MADRAS HIGH COURT
M/S.KHANDELWAL STEEL & TUBE VS
THE ITO
DATED: 04-06-2018
Summarised Judgement (Scroll for Complete Judgement)
Introduction:
In the Tax Case
(Appeals), the assessee challenges the levy of penalty for the aforesaid two
assessment years and in the Writ Petitions, the assessee questions the order
passed by the Commissioner of Income Tax, refusing to delete the additions made
or in the alternative, the opening balance difference be set off and the
closing stock adjusted for the difference and the income recomputed or in the
alternative to set aside the order of assessment and recompute the correct
income.
Facts of the Case:
A survey was conducted
in the premises of the assessee under Section 133A of the Act, which ultimately
lead to the passing of the assessment order, dated 17.04.2003, wherein the
differences in the balances of four major suppliers of the assessee, were
worked out. The assessee explained that reconciliation of the closing balance
have not been effected and arose on account of the running balance maintained
by the assessee in respect of the transactions with four suppliers as well as
non-examination and the credit notes were not considered. It is further
submitted that since the assessee wanted to purchase peace with the department,
additional income totalling Rs.168,45,190/- was offered vide two revised
returns of income. While so, the assessee received a notice initiating
proceedings for levy of penalty under Section 271(1)(c) of the Act. This
ultimately lead to an order imposing penalty on the assessee, which was
questioned by the assessee by filing appeal. The assessee also filed petition
under Section 264 of the Act for revision of the
assessment
order by contending that the Assessing Authority had not granted any opportunity
to the assessee to reconcile the closing balance and had arbitrarily foisted
allegations of irregularities and deficiencies in the assessee's account that
were factually and
legally untenable and incorrect.
It is further submitted
that the Commissioner of Income Tax proceeded on the basis that it is only on
account of the penalty proceedings, the revision applications were filed and
the main contention raised by the petitioner that additional income offered,
did not represent the reconciled correct figures, after taking into account the
credit note and the running notes in respect of four major suppliers were not
considered. Therefore, It is submitted
that the order passed by the Commissioner rejecting the petition under Section
263 of the Act is erroneous.
Judgement:
Thus,
we find there are no good grounds made out by the assessee to dislodge the
factual findings recorded by the Commissioner in the impugned order under
Section 264 of the Act. Therefore, the Writ Petitions have to necessarily fail.
34.
In the result:-
(i)
Thus, for the above reasons, we find that the order passed by the Tribunal was
perfectly correct and the substantial questions of law framed for
consideration, are answered against the assessee and in favour of the Revenue.
Accordingly, Tax Case Appeals are dismissed.
(ii) We find there are no good grounds made
out by the petitioner to dislodge the factual findings recorded by the
Commissioner in the impugned order under Section 264 of the Act. Therefore, the
Writ Petitions fail and they are dismissed.
(iii)
Consequently, connected Miscellaneous Petitions are closed. No costs.
===========================================
Complete Judgement
MADRAS HIGH COURT
M/S.KHANDELWAL STEEL & TUBE ...
VS THE INCOME TAX OFFICER
DATED: 04-06-2018
Madras
High Court
M/S.Khandelwal
Steel & Tube ... vs The Income Tax Officer
IN
THE HIGH COURT OF JUDICATURE AT MADRAS
Reserved
on: 11.04.2018
Delivered
on: 04.06.2018
CORAM
THE
HONOURABLE MR.JUSTICE T.S.SIVAGNANAM
AND
THE
HONOURABLE MR.JUSTICE N.SESHASAYEE
T.C.
(Appeal).Nos.186 and 187 of 2005 &
TC.M.P.Nos.164
& 165 of 2005
&
W.P.Nos.43110
& 43111 of 2006
T.C.A.Nos.186
& 187 of 2005
M/s.Khandelwal
Steel & Tube Traders
No.81,
Armenian Street,
Chennai
600 001.........................Appellant
in
both the appeals
vs
The
Income Tax Officer,
Ward
IX (3),
No.121,
Nungambakkam High Road,
Chennai
600 034. ............Respondent
In both the appeals
Appeals filed under Section 260A of the Income Tax Act against the order of the
Income Tax Appellate Tribunal Chennai Bench 'A' dated 06.04.2005 made in ITA
No.3167/MDS/2004 and ITA No.3168/MDS/2004.
