(c). Penalty is imposable u/s 271(1)(c) of the Act where assessee himself admitted his failure to furnish true or full disclosure of income. It was submitted that in the case of the assessee, after the survey, in pursuance of notice issued u/s 148 of the Act by the Assessing Officer, the assessee came forward to disclose the additional income by filing return of income.
9. He further relied on the decision of the Hon'ble Delhi High Court in the case of CIT vs Usha International Ltd. [2013] 212 Taxman 519(Delhi) wherein it was held that the Tribunal was not right in upholding the cancellation of penalty. It cannot be denied that there were searches and investigations which resulted in the income-tax authorities unearthing a concerted design to enable the reduction of the taxable income of the assessee by making use of the provisions of section 35(2A), section 35(1)(ii) and section 35CCA of the Act.
10. He further relied on the decision of the Hon'ble Madras High Court in the case of CIT vs Krishna & Co. [1979] 120 ITR 144(Mad), wherein it was held that if penalty could be levied on a charge of concealment of income from the original return after a revised return was filed, there is no reason why penalty could not be levied when a :- 13 -: I.T.A.No.61 to 67/13 person made an oral admission and stopped short of submitting a revised return.
11. He further relied on the decision of Hon'ble Madras High Court in the case of Sajjanraj Nahar vs CIT, 283 ITR 230(Mad) wherein it was held as under:
"In any event, it is a settled law that once the authorities have arrived at a subjective satisfaction under the facts and circumstances of the case, it may not be proper for this court to enter into the merits of the controversy at all in the proceedings under reference, as the Tribunal had rendered a clear finding that,
(i) the assessee did not act bona fide and honestly in returning the correct income originally;
(ii) the filing of the revised return offering additional income by way of adding interest expenditure cannot be considered a bona fide act; and
(iii) the Assessing Officer was fully justified in initiating and thereafter, levying penalty under section 271(l)(c) of the Act, after calling for explanation from the respective assessees, as the assessees failed to offer any convincing explanation, and unless it is demonstrated that such indication made by the Assessing Officer to initiate penalty proceedings is mala fide, perverse, based on no evidence, misreading of evidence or which a reasonable man could not form or that the person concerned was not given due opportunity resulting in prejudice, the said proceedings needs no interference."
12. We have considered the rival submissions, perused the orders of the lower authorities and materials available on record. The undisputed facts of the case for assessment years 2002-03 to 2007-08 are that the assessee in its original returns filed for the assessment :- 14 -: I.T.A.No.61 to 67/13 years in question had not shown interest income earned on FDRs and investments made in FDRs. A survey u/s 133A of the Act was conducted in the case of the assessee on 6.1.2009 wherein the fact of earning of interest income on FDRs and investment in FDRs was found by the Department. Thereafter, notices u/s 148 were issued for all the years under consideration and in pursuance to which the assessee filed return for each of the years disclosing additional income. The Assessing Officer levied penalty u/s 271(1)(c) of the Act for all the years under consideration in respect of this additional income which was not disclosed in the original returns filed by the assessee and was only disclosed in the returns which were filed in pursuance to notices issued u/s 148 of the Act.
13. The ld. CIT(A) confirmed the action of the Assessing Officer.
14. Before us, the ld. A.R of the assessee contended that as the assessee could not file evidences to show that investment in FDRs was in fact, renewal of old FDRs and therefore, the assessee admitted the same as his income which was accepted by the Department. Therefore, penalty should not have been levied in respect of the amount which represents investment in FDRs. The assessee also relied upon the decision of the Amritsar Bench of the Tribunal in the :- 15 -: I.T.A.No.61 to 67/13 case of ITO vs Fashionways(supra) and the decision of the Hon'ble Delhi High Court in the case of CIT vs Sas Pharmaceuticals (supra).
15. We find that the assessee had produced absolutely no material before us or before any of the lower authorities to show that the amount invested in FDRs in the years under consideration was renewal of old FDRs and not fresh investment of the relevant years. The assessee, has even not filed copies of FDRs or any certificate from bank in support of his above submissions. In the absence of any such material, we find that the assessee's submission in this respect cannot be accepted being without any basis or material.
16. Further in the decision of the Amritsar Bench of the Tribunal in the case of ITO vs Fashionways(supra),it was held that where the assessee filed a revised return prior to the completion of the assessment wherein he corrected the earlier omission or mistake, for such mistake penalty u/s 271(1)(c) of the Act is not leviable. We find that in the instant case, the assessee could not produce any material before us to show that the subsequent returns filed by him in pursuance to notices u/s 148 were legal and valid revised returns u/s 139(5) of the Act. Therefore, the above decision is not applicable to the facts of the instant case.
