Income Tax Appellate Tribunal - Amritsar
Sh. Harjinder Singh Raina, Jammu vs The Income Tax Officer,, Jammu on 31 December, 2018
IN THE INCOME TAX APPELLATE TRIBUNAL
AMRITSAR BENCH, AMRITSAR (SMC)
BEFORE SH. SANJAY ARORA, ACCOUNTANT MEMBER
I.T.A. No. 73/Asr/2016
Assessment Year: 1992-93
Harjinder Singh Raina vs. Income Tax Officer,
Prop. Singh & Singh Trading Ward-1(1), Jammu
Co. Nehru Market, Jammu
[PAN: AGKPR 4068H]
(Appellant) (Respondent)
Appellant by : Sh. Tarun Bansal (Adv.)
Respondent by: Sh. Charan Dass (D.R.)
Date of Hearing: 28.10.2018
Date of Pronouncement: 31.12.2018
ORDER
Per Sanjay Arora, AM:
This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals), Jammu ('CIT(A)' for short) dated 29.10.2015, confirming the levy of penalty u/s. 271(1)(c) of the Income Tax Act, 1961 ('the Act' hereinafter) vide order dated 28.02.2008 for the Assessment Year (AY) 1992-93.
2. The only issue arising in the instant appeal is the sustainability of the impugned order, i.e., in law and in the facts and circumstances of the case. The brief facts of the case are that the assessee was, upon being found to have invested Rs.17 lacs in a building during the relevant year, questioned in its respect during the assessment proceedings. He explained the same to have been expended out of 2 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO Rs.17.85 lacs received by his mother on the acquisition of her land. He, however, could not correlate the same with the withdrawals from his bank account, in which the compensation received by his mother was stated to have been deposited. Expenditure to the extent of Rs.5.75 lacs was regarded as unexplained and, accordingly, deemed as the assessee's income u/s. 69C of the Act. The same stood confirmed up to the Tribunal, the operative part of whose order (in ITA No. 96/Asr/2016 dated 10.08.2017/PB pgs. 24-40), also read out during hearing, reads as under:
'10. In the written submissions, it has been contended on behalf of the assessee, that he raised loans from different parties and also took building material on credit and constructed the house; that he had received compensation for land acquired to the tune of Rs.17,85,595/70 through cheque which was credited in his account on 10-4-1991; that he immediately started making payments to persons from whom he had raised loans or had taken building materials on credit, by making withdrawals from his said bank account; that all the payments were made through cheques; that the A.O. had disallowed the payments made by the assessee inspite of the fact that four persons, being the managing parties (partners) of the finance companies, had admitted on oath before the A.O. but they had advanced the respective loans to the assessee for the construction of house; that such evidence had been given inspite of the fact that almost 10 years had passed and their respective finance firms had been closed for more than five years, because (of) RBI Regulations; that the bank statement clearly indicated the cheques issued by the assessee; that so, the assessee had duly discharged his onus; that the assessee had paid Rs.20,000/- to Shri Dewan Chand and Rs.1,50,000/- to Shri Muni Chand on 18- 4-1991; that these persons were agents who used to supply the building material that they had supplied bricks, sand and stones to the assessee for the construction of house and made the payment to these persons for the building material supplied; that these payments were also made through cheques; that the payments had been made to persons from whom the assessee had taken loans or building material on credit; that the entire amount had been spent for the construction of the house; that the payment of Rs.20,000/- made by Smt. Satya Rani, who was wife of a friend of the assessee, had also been wrongly disallowed; that this payment had also been made through the cheque; that the assessee had submitted the names and addresses of all the persons from whom the said credits had been raised and refunded the amounts through cheques; that therefore, the assessee had duly discharged his onus and there was no reason for rejecting the explanation; that the assessee had also spent money from his past savings; and that even if no account had been kept by the assessee, the amount spent from savings cannot be completely ignored.3 ITA No. 73/Asr/2016 (AY 1992-93)
Harjinder Singh Raina v. ITO
11. Having considered the rival submissions and having appreciated the material on record, we arc of the view that the order passed by the learned CIT(A) calls for no interference at our hands. The assessee has not been able to refute the clear and categoric findings of fact by the lower authorities. The assessee was a partner in six firms carrying on finance business, namely, M/s. Singh Trading Corporation, M/s.
