Case Law Details
Kishor A. Sewani Vs ITO (ITAT Ahmedabad)
We have heard the rival contentions and perused the materials available on record. In the present case, the assessee has shown sundry creditors of Rs. 8,20,652 as on 31-3-2011. The assessee failed to furnish the present current address of the parties to the assessing officer during the assessment proceedings. Therefore, the same was treated by the assessing officer as bogus. Accordingly, the addition was made to the total income of the assessee.
However, the Assessee during the assessment proceedings claimed to have accepted the addition made by the assessing officer to avoid the litigation, arrive at the amicable solution with the department and buy the peace of mind. Therefore, it cannot be held as the assessee has furnished inaccurate particulars of income or concealed the particulars of income. However, the view taken by the assessing officer was subsequently confirmed by the learned Commissioner (Appeals).
Now the issue before us arises for adjudication so as together whether the penalty needs to be sustained in the hands of the assessee in the given facts and circumstances. It is an undisputed fact that assessment and penalty proceedings are independent and different from each other. If there is any difference between the incomes declared by the assessee or income assessed during the proceedings cannot result in the concealment of income/furnishing inaccurate particulars of income.
The assessee has duly disclosed the sundry creditors in its books of accounts, which were not verified during the assessment proceedings for want of present address. But that does not mean that the assessee has concealed the particulars of income or furnished inaccurate particulars of income. The impugned sundry creditors are arising from the purchases which have not been disturbed by the lower authorities. It implies that the lower authorities have accepted the purchases but corresponding creditors have been added to the total income of the assessee for want of the address. In our considered view the addition on account of sundry creditors arising out of purchases cannot be added without disturbing the corresponding purchases.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
