Mobile View
Main Search Advanced Search Disclaimer
Cites 1 docs
The Income- Tax Act, 1995

View the actual judgment from court
User Queries
Income Tax Appellate Tribunal - Pune
Sh.Shantilal N Lodha (Huf),, Pune vs Assessee on 25 September, 2012
                                           1


             IN THE INCOME TAX APPELLATE TRIBUNAL
                       PUNE BENCH "B", PUNE

           Before Shri Shailendra Kumar Yadav Judicial Member
                 and Shri R.K. Panda Accountant Member

                             ITA NO. 1324/PN/2010
                           (Assessment Year 2004-05)

Shri Shantilal N. Lodha (HUF),
134/3-4, Raunak Residency,
Mayur Colony, Kothrud,
Pune - 411 029.                                            ..     Appellant
PAN No.AAAHL 9538G
                                          Vs.
Deputy Commissioner of Income Tax,
Central Circle 1(1), Pune.                                 ..     Respondent

      Assessee by                     :         Sri Sunil Ganoo
      Department by                   :         Sri Rajiv Harit
      Date of Hearing                 :         25-09-2012
      Date of Pronouncement           :         30-10-2012

                                     ORDER

PER R.K. PANDA, AM :

This appeal filed by the assessee is directed against the order dated 28-01- 2010 of the CIT(A)-I, Pune relating to Assessment Year 2004-05.

2. Facts of the case, in brief, are that during a search conducted u/s.132 of the Act on 15-06-2001 in the case of Sri Shantilal N. Lodha certain records pertaining to the HUF were found and seized. In response to notice u/s.153C issued by the AO on 05-01-2007 the assessee filed return of income of the HUF on 27-02-2007 disclosing taxable income of Rs.10,18,290/-. During the course of assessment proceedings the AO noted that Page Nos. 15 and 16 of the seized record contains expenditure of Rs.97,198/- paid to PMC towards road development and compromise expenses. Since during the course of search the assessee had admitted that the payment has been made out of the unaccounted income and offered to pay tax the AO made addition of Rs.97,198/- and determined the total income at Rs.11,15,488/-.

2

2.1 Subsequently the AO initiated penalty proceedings u/s.271(1)(c) of the Income Tax Act, 1961. He AO noted that the assessee had filed return on 25-11- 2004 disclosing taxable income of Rs.5,68,287/- and in response to the notice u/s.153C it had filed the return disclosing taxable income of Rs.10,18,290/-. As against the returned income of Rs.5,68,287/- the income was assessed at Rs.11,15,488/-. Despite repeated opportunities granted the assessee neither appeared before the AO nor filed any submission against the notice issued u/s.274 r.w.s.271(1)(c). The AO therefore levied penalty of Rs.1,95,025/- being the minimum penalty leviable @100% of tax on concealed income.

3. Before CIT(A) it was submitted that the assessee had submitted his original return of income on 08-11-2004 disclosing the net taxable income of Rs.10,18,290/- vide Ack No. 403 for A.Y. 2004-05 which was treated as return filed u/s.139(4) of I.T. Act. Subsequently the assessee filed a revised return of income on 12-01-2007 disclosing the net taxable income of Rs.10,18,290/- vide Ack No.418 u/s.153C consequent to I.T. search proceedings for A.Y. 2004-05. It was claimed that in between the above said two returns the assessee through oversight had filed a return declaring income of Rs.5,68,290/- vide Ack No.418 dated 25-11-2004 which was later withdrawn vide assessee's letter dated 06-12- 2004. It was contended that since the original return was not filed within the statutory time u/s.139(1) the said original return cannot be revised u/s.139(5) of I.T. Act and therefore, the return filed on 25-11-2004 was an invalid and non-est return in terms of provisions of I.T. Act and accordingly liable to be ignored. It was submitted that the AO had made small addition of Rs.97,198/- to the returned income and the income declared in the original return filed on 08-11-2004 and last return on 12-01-2007 in response to notice u/s.153C is same at Rs.10,18,290/- and there is no difference of income between the first and last return. It was submitted that the AO has passed the impugned penalty order levying penalty of 3 Rs.1,96,000/- u/s.271(1)(c) of I.T. Act on the basis of I.T return filed on 25-11- 2004 and 12-01-2007 by ignoring the original return filed on 08-11-2004. It was argued that since the return filed on 25-11-2004 was not valid and was non-est, therefore, the penalty levied on the basis of such non-est return is not sustainable. In support of the above proposition the decision of the Pune Bench of the Tribunal in the case of Income Tax Officer Vs. Smt. Santosh P Pipada vide ITA No.725/PN/2000 was relied upon wherein the ITAT has deleted the penalty on the ground of invalidity of the assessment.

