2012 (1) TMI 359 - AT - Income Tax

Summary

Issues involved: Appeal against order of CIT(Appeals)-IV, Chennai in ITA No. 88/08-09/A-IV dated 30-08-2011 for the assessment year 2004-05.

Summary:
The appeal was filed by the assessee against the order of the CIT(A) regarding gifts and loans received from his nephew, Shri Sushil Jain. The Assessing Officer disputed the gifts and loans, leading to penalty under u/s 271(1)(c) of the Income Tax Act, 1961. The Tribunal allowed the Revenue's appeal, but the High Court admitted the appeal filed by the assessee u/s 260A. The assessee provided explanations and evidence, including a letter from a Dubai company, to support the gifts and loans. The Tribunal found the explanation plausible, leading to the reversal of the penalty.

In reply, the Jr. Standing Counsel supported the orders of the CIT(A) and the Assessing Officer, stating that the gifts and loans were not established by the assessee.

The Tribunal considered the submissions and noted that the gifts and loans came through proper banking channels, with evidence of telegraphic transfers. The explanation provided by the assessee was found plausible by the CIT(A) and had led to a substantial question of law admitted by the High Court. As the explanation was supported by evidence and not proven false, the penalty u/s 271(1)(c) was deemed not leviable. Therefore, the appeal of the assessee was allowed, and the penalty was reversed.

The order was pronounced on 31/01/2012.