Khalsa Finance Corporation, M/s. New Parbhat Finance Corporation, M/s. Apex Motor Finance Corporation, M/s. Punjab Finance Corporation and M/s. Tulsi Finance Corporation. He had not filed his income tax returns for the earlier four to five years, contending that his income was not taxable. His case is that he constructed his house property by investing Rs.17 lacs. This amount of Rs.17 lacs is stated to have come as compensation received on acquisition of land. This loan was statedly deposited by the assessee in his bank account and the investment in the house is stated to have been made by making withdrawals therefrom between 11-4-1991 to 3-5-1991. Some of the withdrawals are stated to have been utilised for the repayment of loans taken in earlier years from finance companies and other persons. However, undisputedly, the assessee did not file any details of the expenditure incurred on the construction of the house, nor any bills or vouchers of the expenditure.
12. The alleged loans taken were also not supported by any evidence, nor was the purpose for such loans divulged. It is not comprehensible as to why the finance companies, which were advancing loans for financing vehicles, would advance loans to the assessee for construction of the house, particularly when the assessee himself was in the business of finance. It is pertinent to note that despite the fact that the assessee was a partner in six firms carrying on finance business, he did not maintain any construction account regarding his house and even did not have any details of the alleged loans raised. So much so, the assessee even failed to file a copy of his bank account where the loans allegedly raised from the financing companies were deposited. Moreover, even the withdrawals could not be correlated with the construction of the house.
13. It was in these facts that the authorities below rightly did not accept the statements of the partners of the firm, such statements being only bald statements unsupported by any evidence whatsoever, as discussed hereinabove.
14. Apropos the payments allegedly made to Shri Muni Lal and Shri Dewan Chand, the assessee could not even establish their identity. Also, even the purpose of such payment was not justified. Evidently, therefore, such payments did not stand co-related with the alleged construction of house by the assessee, as was also the case with the payment of Rs.11,000/- to the Principal, Guru Har Krishan School and Rs.60,000/- utilised for purchase of FDR and Rs.20,000/-, the payment allegedly made to Smt. Satya Rani, wife of a friend of the assessee.
15. The mere fact that the payments had been made through cheques is of no avail to the assessee, the assessee having miserably failed to produce any evidence whatsoever, as discussed above. Further, by merely submitting the names and addresses of all the creditors, the assessee does not get absolved. The contention that 4 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO the assessee had spent money from his past savings also, is an entirely new plea, it was never before either of the authorities below. Moreover, this, again, is a bland and uncorroborated assertion.
16. The assessee has also failed to prove his contention that the construction of the house was spread over two years. Once again, no evidence in this regard is forth- coming. Rather, the withdrawals made by the assessee pertain to the period 10-4- 1991 to 3-5-1991, less than one month, comprised in one single year.
17. Second 69C of the Act provides as follows:-
"Where in any financial year an assessee has incurred any expenditure and he offers no explanation about the source of such expenditure or part thereof, or the explanation, if any, offered by him is not, in the opinion of the Assessing Officer, satisfactory, the amount covered by such expenditure or part thereof, as the case may be, may be deemed to be the income of the assessee for such financial year."
18. In the present case, the explanation offered by the assessee regarding the source of the expenditure in question was not, in the view of the A.O., satisfactory, for the reasons related (narrated) in the assessment order. The learned CIT(A), vide the impugned order, confirmed the assessment order, discussing threadbare the explanation offered by the assessee before the A.O. as well as before himself [the learned CIT(A)]. The addition made by the A.O. has been confirmed by the learned CIT(A) by recording categoric findings of fact, which run concurrent with those contained in the assessment order.
