2019 (10) TMI 243 - AT - Income Tax

Penalty u/s 271(1)(c) - unexplained cash credit - HELD THAT - Matter was first called for hearing on 02.08.2012 by the Tribunal and thereafter was listed for hearing numerous times till today. The assessee has taken adjournment on one pretext or the other which reflects indolent attitude of the assessee. The matter concerns AY 1994-95 and the appeal was filed in the Tribunal in 2012 more than six years have lapsed before the Tribunal. We also see that the records before the Tribunal are only partly complete. It is also noticed that the assessee has dodged the notices in the assessment proceedings as well, which impeded requisite inquiry. In view of the indifferent behavior, we proceed to dispose of the appeal on the basis of submissions made by the assessee before the CIT(A). Nothing substantive to rebut the allegation of cash deposits of ₹ 1,90,000/- in aggregate as an explained. The CIT(A) has also observed that assessee has failed to explain the source of cash deposit. Nothing has been brought on record before the Tribunal to rebut the aforesaid findings of the CIT(A). We thus see no reason to interfere with the order of the CIT(A) confirming the penalty of the aforesaid amount. - Decided against assessee.

Summary

Issues involved:
Imposition of penalty under section 271(1)(c) of the Income Tax Act, 1961 on unexplained cash credit of ?1,90,000 for Assessment Year 1994-95.

Analysis:

1. Background and Quantum Assessment:
The appeal was filed by the assessee against the penalty order passed by the Assessing Officer under section 271(1)(c) of the Income Tax Act for Assessment Year 1994-95. The assessed income included ?1,90,000 as unexplained credit, which the assessee contested before the Commissioner of Income Tax (Appeals) but without success.

2. Penalty Imposition and CIT(A) Confirmation:
The Tribunal dismissed the appeal against the CIT(A) order in quantum proceedings due to non-representation by the assessee. Consequently, the penalty was imposed by the Assessing Officer under section 271(1)(c) on the unexplained cash credit, which was confirmed by the CIT(A). The CIT(A upheld the penalty citing the absence of any explanation regarding the source of the cash deposit, invoking Explanation 1 below section 271(1)(c).

3. Assessee's Appeal before the Tribunal:
The assessee, aggrieved by the CIT(A)'s decision, appealed before the Tribunal. The assessee's representative argued that the cash deposit was share application money received from shareholders, but failed to provide evidence to support this claim. The representative urged for the deletion of the penalty.

4. Tribunal's Decision and Dismissal of Appeal:
The Tribunal considered the rival submissions and noted the prolonged delay in the proceedings due to the assessee's adjournments and indifferent behavior. Despite the assessee's claims, the Tribunal found no substantial evidence to rebut the allegation of unexplained cash deposits. The Tribunal upheld the CIT(A)'s decision to confirm the penalty, stating that the assessee failed to explain the source of the cash deposit.

5. Conclusion:
Ultimately, the Tribunal dismissed the assessee's appeal, emphasizing the lack of evidence provided by the assessee to refute the unexplained cash deposits. The Tribunal's decision was based on the submissions made before the CIT(A) and the absence of any new evidence presented during the appeal.

This detailed analysis covers the issues involved in the legal judgment, highlighting the key arguments, decisions, and reasoning presented throughout the case.