Case Law Details
Brief of the Case
In the case of Ms. Chaurasia & Sons. Vs. I.T.O the Hon’ble Kolkata ITAT held that mere confirmation of addition will not lead to conclusion that penalty is leviable, unless it is established that assessee has concealed its income. The assessee’s representative conceding the evasion of tax is of no consequence because assessee cannot be made to suffer for the wrong advice of counsel.
Facts of the Case
The assessee had filed its return of income showing total income of Rs.29,660/-. The assessment was completed under section 143(3) at Rs.40,70,677/-, which was revised to Rs.7,28,100/- after ld. CIT(A) order. Tribunal had set aside the order of ld. CIT(A) and directed to verify the claim of assessee in regard to the difference of stock found during the course of survey by personally examining Shri Kailash Nath Chaurasia, who was proprietor of Kailash Trading Co. dealing in the same products and also of the assessee M/s. Chaurasia & Sons, claimed as owner of the stock found in the factory of the assessee-firm. The Tribunal also directed to collect the affidavit of the claimant in this regard. Consequently summons under section 131 was served upon Shri Kailash Nath Chaurasia for personal examination.
After personal examination and verification of accounts and other documents produced it emerged that the assessee firm and Shri Kailash Nath Chaurasia run their business from two different places and their stocks were also kept in two different premises. Further, Shri Kailash Nath Chaurasia was just a petty businessman delivering good from door to door on his bicycle and that he does not have the financial capabilities to maintain such huge amount of stock. They also failed to submit any affidavit in connection to the claim of stock which totally violated the direction given by Hon’ble ITAT.
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