IN INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JUDICIAL MEMBER And SHRI O.P. MEENA, ACCOUNTANT MEMBER ITA No. 753/Ind/2015 A.Y. 2009-10 M/s. Jila Sahkari Kendriya Bank Mydt., Shajapur PAN AAAAJ 0112 B :: Appellant Vs Addl. CIT, Range-2, Ujjain :: Respondent Assessee by Shri Y.K. Bhargav Respondent by Shri Mohd. Javed Date of hearing 24.8.2016 Date of 03.10.2016 pronouncement O R D E R PER SHRI D.T. GARASIA, JM This appeal is filed by assessee challenging order dated 01.9.2015 of ld. CIT(A)-Ujjain, regarding issue of imposition of penalty u/s 271(1)(c) of I.T. Act. 2. Short facts of case are that assessee is District Co-operative Bank. return of income declaring total income of Rs.9,38,29,300/- was filed on 30.9.2009. Assessing Officer : ^ < /d E / z made addition of Rs.12,92,691/- on account of entries in suspense account and Rs.20 lacs on account of gratuity fund. addition on account of entries in suspense account amounting to Rs.12,92,691/- was confirmed by ld. CIT(A)- Ujjain and ITAT, Indore. Assessing Officer imposed penalty at Rs.4 lacs u/s 271(1)(c) of I.T. Act on confirmed addition of Rs.12,92,691/-. 3. Matter carried to ld. CIT(A) who upheld action of Assessing Officer. ld. CIT(A) noted that quantum addition has been confirmed by ld. CIT(A) as well as ITAT, Indore. Had case has not been scrutinised u/s 143(3) and same has not been pointed out by Assessing Officer during course of assessment proceedings, amount of Rs.12,92,269/- would have been escaped from taxation. Unless and until assessee substantiates explanation and proves that such explanation was bona fide, addition made to income shall be deemed to represent concealed income and as such, assessee would be liable for penalty u/s 271(1)(c) of I.T. Act. It is now established law that presumption would not stand rebutted merely by furnishing any general or unreasonable explanation by assessee. explanation should be based on : ^ < /d E / z cogent and relevant material and should be accepted to authorities. full and true disclosure of income is primary obligation of assessee. Ld. CIT(A) also placed reliance on decisions namely, CIT vs. Gurbachan Lal, 250 ITR 157 (Del); Viswaramma Industries vs. CIT, 135 ITR 652 (P & H); CIT vs. K.P. Madhusudan, 246 ITR 218 (Ker); Sushil Kumar Sharad Kumar, 232 ITR 588 (All) etc. In view of these facts, ld. CIT(A) held that it is evident that assessee had deliberately and intentionally not disclosed true and correct income and had concealed particulars of income with intention to evade tax. Hence, Assessing Officer has rightly imposed penalty u/s 271(1)(c) of I.T. Act. Being aggrieved, assessee is before us. 4. Before us, ld. Counsel for assessee reiterated submissions made before Revenue Authorities and submitted that major portion of controversial entries in suspense account pertain to assessment year 2006-07 and deduction u/s 80P was available to cooperative banks till assessment year 2006-07. Hence, there is no reason why mens rea would exist as income of bank was practically non-taxable. Therefore, penalty should have not been imposed/confirmed by : ^ < /d E / z Assessing Officer/ld. CIT(A). On other hand, ld. DR relied upon orders of Revenue Authorities. 5. We have heard rival contentions of both parties and perused material available on record. So far as contention of ld. CIT(A) that explanation should be bona fide based on cogent and relevant material and full and true disclosure of income is primary obligation of assessee and presumption would not stand rebutted merely by furnishing any general or unreasonable explanation by assessee is concerned, we find that in present case, controversial entries are of nature that out of prudence with regard to doubtful receipts, assessee credited same to suspense account and major portion of same relate to assessment year 2006-07 or before, when deduction u/s 80P was available to assessee. Amendment was made w.e.f. 1.4.2007 i.e. assessment year 2007- 08. Therefore, there is no reason why mens rea or guilty mind would exist as income of bank was practically non- taxable. Further, we find that controversial entries have been disclosed by assessee in its own books of accounts and final accounts, particularly in balance-sheet. This is not case that assessee has hidden entries and has not : ^ < /d E / z recorded in books of accounts. Therefore, assessee had been able to meet out contention of ld. CIT(A). cases relied upon by ld. CIT(A) are not applicable to present facts narrated hereinabove as same are clearly distinguishable on facts. Assessing Officer also levied penalty just for purpose of levying penalty as Assessing Officer imposed penalty merely confirmation of quantum addition and no speaking discussion has been made in penalty order. Thus, Revenue Authorities failed to appreciate these facts and levied/sustained penalty. Thus, looking to these facts and circumstances, we are of view that for bona fide mistake and that there was no motive for assessee for deliberately concealing or furnishing inaccurate particulars of income in present case, penalty does not deserve to be confirmed. Accordingly, we delete penalty. 6. Finally, appeal filed by assessee is allowed. Order was pronounced in open Court on 03.10.2016. Sd/- Sd/- (O.P. MEENA) (D.T. GARASIA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 03.10.2016 M/s. Jila Sahkari Kendriya Bank Mydt. v. Addl. CIT, Range-2, Ujjain