3.1 So far as the penalty levied on the addition of Rs.97,198/- is concerned it was submitted that the same was wrongly added to the returned income exclusively on assumption basis without verification of the books of accounts and without considering the fact that cash payment of Rs.97,198/- to Municipal Corporation has already been reflected in the books of account. It was pointed out that the AO has added Rs.97,198/- by not accepting the submission of the assessee and the Assessing Officer has not recorded his satisfaction on concealment of income or furnishing of any inaccurate particulars of income by the assessee in Assessment order.

4. However, the CIT(A) was not satisfied with the explanation given by the assessee. He noted that the assessee has filed its return of income on 25-11-2004 vide receipt No. 00418 admitting the total income of Rs.5,68,837/- and claimed refund of Rs.1,84,150/-. Subsequently, in response to notice u/s.153C, assessee filed another return on 12-01-2007 declaring total income of Rs.10,18,290/- which includes the aforesaid WIP of Rs.4,50,000/-. Since the WIP of Rs.4,50,000/- was not considered in the return of income filed on 25-11-2004, the Assessing Officer levied penalty on the additional income of Rs.4,50,000/- admitted in the return filed in response to notice under sec.153C and the unexplained expenditure of 4 Rs.97,198/- considered in the assessment order. But during the appellate proceedings the assessee filed copy of another return claimed to have been filed on 08-11-2004 declaring total income of Rs.10,18,837/-. According to the assessee, this return was not taken into cognizance by the Assessing Officer while levying the impugned penalty and the second return filed on 25-11-2004 is an invalid return and non-est in the eyes of law as the original return was filed belatedly on 08-11-2004. The argument of the assessee that a belated return filed u/s.139(4) cannot be revised u/s.139(5) and therefore penalty levied on the basis of income declared in such invalid return is ab-initio void and that the assessee had filed a letter dated 06-12-2004 before the Assessing Officer to ignore the return filed on 25-11-2004 was not accepted by him. He observed that the return of income purported to have been filed on 08-11-2004 and also the letter dated 06-12-2004 came to the fore for the first time during the appellate proceedings. There was no reference or finding in the assessment order or penalty order about the first return claimed to have been filed by the assessee on 08-11-2004. Similarly, there was no mention of the letter dated 06-12-2004 either in the assessment order or penalty order or the statement of facts filed by the assessee along with appeal. On the contrary, it is stated at Col.No.12 of the return that it is the 'original return' but in the copy of the return filed now, the word 'original' is scored out. 4.1 According to learned CIT(A) if the assessee had already filed the return of income on 08-11-2004 as claimed by him admitting the income at Rs.10,18,287/- including the said WIP of Rs.4,50,000/-, there was no necessity for the assessee to state in the computation of total income filed with the return furnished on 12-01- 2007 in response to notice u/s.153C that it is the 'revised' computation of total income and income of Rs.4,50,000/- was declared in WIP under sec.153C. According to Ld. CIT(A), if there is no change in the income declared as per the return claimed to have been filed on 08-11-2004 and the return filed in response to 5 notice u/s.153C this fact would have been mentioned in the return filed on 12-01- 2007 and the assessee would not have mentioned 'revised' in the subsequent return. Therefore, the return filed on 25-11-2004 clearly stating as 'original' return is a valid return u/s.139(4). In any case, the assessee has not paid advance tax on the income admitted prior to the search operation and this clearly shows that the intention was not to disclose the income but for the search and seizure operation carried out in the case of the assessee. It appears that the computerised books of accounts were prepared after the search operations and the work-in-progress was shown in the said statements. The fact that a return was filed on 25-11-2004 excluding the WIP of Rs.4,50,000/- and claiming refund also demonstrate that the intention of the assessee was not to admit the additional income and such filing of return claiming refund of cash seized and adjusted against tax liability of the assessee cannot be said to be of bonafide mistake. It is only after the issue of notice u/s.153C that the assessee admitted the said income in the return filed on 12- 01-2007 clearly stating 'income declared in W.I.P. u/s.153C. But for the issue of notice u/c.153C and scrutiny of return of income the additional income would have gone unnoticed.

