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TMI Blog2009 (5) TMI 924X X X X Extracts X X X X X X X X Extracts X X X X ..... from the record of the Tribunal, are that the assessee filed its return of income declaring total income at ₹ 4,89,385/-. The assessment was completed on 29.3.2004 at total income of ₹ 26,37,390/-. It was found that the assessee showed gifts aggregating to ₹ 19.02 lakh from six persons in the relevant previous year. The details of the gifts are mentioned in the assessment order, which are reproduced as under:- Sl. No. Amount Donor (i) "Rs.10,00,000/- from Smt. Dropadi Devi, mother-in-law (ii) Rs.1,01,000/- from Shri Veer Singh (iii) Rs.2,01,000/- from Shri Surendra Sahai (iv) Rs.2,00,000/- from Shri Raju Sharma (v) Rs.2,00,000/- from Shri Phool Singh (vi) Rs.2,00,000/- from Shri Munish Chandra Sharma " Total: Rs.19,02,000/- The assessee was required to prove the genuineness of the gifts and evidences in support of the gifts were filed in the course of assessment proceedings. However, the AO was not satisfied with the evidence and the explanation tendered by the assessee and, therefore, an amount of ₹ 19.02 lakh was added to the income. Aggrieved by this order, the assessee filed appeal before the Ld. CIT(A). The Ld. CIT(Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tes, in which they were partners. These persons could not be traced at the given address as registered letter forwarded to them was returned by the postal authority with the remarks "not known" and the ward inspector also reported that no such person was staying at the given address. It appears that Shri Surendra Sahai had expired when the enquiries were made, but the assessee was not aware about this fact although it was claimed that the gift was made out of love and affection. 2.3 In regard to gift from Shri Munish Chander Saxena of ₹ 2.00 lakh, it was deposed by him that the amount was earlier deposited with M/s J.S. Investment. From the copy of the account, it was found that the credit in the account was on account of sale of shares of Mohit Cold Storage and Ice Factory, to which no averment was made by Shri Saxena in his deposition. He was working as a clerk with Krishna Cold Storage, Kunwar Gaon, Budaun, and was getting salary of ₹ 53,000/- p.a. His family consisted of five persons, being self, wife and three children. He did not own any immovable property or other moveable properties. 2.4 Shri Phool Singh, who gifted ₹ 2.00 lakh to the assessee, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n essential ingredient for attracting civil liability as is the case in the matter of prosecution u/s 276C of the Act. In the light of this judgment, it was argued that since the assessee did not discharge the onus cast on it under Explanation-1, the penalty being a civil liability, it may be confirmed. 3. The ld. counsel for the assessee sought to defend the order of the learned CIT(Appeals) on a totally new ground by submitting that the assessee as a respondent would be entitled to raise any legal plea to defend the order of the CIT(Appeals). However, if the plea succeeds, the effect would be that his order will stand as it is. In this connection, reliance was placed on the order of "A" Bench of Delhi Tribunal in the case of ITO vs. Smt. Gurinder Kaur (2006) 102 ITD 189, in which it was held that it would be open for the respondent to support the order on any ground decided against him or on a new ground in defence of that order. Further, reliance was placed on the order of Delhi Bench of the Tribunal in the case of DCIT vs. Capital Cars (P) Ltd. (2007) 295 ITR (AT) 224, in which it was inter-alia held that the assessee can take a legal plea, not taken before the CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellate order, revisionary order etc. is received or passed. It was argued that since no order was passed earlier, this sub-section was not applicable to the facts of the case. 3.2 Further, it was submitted that no charge of concealment of income or furnishing inaccurate particulars of income was raised against the assessee in the assessment or the penalty order. Therefore, in absence thereof, the levy of penalty was not sustainable in law. It was further submitted that the assessee had disclosed the factum of having received gifts in the return of income. Therefore, it was neither a case of concealment of income nor furnishing . inaccurate particulars of income. 3.3 In this connection, our attention was drawn towards pages 101 to 112 of the paper book, being evidence in case of Smt. Daropa Devi, which contain copies of-(i) registration of her death on 11.7.2002, (ii) letter dated 23.10.2000 confirming the gift, (iii) intimation u/s 143(1) showing total income of ₹ 1,32,090/- for assessment year 2001-02, (iv) return of income, (v) income and outgoing account inter-alia showing purchase and sale of potato at 4,40,160/-, (vi) gift to the HUF of son-in-law at ₹ 10. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not have been done as assessment and penalty proceedings are separate proceedings. In this connection, reliance was placed on the order of "A" Bench of Delhi Tribunal in the case of Vijay Power Generators Ltd. in ITA No.1649(Del)/2007 for assessment year 1997-98 dated 31.8.2007, in which it was mentioned that non-consideration of the evidence independently in penalty proceedings amounts to basic infirmity in the penalty order. The case of the ld. counsel was that mere confirmation of the addition by the Tribunal cannot lead to levy of penalty. The authorities are bound to consider the explanation of the assessee in penalty proceedings independently. 4. In the rejoinder, the ld. DR submitted that section 275(1A) is independent of section 275(1) and they cover totally different areas. We may mention here that such was also the argument of the ld. counsel for the assessee. 5. We have considered the facts of the case and rival submissions. The ld. counsel has sought to defend the order of CIT(Appeals) as a respondent by taking the plea that the order of penalty was barred by limitation. Such a plea was not taken before the learned CIT(Appeals). It was inter-alia argued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an exception and not to abrogate a part of the main provision. Thus, the plea of the ld. counsel is not acceptable in view of the aforesaid settled rule of statutory interpretation. Thus, the only meaning which can be placed on the proviso is that in a case where the assessment proceeding come to an end with the order of the learned CIT(Appeals), then, the outer limit of passing the order will be one year from the end of the financial year in which the order of the learned CIT(Appeals) was received; and in cases where the matter is carried further in appeal to the Tribunal, the time limit shall be six months from the end of the month in which the order of the Tribunal is received by the Commissioner. Thus, it is held that the order of penalty was passed within the time prescribed by the statute u/s 275(1)(a). 5.1 The learned counsel further took a plea that the AO did not raise the charge of concealment of income or furnishing inaccurate particulars of income in assessment or penalty proceedings. On perusal of the assessment order, it is found that it is mentioned therein that penalty proceedings u/s 271(1)(c) are initiated separately. Similarly, in the penalty order, it is specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 53,000/- and his statement of affairs show that the whole of balance brought forward from earlier years, for which there is no evidence, was more or less gifted to the assessee. In the past, he made only minor gifts on ceremonial occasions but no occasion was shown for making gift to the assessee. In the case of Shri Raju Sharma, it is seen that his total income was about ₹ 53,000/- and in this case also almost the whole of opening balance as on 1.4.2001 was gifted away to the assessee. In the context of these facts, the findings of the Tribunal in the quantum appeal become relevant in which it was mentioned that the financial capacity of the donor, occasion for making the gift, relationship between the donor and the donee and the human probabilities for making the gift, as alleged, become of importance. Therefore, if the evidence filed is such that it is not believable even in a prima facie manner, the alleged amount of gift can be taken to be income even without making any detailed enquiry into the evidence. For the sake of ready reference, paragraphs 12 and 13 of the order of the Tribunal are reproduced below:- "12. From the principles laid down in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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