- (1.) The delay in refiling the appeal is condoned. This appeal has been preferred by the assessee under section 260A of the Income-tax Act, 1961 (in short, "the Act"), against the order dated August 27, 2013, annexure A.22 passed by the Income-tax Appellate Tribunal, Chandigarh Bench "A" (in short, "the Tribunal") in I.T.A. No. 725/Chd/2011 for the assessment year 2007-08, claiming the following substantial questions of law : "(i) Whether, under the facts and in the circumstances of the case, the penalty proceedings under section 271(1)(c) are distinct from the quantum proceedings under section 143(3), thus requiring independent examination and appreciation of material facts containing material particulars on the merits thereof? (ii) Whether, under the facts and in the circumstances of the case and on consideration of the additional evidences, the admission thereof for case adjudication is necessarily to be examined?"
(2.) A few facts relevant for the decision of the controversy involved as narrated in the appeal may be noticed. The business of jewellery is being carried by the HUF under the name and style of Nikka Mal Babu Ram (JJ group) and the constitution of the group is, namely, Nikka Mal Babu Ram and Sons controlled by Shri Kamal Kant Jain and his son, Mandeep Jain; Nikka Mal Babu Ram and Sons (the Jewellery Arcade) run by Akhil Jain and Smt. Pooja Jain and Nikka Mal Babu Ram and Sons 0J group) by the appellant, Jawahar Jain (HUF), and other coparcener, Rohit Jain, Neeraj Jain (Sons), proprietary concern of the appellant (HUF). The appellant was covered by action of search under section 132 of the Act on October 27, 2006. A consignment of gold belonging to the appellant being stock in trade (business asset) was received at the residence No. 67, Sector 8, Chandigarh, on October 26, 2006. The trading account dated October 27, 2006, at annexure A.2 was required to be prepared by the appellant during the search proceedings qua the value of stock of gold, diamond which had been valued by the respondent-Department. Surrender of Rs. 2.50 crores was made attributable to cash found, i.e., Rs. 50 lakhs, excess gold Rs. 75.34 lakhs, excess diamond (stock) Rs. 1.20 crores in the statement made under section 132(4) of the Act on October 30, 2006. Thereafter, jurisdiction over the appellant was transferred to the Deputy Commissioner of Income-tax (DCIT), Central Circle I, Chandigarh, under section 127 of the Act through order being effective from February 9, 2007, as a consequence of search. The assessment proceedings were initiated on June 24, 2007, through issuance of notice under section 142(1) of the Act for the preceding six years, namely, with effect from the assessment year 2001-02 onwards. Notice under section 153A of the Act was issued requiring the assessee for filing the return of income in consequence of the search proceedings. In pursuance thereof, return of income dated July 31, 2007, was filed at Rs. 1,06,48,173 containing the amount from regular sources of income amounting to Rs. 48,27,928 and the balance amount of Rs. 58,20,245 attributable to the discrepancies found and after reconciling with the corroborative material facts containing material particulars. A questionnaire was issued on June 4, 2008, to the assessee asking for reasons for variance of the declaration made being Rs. 2.50 crores whereas charged to tax was Rs. 58 lakhs. Written submissions were furnished by the appellant on December 26, 2006, submitting that chargeability was in consonance with the declaration made before the ADI conducting search proceedings. The appellant further submitted the written submissions before the respondent- Director of Investigation to the effect that having made reconciliation with corroborative material and on adopting the respondent-Department's valuation report dated November 8, 2006, at Rs. 5,25,94,746, the difference came to Rs. 57 lakhs qua diamond jewellery. Subsequently, the revised return of income was filed on December 2, 2008, declaring an income of Rs. 2,98,41,628 which included the amount of Rs. 48,41,628 from the regular sources of income and additionally Rs. 2.50 crores attributable for the discrepancies for the purpose of settling the controversy but the said return had been treated as non est being beyond the permitted period under section 139(5) of the Act which ended on March 31, 2008. The assessment was completed under section 143(3) read with section 153A of the Act on December 30, 2008, annexure A.13. The aforesaid assessment order was accepted and the tax was paid on December 8, 2008, annexure A-14 without having challenged the same in the appellate proceedings before the Commissioner of Income-tax (Appeals) ("the CIT (A)''), the Tribunal, etc. Penalty proceedings under section 271(1)(c) of the Act were initiated through notice issued on December 30, 2008, annexure A.15, Written submissions were furnished by the assessee. After examining the matter, penalty under section 271(i)(c) was levied on June 23, 2009, annexure A.18 at Rs. 67,75,500. The said order was challenged before the Commissioner of Income-tax (Appeals) by the assessee. Vide order dated May 26, 2011, annexure A.20, the Commissioner of Income-tax (Appeals) dismissed the appeal Still not satisfied, the assessee filed an appeal before the Tribunal and prayer was made for admitting the additional evidences under rule 29 of the Income-tax (Appellate Tribunal) Rules,1963. Vide order dated August 27, 2013, annexure A.22, the Tribunal dismissed the appeal, upholding the levy of penalty under section 271(1)(c) of the Act and rejecting the prayer for admission of additional evidences. Hence, the instant appeal by the assessee.
(3.) We have heard learned counsel for the appellant and perused the record.;