W.P.Nos.43110 &
43111 of 2006 M/s.Khandelwal Steel & Tube Traders No.81, Armenian Street,
Chennai 600 001. ...Petitioner in both W.Ps.
vs
1.The Income Tax
Officer, Ward IX (3), 4th Floor Kannammai Building, 611, Anna Salai, Chennai
600 006.
2.The Commissioner of
Income Tax, Chennai-VIII, 7th Floor, New Block, 121, Nungambakkam High Road,
Chennai 600 034. ...Respondent in both
W.Ps., COMMON PRAYER:Petitions have been filed Under Article 226 of the
Constitution of India praying for issuance of a Writ of Certiorari, to call for
the records in P.A.No.AAAFK 2820Q, dated 24.03.2006, relating to Assessment
Year 2001-02 & 2002-03 on the file of the second respondent and quash the
same.
For Appellant / :
Mr.G.Baskar
Petitioner
For Respondents : Mr.J.Narayanaswamy
in
W.P.Nos.43110 & 43111/2006
Mr.M.Swaminathan in
T.C.Nos.186 & 187 of 2005
COMMON
JUDGMENT
T.S.SIVAGNANAM.J.,
These Tax Case
(Appeals) have been filed by the Assessee questioning the order passed by the
Income Tax Appellant Tribunal, Bench 'A', Chennai in I.T.A.Nos.3167 &
3168/MDS/2004, for the assessments 2001-02 & 2002-03.
2. W.P.Nos.43110 &
43111 of 2006, have been filed by the assessee, challenging the order passed by
the Commissioner of Income Tax, Chennai-VIII, Chennai, dated 24.03.2006,
rejecting the petitions filed by the assessee under Section 264 of the Income
Tax Act, 1961, (hereinafter referred to as Act) for the assessment years
2001-02 & 2002-03.
3. Tax Case (Appeals)
have been admitted on 28.04.2005, on the following substantial questions of
law:-
1. Whether the Income
Tax Appellate Tribunal is right in law in not cancelling the levy of penalty?
2. Whether the Income
Tax Appellate Tribunal is right in law in not considering the specific grounds
raised by the appellant herein on the leviability of penalty?
3. Whether the Income
Tax Appellate Tribunal was right in confirming the levy of penalty where the
alleged income admittedly is spread over a period of several years?
4. Whether the Income
Tax Appellate Tribunal is right in law in holding that reality would be imposed
notwithstanding that the assessee had agreed to the additions on the specific
understanding that penalty would not be impact?
5. Whether the Income
Tax Appellate Tribunal was right in disposing the appeal and confirming the
levy of penalty in the light of its observation that the validity of the
assessment proceedings could not be challenged in the penalty proceedings, when
a specific contention had been raised regarding the pendency of the revision
petition before the Commissioner?
4. In the Tax Case
(Appeals), the assessee challenges the levy of penalty for the aforesaid two
assessment years and in the Writ Petitions, the assessee questions the order
passed by the Commissioner of Income Tax, refusing to delete the additions made
or in the alternative, the opening balance difference be set off and the
closing stock adjusted for the difference and the income recomputed or in the
alternative to set aside the order of assessment and recompute the correct
income.
5. Mr. G. Baskar,
learned counsel appearing for the assessee submitted that a survey was
conducted in the premises of the assessee under Section 133A of the Act, which
ultimately lead to the passing of the assessment order, dated 17.04.2003,
wherein the differences in the balances of four major suppliers of the
assessee, were worked out. The assessee explained that reconciliation of the
closing balance have not been effected and arose on account of the running
balance maintained by the assessee in respect of the transactions with four
suppliers as well as non-examination and the credit notes were not considered.