:- 16 -: I.T.A.No.61 to 67/13
17. Similarly, the decision of the Hon'ble Delhi High Court in the case of CIT vs Sas Pharmaceuticals (supra) is found to be not applicable to the facts of the assessee's case for the years under consideration. In that case, the Hon'ble Delhi High Court has held that concealment of income has to be found with respect to the return of income filed by the assessee. If the assessee has disclosed true and correct income in the regular return even after survey or even because of survey that itself does not empower the Department to levy penalty u/s 271(1)(c) of the Act on the basis of surmises and conjectures and assumptions and that the assessee could not have disclosed the true and correct income in the return but for the survey.
18. We find that regular returns of income were filed in each of the years under consideration before the date of survey wherein full and true income was not disclosed by the assessee, but disclosed the same in the returns which were filed in pursuance to notices issued u/s 148 of the Act. We find that the assessee could not produce any bonafide reason for which correct income could not be disclosed in the regular returns filed u/s 139(1) or 139(4) or 139(5) of the Act. We, therefore, do not find any reason to interfere with the orders of the :- 17 -: I.T.A.No.61 to 67/13 lower authorities. They are confirmed and the grounds of appeal of the assessee for the years under consideration are dismissed.
19. For assessment year 2008-09, the undisputed facts of the case are that the assessee filed return of income on 26.2.2009 admitting income from bus business of ` 1,81,971/-, investment in fixed deposits made during the year of ` 18,20,000/- and interest on fixed deposit of ` 2,72,272/-, thereby showing total income of ` 22,74,243/-. The assessment was completed by the Assessing Officer at the returned income of the assessee. Thereafter, the Assessing Officer issued notice u/s 271(1)(c) of the Act and levied penalty of 100% of the tax sought to be evaded amounting to ` 7,00,053/- on the ground that the investment made in FDRs and interest income earned on FDRs prior to the date of survey were not disclosed in the return of income filed by the assessee.
20. Being aggrieved, the assessee filed appeal before the ld. CIT(A), who confirmed the action of the Assessing Officer.
21. Before us, the ld. A.R of the assessee submitted that as the assessee could not file evidences to show that investment in FDRs was in fact, renewal of old FDRs and therefore, the assessee admitted the same as his income which was accepted by the Department. :- 18 -: I.T.A.No.61 to 67/13 Therefore, penalty should not have been levied in respect of the amount which represents investment in FDRs. He also relied on the decision of the Amritsar Bench of the Tribunal in the case of ITO vs Fashionways(supra) and the decision of the Hon'ble Dehi High Court in the case of CIT vs Sas Pharmaceuticals(supra).
22. On the other hand, the ld. DR relied on the decisions of the Hon'ble Karnataka High Court in the case of CIT vs Sangmeshwara Associates (supra), Hon'ble Delhi High Court's decision in the case of CIT vs Usha Internation Ltd (supra) and Hon'ble Madras High Court's decisions in the case of CIT vs Krishna & Co.(supra) and Sajjanraj Nahar vs CIT(supra).
23. After hearing the rival submissions, we find that the assessee filed his return of income for assessment year 2008-09 on 26.2.2009 disclosing therein total income at ` 22,74,248/-. The assessment was completed u/s 143(3) of the Act on 31.3.2009 determining the total income of the assessee at ` 22,74,243/- i.e the very same amount which was disclosed by the assessee in his return of income. Thereafter, the Assessing Officer levied penalty u/s 271(1)(c) of the Act of ` 7,00,503/- on the ground that investment in FDRs and interest earned thereon were not disclosed prior to survey in :- 19 -: I.T.A.No.61 to 67/13 the return of income filed by the assessee. A survey was conducted in the case of the assessee on 6.1.2009 wherein it was found that the assessee made investment in FDRs and earned interest income thereon.
24. On appeal, the ld. CIT(A) confirmed the action of the Assessing Officer.
25. We find that in the instant case, it is not in dispute that the assessee filed return of income on 26.2.2009 which was a valid return u/s 139(4) of the Act. No material has been brought on record by the Revenue to show that any income was concealed by the assessee in the return of income filed for the year under consideration. In fact, the assessee filed only one return for the year under consideration and the income shown therein was found correct on assessment. There was no difference in the tax on this returned income and the tax on the assessed income. In the above circumstances, no penalty u/s 271(1)(c) of the Act is legally tenable. We, therefore, delete the penalty of ` 7,00,503/- levied for the year under consideration. Thus, the grounds of appeal of the assessee for the year under consideration are allowed.
:- 20 -: I.T.A.No.61 to 67/13
26. In the result, the appeals of the assessee in I.T.A.Nos.61 to 66/Mds/2013 for assessment years 2002-03 to 2007-08 are dismissed whereas appeal in I.T.A.No.67/Mds/2013 for assessment year 2008-09 is allowed.
Order pronounced on Thursday, the 21st of March, 2013, at Chennai.
Sd/- Sd/- (V. DURGA RAO) (N.S.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 21st March, 2013, RD
Copy to: Appellant/Respondent/CIT(A)/CIT/DR