The Commissioner Of Income Tax – Iii, Pune v. Shri Rakesh Devichand Nibjiya, Pune

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1826 OF 2009 The Commissioner of Income Tax – III, PuneVersus Shri Rakesh Devichand Nibjiya, Pune ..Appellant. ..Respondent. Mr.Vimal Gupta for the appellant.Mr.S.N. Inamdar for the respondent. CORAM : Dr.D.Y. Chandrachud & J.P. Devadhar, JJ. DATE : 8 June, 2010. P.C. : 1.The only issue involved in this appeal by the Revenue, which is pressed during the course of the submissions relates to the order of the Income Tax Appellate Tribunal in so far as it restricts the penalty under Section 271(1)(c) to the extent of Rs.8,78,512/-. The dispute relates to the assessment year 2002-2003. The assessee filed a return on 31 October 2002 of an income of Rs.17,06,870/-. On 12 February 2003, a survey took place. A diary was impounded. The assessee voluntarily declared an unaccounted income of Rs.40,00,000/-. On 25 March 2003, the assessee filed a revised return of Rs.57,06,870/- which was accepted. Penalty proceedings were initiated under Section 271(1)(c) and a penalty was imposed on the total unaccounted income of Rs.40,00,000/- declared by the assessee. 2.The Tribunal by the impugned order has restricted the extent of the penalty to 100% on the amount of Rs.8,78,512/- which is reflected in the diary which was impounded during the course of the survey. The Tribunal has observed that the diary which was impounded contained particulars relating to the aforesaid amount of Rs.8,78,512/-. The income of Rs.40,00,000/- was voluntarily declared by the assessee and was not as such supported by any incriminating material revealed during the survey. 3.The Court has been informed that the entire tax as well as the penalty imposed by the Tribunal have been paid. We are of the view that the Tribunal has upon considering all the circumstances of the case exercised its judicial discretion to restrict the amount of penalty to the figure of Rs.8,78,512/- which was disclosed in the diary which was impounded during the course of the survey. The Tribunal having found the explanation of the assessee to be reasonable and since the Tribunal has taken a possible view, it would not be appropriate for this Court to entertain the appeal particularly since no substantial question of law would arise. In the circumstances, the appeal is dismissed. There shall be no order as to costs.