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TMI Blog2009 (3) TMI 229X X X X Extracts X X X X X X X X Extracts X X X X ..... sue is involved, all these appeals were heard together and arc being disposed of by this common order for the sake of convenience. 2. In all these cases, it was the claim of these assessees that they have received gift of various amounts from one Shri Sanjay Mohan Agarwal. The original return of income filed by these assessees were accepted after processing under s. 143(1)(a) of the Act. Thereafter, information was received by the AO from Addl. CIT (Inv.), Meerut through Addl. Director of IT, Faridabad as per which, it was intimated that Shri Sanjay Mohan Agarwal having residential address at 4674-Shora Kothi, Pahar Ganj, New Delhi was involved in giving bogus gifts and bogus loans by cheques and demand drafts in lieu of cash received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese assessees carried the matter in appeal before learned CIT(A) but he also confirmed the penalty in all these five cases and now, these assessees arc in further appeal before us against the penalty imposed by the AO under s. 271(1)(c) of the Act. 3. It is submitted by the learned Authorised Representative of the assessee that all evidences were furnished before the AO regarding these gifts said to be received by these assessees from Shri Sanjay Mohan Agarwal in the form of memorandum of gift, affidavit of the donor, copy of return and balance sheet of the donor, copy of ration card of the donor etc. But the AO asked the assessee to produce Shri Sanjay Mohan Agarwal and since the donor Shri Sanjay Mohan Agarwal had already died befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts cited by both sides. First of all, we find that in all these cases, notice under s. 148 was issued in the month of March, 2006 whereas the alleged donor Shri Sanjay Mohan Agarwal has died in the month of July, 2005 precisely on 6th July, 2005. In view of these facts, we are in agreement with the learned Authorised Representative of the assessee that it was not possible on the part of these asses sees to produce Shri Sanjay Mohan Agarwal as an evidence regarding claim of these assessees for gifts from this person. In the light of these facts, when we examine the issue in dispute before us, we feel that Expln. 1 to s. 271(1) is very much relevant and hence we reproduce the same hereinbelow: Explanation 1-Where in respect of any fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , we find that explanation was offered by the assessee but he could not substantiate the same and hence, we have to see and examine as to whether such explanation is bona fide and whether all the facts relating to the same and material to the computation of total income have been disclosed by the assessees. We find that in the present case it is the claim of these assessees that they have received gifts from Shri Sanjay Mohan Agarwal and in support of the same, they have brought on record memorandum of gift, affidavit of the donor, copy of return and balance sheet of the donor as well as the copy of the ration card of the donor. All these documents are available before us also on pp. 53 to 72 of the paper book. The case of the Revenue is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were produced such as memorandum of gift, affidavit of the donor, copy of his IT return and his balance sheet etc. which means that all information relating to these gifts was also brought on record by these assessees. 7. Now we consider and examine the applicability of judgment of Hon'ble apex Court rendered in the case of Dharamendra Textile Processors. In this case, it was held that the penalty under the provisions of s. 271 (1)(c) is civil liability and wilful concealment is not essential ingredient for attracting the civil liability. But in the present case, this is not the case of the assessee that there is no wilful concealment. The case of the assessee before us is that there is no concealment at all as provided in s. 271 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... loans were neither disclosed nor were any supporting documents on record. The accountant who has arranged the loan was not produced and it was stated that he has left the service as relations with him are strained. Under these facts, it was held by Hon'ble Gujarat High Court that in this state of accounts and evidence in the quantum proceedings, the Department was justified in treating the cash credit as income of the assessee but merely on that basis by recourse to Expln. 1, penalty under s. 271 (1)(c) could not be imposed by the Department when the Department is not making any other effort to come to the conclusion that the cash credit could in no circumstances have been amount received as temporary loans from various parties. It is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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