4.2 So far as the addition of Rs.97,198/- on account of payment made in cash to PMC is concerned the CIT(A) noted that the assessee has categorically stated vide his answer to Question No.18 of the statement on 17-06-2004 that the expenses were not recorded in the regular books of accounts and the same constitutes unrecorded/unaccounted expenditure of the assessee. But subsequently the assessee incorporated the said cash entries in the computerised accounts prepared after the search operations and made the claim as an afterthought that the expenditure was recorded in the regular books of accounts. Since the amounts were paid in cash, the claim of the assessee that these cash transactions were intended to be recorded in the regular books of accounts is not amenable to independent verification. The 6 very fact that the assessee has not preferred appeal against the quantum addition made in the assessment order clearly shows that the explanation now furnished by the assessee is only an afterthought and the Assessing Officer is justified in drawing the inference that the assessee furnished inaccurate particulars of income. 4.3 He further observed that the declaration of income made u/s.132(4) was not admitted in the return filed after the search and thus the assessee has not adhered to the declaration made u/s.132(4) in respect of work-in-progress and the unexplained expenditure. The assessee has also not specified the manner in which such income representing W.I.P and unexplained expenditure has been derived. Therefore, assessee is not entitled to benefit of immunity provided under Explanation 5 for the declaration made u/s.132(4) for the year under appeal. The subsequent act of admission in respect of W.I.P. of Rs.4,50,000/- in the return filed in response to notice issued u/s.153C is not at all voluntary having regard to return of income filed on 25-11-2004 and does not absolve the assessee of penal consequences u/s.271(1)(c).

5. Distinguishing the various decisions relied on by the assessee and relying on the decision of Hon'ble Supreme Court in the case of Dharmendra Textile Processors Ltd. reported in 306 ITR 277 he upheld the penalty levied by the AO u/s.271(1)(c) of the Income Tax Act.

5.1 Aggrieved with such order of the CIT(A) the assessee is in appeal before us with the following grounds :

"1. In the facts and circumstances of the case and in law, the learned CIT(A) has erred in confirming the penalty of Rs.1,96,000/- u/s.271(1)(c) of I.T. Act for the A.Y. 2004-05 wrongly levied by the learned Assessing Officer and the said penalty may please be deleted.
2. The CIT(Appeal) has erred by not appraising the fact that, the appellant has submitted his original return of income on 08-11-2004 disclosing the net taxable income of Rs.10,18,290/- vide Ack No.403 for A.Y. 2004-05. Later on the appellant has filed his revised return of income on 12-01-2007 disclosing the net taxable income of 7 Rs.10,18,290- vide Ack No. 37 u/s.153C consequent to I.T. search proceedings for A.Y.2004-05.
3. The AO has wrongly made the small addition of Rs.97,198/- to the revised return of income for development charges paid to PMC, inspire of the fact that the said amount/expenditure has already been reflected in the regular books of accounts."

6. The learned counsel for the assessee reiterated the same submissions as made before the CIT(A). Referring to the copy of the letter addressed to the AO on 21-01-2008 (Paper Book Page Nos. 36 to 38) he submitted that it was categorically written to the AO that the original return filed on 08-11-2004 was not within the statutory time and therefore the subsequent return filed through oversight on 25-11-2004 is an invalid and non-est for Income Tax Assessment. It was accordingly requested that the return filed through oversight on 25-11-2004 be ignored and may not be considered for the purpose of Income Tax. 6.1 As regards the objection of the learned CIT(A) that the Acknowledgement Number in the receipt is hand written as against Printed Number, therefore, the same is doubtful, he submitted that the assessee had filed copies of returns in the case of various family members. Similar hand written numbers are there in all these returns and on the basis of these returns assessments have been completed by the AO u/s.153A(b) r.w.s. 143(3). Referring to Page 5 of the Paper Book he drew the attention of the Bench to the letter addressed to the CIT Central on 08-11-2004 in which the assessee had requested to adjust the cash found against the self assessment tax for various assessment years. He submitted that tax was paid on the income of Rs.10,18,290/- and the return was filed on 08-11-2004. The observation of the learned CIT(A) that no self assessment tax was paid is erroneous since the assessee has paid an amount of Rs.1,00,000/- on 07-07-2004, a copy of which is placed at Paper Book Page No.4.

