IN INCOME TAX APPELLATE TRIBUNAL D BENCH, MUMBAI BEFORE SHRI MAHAVIR SINGH, JM AND SHRI RAJESH KUMAR, AM I.T.A. No.2540/Mum/2014 (Assessment Years : 2009-10) Shri Qamriddom Kazi, Income Tax Officer 3/45, Vanrai, 23(3)(2), Vishvakarma Nagar, Vs. Pratyaksha Kar Bhavan, Vishvakarma Marg, BKC, Bandra (E), Mulund West, Mumbai-400051 Mumbai-400080 PAN :AADPK9828P Assessee by Shri Haresh Shah Revenue by Ms.Surabhi Sharma Date of Hearing : 14.9.2016 Date of Pronouncement : 14.10.2016 O R D E R PER RAJESH KUMAR, AM This is appeal filed by assessee challenging order dated 4.3.2014 passed by ld.CIT(A)-33, Mumbai confirming action of AO in imposing penalty u/s 271(1)( c) of Income Tax Act, 1961 amounting to Rs.9,59,736/-which pertains to assessment year 2009-10. 2. issue raised in grounds of appeal is with respect to confirmation of penalty of Rs.9,59,736/- as imposed by AO under section 271(1)( c ) of 2 ITA No.2540/Mum/2014 Act. issue raised in ground no.2 is against violation of principle of natural justice. 3. Facts of case are that assessee filed his return of income on 4.9.2009 declaring income of Rs.11,72,862/-. assessment was completed u/s 143(3) vide order dated 21.12.2011 assessing total income at Rs.40,90,260/- as against returned income of Rs.11,72,862/- by making addition of Rs.28,23,582/- on account of capital introduced which as per AO assessee could not furnish any documents supporting /evidencing introduction of capital. assessee submitted before AO that said amount was received on sale of agricultural land situated in native place of assessee and assessee s share came to Rs.28,23,582/- necessary documents proving sale of land could not be furnished by assessee as there was dispute between parties who were shareholders in ancestral land and did not co-operate. Ultimately, assessee agreed for addition of Rs.28,23,582/- in order to buy peace of mind and assessment was framed accordingly. During course of penalty proceedings, assessee submitted that he has not furnished any inaccurate particulars of income or concealed any such income which was fully disclosed in income tax return filed with department. However, AO not finding reply of assessee convincing imposed penalty of Rs.9,59,756/- 100% of tax sought to be evaded vide order dated 22.6.2012 passed under section 271(1)( c) of Act. Before, 3 ITA No.2540/Mum/2014 FAA, ld. CIT(A) also dismissed appeal of assessee by holding that surrender of concealed income which were in guise of capital introduced by not giving correct facts and thus filed inaccurate particulars of income. 4. We have heard rival contentions and perused material placed before us including orders of authorities below. We find that assessee has shown capital introduced to tune of Rs.28,23,582/- in capital account which was stated to be received on account of sale of agricultural land in native place of assessee. share of assessee was shown as capital introduced in balancesheet. We also find that assessee could not produce any documentary evidence of sale of ancestral land and share of assessee was to tune of Rs.28,23,582/- which was disclosed in balance sheet filed before authorities below. Before us, ld. AR vehemently submitted that he has fully disclosed all facts of income in income tax return filed by assessee however could not produce documents or evidences to support his contention with regard to sale of land due to family dispute as party in possession of sale document of property did not co-operate and accordingly, documents could not be produced. Now, before us, ld. AR vehemently argued that he is willing to produce all relevant documents before authorities below and requested for restoration of matter to file of AO. We find that in penalty proceedings, unless and until concealment or furnishing of inaccurate 4 ITA No.2540/Mum/2014 particulars of income is established, penalty proceedings u/s 271(1)(c) could not be invoked. stand of assessee in verbatim before us as it were before lower authorities but for want of documentary evidence could not be verified. We, therefore, are of considered view that ends of justice would be met if assessee is given one more opportunity to furnish document to prove his case. Accordingly, we restore matter back to file of AO with direction to decide issue afresh after verification of facts as to sale of ancestral land of assessee and assessee is also directed to produce necessary documents before AO to decide issue as per law and facts as narrated before us. appeal filed by assessee stands allowed for statistical purposes. 5. In result, appeal of assessee is allowed for statistical purposes. Order pronounced in open court on 14.10.2016. Sd sd (MAHAVIR SINGH ) (RAJESH KUMAR) Judicial Member Accountant Member Mumbai; Dated :14.10.2016 Sr.PS:SRL: 5 ITA No.2540/Mum/2014 Copy of Order forwarded to : 1. Appellant 2. Respondent 3. CIT(A) 4. CIT concerned 5. DR, ITAT, Mumbai 6. Guard File BY ORDER, True copy (Dy./Asstt. Registrar) ITAT, Mumbai Qamriddom Kazi v. Income Tax Officer 23(3)(2), Mumbai