9911796707
TMI Blog2012 (12) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in not considering the overall facts and circumstances of the case and in the process erred in confirming the penalty." 2. The brief facts are that the Assessing Officer stated in the penalty order that during the course of the survey, on the basis of loose torn paers, the partner of the firm, Shri Mukund Shah admitted that these papers related to sales of financial year 2000-01 and on the basis of these papers the assessee admitted that unaccounted sales of Rs.25 lakh escaped from tax. The partners accepted that the unaccounted sale consideration has been utilized by the partners in repair of their residence and other expenses. Hence, this income had already been earned and invested by he assessee-firm and its partners. The AO also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nonbusiness purpose, however, the CIT(A) has directed Assessing Officer to apply rate of interest as per the prevalent bank rate since assessee has CC facility. As per the direction of Ld. CIT(A), the disallowance of interest was worked out and restricted to the extent of Rs.5,98,644/-. The assessee during the penalty proceedings submitted that it had neither concealed income nor furnished inaccurate particulars of income and disallowance of interest claimed does not lead to a positive conclusion that such income were in fact earned and had been concealed. Assessee's nature of business is such that many times it has to borrow funds from its associate concerns, friends and relatives and many times surplus funds are available with the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he additions at Rs.12.15 lakh. 4. Ld. CIT(A) confirmed the action of Assessing Officer. 5. Learned Counsel for the assessee, Mr. J.P. Shah argued that return of income originally was filed on 18-09-2001. The survey operation u/s 133A of the Act was carried out on 05-11-2001. The revised return of income was filed on 22-11-2001. The assessee is engaged as a retail dealer of Raymond Collection is a partnership firm. On the basis of certain loose torn papers, Shri Mukund Shah, the partner with the firm admitted the unaccounted sales of Rs.25 lakh, which was declared in the revised return. As per note appended to the return of income, it has been mentioned that the return is revised pursuance to the statement given voluntarily by the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in support of his argument. Moreover, the statements during the survey do not have any evidentiary value was relied upon by Mr. Shah as held by Hon'ble Kerala High Court in the case of Paul Mathus and Sons v. CIT (2003) as reported in 263 ITR 101 (Ker). 6. On the other hand, Ld. DR Shri Samir Tokriwal argued that during the course of survey excess cash of Rs.11 lakh was found and excess stock of Rs.18 lakh was also found apart from excess sales of Rs.25 lakh. The Assessing Officer in the penalty proceedings have given the clear-cut finding that the assessee had concealed the income. Therefore the Ld. DR supported the order of both the authorities below. Ld. DR Mr. Tokriwal in support of his arguments relied upon the various courts law as u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er-dispute. The said torn papers were not looked into during the course of survey proceedings which were packed and were opened during the assessment proceedings. What is the quantum of the sales in the said torn papers has not been brought on record by any of the authorities below and also it has not been pointed out by the Ld. DR that what is the quantum of sales not declared in the said torn papers. The assessee having given the explanation that the said papers were related to the commission on sales has not bee taken into consideration, while the deciding the penalty proceedings. Moreover, the AO has not brought any evidence or cogent material apart from assessee's explanation from which it could be inferred that assessee has concealed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e orders. But the Appellate Tribunal held that the Department had not discharged its burden of proving concealment and had simply rested its conclusion on the act of voluntary surrender done by the assessee in good faith, and that penalty could not be levied. On a reference, the High Court held that no penalty could be levied for concealment (see [2000]241 ITR 124). The Department preferred appeals to the Supreme Court. The Supreme Court dismissed the appeals holding that no interference with the order of the High Court was called for." In the circumstances and facts of the case, the order of the Ld. CIT(A) is reversed and Assessing Officer is directed to cancel the penalty so levied. 9. The Assessing Officer has also levied the penalty s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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