6.2 As regards the observation of the CIT(A) that there are certain mistakes in the return filed on 25-11-2004 since the word "original" was not striked and 8 therefore that is the original return, he submitted that it was not the case of the lower authorities that the assessee has never filed the return on 08-11-2004. Referring to the decision of the Pune Bench of the Tribunal in the case of Santosh P. Pipada he submitted that the case is squarely covered in favour of the assessee and at best penalty can be levied on the addition of Rs.97,198/- and not on the work in progress amounting to Rs.4,50,000/-.

7. The learned DR on the other hand heavily relied on the order of the CIT(A). Referring to Page No.1 of the Paper Book he submitted that the assessee on the top of the return has mentioned "return filed u/s.153A(b)". Clause 12 of the said return shows that it is a revised return. In the copy of the acknowledgement placed at Page No.7 the entire clause 12 has been crossed, therefore, it raises a doubt regarding the authenticity of the return filed on 08-11-2004. No plea of filing of original return was filed before the AO. There is no such reference in the assessment order regarding adjustment of tax. All these points show that the conduct of the assessee is not above board. Therefore, the CIT(A) was justified in confirming the penalty levied by the AO.

8. The learned counsel for the assessee in his rejoinder submitted that in connected cases the learned DR was directed to verify the Return receipt register to find out whether the returns in the case of other family members were filed or not. However, despite such opportunity given, the learned DR was unable to verify the same. Since assessments have been completed u/s.153A(b) r.w.s.143(3) on the basis of returns filed by various family members and since return filed by the assessee on 08-11-2004 was in between, therefore, the assessee has conclusively proved beyond doubt that the first return was filed on 08-11-2004. He further submitted that despite a direction by the Bench the learned DR was unable to produce the entire case records of the department since the order sheet was not 9 available and the various correspondences made by the assessee to the Assessing Officer are also not available in the records filed by the department. Relying on various decisions he submitted that the penalty levied by the AO and upheld by the CIT(A) should be deleted.

9. We have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the Paper Book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find in the instant case penalty has been levied on account of 2 items, i.e. suppression of work in progress Rs.4,50,000/- and amount paid to PMC towards road development not accounted in the books of account of Rs.97.198/-. We find during the penalty proceedings the assessee did not appear before the AO nor filed any submission for which the AO levied penalty of Rs.1,95,025/-. We find before the CIT(A) it was submitted that the assessee had filed the return of income on 08- 11-2004 vide Acknowledgement No.403 disclosing net taxable income of Rs.10,18,290/- which included the amount for Rs.4,50,000/-. The assessee filed a revised return on 25-11-2004 disclosing the returned income at Rs.5,68,290/- vide Acknowledgement No.418, dated 25-11-2004 which was later withdrawn by the assessee vide letter dated 06-12-2004 on the ground that the first return filed was a belated return and therefore the same is non-est. In response to notice u/s.153C the assessee filed a return on 12-01-2007 disclosing returned income at Rs.10,18,290/-. There being no difference between the first return filed on 08-11-2004 and the return filed in response to notice u/s.153C on 12-01-2007, therefore, there is no concealment of income and therefore no penalty is leviable on account of work in progress of Rs.4,50,000/-. We find the learned CIT(A) did not agree with the above contention of the assessee on the ground that no such plea was taken before the AO and this argument has come for the first time before the appeal proceedings. He further noted that in the return filed on 25-11-2004 there are 10 certain mistakes such as column No.12 of the return is crossed and in the return filed on 08-11-2004 Column No.12 shows the same to be revised return. According to the learned CIT(A) the assessee has not paid any self assessment tax on the returned income of Rs.10,18,290/- filed on 08-11-2004, therefore, conduct of the assessee does not appear to be bonafide. So far as the addition of Rs.97,198/- is concerned he noted that the assessee during the course of search had himself admitted that payment has been done out of unaccounted income and offered to pay the tax. Therefore, the assessee has concealed the particulars of income and AO was justified in levying penalty.

10. We find the assessee vide letter dated 21-01-2008 had made a request to the AO to drop the penalty proceedings wherein it was categorically mentioned that the original return was filed on 08-11-2004 which is not within the statutory time and the assessee subsequently through oversight had filed another return on 25-11- 2004. For the sake of convenience the letter addressed by the assessee to the AO is reproduced as under :

Shantilal N. Lodha (HUF) 134/B+4, Raunak Residency, Mayur Colony, Kothrud, Pune 411 029.

Date : 21-01-2008 To The Dy. Commissioner of Income Tax, Central Circle 1(1), Income Tax Office, PMT Building, Swargate, Pune.