19. As such, finding no error in the order of the learned CIT(A), the same is hereby upheld. The grievance raised by the assessee by way of the grounds of appeal, is rejected.' [emphasis, supplied] In the penalty proceedings, the assessee failing to make any improvement in his case, i.e., vis-à-vis that in the assessment proceedings; in fact, failing to advance any explanation, i.e., qua the addition of Rs. 5.75 lacs, penalty thereon was levied for concealment of particulars of income. In appeal, as claimed, the assessee made an application under rule 46A of the Income Tax Rules, 1962 ('the Rules' hereinafter) toward a loan of Rs.1 lac from a finance company, M/s. Singh Finance Pvt. Ltd. which, taken during financial year (f.y.) 1990-91 (i.e., the previous year relevant to AY 1991-92), was repaid during the relevant year, i.e., f.y.1991-92. The assessee's explanation of having repaid the loan taken for investment purposes, 5 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO would thus merit being admitted, which, however, the ld. counsel for the assessee, Sh. Bansal, would argue, was unfortunately not. On being questioned about the assessee's case for the balance Rs.4.75 lacs, he would submit that the same shall not hold as it is one single penalty, i.e., for a specific amount of Rs.5.75 lacs, and not a case of two separate penalties. Once, therefore, explanation for a part of it is 'accepted', the balance would not obtain in-as-much as it is not a case of the penalty being levied separately for Rs.1 lac and separately for the balance amount of Rs. 4.75 lacs. In fact, he would continue, no penalty could at all be levied as the basis of the investment in the building by the assessee (at Rs.17 lacs) is the valuation report, i.e., an estimation, with it being trite law that penalty cannot be imposed on an estimate. The ld. Departmental Representative (DR) would vehemently oppose. The investment by the assessee at Rs.17 lacs is an undisputed fact. It is not a case of the assessee having furnished a counter valuation, contending, on that basis, to have invested a lower sum.
3. I have heard the parties, and perused the material on record. 3.1 Indubitably, the assessee did not furnish any explanation of substance in the penalty proceedings which, as rightly argued by Sh. Bansal, are separate and distinct from the assessment proceedings, so that the same by itself cannot be conclusive of the penalty. But, then, it is only the assessee who has to therefore make out of a case in the penalty proceedings, i.e., as to why, despite substantive findings of fact against him (his case) arrived at in the assessment proceedings, which stand firmed up and, rather, have attained finality, ought to be discarded or modified, and penalty not levied, furnishing an explanation. Rather, on the contrary, these findings, based as they are on cogent basis and, further, by a competent authority, can surely be relied upon in the penalty proceedings, particularly where the assessee furnishes no substantive explanation in the penalty 6 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO proceedings (Bharat Rice Mills v. CIT [2005] 278 ITR 599 (All); CIT v. Somnath Oil Mills [1995] 214 ITR 32 (Guj); S.S. Ratanchand Bholanath v. CIT [1994] 210 ITR 682 (MP); CIT v. Ram Niwas Agarwal [1980] 125 ITR 432 (All)). Absence of such an explanation is a sure recipe for levy of penalty; it being the sub-stratum or the edifice on which the assessee's case in penalty proceedings rests. This represents trite law, often expressed by stating of a plausible explanation saving penalty, and for which reference be made to a host of case law by the Apex Court settling the same (viz. Mak Data (P.) Ltd. vs. CIT [2013] 358 ITR 593 (SC); Union of India v. Dharmendra Textile Processors [2008] 306 ITR 277 (SC); K.P. Madhusudhanan vs. CIT [2001] 251 ITR 99 (SC); B.A. Balasubramaniam and Bros v. CIT [1999] 236 ITR 977 (SC); Addl. CIT vs. Jeevan Lal Shah [1994] 205 ITR 244 (SC); CIT vs. K. R. Sadayappan [1990] 185 ITR 49 (SC)), to cite some, followed by Hon'ble High Courts throughout the country, as by the