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TMI Blog2012 (7) TMI 364X X X X Extracts X X X X X X X X Extracts X X X X ..... ed - Held that:- It is well settled law that penalty cannot be levied on the amounts /additions, which have already been deleted on quantum appeals. No basis would be left for levy of penalty if addition on which penalty was levied has already been deleted by the appellate authorities - Since the order of the Tribunal was delivered after the levy of penalty, therefore, such circumstances and peculiar facts should have been considered by the ld. CIT(A) in the penalty appeal instead of dismissing the appeal of the assessee holding it to be time barred - the assessee was prevented by sufficient cause from not filing the appeal before the CIT(A) within the period of limitation, thus in such circumstances, the delay should have been condoned - the appeal of the assessee is restored to the file of CIT(A) with the direction to redecide the appeal on merits - in favour of assessee by way of remand. - ITA No. 456 & 457/Agra/2010 - - - Dated:- 22-6-2012 - SHRI BHAVNESH SAINI, AND SHRI A.L. GEHLOT, JJ. Appellant by : Shri Pankaj Gargh, Advocate. Respondent by : Shri Waseem Arshad, Sr. D.R. ORDER Per Bhavnesh Saini, J.M.: Both the appeals by the assessee are direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in accordance with law by giving reasonable opportunity of being heard to the assessee. The relevant finding of the Tribunal have been incorporated in para 2.2 of the appellate order and the copy of Tribunal order dated 25.05.2007 has been filed at page 1 to 10 of the paper book and relevant finding of the Tribunal are noted in para 20 of the order of the Tribunal. The ld. CIT(A) took up the matter and assessee s counsel submitted before him that the assessee submitted the statement to the AO, but the assessee was not required to explain the credits in the bank account. In the bank account from the assessee s account books, names of the parties on whose behalf drafts were received are mentioned. Copies of the accounts of the parties, in which drafts were credited and accounted for, have been filed. Thus, the credits in the bank account are fully proved and explained. The peak credit in the bank account is of Rs.2,23,163.57 as on 14.06.2002 (PB-12). Copy of the bank statement and peak credit was submitted before the ld. CIT(A) for verification. The ld. CIT(A) discussed the issue with the ld. counsel for the assessee at the appellate stage and he was asked whether the assessee accep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It stands to reason that the addition could be limited to peak credit, as between the credits which are not genuine. Where the assessee claimed them to be genuine deposits, he cannot in the same breath ask for the benefit of peak credit addition. The Tribunal s finding that the benefit cannot be given in such a case was upheld by the High Court on the ground, that there was no infirmity in the order of the Tribunal. The decision appears to bring the principle of estoppel against the assessee. 5.2, As I have already mentioned above, the appellant s counsel has taken a stand that the credit entries appearing in the bank statement are not representing appellant s unaccounted money and these represent the advance received from different farmers. In such circumstances, if we apply the discussion made above and the ratio of the jurisdictional High Court in case of Bhaiyalal Shyam Behari (supra) to the facts of present case; it gives inference that the assessee cannot be given advantage of its alternative plea of peak credit. There is no convincing explanation as to how the advance received from one farmer can be withdrawn and then given to another farmer for deposit with the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Tribunal in the first instance as per para 16 of the Tribunal order (PB-8) that the names of parties on whose behalf the drafts were received are mentioned in the books of account and the bank account and copies of accounts of these parties were also furnished wherein the drafts were duly credited and accounted for. The assessee, therefore, claimed before the Tribunal that credits in the bank account are fully proved. The assessee also submitted that in the set aside proceedings, the assessee did not accept that the credit entries appearing in the bank account represent assessee s unaccounted money. The assessment order was passed exparte u/s. 144 of the IT Act. Therefore, there is no question of disputing the addition before the AO. Thus, the assessee in several proceedings at different level has claimed that the amounts received through bank drafts from various parties are genuine deposits / investment and the assessee claimed that source of the same have been explained, though the claim of the assessee was not accepted by the Tribunal and confirmed the addition on account of unaccounted investment u/s. 69 of the IT Act. Therefore, the decision of Hon ble Allahabad High Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial on record rightly confirmed the addition. We, therefore, do not find any infirmity in the order of the ld. CIT(A). The decision of the Tribunal cited by the assessee s counsel cannot be given preference against the decision of Jurisdictional Allahabad High Court. We accordingly dismiss the appeal of the assessee in ITA No. 456/Agra/2010. ITA No. 457/Agra/2010 7. This appeal is filed by the assessee for levy of penalty u/s. 271(1)(c) of the Act on the same facts as have been noted on merits. The appeal of the assessee before the ld. CIT(A) was time barred by 2 years. The assessee was asked to explain the delay in filing the appeal. The assessee submitted before the ld. CIT(A) that the appeal was not filed by the C.A. in time and thus there was default on the part of the C.A.. When the assessee received demand notice u/s. 221(1) dated 13.05.2009, it came to the notice of assessee that the appeal was not filed by the earlier counsel. Affidavit of director of the assessee company was also filed in support of the same. The assessee, therefore, prayed that the delay may be condoned. The assessee relied upon several decisions in support of the above contention that where t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he applicant for filing an application u/s. 27(3), from July 11, when the application should have been filed, till Oct. 8, when the papers were alleged to have been located. As the applicant had failed to place on record all the facts, in action or want of diligence on the part of the applicant would not entitle the applicant to the benefits of the provisions of sec. 5 of the Limitation Act. As the applicant had failed to make out a case that there was sufficient cause for delay in filing the application in time, the application for condonation of delay was rejected. 3.2. In absence of any justifiable reason on record, I find that the delay has not been explained and the delay tantamounts to gross negligence for which law does not suggest any liberal attitude. Such negligent and unexplained mistake cannot be exonerated, otherwise the legal provision regarding condonation of delay will be rendered redundant. 3.3 Such case of inordinate delay without reasonable cause cannot be condoned. Consequently, this appeal is not admitted. 8. The ld. counsel for the assessee reiterated the submissions made before the ld. CIT(A) and submitted that the ld. CIT(A) has factually recorded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e ld. CIT(A). 9. We have considered the rival submissions and the material on record. We may note here that the assessment order in this case was passed on 26.04.2005 exparte u/s. 144 of the IT Act making the additions of Rs. 26,33,328/- on account of advance from the farmers and addition of Rs.35,03,011/- as unexplained deposits in the bank account. The AO vide separate order dated 22.03.2007 levied penalty of Rs.22,55,104/- on account of additions maintained by the ld. CIT(A) in a sum of Rs.26,33,328/- and Rs. 35,03,011/- (total Rs.61,36,339/-). The AO on the aforesaid additions levied the penalty. It may also be noted here that the assessee preferred appeal against the quantum additions on merits before the Tribunal in ITA No. 16/Agra/2006, which was decided vide order dated 25.05.2007. The Tribunal deleted the addition of Rs.26,33,328/-. However, the addition of Rs.35,03,011/- was confirmed on merits, however, the matter was remanded to the file of ld. CIT(A) for limited purpose for deciding the issue of applicability of addition of peak credit on such additions. The issue of peak credit remained subject matter in appeal before us in ITA No. 456/Agra/2010 above, in which we h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove clearly make out a case that the delay in filing the appeal should be condoned by the ld. CIT(A). Further, we find that the ld. CIT(A) incorrectly noted the fact in the impugned order that affidavit of the present counsel has been filed. In fact, the affidavit of Shri Pankaj Singhal, the director of the assessee company was filed before the ld. CIT(A) (PB-5) explaining the reasons for delay in filing the appeal due to negligence of the counsel. The ld. CIT(A) under mistaken belief did not take cognizance of the correct facts. In that event, the ld. CIT(A) further noted in the impugned order that the fault lay with the assessee and the previous counsel, but none of them filed their affidavits. It would, therefore, show that the ld. CIT(A) did not condone the delay because no affidavit of the assessee or the earlier counsel was filed, otherwise, the ld. CIT(A) would have condoned the delay if the affidavit of the assessee had been filed before him. In fact, the affidavit is filed by the director of the assessee company, as noted above. Therefore, considering the observations of the ld. CIT(A) and his findings given in the appellate order, the delay in filing the appeal before t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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