Income Tax Appellate Tribunal - Mumbai
Dilip H. Chhabria, Mumbai vs Assessee on 19 August, 2015
आयकर अपील य अ धकरण "डी" यायपीठ मुंबई म।
IN THE INCOME TAX APPELLATE TRIBUNAL "D" BENCH, MUMBAI ी डी. म मोहन, उपा य एवं ी संजय अरोड़ा, लेखा सद य के सम । BEFORE SHRI D. MANMOHAN, VP AND SHRI SANJAY ARORA, AM IT(SS)A No.23/Mum/2012 (बा धत अव ध/Block Period: 01.04.1987 to 18.12.1997) Dilip H. Chhabria Dy. CIT-8(1) 21, Sanjay Plaza, A. B. Nair Rd., Aaykar Bhawan, M. K. Marg, बनाम/ Silver Beach Juhu, Mumbai-400 020 Mumbai-400 049 Vs. थायी ले खा सं . /जीआइआर सं . /PAN/GIR No. ADCPS 0642 D (अपीलाथ /Appellant) : ( यथ / Respondent) अपीलाथ क ओर से / Appellant by : Shri Subhash S. Shetty & Shri R. N. Vasani यथ क ओर से/Respondent by : Shri Sanjay Punglia सनु वाई क तार ख / : 19.05.2015 Date of Hearing घोषणा क तार ख / : 19.08.2015 Date of Pronouncement आदे श / O R D E R Per Sanjay Arora, A. M.:
This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-16, Mumbai ('CIT(A)' for short) dated 10.05.2012, dismissing the Assessee's appeal challenging the confirmation of penalty under section 158BF(2) of the Income Tax Act, 1961 ('the Act' hereinafter) following the assessee's block assessment u/s. 158BC of the Act.2
IT(SS)A No.23/Mum/2012 (BP: 01.04.1987 to 18. 12.1997) Dilip H. Chhabria vs. Dy. CIT
2. The background facts of the case are that assessment u/s.158BC of the Act (for the block period commencing 01.04.1987 to the date of search, i.e., 18.12.1997) was completed on 31.01.2001 at an undisclosed income of `.58,18,970/-, as against a returned undisclosed income of `.10 lacs. The matter travelled up to the Tribunal, which confirmed the addition at `.10 lacs on a finding of repetitive additions vide its Order dated 31.01.2006 (in IT(SS)A Nos. 61 and 75/Mum/2001/copy on record). Notice u/s.158BFA(2), for the levy of penalty there-under, was accordingly issued on 20.02.2007. The assessee, in response, relied on the said order by the tribunal, stating that the addition as finally sustained was under the peculiar circumstances of the case and, accordingly, should not attract penalty u/s.158BFA(2). In appeal, the assessee, relying on the tribunal's order in the quantum proceedings, the ld. CIT(A) reproduced the relevant part thereof (para 10), to hold, after analyzing the same, that it was completely incorrect to say that the addition as finally sustained by the tribunal had no relevance with the material on record or the evidences gathered during the course of search. On the contrary, the addition upheld by the tribunal proved the assessee to have not disclosed his full income even in the search proceedings. All that it had done was to eliminate the additions that had a multiplier or a repetitive effect. Aggrieved, the assessee is in second appeal before us.
3. We have heard the parties, and perused the material on record.
The assessee, though raising the legal ground qua the time limitation for the initiation of the penalty proceedings (vide ground no. 1), did not press the same during hearing, so that the same is dismissed as not pressed.
On merits, we may begin by reproducing the relevant section, as under:
' Levy of interest and penalty in certain cases.
158BFA. (1) ..............
(2) The Assessing Officer or the Commissioner (Appeals) in the course of any proceedings under this Chapter, may direct that a person shall 3 IT(SS)A No.23/Mum/2012 (BP: 01.04.1987 to 18. 12.1997) Dilip H. Chhabria vs. Dy. CIT pay by way of penalty a sum which shall not be less than the amount of tax leviable but which shall not exceed three times the amount of tax so leviable in respect of the undisclosed income determined by the Assessing Officer under clause (c) of section 158BC :
Provided that no order imposing penalty shall be made in respect of a person if--
(i) such person has furnished a return under clause (a) of section 158BC;
(ii) the tax payable on the basis of such return has been paid or, if the assets seized consist of money, the assessee offers the money so seized to be adjusted against the tax payable;
(iii) evidence of tax paid is furnished along with the return; and
(iv) an appeal is not filed against the assessment of that part of income which is shown in the return:
Provided further that the provisions of the preceding proviso shall not apply where the undisclosed income determined by the Assessing Officer is in excess of the income shown in the return and in such cases the penalty shall be imposed on that portion of undisclosed income determined which is in excess of the amount of undisclosed income shown in the return.' The assessee's sole case, adverting our attention to paras 10 and 11 of the tribunal's order supra, was that the addition as sustained was on an estimate basis, and which could not therefore be subject to penalty. We are completely unable to appreciate the assessee's case. The addition (or disallowance) in any assessment could only be on the basis of some material/evidence, lest it is illegal, unable to stand the test of judicial scrutiny. Further, assessment under Chapter XIV-B of the Act is only of undisclosed income, i.e., which is not or would not have been, but for a search or requisition, disclosed to the Revenue. In fact, the very assumption of jurisdiction for assessment of such income is based on discovery of material indicating such income of the assessee, or evidence relatable thereto. All that the tribunal has done is to eliminate the addition/s that had the effect of inflating the quantum of the assessed income superfluously, i.e., which is not backed by any independent material - nothing 4 IT(SS)A No.23/Mum/2012 (BP: 01.04.1987 to 18. 12.1997) Dilip H. Chhabria vs. Dy. CIT more and nothing less. Rather, as observed during hearing, the tribunal had not proceeded in a mathematical fashion, giving a specific finding qua each separate addition deleted, even as the Revenue had tabulated each addition comprising the assessed income separately. In fact, it is conscious of the same, explaining itself by stating (at para 11 of its order) of restricting the addition to a reasonable sum of `.10 lacs. To therefore read its order to mean that the addition as sustained was based on no material would be a complete misreading of, or misconstruing, its order. The law in the matter is patently clear and the onus to show that he was entitled to a relief higher than that allowed by the tribunal is squarely on the assessee. The ingredients of the penal provision, which, as its reading would show, is strict, are satisfied, and no case for non-imposition of the penalty has been made out. The same could only be by leading evidence or even furnishing an explanation, exhibiting or establishing its case on facts. Merely making a bald assertion of the assessment being based on an estimate, which is de hors the material on record, would not assist the assessee. For the same reasons, reliance on case law, which we have otherwise perused, would be of little consequence. We decide accordingly.
4. In the result, the assessee's appeal is dismissed.
प रणामतः नधा रती क अपील खा रज क जाती है ।
Order pronounced in the open court on August 19, 2015 Sd/- Sd/-
(D. Manmohan) (Sanjay Arora)
उपा य / Vice President लेखा सद य / Accountant Member
मुंबई Mumbai; दनांक Dated : 19.08.2015
व. न.स./Roshani, Sr. PS
5
IT(SS)A No.23/Mum/2012
(BP: 01.04.1987 to 18. 12.1997)
Dilip H. Chhabria vs. Dy. CIT
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 - concerned
5. वभागीय त न ध, आयकर अपील य अ धकरण, मुंबई / DR, ITAT, Mumbai
6. गाड फाईल / Guard File आदे शानुसार/ BY ORDER, उप/सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपील य अ धकरण, मुंबई / ITAT, Mumbai