jurisdictional High Court in CIT v. Lalchand Tirath Ram [1997] 225 ITR 675 (P&H); Prem Pal Gandhi v. CIT (in ITA No. 353 of 2009, dated 22/7/2009), again to note some. Why, absence of an explanation in respect of facts material to the computation of his income, i.e., qua the disallowance/s or additions sustained in assessment, itself deems, by statutory fiction, the assessee to have concealed the particulars of his income, attracting penalty u/s. 271(1)(c), per Explanation 1 thereof. This would also include a case where the explanation furnished is found false, or remains unsubstantiated. This legal position stands reiterated, once again, by the Apex Court in Mak Data (P.) Ltd. (supra). It, while affirming the decision by the Hon'ble Delhi Court, held as under (at page 598):
'Explanation 1 to section 271(1) (c) of the Income-tax Act, 1961, raises a presumption of concealment, when a difference is noticed by the Assessing Office, between the reported and assessed income. The burden is then on the assessee to show otherwise, by cogent and reliable evidence. When the initial onus placed by the Explanation has been discharged by him, the onus 7 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO shifts to the Department to show that the amount in question constituted income and not otherwise.' Of course, where the assessee furnishes an explanation in the penalty proceedings, substantiating it, the same is to be examined on its' merits, i.e., on the anvil of Explanation 1 to section 271(1)(c), which deems the assessee to have concealed particulars of his income where he fails to furnish an explanation (or offers one which is found by the Revenue to be false) or otherwise fails to substantiate it, disclosing facts relating to the same and material to the computation of his income. In the instant case, the assessee in the penalty proceedings failed to prove the source, to that extent, of the expenditure incurred by him, i.e., Rs. 5.75 lacs. How, then, one wonders, could the Assessing Officer (AO) be faulted for levying the penalty u/s. 271(1)(c)?
3.2 As regards the non-admission of the additional evidence by the ld. CIT(A) under rule 46A of the Rules, the recourse for the assessee in such a case is to raise this issue before the higher appellate forum, the Tribunal in the instant case, and make out the case for the admission of the said evidence by the first appellate authority. There is no specific ground raised by the assessee before the tribunal in this respect; the several grounds raised (as amended) reading as under:
'1. That the penalty order of Id AO u/s 271(l)(c) of Income-tax Act 1961, is illegal, invalid & void-obnitio, in as much as, the reasons for the initiation of penalty proceedings in the Quantum Order are different from the A.O's Penalty Order, levying the penalty u/s 271(l)(c) of the Act.
2. That the adoption of Fair market value on reference to Valuation Officer / adoption of a Valuation Report of Valuation Officer for additions is an estimate, as per sec. 55A & 142A, hence levy of penalty on estimate is bad-in-law.
3. That in the Valuation Report, year of construction is 1991, and year 1991 falls into two financial years, hence levy of penalty only in the A.Y. 1992-93 is bad-in-law.8 ITA No. 73/Asr/2016 (AY 1992-93)
Harjinder Singh Raina v. ITO
4. That the Id. AO in penalty order wrongly imposed the penalty on the basis of the confirmed Quantum Order of CIT(A), as well as, of ITAT whereas CIT(A) in quantum order confirmed the addition on the theory of probability.
5. That the Id AO and CIT(A) has neither given any independent finding in the order u/s 271(l)(c), of his conclusion that there was a deliberate design on the part of the assessee nor the bonafides of the assessee's conduct was verified.
6. That the Id CIT(A) in penalty order has wrongly confirmed the penalty, before verifying the facts as per letter dated 18.07.13 & 19.05.14 mentioning that the appellant had taken a loan of Rs. 1,00,000 from Singh Finance Pvt. Ltd which was wrongly mentioned as Singh Finance Corp in A.O's Penalty order at Page - 3 , Para - 2 and is bad-in-law.