Sir, Subject : Request to drop the penalty proceeding for penalty u/s.271(1)(c) of I.T. Act, 1961 for A.Y. 2004-05. Kindly refer your notice for penalty proceedings u/s.274 RWS 271(1)(c) of I.T. Act for A.Y. 2004-05 and we wish to submit the following facts in support of our request to drop the penalty proceeding for penalty initiated u/s.271(1)(c) of I.T. Act 1961 for A.Y. 2004-05.

We have filed our original return of income declaring the net taxable income of Rs.10,18,290/- vide Ack.No.403, dated 08-11-2004. Xerox of I.T. return Ack, is enclosed herewith for your kind perusal. Later on, after receipt of notice u/s.153C of I.T. Act, we have submitted revised return declaring the net taxable income of Rs.10,18,290/- vide Ack No.37 dated 12-01-2007 and thus there is no difference between the income in original return of income and revised return of income. Xerox of I.T. Ack are enclosed herewith for your kind perusal. 11 In between the above said two returns, through oversight we have submitted a return of income on 25-11-2004 declaring the income of Rs.5,68,290/-. However, immediately after filing this return, we have voluntarily given a letter dated 06-12-2004 for withdrawal of said return wrongly filed through oversight. Xerox of said letter is enclosed herewith. It is pertinent to note that, the letter of withdrawal has been submitted voluntarily and before any notice and before filing the revised return u/s.153C of I.T. Act.

We wish to draw you kind attention to the fact that, the original return filed on 08-11-2004 is not within the statutory time and therefore the subsequent return filed through oversight on 25-11-2004 even if for movement assumed as a revised return u/s.139(5) of I.T. Act, the return filed shall be invalid and non-est for income tax assessment. Therefore the IT return filed through oversight on 25-11-2004 may please be ignored and may not be considered for the purpose of Income Tax Assessment.

Further it is pertinent to note that, the assessment order for A.Y. 2004-05 did not contained any reference of return filed through oversight on 25-11-2004 since it has been entirely ignored as explained above. We wish to draw your kind attention to the fact, that the income assessed as per AO was Rs.1,11,54,888/- as against the income declared Rs.10,18,220/- in original as well as revised return of income. Thus your honour shall appreciate that, there is extremely small difference of Rs.97,198/- which as added by AO in assessment order. Further the addition of Rs.97,198/- made by the AO was towards cash payment to Municipal Corporation as discussed in assessment order. We wish to draw your kind attention to the fact that, the payment of Rs.97,198/- to Municipal Corporation has already been reflected in the regular computerized books of accounts. It is pertinent to note that, we did not acted deliberately in defiance of Law neither guilty of conduct, contumacious or dishonest nor acted in conscious disregard to its obligation. We have cooperated to the assessment proceeding. There is no conscious breach of law. We did not conceal any income or facts and neither furnished any inaccurate particulars of income. It is appreciate to note that, your honour did not find any concealment during the course of assessment proceeding. We wish to draw your kind attention to the following various judgments wherein the Hon. SC/HC/ITAT has depleted/dropped penalty u/s.271(1)(c) of Income Tax Act. In case of the Hindustan Steel Ltd. Vs. State of Orissa (1972) 63 ITR 26 (SC) wherein Hon SC has held that, no penalty shall be levied in case of technical breach, were the breach flows from bonafide belief that the offered is not liable to Act in the manner prescribed by the statute.

It is pertinent to note that, we have already paid the entire tax/assessment dues along with interest u/s.234B &C. Your Honour shall appreciate that, the levy of penalty in addition to above said tax/interest will certainly have overburdened and grate hardship cause of natural justice to an honest tax payers. Looking to the above facts and circumstances, we request your honour kindly drop the penalty proceeding initiated for penalty u/s.271(1)(c) of the I.T. Act 1961 for A.Y. 2004-05. Kindly do the needful & oblige, Thanking You, Yours faithfully, Shantilal Lodha (HUF) (Shantilal Lodha) Karta/Manager Encl:As above

11. We find the assessee vide letter dated 06-12-2004 addressed to the AO had made a request to grant permission for withdrawal of Income Tax return filed through oversight for A.Y. 2004-05 vide Acknowledgement No.418, the contents of the letter are reproduced as under :

12

Shantilal N. Lodha (HUF) 134/B+4, Raunak Residency, Mayur Colony, Kothrud, Pune 411 029.