It is further submitted that since the assessee wanted to purchase peace with
the department, additional income totalling Rs.168,45,190/- was offered vide
two revised returns of income. While so, the assessee received a notice
initiating proceedings for levy of penalty under Section 271(1)(c) of the Act.
This ultimately lead to an order imposing penalty on the assessee, which was
questioned by the assessee by filing appeal. The assessee also filed petition
under Section 264 of the Act for revision of the assessment order by contending
that the Assessing Authority had not granted any opportunity to the assessee to
reconcile the closing balance and had arbitrarily foisted allegations of
irregularities and deficiencies in the assessee's account that were factually
and legally untenable and incorrect. Further major suppliers of the assessee
are public limited companies and it is inconceivable that a company of stature
of M/s.Tata Iron and Steel Co., would be involved in suppression of materials
supplied to the assessee, as alleged by the respondents. It is further
submitted that the Commissioner of Income Tax proceeded on the basis that it is
only on account of the penalty proceedings, the revision applications were
filed and the main contention raised by the petitioner that additional income
offered, did not represent the reconciled correct figures, after taking into
account the credit note and the running notes in respect of four major
suppliers were not considered. Therefore, It is submitted that the order passed
by the Commissioner rejecting the petition under Section 263 of the Act is
erroneous.
6. With regard to the
levy of penalty, it is submitted that the Tribunal ought to have considered as
to whether the levy of penalty was justified, when the assessee had agreed to
certain additions on the specific contention that the penalty would not be
levied by the department. The Tribunal failed to take into consideration that
when the correctness of the penalty proceedings were considered by the
Tribunal, the revision petition before the Commissioner to revise the
assessment proceedings were pending and the Tribunal was not right in observing
that the validity of the assessment proceedings could not be challenged in a
penalty proceedings. The learned counsel placed reliance on the decision of the
Hon'ble Supreme Court in the case of Distributors (Baroda) P., Ltd., vs. Union
of India & Ors., [(1985) 155 ITR 0120] and submitted that the revision
petition ought to have been considered by the Commissioner in a proper
prospective and the correctness of the assessment proceedings cannot be tested
based upon the reasons in the penalty proceedings thereby, non-suiting the
petitioner before the both forums. Thus, it is submitted that to rectify is
compulsion of judicial conscience. Reliance was placed on the decision of the
Division Bench in the case of Sri Selvamuthukumar vs. Commissioner of Income
Tax, Chennai-VI [2017] 79 Taxmann.com 113 (Madras), to explain the power of the
Commissioner under Section 264 of the Act.
7. Mr.J.Narayanaswamy,
learned Senior Standing counsel appearing for the Revenue in the Writ Petitions
and Mr.M.Swaminathan, learned Senior Standing counsel appearing for the Revenue
in the Tax Case (Appeals), submitted that the Commissioner after taking into
consideration the factual aspects, has given reasons for rejecting the revision
petition and the plea raised by the assessee is unacceptable and reading of the
order passed by the Commissioner as well as the Tribunal would clearly
establish the conduct of the assessee and there is no error in the order.
Further, it is submitted that the levy of penalty under Section 271(1)(c) of the
Act, is proper and valid and mere voluntarily offering additional income after
the survey proceedings will not exonerate the assessee from penalty
proceedings. In support of such contention, reliance was placed on the decision
of the Hon'ble Supreme Court in the case of Mak Data (P) Ltd., vs. Commissioner
of Income Tax-II [(2013) 38 Taxmann.com 448 (SC)].
8. Heard the learned
counsels appearing for the parties and perused the materials placed on record.
9. Firstly, we take up
the Tax Case (Appeals) for consideration. As mentioned above, the appeals have
been filed challenging the order passed by the ITAT, rejecting the assessee's
appeal and confirming the order passed by the Commissioner of Income Tax
(Appeals)-IX, dated 05.11.2004. The assessment for the year 2001-02, was
completed on 17.04.2003, and in the course of assessment proceedings, penalty
notice under Section 274 read with Section 271(1)(c), was issued to the
assessee. The assessment for the year 2002-03 was completed on 17.04.2003, and
in the course of assessment proceedings, penalty notice dated 14.05.2003, was
issued to the assessee. The assessee submitted separate replies to the notices.
