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TMI Blog2016 (9) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... Per Shri K. Narasimha Chary, JM: This appeal by revenue is arising out of order of CIT(A)-XXXVI, Kolkata vide appeal No. 69/CIT(A)-XXXVI/Kol/Wd.55(4)/2012-13/663 dated 31.07.2013. Assessment was framed by ITO, Ward-55(4), Kolkata u/s. 143(3) of the Income tax Act, 1961 (hereinafter referred to as the Act ) for AY 2009-10 vide his order dated 23.12.2011. Penalty imposed by ITO, Wd-55(4), Kolkata u/s. 271(1)(c) of the Act vide his order dated 21.06.2012. 2. Brief facts of the case are that the assessee is an individual having multiple sources of the income. The assessee during the FY received a sum of ₹ 73,77,914/- from M/s. Grasim Industries Ltd. on 11.06.2009 i.e. during FY 2008-09 relevant to AY 2009-10. Tax deduction of ₹ 9,39,238/- was made from the said commission payment by Grasim Industries Ltd. in the year 2008-09 corresponding to AY 2009-10. As per the mercantile system of accounting, the assessee should have included this income in the relevant assessment year but under the mistaken impression on actual receipt basis they have included the same in the income of next year. However, on coming to know of this lapse, the assessee claims to have filed a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the lapse was detected by the AO and having no other option the assessee declared the same, as such, the mere plea of the assessee that the income was calculated on cash basis is not suffice to drop the penalty proceedings. According to the Ld. DR, u/s. 271(1)(c) of the Act it is not the mere concealment but furnishing of inaccurate particulars of income, which would also attract penal proceedings and for this purpose, mens rea is not an essential ingredient. He further submitted that the Act of the assessee for omitting this particular item of income in the original return but declaring the same only in the revised computation after being confronted with the same amounts tantamount to furnishing inaccurate particulars or concealment of income and for these reasons, the conclusion reached by the CIT(A) are not at all acceptable. According to Ld. CIT(A), deterency is one of the modes of enforcement of law without which it will not be possible for the revenue to implement the provisions of the Act and to obtain the desired results. For these reasons, he prayed before us to hold want of bona fides on the part of the assessee and to restore the penalty imposed by the AO. 5. On th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. CIT(A) has called for the record relating to AY 2009-10 and 2010-11 for verification and on verification he recorded a finding that the record corroborates the contention of the assessee that the commission amount of ₹ 73,77,914/- was received in June, 2009, it ought to have been shown in the FY 2008-09 on accrual basis but it was shown in the next year on cash basis. On this verification, the Ld. CIT(A) opined that it is a case of showing the income in the subsequent year due to the receipt of the same during the subsequent FY and certainly it is a bona fide mistake. The Ld. CIT(A) also found that since the assessee rectified the mistake voluntarily offering the income in the AY 2009-10 and not challenging the addition made by the AO in appeal, a lenient view is to be taken and accordingly, deleted the penalty. 10. We find that the assessee by making an additional disclosure of income of ₹ 73,77,914/- for the Asst Years 2009-10 before any detection by the department in order to meet the deficiencies, if any, on the outflows of the assessee, had sought to genuinely rectify the omission or misdeed which had been made in the original disclosure statement u/s 132(4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use at that stage there is no such concealment. It disappeared by an action of the Assessing Officer. In this case the assessee has no doubt did not show the amounts received as alleged gifts as his income,but no details of loans are given in the return nor any other particulars thereof given by the assessee at that stage, not to speak of inaccurate one. When the assessment was taken up and a general enquiry was made by the Assessing Officer requiring him to furnish details of any loans / gifts, if any, the assessee offered the amounts received as alleged gifts as his income and before it could be detection by the Assessing Officer. There was thus no concealment of the particulars of his income nor there remained furnishing of any inaccurate particulars of his income. It vanished before it could be detected. 21. The correct and accurate disclosure may be by filing the revised return or by furnishing the particulars of such income before the detection by the Assessing Officer. The mere fact that the assessee had not revised the returns or that the offer was by letter to avoid harassment to the assessee and the donors who were non-resident persons, it cannot convert an offer to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same in the returned income, it has to be taken as a voluntary offer to tax. On the face of the evidence in the shape of confirmation letters, bank accounts, passport etc., in the hands of the assessee, it might be valid gift that would have convinced a reasonably minded person, specially a person exercising a judicial function. The accepted position of law is that merely because an assessee had agreed to the assessment that cannot bring in automatic levy of penalty. 25. The facts and circumstances and the merits of the case and the cogent evidences placed on record are such as to exonerate the assessee from concealment penalty. The CIT(A) in my opinion is right in deleting the penalty, his order is affirmed and the appeals of the revenue are dismissed. We find that this Delhi Tribunal decision (i.e Prem Chand Garg case) has been considered and approved by the Jurisdictional High Court in the case of CIT vs Ramesh Chand Goyal in G.A.No. 2347 of 2010 in ITAT No. 181 of 2010 dated 11.8.2010 while adjudicating the impugned issue. 11. It is a judicially acknowledged fact that the tax laws of this country are complex and complicated and often requires for complianc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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