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TMI Blog2024 (4) TMI 1055X X X X Extracts X X X X X X X X Extracts X X X X ..... ect of addition on account of contractual receipts - mismatch between the Revenue recognized by the assessee and the amount reflecting in Form 26AS - HELD THAT:- As the explanation given by the assessee on account of the possible cause of mismatch between the Revenue recognized by the assessee and the amount reflecting in Form 26AS, looking into the fact that the mismatch was only of a meagre amount of Rs. 1,05,827/- against the total contractual receipts of Rs. 2,14,08,976/- shown by the assessee as his contractual receipts, we are of the considered view that this is not a fit case for levy of penalty u/s 271(1)(c) of the Act Apparently the assessee has no mala fide intention to conceal the Revenue or furnish inaccurate particulars of his Revenue. In the result, levy of penalty with respect to addition on account of contractual receipts is hereby directed to be deleted. Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... utting forth his argument with respect to levy of penalty under Section 271(1)(c) of the Act in respect of two additions, which were subsequently confirmed by the Ld. CIT(A). 5. In view of the submissions of the Ld. Counsel of the assessee before us, the appeal of the assessee with respect to quantum additions (ITA No. 84/Rjt/2018) is being dismissed as not pressed. 6. Now we shall discuss the assessee's appeal with respect to levy of penalty under Section 271(1)(c) of the Act, in respect of two additions which were confirmed by Ld. CIT(A). Levy of penalty on account of purchase of agricultural land. 7. The brief facts in relation to this ground of appeal are that during the course of assessment proceedings, the Assessing Officer observed that the assessee had purchased agricultural land worth Rs. 2,00,500/-. The assessee could not explain the source of this investment and agreed for an addition of Rs. 2,00,500/-. The Assessing Officer added an amount of Rs. 2,00,500/- to the income of the assessee and also initiated penalty proceedings under Section 271(1)(c) of the Act for furnishing inaccurate particulars of income and thereby concealment of income. 8. In quantum appeal, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ten submission is that the payment of purchase of agricultural land was made from the cash balance at that point of time. As per the appellant this agricultural land was clearly shown in the books of account as well as in the audit report. Surprisingly the appellant failed to attend the office of the Assessing Officer during the course of penalty proceedings in response to show cause notice of the Assessing Officer and no any explanation was made before the Assessing Officer and no any written submission was also filed. Thus the appellant has failed to explain the sources of investment as made in purchase of land either at the time of assessment proceedings or at the time of penalty proceedings. Even at appellate stage a/so appellant could not substantiate this claim i.e. the payment for agriculture land was made from the cash balance which was available at that point of time before the CIT(A). Considering these facts, it can be said that the appellant has filed inaccurate particulars of income so far as levy of penalty u/s 271(1)(c) of the Act on this addition of Rs. 200500/- is concerned and therefore this levy of penalty of appeal 2,00,500 as levied by the AO u/s 271(1)(C) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in relation to this ground of appeal are that the assessee has shown total income of Rs. 2,14,08,976/- in the books of accounts, whereas in Form 26AS, the income of the assessee was reflecting at a figure of Rs. 2,15,15,062/-. 15. During the course of assessment proceedings, the assessee failed to provide explanation on this issue and he agreed for addition of the aforesaid amount to his income. As per the Assessing Officer, since the assessee failed to provide any plausible explanation, penalty under Section 271(1)(c) of the Act was also imposed on the assessee for furnishing inaccurate particulars of income. 16. In appeal before CIT(A), against the imposition of penalty under Section 271(1)(c) of the Act, the assessee submitted that this difference of Rs. 1,05,827/- is essentially on account of accounting practices followed by the assessee with respect to recognition of Revenue. The assessee submitted that as per the accounting practices followed by the assessee, the revenue / amounts are booked only when the assessee gets bills approved from the contractee / customers. Therefore, there may be some instances where bills are placed before the customers which have not been appro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssions which were made by the assessee before Ld. CIT(A). 20. In response, Ld. D.R. placed reliance on the observations made by the Ld. CIT(A) in the appellate order. 21. We have heard the rival contentions and perused the material on record. On going through the facts of the instant case, the totality of circumstances, the explanation given by the assessee on account of the possible cause of mismatch between the Revenue recognized by the assessee and the amount reflecting in Form 26AS, looking into the fact that the mismatch was only of a meagre amount of Rs. 1,05,827/- against the total contractual receipts of Rs. 2,14,08,976/- shown by the assessee as his contractual receipts, we are of the considered view that this is not a fit case for levy of penalty under Section 271(1)(c) of the Act. From the facts placed on record, apparently the assessee has no mala fide intention to conceal the Revenue or furnish inaccurate particulars of his Revenue. In the result, levy of penalty with respect to addition on account of contractual receipts is hereby directed to be deleted. 22. In the result, the appeal of the assessee is allowed in ITA No. 62/Rjt/2019. 23. In the combined result, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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