7. That order of Ld AO & Ld CIT (A) is bad in law, as well as, on facts.' The assessee, in my humble view, ought to have raised this issue, i.e., the non-
admission of additional evidence by the ld. CIT(A), per a specific ground in its memo of appeal. Even so, on merits of the said non-admission, the stated reason for the same in the impugned order is the grant of sufficient opportunities to the assessee during the assessment proceedings. The same, though without doubt relevant, the said evidence being admittedly sought to be furnished for the first time in the appellate proceedings, what would be equally relevant is the reason for the non-furnishing of the same during the penalty proceedings, which, though not independent, are yet separate and distinct proceedings in which, therefore, the assessee could furnish evidence. Why, the assessee would, in order to successfully plead admission, need to show as to why it could not produce the same earlier, which would therefore include the assessment proceedings as well, the penalty proceedings being only in continuation thereto. The penalty proceedings being, however, different, with separate consequences, the admission of additional evidence cannot be excluded solely on the basis of it being not furnished in quantum proceedings, i.e., without any justifiable cause. In fact, Explanation 1(B) to section 271(1)(c) specifically provides for furnishing an explanation and its substantiation in the penalty proceedings. However, without doubt, no such 9 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO explanation, duly supported by evidence, was furnished during the penalty proceedings, wherein the assessee stands show caused vide notice dated 26.10.2007. Not only, therefore, sufficient opportunities stand allowed to the assessee, no case of being prevented by sufficient cause in producing the said evidence has been shown. No reason for non-adducing the said evidence in the penalty proceedings stands advanced despite the absence of evidence being the prime reason for disregarding the assessee's stated explanation, discussed, as would be apparent from its' order, reproduced supra, by the tribunal, threadbare. How, then, one wonders, could the impugned non-admission, denied u/r. 46A(1), be validly assailed? No supervening circumstances preventing the production of the said evidence, are stated, even as the assessee stands allowed sufficient opportunity both for production of the evidence sought to be admitted. No wonder, the Hon'ble Courts, considering the several stages through which the examination of the assessee's case stands passed, have opined that an assessee could not furnish fresh evidence in the appellate stage of the penalty proceedings. As I see it, and even as observed by the Bench during hearing, the said evidence is even otherwise liable to not admitted at the threshold, i.e., on the ground of its relevancy or, rather, non-relevancy. The expenditure for incurring which, i.e., without establishing source thereof, the addition u/s. 69C has been made and confirmed, is that incurred by the assessee during the relevant previous year, i.e., the financial year 1991-92. The evidence, which is in respect of a loan (of Rs. one lac) contracted earlier, repaid by the assessee on April 24, 1991, would not therefore assist the assessee's case qua the said addition, i.e., even to that extent, in any manner. The repayment of a loan during the relevant year, rather than suggesting availability of resources for meeting the impugned expenditure or investment on construction of a house, depletes the assessee's resources, available with him for the relevant year, to that extent. If anything, it further weakens the assessee's case on merits. Reference in 10 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO this regard may also be made to the emphasized parts of the tribunal's order in the quantum proceedings, whereat it states of the assessee being unable to correlate the withdrawals from his bank account with the construction of the house, and which position continues to obtain.
