2016 (4) TMI 508 - AT - Income Tax

Unexplained investment under section 69 - Held that - the learned Authorized Representative could not furnish any materials to explain the source of investment of the assessee. Therefore, we do not have any other option but to confirm the order of the Revenue on this issue. Accordingly, we hereby confirm the addition made by the learned Assessing Officer which was further sustained by the learned Commissioner of Income Tax (Appeals). - Decided against assessee Penalty u/s 271(c) - Held that - Assessee could not advance any arguments for deleting the penalty levied by the Revenue. In these circumstances, we do not have any other option but to confirm the penalty levied by the Revenue. Accordingly, we hereby confirm the penalty levied - Decided against assessee

Summary

Issues:
1. Addition of unexplained investment under section 69 of the Act.
2. Confirmation of penalty under section 271(1)(c) of the Act.

Issue 1: Addition of Unexplained Investment under Section 69 of the Act:
The appellant challenged the addition of Rs. 200,82,00,000 as unexplained investment under section 69 of the Act. The appellant failed to provide evidence to verify the source of this investment despite multiple opportunities. The Assessing Officer and the Commissioner of Income Tax (Appeals) both upheld the addition. The Commissioner noted the lack of credible evidence and rejected the appellant's claims. The appellant's representative could not explain the source of investment during the appeal. Consequently, the Tribunal confirmed the addition, agreeing with the Revenue's decision.

Issue 2: Confirmation of Penalty under Section 271(1)(c) of the Act:
The appellant also contested the penalty of Rs. 72,93,844 imposed under section 271(1)(c) of the Act for failure to explain the source of the investment. The Assessing Officer and the Commissioner upheld the penalty due to the appellant's inability to provide a satisfactory explanation. The Commissioner highlighted the appellant's failure to substantiate their claims with material evidence. The appellant's representative did not present any arguments to challenge the penalty during the appeal. As a result, the Tribunal affirmed the penalty, concurring with the Revenue's decision.

In conclusion, both appeals filed by the assessee were dismissed, with the Tribunal confirming the addition of unexplained investment and the penalty imposed under sections 69 and 271(1)(c) of the Income Tax Act, respectively. The judgments of the Assessing Officer and the Commissioner of Income Tax (Appeals) were upheld based on the lack of credible evidence and failure to provide a satisfactory explanation regarding the source of the investment.