RAKESH KALIA Vs. ITO

JUDGEMENT

(1.) THESE appeals of the assessed are directed against the orders of the Commissioner (Appeals) on quantum as well as on penalty under section 271(1)(c) for the assessment year 1992 -93.

(2.) THE assessed in this case derived income from salary, meeting fee and consultancy. On scrutiny of the details of the documents filed along with the return of income, the assessing officer found that during the year the assessed made a deposit of Rs. 2,55,000 with M/s Melloon Engineers (P) Ltd. The assessed explained that the said amount was received from the NRE account during the Immunity Scheme, 1991, and declaration under the remittance in Foreign Exchange Scheme, 1991, duly verified and issued under the stamp and signature of the Bank Manager, State Bank of India, Race Course Road, Bangalore was also annexed with the return of income. In order to verify the genuineness of the declaration, a reference was made to the State Bank of India, Race Course Road, Bangalore, and in confirmation the Chief Manager confirmed that a demand draft bearing No. 768737, dated 26 -1 -1992 was issued the bank for the (sic) said sum. But it was also verified by them that the fund had come from resident depositor's account rather than from NRE account. The assessing officer, Therefore, held that the amount represented the concealed income of the assessed and assessed the same accordingly. He also initiated penalty proceedings under section 271(1)(c) of the Act.

(3.) AGGRIEVED by the said order, the assessed took up the matter in appeal before the Commissioner (Appeals). The learned Commissioner (Appeals), however, upheld the order of the assessing officer on the reasoning that the assessed cannot claim immunity as the case of the assessed is not applicable to the Immunity Scheme declared by the Government. It was further found by him that the claim of gift from the person who initially gave the amount to the assessed cannot be accepted because the identity of the donor was never proved and no gift -tax return was filed. He accordingly upheld the addition and also the penalty imposed by the assessing officer.