3.3 Next, let us visit the assessee's argument of the impugned penalty being not maintainable in-as-much as the basis of the investment of Rs.17 lacs (on the construction of the house) is the valuation report, which is only an estimate. The argument, which states too broad a proposition, admitting of several caveats, is not tenable on the facts of the case. Firstly, on a more general plane, a question would arise only there is more than one estimate or basis, in which case, again, the lower of the two shall obtain. For example, if the assessee's claim of the investment, also supported by a valuation report, is at Rs.15 lacs (say), it may be possible to contend that penalty could not be levied on the difference of Rs.2 lacs, representing a bona fide difference between two reasonable values. This, again, presumes absence of any marked inconsistencies between the two statements, as where one of them may bear some omissions, etc. More specifically, in the facts of the case, there is, to begin with, no reference to the valuation report either in the assessment or in the penalty order or in fact in any explanation furnished by the assessee in penalty proceedings. In fact, the assessee vide his letter dated 28.11.2016 (through his counsel, Sh. Bansal) to the registry of the Tribunal (copy on record), clearly states that it needs to be verified whether the reopening of the assessment in the instant case is based on a valuation report or not. Rather, no dispute as regards the quantum of investment by the assessee, adopted through-out at Rs. 17 lacs, even as aforenoted, is observed. Why, the assessee's case, as noted by the tribunal at para 11 of its' order, is stated as of him having constructed a house property investing Rs. 17 lacs. Why, in fact, one wonders, would the assessee explain the source of 11 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO investment of Rs.17 lacs if he had not made the same or disagreed with the quantum stated? Rather, the assessee's first explanation is of the source of investment being the compensation of Rs.17.85 lacs received by his mother, and which stands credited in (his) saving bank account in April, 1991. Though the account no.1968 with J&K Bank is not specifically stated to be the assessee's bank account, this is presumed and, in any case, even if it is his mothers' account, withdrawals from the same for construction would validly prove the source. In other words, the investment of Rs.17 lacs by the assessee is both undisputed and admitted. It would, it may be though added, be a different matter all together if the assessee was to prove that the investment on construction was made during an earlier period, so that the invocation of sec.69C or sec.69, for that matter, in which case despite the addition being sustained, no penalty could be levied. Reference in this regard may be made to the recent decision by the Tribunal in Kamal Gandhi vs. Asst. CIT (in ITA No.458/Asr/2017 dated 28.08.2018). The assessee's case throughout, on the other hand, as the reading of the tribunals' order in quantum would show, has been that the construction was made by purchasing construction material on credit or by assuming loans from finance companies, which obligations were discharged from withdrawals from his bank account in April, 1991. The construction activity is completely unevidenced as to its period. Further, again as apparent from the tribunals' order in quantum, the assesse has completely failed to correlate the withdrawals from the said bank account with the construction activity
- stated to be spread over two years, with the payments to creditors or of loans, which is stated to be during 1991. Why, the source of credit of Rs.17.85 lacs, going by the assessee's case, being proved, all he had to do so of the same having been utilized for the construction of the house, payments for which, to the extent allowed, were found to have been made during f.y. 1991-92, the relevant previous year. The allowance of credit for two years is bizarre, and out of bounds of 12 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO imagination, i.e., even for building materials, not to speak of labour. The assessee in fact has already been allowed credit for the withdrawals made from 10.04.1991 to 3.5.1991 to the extent these are to self or to persons engaged in the construction of the house (i.e., at Rs.11.25 lacs), also detailed by the ld. counsel and referred to during hearing (copy on record). The assessee's plea is, thus, without merit.
3.4 Next, I may address the assessee's plea with regard to the non- maintainability of the penalty on the balance amount of Rs.4.75 lacs or, for that matter, the entire Rs. 5.75 lacs. The said plea, with respect, only needs to be stated to be rejected. To begin with, the same presumes 'acceptance' of the assesse's explanation for Rs.1 lac, representing a loan from a finance company, repaid during the relevant previous year. The same, however, has not been accepted, either in principle or even as regards its admission. That being the case, the question of the acceptance of Rs.4.75 lacs, 'acceptance' of which is stated follow in consequence (to the acceptance of Rs.1 lac), would not. There is, in fact, no correlation between the two; the assesee being called upon to establish the source of Rs.17 lacs invested on the construction of his house, was, on the basis of the examination of the explanation furnished, found to have satisfactorily explained it to the extent of Rs.11.25 lacs, so that the balance amount was added u/s. 69C, even as it could equally validly be u/s. 69. The appropriateness of the section, i.e., s. 69 or s. 69C, fairly not disputed before us, would, we may though clarify, of little consequence in view of the settled law in the matter, and toward which I may advert to decisions in L. Hazari Mal Kathulia v. ITO [1961] 41 ITR 12 (SC); Isha Beevi v. TRO [1975] 101 ITR 449 (SC); CIT v. Hargopal Bhalla & Sons [1971] 82 ITR 243 (P&H); Namdev Arora v. CIT [2016] 389 ITR 434 (P&H)]. There has been, further, no improvement in his case by the assessee in the penalty proceedings, i.e., up to the stage of the tribunal; the explanation being wholly 13 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO unsubstantiated. The assessee in the penalty proceedings in fact only reiterated his case as in the quantum proceedings, which had been found by all the authorities up to the tribunal as without any evidence, and it would therefore not be incorrect to say of the assessee's case being without any evidence. Clearly, if therefore the assessee was able to make out a case for a part sum, as he sought to, it is only the penalty for that sum that would, accordingly, i.e., assuming the acceptance of this plea, deleted. No case, it may be added, stands made out for any part of the impugned sum. None of the several observations or findings by the tribunal, issued on examining the assessee's explanation, which remains the same in the penalty proceedings have been met in the penalty proceedings. In fact, even the evidence sought to be admitted in part explanation of the impugned sum in appellate proceedings, apart from not satisfying the mandate of r. 46A, found as not relevant (also refer paras 2, 3.3).