10. For the assessment
year 2001-02, the assessee stated the addition made by the Assessing Officer of
Rs.3,19,021/-, represented amount due to two trade creditors, who were reported
to have closed their business and their whereabouts were not known. According
to the assessee, it cannot be safely concluded that the credit balances have
become time barred or not recoverable by the concerned party. Further it was
contended that in view of their voluntarily offering substantial amount for the
assessment year 2002-03, in the wake of survey, the assessee has chosen to
accept the department's proposal to make additions for the assessment year
2001-02, to avoid prolonged litigation and purchase peace. It was further
submitted that the issue is an arguable matter and merely because, the assessee
had agreed for addition, the act of concealment cannot be presumed. For the
penalty notice for the assessment year 2002-03, the assessee stated that the
assessment was completed on 17.04.2003, on the basis of the revised return
filed by them on 12.03.2003 after including the additional income of
Rs.1,68,45,194/-, and this amount has been offered voluntarily in the course of
survey operations. Further, it was stated that the assessee in their letter
dated 10.03.2003, that they are offering the differences in the 4 sundry
creditors cases, as they could not reconcile the same and this was to avoid
protracted litigation and purchase peace. Further, they have stated that there
is no concealment either by suppressing any income or by deliberately
furnishing the inaccurate particulars warranting levy of penalty. The Assessing
Officer among other things held the assessee did not prove the credit balance
in the account of the two concerns and only as a result of this, the assessee
offered Rs.3,19,021/- as income and but for the survey conducted by the
Department, assessee might not have agreed to the addition hence, it cannot be
said the addition was made voluntarily.
11. So far as the
assessment year 2002-03, the Assessing Officer pointed out that whenever
defects were noticed by the Department and put across to the assessee, they
came forward and offered additional income and the additional income was
brought to tax only due to survey operation under Section 133A and on facts, it
cannot be said the assessee voluntarily offered income. Further, it was
observed that no assessee will offer Rs.1.40 crores, unless he is sure that the
department has material to make addition to that extent. Thus, taking into
facts and circumstances of the case levied minimum penalty of Rs.1,25,056/- for
the assessment year 2001-02 and Rs.60,13,733/- for the assessment year 2002-03.
12. The Commissioner of
Income Tax (Appeals) while testing the correctness of this order, held that the
assessee cannot contend that revised returns filed, were not valid and they
having filed the same voluntary. It was further pointed out that the assessee
on the one hand contend that what was found and deducted, can be explained and
the other hand states it has accepted the discrepancies in order to buy peace
with the department and avoid prolonged litigation. Therefore, the CIT (Appeals)
held both the arguments cannot go together. After taking note of certain
decisions, the CIT (Appeals) observed that the quality of evidences deducted
positively justify levy of penalty under Section 271(1)(c), as mens rea has
been fully established with deduction of evidence against the assessee and the
assessee having accepted the same by filing revised returns. Similar reasons
were assigned by the CIT (Appeals) in the appeal against the penalty order for
the assessment year 2002-03.
13. On appeal to the
Tribunal, it was pointed out that the assessee raised three contentions,
namely, (i) return was filed voluntarily, therefore penal action was not
attracted; (ii) the revised return was filed only after an assurance given by
the department that no penalty proceedings will be initiated; (iii) Revenue has
not proved that income was really concealed.
14. On the first
question, the Tribunal took note of the findings during the survey proceedings
and that the actual purchase was inflated and the inflation of purchase was
admitted to the tune of Rs.90,63,508/-, credit balances had been inflated by
the assessee and disclosure of the concealed income after the department has
seized material, cannot be voluntary disclosure, because, it was made under the
constrains of exposure of adverse action by the Department.