Date : 06-12-2004 To The Dy. Commissioner of Income Tax, Central Circle 1(1), Income Tax Office, PMT Building, Swargate, Pune.

Sir, Subject : Request to grant the permission for withdrawal of I.T. Return filed through oversight for A.Y. 2004/05 vide Ack No. 418 dated 25/11/2004.

Kindly note that, through oversight we have filed the I.T. Return for A.Y. 2004/05 vide Ack No. 418 dated 25/11/2004. It is pertinent to note that, the above said return has been filed through oversight and inadvertently and therefore we request your honour kindly ignore it and grant us permission for withdrawal of said return. We wish to draw your kind attention to the fact that, we have filed voluntarily and without any notice the original return declaring the higher net taxable income of Rs.10,18,290/- for A.Y. 2004/05 vide Ack No.403 dated 08/11/2004 and accordingly we wish to assess ourselves exclusively on the basis of return filed on 08/11/2004. Further we wish to draw your kind attention to the fact that, the original return filed on 08/11/2004 is not within the statutory time and therefore the subsequent return filed through oversight on 25/11/2004 even if for movement assumed as a revised return u/s.139(5) of I.T. Act, the return filed shall be invalid and non-est for income tax assessment.

Therefore the IT return filed through oversight on 25/11/2004 may please be ignored and may please be allowed to withdraw.

Looking to the above facts and circumstances, we request your honour kindly grant us permission for withdrawal of I.T. Return filed through oversight for A.Y. 2004/05 on 25/11/2004. Kindly do the needful & oblige, Thanking you, Yours Faithfully, Shantilal Lodha (HUF) Sd/-

(Shantilal Lodha) Karta/Manager

12. During the course of hearing before the Tribunal, the learned DR was directed to produce the records of the department in the penalty proceedings. However, the records produced were not complete. There was neither any order sheet nor copies of the letters filed by the assessee before the AO although these letters bear the stamp of the office of the AO. We further find although returns of other family members filed on the same day bearing hand written receipt numbers have subsequently been assessed by the AO in orders passed u/s.153A(b) r.w.s. 143(3), however, the return filed by the assessee on 08-11-2004 does not bear any 13 mention in the assessment order. Similarly we find the assessee vide letter dated 08-11-2004 addressed to the CIT with copy to the Additional CIT had requested for adjustment of the seized cash towards self assessment tax payable for A.Y. 2000-01 to 2004-05 in the case of the HUF and for A.Y. 2004-05 in the case of the individual. The assessee has also paid an amount of Rs.1,00,000/- as self assessment tax on 07-07-2004 in the case of the HUF for the A.Y. 2004-05. All these above facts show that a return declaring income of Rs.10,18,290/- was filed on 08-11-2004 although the same was u/s.139(4). The letters filed by the assessee before the AO could not be proved to be false or untrue by the department. Under these circumstances, we find some force in the submission of the learned counsel for the assessee that since the amount of Rs.4,50,000/- was declared in the original return filed, therefore no penalty is leviable. We accordingly set aside the order of the Ld. CIT(A) on this issue and direct the AO to delete the penalty levied on the amount of Rs.4,50,000/- on account of work in progress.

13. So far as the penalty levied on the amount of Rs.97,198/- we find the assessee during the course of search had himself admitted that the payment has been done out of the unaccounted income and offered to pay the tax. Therefore, levy of penalty on the above amount of Rs.97,198/-, in our opinion, has to be upheld. In this view of the matter, we set aside the order of the CIT(A) and direct the AO to restrict the levy of penalty on the concealed income of Rs.97,198/- and not on the income of Rs.5,47,198/-. We hold and direct accordingly. The grounds raised by the assessee are accordingly partly allowed.

14. In the result, the appeal filed by the assessee is partly allowed.

Pronounced in the open court on this the 30th day of October 2012.

         Sd/-                                                   Sd/-
 (SHAILENDRA KUMAR YADAV)                                   (R.K. PANDA)
 JUDICIAL MEMBER                                       ACCOUNTANT MEMBER
Pune Dated: the 30th October 2012
Satish
                                            14



Copy of the order forwarded to :
              1.      Assessee
              2.      Department
              3.      CIT(A)-I, Pune
              4.      The D.R, "B" Pune Bench
              5.      Guard File


                                                     By order

// True Copy //
                                                 Senior Private Secretary
                                                ITAT, Pune Benches, Pune