IN INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH SMC , JAIPUR BEFORE: SHRI SHRI VIJAY PAL RAO, JUDICIAL MEMBER ITA No. 65/JP/2017 Assessment Year : 2006-07. Shri Om Prakash Agarwal, cuke ACIT, C/o Shri O.P. Agrawa, FCA Vs. Circle-3, II & III Floor, H-8, Chitranjan Marg, Jaipur. C-Scheme, Jaipur. PAN No. ABHPA3739J Appellant Respondent Assessee by Shri Manish Agarwal (CA) Revenue by: Smt. Neena Jeph (JCIT) Date of Hearing : 16.09.2019. Date of Pronouncement : 30/09/2019. ORDER PER VIJAY PAL RAO, JM : This appeal by assessee is directed against order dated 13.10.2016 of ld. CIT (Appeals) arising from penalty order passed under section 271(1)(c) of I.T. Act for assessment year 2006-07. assessee has raised following grounds of appeal :- 1. On facts and in circumstances of case ld. CIT (A) has grossly erred in confirming penalty levied u/s 271(1)(c) of IT Act, 1961, ex-parte, without adducing enough opportunities to appellant. Thus, order passed is against natural justice, bad in law and deserves to be quashed. 2. That, ld. CIT (A) has further erred in summarily ignoring explanations given before ld. AO and thereby confirming penalty of Rs. 2,24,438/-. Thus, action of ld. CIT (A) deserves to be held bad in law and penalty u/s 271(1)(c) deserves to be deleted. 2 ITA No. 65/JP/2017 Shri Om Prakash Agarwal, Jaipur. 3. That appellant craves right to add, delete, amend or abandon any of grounds of this appeal at time or before actual hearing of case. 2. At time of hearing, ld. A/R of assessee has stated at Bar that assessee does not press ground no. 1 of appeal and same may be dismissed as not pressed. ld. D/R has raised no objection if ground no. 1 of assessee s appeal is dismissed as not pressed. Accordingly, ground no. 1 of assessee s appeal is dismissed being not pressed. Ground no. 2 is regarding levy of penalty under section 271(1)(c) of IT Act which was confirmed by ld. CIT (A). 3. assessee is Individual and proprietor of M/s. Om Construction Company which is engaged in business of contract activity for BSNL such as manual digging and Horizontal Direction Drilling and lying of telephone cable. In scrutiny assessment, AO made various additions/disallowances amounting to Rs. 22,60,831/-. ld. CIT (A) deleted most of additions made by AO except amount of Rs. 6,66,781/- which was not pressed by assessee in respect of contract receipts inadvertently not included in gross receipts declared for year. AO initiated penalty proceedings under section 271(1)(c) and levied penalty of Rs. 2,24,438/- against said addition of Rs. 6,66,781/- which was conceded by assessee in quantum proceedings. assessee challenged action of AO before ld. CIT (A) but could not succeed. 4. Before Tribunal, ld. A/R of assessee has submitted that even in quantum proceedings assessee has explained reasons for not including 3 ITA No. 65/JP/2017 Shri Om Prakash Agarwal, Jaipur. said amount in gross contract receipts due to bonafide and inadvertent mistake. ld. A/R has submitted that entire contract receipts was received from BSNL and subjected to TDS. Therefore, there was no question of concealment of said amount. Even otherwise, details of said receipts were available with department as it was subjected to TDS. When assessee realized his mistake of not including said amount in gross receipts in Profit & Loss account, it was conceded before ld. CIT (A). There was no willful suppression of fact by assessee but it is genuine mistake and omission on part of assessee. ld. A/R has pointed out that AO has noticed this amount only from TDS certificates filed by assessee with return of income which show total contract receipts for year under consideration. Hence ld. A/R has pleaded that bonafide mistake which was corrected by assessee by accepting same in assessment proceedings cannot be construed as furnishing of inaccurate particulars of income or concealment of income. In support of his contention he has relied upon decision of Delhi Benches of Tribunal dated 03.03.2016 in case of B.L. International vs. ACIT in ITA No. 1590/Del/2014. 5. On other hand, ld. D/R has submitted that conduct of assessee is not cooperative as assessee has not appeared before ld. CIT (A) despite 11 opportunities were given. It is clear case of concealment of income as assessee has not shown contract receipts either in books of account or in return of income. She has relied upon orders of authorities below. 4 ITA No. 65/JP/2017 Shri Om Prakash Agarwal, Jaipur. 6. I have considered rival submissions as well as relevant material on record. AO has made addition of Rs. 6,66,781/- by giving details of contract receipts and TDS in assessment order as under :- A. During assessment proceeding it was noted that assessee has shown gross receipts of contract rs. 5,69,87,392/-. During going through contract receipt account in ledger, total of receipts is also of same as under :- Particulars Contract receipts TDS BSNL Jaipur 2,84,99,630 6,45,854 BSNL Jallandhar 2,35,56,026 5,04,570 BSNL Delhi 26,87,977 61,415 BSNL Lucknow 22,43,759 50,349 Total : 5,69,87,392 12,62,188 While with return of income assessee has enclosed five TDS certificates which include certificates from above four parties and from GMTD jodhpur showing payment of Rs. 6,66,781/- and TDS there upon of Rs. 15,003/-. assessee has shown these receipts neither in return of income nor in book of accounts. It is noted that amount of TDS of Rs. 15,003/- has been claimed by assessee. Thus it is clear that assessee has reported total contract receipts of Rs. 5,69,87,392/- and all were subjected to TDS. It is also not in dispute that entire contract receipts were received from BSNL Office. amount of Rs. 6,66,781/- as received from GMTD Jodhpur was detected by AO from TDS certificate filed by assessee. Thus it is clear that only from record produced by assessee, AO noticed this discrepancy of Rs. 6,66,781/- not part of contract 5 ITA No. 65/JP/2017 Shri Om Prakash Agarwal, Jaipur. receipts reported by assessee. accounts of assessee are liable for audit as it is clear from assessment order that audit report under section 44AB was filed by assessee. Therefore, it is apparent that even auditor could not detect this mistake of not including contract receipt of Rs. 6,66,781/- whereas TDS on said receipt was duly reported by assessee. Thus in facts and circumstances of case, when assessee reported contract receipts of Rs. 5,69,87,392/- and only one receipt of Rs. 6,66,781/- was remained unrecorded, then explanation of assessee that this happened only because of inadvertent and bonafide mistake cannot be disbelieved. Therefore, assessee explained that it is not willful suppression but due to genuine mistake and omission this amount was not included in total contract receipts. This is otherwise only about 1% of total contract receipts and, therefore, having regard to peculiar facts and circumstances when entire receipt is subjected to TDS and received from BSNL, it cannot be held to be case of concealment or suppression of contract receipts. Accordingly, explanation of assessee falls in ambit of reasonable and bonafide explanation as per provisions of section 273B of Act and consequently penalty levied under section 271(1)(c) is deleted. 7. In result, appeal of assessee is allowed. Order is pronounced in open court on 30/09/2019. Sd/- (VIJAY PAL RAO) Judicial Member Jaipur Dated:- 30/09/2019. Das/ 6 ITA No. 65/JP/2017 Shri Om Prakash Agarwal, Jaipur. Copy of order forwarded to: 1. Appellant- Shri Om Prakash Agarwal, Jaipur. 2. Respondent ACIT Circle-3, Jaipur. 3. CIT(A). 4. CIT, 5. DR, ITAT, Jaipur 6. Guard File (ITA No. 65/JP/2017) By order, Assistant. Registrar Om Prakash Agarwal v. ACIT, Circle-3, Jaipur