15. On the second
issue, the Tribunal held that there was no material to show that there was any
assurance on the part of the revenue, that no penalty will be imposed if the
assessee agrees to offer additional income. Accordingly, the same was rejected.
16. On the third issue,
the assessee contended that the credit balances stood inflated on account of
accumulation of various years and it cannot be said that income belonged to a
particular year, much less the income was concealed. The Tribunal observed that
the assessee cannot challenge the assessment proceeding in a penalty proceeding
and agreed with the stand taken by the department that incriminating material
was found during survey, assessee offered to declare income in particular
years, probably with a view to save interest under Section 234B and at that
same time, the assessee shut further enquiry to be made by the department.
Further, it was pointed out that once the assessee offered additional income,
it was a clear admission of concealed income and therefore, the Revenue was
required to do nothing further. Further, the filing of revised return not being
on account of any inadvertent mistake or omission, the imposition of penalty
would be justified. Further, the assessee did not bring any material to show
that there was inadvertent omission or mistake in the original return. With the
said reasoning and after referring to the decision of the Hon'ble Supreme Court
in the case of K.P.Madhusudhanan vs. CIT [251-ITR-99(SC)], dismissed the
appeals.
17. The learned counsel
appearing for the assessee contended that the CIT (Appeals) as well as the
Tribunal non-suited the assessee, while contesting the penalty proceedings
based on the findings in the assessment proceedings, which was pending in
appeals/revision at the relevant time. It is further submitted that penalty
proceedings is independent of the assessment proceedings and mere fact that the
assessee did not contest the assessment proceedings, will not be a bar for the
assessee to contest the penalty proceedings.
18. The facts of the
case has been set out in a fairly elaborate manner to show the conduct of the
assessee in the proceedings. It is an admitted fact that after the survey
operations, the assessee filed revised returns. The revised returns is deemed
to be a voluntary action of the assessee, as there is nothing on record to show
that for certain other reasons, the assessee had filed revised returns.
Therefore, the Tribunal was justified in rejecting the case of the assessee
stating that because the Revenue assured that the penalty proceedings will not
be initiated, if addition is admitted, therefore, revised return were filed. In
these Appeals, we are required to examine as to whether the requirements under
Section 271(1)(c) have been satisfied.
19. The Hon'ble Supreme
Court in Mak Data (P) Ltd., (supra), pointed out that the Assessing Officer
shall not be carried away by the plea of the assessee like voluntary
disclosure, buy peace, avoid litigation, amicable settlementetc., to explain
away its conduct. It was further pointed out that the question is whether the
assessee has offered any explanation for concealment of particular income of
furnishing inaccurate particulars of income. It was pointed out that
explanation to Section 271(1) raises a presumption of concealment, when a
difference is noticed by the Assessing Officer between the reported and
assessed income. That burden is then on the assessee to show, otherwise, by
cogent and reliable evidence, when the initial onus placed by the explanation,
has been discharged by the assessee, the ownership's is on the revenue to show
that the amount in question constituted the income and not otherwise.
20. In Mak Data, on
facts, it was found that the surrender of income was after deduction was made
by the Assessing Officer in the search conducted in the sister concern of the
assessee. Applying the decision in the case of Mak Data (P) Ltd.,(supra), to
the facts and circumstances of the case, irresistible conclusion to be arrived,
is that the revised returns filed by the assessee, cannot be termed to be
voluntary, as it was done by the assessee after the revenue deducted
non-disclosure inflation of purchases and concealment of income during the
search proceedings.
21. Mr.G.Baskar,
learned counsel counsel for the assessee strenuously contended that the
Tribunal failed to consider as to whether the Department could levy penalty
where the additions pertained to accumulated differences in the closing balances
with reference to the four suppliers and this issue has not been specifically
answered by the Appellate Authority or by the Tribunal. Further, it is
submitted that various other grounds were raised as well as including the one
that there was a specific undertaking given by the Department that no penalty
could be levied and therefore, the assessee agreed to offer income for
assessment.
