Income Tax Appellate Tribunal - Mumbai
Usha Chandresh Shah, Mumbai vs Ito 19(1)(2), Mumbai on 27 January, 2017
आयकर अपीऱीय अधिकरण, मुंबई न्यायपीठ "बी" मुंबई IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JM AND SHRI RAJESH KUMAR, AM आमकय अऩीर सं./I.T.A.2970/Mum/2015 (ननधधायण वषा / Assessment Year: 2006-07) Usha Chandresh Shah, Income Tax Officer, 52, Laxmi Niwas CHS, ward 19(1)(2), फनधभ/ Flat No.15, 3rd floor, Mumbai.
9th road, Khar(W), Vs.
Mumbai-400052
(अऩीरधथी /Applicant) : (प्रत्मथी / Respondent)
स्थधमी रेखध सं ./ जीआइआय सं ./ PAN : AURPS1402K अऩीरधथी की ओय से / Applicant by : None प्रत्मथी की ओय से/Respondent by : Shri Vishwas Jadhav सुनवधई की तधयीख /Date of Hearing : 24.1.2017 घोषणध की तधयीख /Date of : 27.1.2017 Pronouncement आदे श / O R D E R PER RAJESH KUMAR, A. M:
This is an appeal filed by the assessee challenging the order dated 11.3.2015 passed by the ld.CIT(A)-34, Mumbai for the assessment year 2006-07.
2. We find from the order sheet entries that despite services of notices sent through RPAD on various dates i.e. on 20.7.2016, 28.7.2016 and 1.9.2017 none appeared on behalf of the assessee nor did any application for adjournment filed . Today also none appeared before the bench at the 2 ITA No.650/Mum/2015 and 672/Mum/2015 time of hearing of the appeal and therefore, we are deciding the appeal ex-parte after hearing the ld. DR and considering the material available on record.
3. In the various grounds of appeal, the assessee raised the issue of confirmation of penalty of Rs.1,79,430/- by the ld.CIT(A) as levied by the AO under section 271(1)(c) of the Income Tax Act, 1961.
4. Brief facts of the case are that the assessment under section 143(3) of the Act was completed on 29.12.2008 assessing the total income of the assessee at Rs.9,03,110/- as against the returned income of Rs.1,50,049/-. The major addition was made by the AO on account of unexplained cash credit under section 68 of the Act of Rs.7,53,061/-. Accordingly, the AO initiated penalty proceedings, under section 271(1)(c) of the Act for concealing and filing inaccurate particulars of income. During the year under consideration, the assessee sold 2700 shares of M/s Prime Capital Market Ltd for a total consideration of Rs.7,53,894/- on 1.9.2005 which was purchased on 13.5.2004 for a total consideration of RS.13,959/-. The AO made the addition by holding that there has been phenomenal appreciation in the price of the scrip from Rs.5.17 to Rs.279.50 within a span of 16 months. According to the AO, SEBI has declared the said script of Prime Capital Market Ltd as "Penny Stock" and came to the conclusion that the share prices of stock exchange was manipulated after inquiring the matter from Kolkata Stock Exchange, the brokers and the 3 ITA No.650/Mum/2015 and 672/Mum/2015 depositary M/s India Bulls Securities Ltd. The AO also observed that the shares were purchased by the assessee from M/s Brightsum Merchants Pvt Ltd which was not available at the given address. The Kolkatta Stock Exchange has confirmed that no such transaction has been effected on the platform of the Stock Exchange. The AO obtained the copies of client registration form and demat account under section under section 133(6) of the Act from the depository by calling for information u/s 133(6) of the Act and finally came to the conclusion that the assessee has earned profit through malpractices and non-genuine transactions and added Rs. 7,53,061/- to the income of the assessee. A show cause notice was issued to the assessee on 12.2.2013, which was replied by the AR of the assessee on 25.2.2013 stating therein that the penalty proceedings under section 271(1)(c) being separate and independent, the addition in quantum proceedings will not automatically result into levy of penalty and submitted that the evidence found by the AO was neither sufficient nor relevant to impose penalty. The ld.AR submitted before the AO that the script and broker i.e. D K Khandelwal were same as in the case as decided by the the Hon'ble Tribunal holding the share transaction as valid by relying on the decision in the case of Avinash Kantilal Jain in ITA No.980/PN/2010 dated 31.10.2012 in the case of Shyam Pawar in ITA No.5585/Mum/2011, dated 4.5.2012 and in the case of Ajay Nawandar reported in 33 DTR 452 (Mum). As regard off market transaction, the assessee has relied on the decision of Mukesh Marolia stating that the off market transaction are legal 4 ITA No.650/Mum/2015 and 672/Mum/2015 and valid. The ld.AR submitted that the assessee has filed all the evidences produced by the assessee, purchase as well as demat account, payment made to the seller of shares etc before the AO and therefore, the assessee cannot be said to have either concealed particulars of income or furnished inaccurate particulars of income under section 271(1)(c) of the Act. The AO was not convinced with the assessee and finally came to the conclusion that the assessee has furnished inaccurate particulars of income and concealed income falling within the meaning of section 271(1)(c) of the Act read with Explanation (1) of the section 271(1)( c ) of the Act and levied penalty 100% of the tax sought to be evaded Rs.7,53,061/- and tax sought to be evaded Rs.1,79,430/- under section 271(1)(c). The First Appellate Authority also confirmed the action of the AO by holding that the assessee has manipulated the transactions to disclose income of Rs.7,53,061/-. Being aggrieved by the order of the ld.CIT(A), the assessee is in appeal before this Tribunal.
5. We have carefully considered the contentions of the DR, perused the material placed before us during the course of hearing including the decisions of authorities below as also the decisions relied upon by the ld. AR. We find that there is nothing on record to controvert the findings of the authorities below and therefore, we are , therefore after considering the submission of the ld DR and facts on records, inclined to uphold the order of FAA by dismissing the appeal of the assessee. 5 ITA No.650/Mum/2015
and 672/Mum/2015
6. In the result, the appeal of the assessee is dismiss.
Order pronounced in the open court on 27.1.2017.
Sd sd
(Mahavir Singh) (Rajesh Kumar)
न्याययक सदस्य / Judicial Member लेखा सदस्य / Accountant Member
भुंफई Mumbai; ददनधंक Dated : 27.1.2017
SRL,Sr.PS
आदे श की प्रनतलरपऩ अग्रेपषत/Copy of the Order forwarded to :
1. अऩीरधथी / The Appellant
2. प्रत्मथी / The Respondent
3. आमकय आमुक्त(अऩीर) / The CIT(A)
4. आमकय आमुक्त / CIT - concerned
5. पवबधगीम प्रनतननधध, आमकय अऩीरीम अधधकयण, भुंफई / DR, ITAT, Mumbai
6. गधर्ा पधईर / Guard File आदे शधनस ु धय/ BY ORDER, True copy उऩ/सहधमक ऩंजीकधय (Dy./Asstt. Registrar) आमकय अऩीरीम अधधकयण, भुंफई / ITAT, Mumbai