3.5 Finally, the assessee has placed his 'reliance' on the orders of the tribunal in the case of Dy. CIT vs. Yash Pal Narender Kumar (in ITA No.5340-42/Del/2012, dated 07.02.2013) and Anita Surendera Aggarwal vs. ITO (in ITA No.3102/Mum 2014, dated 08.06.2018). The first order is qua a quantum assessment. It is not understood as to how is the same relevant, being also not referred to during hearing. As regards the latter, which was also read out during hearing, the sole aspect sought to be emphasized by Sh. Bansal was that the assessment and penalty proceedings being separate, findings in assessment proceedings could not be ipso facto conclusive of the levy of penalty. There is quarrel with this proposition. However, as afore-noted, with reference to case law (refer para 3.1), firstly, the findings in the assessment proceedings are extremely relevant, so that they would require to be dislodged, and which has not been in the present case. Two, Explantion-1 to section 271(1)(c), as is well settled, raises a statutory presumption 14 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO against the assessee, which is to be met, and which has not been in the instant case. As explained in Lalchand Tirath Ram (supra), that mere furnishing of an explanation in not sufficient, and is to be substantiated by cogent and reliable evidence. The requirement of substantiation, it may be noted, stands provided by law for an assessee to establish the truth of his explanation. The decision in Ananthanram Veerasinghaiah & Co. vs. CIT [1980] 123 ITR 457(SC), relied upon by the Tribunal in Anita Surendera Aggarwal (supra), follows the decision in CIT vs. Anwar Ali [1970] 76 ITR 696 (SC). The same, in view of the amendment in law as well as the decisions afore-referred, no longer represents the law. The penalty proceedings u/s. 271(1)(c) of the Act are civil in nature and no mens rea is required to be proved by the Revenue. Further, reference in this context may be useful made to the decision in Chuharmal vs. CIT [1988] 172 ITR 250 (SC), wherein the penalty confirmed was in respect of income u/s. 69 of the Act.
3.6 Before parting with this order, it may be added that though the assessee has raised several grounds, only that discussed above were pressed or otherwise argued by the assessee's counsel during the hearing. I decide accordingly.
4. In the result, the assessee's appeal is dismissed.
Order pronounced in the open court on December 31, 2018 Sd/-
(Sanjay Arora) Accountant Member Date: 31.12.2018 /GP/Sr. Ps.
Copy of the order forwarded to:
(1) The Appellant: Harjinder Singh Raina, Prop. Singh & Singh Trading Co., Nehru Market, Jammu (2) The Respondent: Income Tax Officer, Ward-1(1), Jammu (3) The CIT(Appeals), Jammu 15 ITA No. 73/Asr/2016 (AY 1992-93) Harjinder Singh Raina v. ITO (4) The CIT concerned (5) The Sr. DR, I.T.A.T True Copy By Order