22. The Tribunal while
approving the view taken by the CIT (A), held that there was specific evidence
in respect of inflation of stock, inflation of purchase, inflation of sundry
creditors, etc, which constitute valid evidence for holding that the assessee
has concealed its income. Further, it was pointed out that the assessee WHEN
confronted with these materials, had accepted the inflation and offered income
for taxation and the assessee had no suitable explanation against the evidences
found during survey.
23. To examine the
correctness of the argument of the learned counsel for the assessee, we perused
the order passed by the CIT (A) and the findings recorded on facts, as the
assessee would persistently state that the closing balances with reference to
four suppliers were not considered. On a perusal of the order passed by the CIT
(A), it is seen that during the course of survey, incriminating evidences
regarding the purchase were found and the statement of the assessee was
recorded. The stock statement showed a negative figure of Rs.13,71,146/- and
there was a difference in closing balances in case of four sundry creditors and
the total difference worked out to Rs.1,68,45,192/ and the assessee accordingly
filed revised return admitting additional income. Thus, during the search,
there was specific evidence on account of stock, on account of purchases,
sundry creditors and closing balances of the stock. The assessee was given an
opportunity to explain and no where rebutted the evidences, which were
recovered during the course of survey. Thus, in the absence of any explanation,
the assessee has come forward by filing revised return. Thus, we are unable to
agree with the stand taken by the learned counsel for the assessee that the
contentions advanced by the assessee were not considered by the CIT (A) or for
that matter the Tribunal.
24. It was argued that
merely by filing a revised return and offering additional income will not by
itself be a ground to levy penalty. This is a broad legal principle, but has to
be applied by taking note of the facts of each case. The assessee has to
satisfy the test that he has a satisfactory explanation regarding such income
offered in the revised return. The explanation as to why there was an omission
or wrong statement in the original return must be due to bona fide inadvertence
or bona fide mistake on the part of the assessee. Even if the assessee agreed
to the addition with a condition that penalty could not be imposed, the
Department is not precluded from initiating penalty proceedings. In the instant
case on facts, it was found that there was no such assurance.
25. Reading of the
order passed by the CIT (A) as confirmed by the Tribunal would clearly show
that the materials, which were recovered during the search proceedings reveal
concealment of income and the assessee agreed for the additions and it would be
too late for the assessee to now state that the authorities are not justified
in levy penalty, especially when the assessee had no satisfactory explanation
as to why he had offered income in the revised return.
26. It is a settled
legal position that the burden is on the assessee to prove non-concealment
against additional income disclosure in the revised return. In the instant
case, no explanation was offered for not having disclosed income earlier. Thus,
for the above reasons, we find that the order passed by the Tribunal was
perfectly correct and the questions of law framed for consideration, are to be
answered against the assessee and in favour of the Revenue.
27. The challenge in
the Writ Petitions is to the order passed by the CIT, rejecting the petition
filed under Section 264 of the Act. For the assessment year 2001-02, the stand
taken by the petitioner was that the addition made in respect of credit
balances appearing in the names of two parties, was not proper in as much as
the said balances are correct, though the parties are not traceable. The
assessee further stated that the difference in closing balance was added as
'income' without proper investigation or verification of the correctness of the
figures. It was further submitted that the difference was treated as purchase
inflation and therefore, closing stock should have been correspondingly
adjusted, which was not done. Further, the amount of Rs.3,19,021/- was offered
to tax to purchase peace with the Department and on assurance that they would
be no liability, interest and penalty.
