Dr. K.l. Batra, Chandigarh v. Commissioner Of Income Tax, Patiala

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH I.T.R. Nos. 107 to 109 of 1999Date of Decision:-08.01.2015 Dr. K.L. Batra, Chandigarh ...Petitioner Versus Commissioner of Income Tax, Patiala ...Respondent CORAM: HON'BLE MR. JUSTICE HEMANT GUPTAHON'BLE MR. JUSTICE HARI PAL VERMA Present:-Mr. Akshay Bhan, Senior Advocate with Mr. Aalok Mittal, Advocate for the petitioner. Ms. Urvashi Dhugga, Advocate For the respondent. HEMANT GUPTA J.(Oral) This order shall dispose of Income Tax Reference Nos.107 to109 of 1999 referred to this Court under Section 256(2) of the Income TaxAct, 1961 (for short 'the Act') arising out of the order passed by the IncomeTax Appellate Tribunal, Chandigarh Bench, Chandigarh (for short 'theTribunal') on 24.12.1997 pertaining to assessment years 1979-80, 1980-81and 1981-82 raising the following substantial question of law:- “Whether in the facts and circumstances of thecase, the Tribunal was right in holding that theAssessee was liable to penalty under Section 271(1)(c) of the Income Tax Act, 1961 for the Assessment Years 1979-1980 to 1981-1982?” The facts in brief are that the assessee after filing its originalreturn, submitted revised return after survey operation was conducted on11.8.1988. In the revised return, the assessee revised his income. Afterthe assessment was framed, proceedings under Section 271(1)(c) of theAct were initiated for imposing of penalty for furnishing inaccurateparticulars of income. The assessee sought to justify the claim of household expenses and of professional income but admitted unexplainedinvestment in the agricultural land. After considering the replies filed, theAssessing Officer levied different amount of penalties in the threeassessment years on 31.7.1992. Separate appeals against the order ofpenalty imposed by the Assessing Officer were partly allowed by theCommissioner of Income Tax (Appeals) on 1.10.1992. The orders inappeal set aside the levy of penalty on account of house hold expensesbecause the addition has been made on estimated basis without pointingout as to any item of expenditure which the assessee has failed to disclose.The amount of penalty in respect of addition on account of professionalincome was set aside following the decision of the Tribunal in theassessee’s own case pertaining to assessment year beginning 1982-83ending with 1988-89 vide order dated 15.6.1992. However, the penalty on account of investment in the agriculturalland was maintained for the reason that the assessee has not been able totender any evidence at any stage of the proceedings to explain orsubstantiate the investment. In fact, the counsel representing theassessee admitted that unexplained investment in agricultural land would involve penalty under Section 271(1)(c) of the Act. The amount of penalty in respect of additions on amount ofprofessional income and house hold has been set aside by theCommissioner of Income Tax (Appeals) and maintained by the Tribunal. Itis only the penalty on the amount of investment in the agricultural land,which has been maintained. The learned Tribunal has recorded a findingthat even before the Tribunal in the penalty proceedings; the counselexpressed his inability to produce any evidence to explain the investmentsin the agricultural land. Since there is no explanation in respect ofinvestment in the agricultural land at any stage of the proceedings,therefore, the finding recorded by the Tribunal upholding the levy of penaltyto such extent cannot be said to be raising any substantial question of lawfor consideration of this Court. Thus, the question of law is answered in affirmative against theassessee. ( HEMANT GUPTA )JUDGE January 08, 2015Vijay Asija ( HARI PAL VERMA )JUDGE