28. Commissioner of
Income Tax considered the said factual submission and rejected the same as
being erroneous, by taking note of the record of proceedings that addition was
made after the same was offered for taxation by the assessee. Further, the
Commissioner has noted that as per the assessee's own version, the trade
creditors were not traceable. That apart, the Commissioner took note of the
order passed by the ITAT confirming the order of penalty. The submission of the
learned counsel for the assessee is that the revision petition was rejected by
the Commissioner solely for the reason that penalty proceedings were confirmed
by the Tribunal and none of the aspects, which have been pointed out by the
petitioner in the revision petition have been dealt with. We are unable to
persuade ourselves to accept the said contention for the reason that the
Commissioner has taken note of the conduct of the assessee and has come to the
conclusion that the addition was made after the assessee offered the same for
taxation and the assessee also admitted that the said trade creditors are not
traceable. After rendering such a finding, the Commissioner has referred to the
order passed by the ITAT confirming the penalty proceedings. Therefore, the
revision petition for the assessment year 2001-02, was not rejected, solely for
the reason that the ITAT had confirmed the penalty proceedings. Thus, we find
that there are no extraneous circumstances warranting interference on the
factual findings recorded by the Commissioner affirming the findings recorded
by the Assessing Officer for the year 2001-02.
29. With regard to the
assessment year 2002-03, the sum and substance of the contention of the
assessee is that the disclosure of additional income of Rs.1,68,45,194/- does not
represent the correct figure, since final reconciliation was not done. After
taking note of the contentions raised by the petitioner/assessee, the
Commissioner took note of the declaration given by the senior partner of the
petitioner/assessee firm at the time of survey, which was based upon the
documents discovered during the course of survey and the Commissioner rejected
the contention of the assessee that the declaration of additional income was
made in a hurry without proper appreciation of account. It was pointed out that
the additional income of Rs.1.40 crores, was declared during the course of
survey which was further enhanced to Rs.1.68 crores and these figures have been
shown in two revised returns filed by the assessee. In this regard, the letter
given by the senior partner of the assessee firm, dated 10.03.2003, was taken
note of. Thus, factually the Commissioner concluded that the contention of the
assessee that additional income was offered without application of mind was
rejected. In the said order also, the Commissioner has noted that the order
imposing penalty, has been confirmed by the Tribunal.
30. Be it noted that
the assessee had filed two revised returns. In the first revised return, the
assessee offered additional income of Rs.1.40 crores. At that point of time,
the assessee did not take a stand that there was insufficient time or the same
does not represent correct figures etc. Assuming, it was so, then the assessee
had other remedies upon filing a revised return accepting additional income of
Rs.1.40crores. The assessee did not avail any such remedy, but on the contrary
filed a second revised return admitting additional income of Rs.1.68 crores.
31. Thus, the
Commissioner on facts rightly held that the contention of the assessee that
additional income was offered without due application of mind is to be rejected
and the offer made by the assessee was a conscious one.
32. As observed
earlier, though there is an observation regarding the order passed by the ITAT
confirming the penalty proceedings in the Section 264 order, we find that is
not the reason for rejecting the revision petition, but on facts, the
Commissioner has recorded findings and confirmed the order passed by the
Assessing Officer.
33. Thus, we find there
are no good grounds made out by the assessee to dislodge the factual findings
recorded by the Commissioner in the impugned order under Section 264 of the
Act. Therefore, the Writ Petitions have to necessarily fail.
34. In the result:-
(i) Thus, for the above
reasons, we find that the order passed by the Tribunal was perfectly correct
and the substantial questions of law framed for consideration, are answered
against the assessee and in favour of the Revenue. Accordingly, Tax Case
Appeals are dismissed.
(ii) we find there are
no good grounds made out by the petitioner to dislodge the factual findings
recorded by the Commissioner in the impugned order under Section 264 of the
Act. Therefore, the Writ Petitions fail and they are dismissed.
(iii) Consequently,
connected Miscellaneous Petitions are closed. No costs.
Index: Yes/No
To
1. The Income Tax Officer,
Ward IX
(3),
No.121,
Nungambakkam High Road,
Chennai
600 034.
2. The Income Tax Officer,
Ward IX
(3),
4th Floor Kannammai
Building,
611, Anna
Salai,
Chennai 600
006.
3. The Commissioner of Income Tax,
Chennai-VIII,
7th Floor,
New Block,
121,
Nungambakkam High Road,
Chennai 600 034.
T.S.SIVAGNANAM.J.,
&
N.SESHASAYEE.J.,
No comments:
Post a Comment