IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH ‘A’: NEW DELHI
(Through Video Conferencing)

BEFORE,
SHRI G.S. PANNU, VICE PRESIDENT

AND
SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER

I.T.A No.7861/Del/2017
(ASSESSMENT YEAR 2012-13)

Dy. CIT Sh. Anurag Dalmia
Central Circle-26, 2nd Floor,
New Delhi.
Vs. Indraprakash Building
(Appellant) 21, Barakhamba Road,
New Delhi.

PAN-AADPD 9439P
(Respondent)

I.T.A No.7862/Del/2017
(ASSESSMENT YEAR 2012-13)

Asst. CIT Sh. Anurag Dalmia
Central Circle-26, 2nd Floor,
New Delhi.
Vs. Indraprakash Building
(Appellant) 21, Barakhamba Road,
New Delhi.

PAN-AADPD 9439P
(Respondent)

Appellant By Sh. V.K. Bindal, CA

Mrs. Rinki Sharma, CA

Respondent by Sh. Prakash Dubey, Sr. DR

Date of Hearing 14.01.2021

Date of Pronouncement 13.04.2021
2 ITA Nos.7861 & 7862 /Del/2017

DCIT vs. Anurag Dalmia

ORDER
PER SUDHANSHU SRIVASTAVA, JM:

Both the appeals are preferred by the Department. ITA
No.7861/Del/2017 is the Department’s appeal against the
quantum order dated 12.10.2017 passed by the Learned
Commissioner of Income Tax (Appeals)-29, New Delhi {CIT(A)} for
Assessment Year 2012-13 whereas ITA No.7862/Del/2017 is the
Department’s appeal against order dated 12.10.2017 passed by the
Learned Commissioner of Income Tax (Appeals)-29, New Delhi
{CIT(A)} for Assessment Year 2012-13, wherein the Ld. CIT(A) has
deleted the penalty of Rs.45,46,111/- imposed u/s 271(1)(c) of the
Income Tax Act, 1961 (hereinafter called ‘the Act’).

2.0 The brief facts of the case are that during the year, the

assessee had declared his income from salary and income from

other sources. The original return was filed on 31.07.2012 declaring

an income of Rs.83,71,100/-. A search and seizure action u/s 132

of the Act was carried out in this case on 20.01.2012 and during

the course of search, cash of Rs.2,21,630/- was found at the

assessee’s residence and cash of Rs.6,08,750/- was found at 2nd
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DCIT vs. Anurag Dalmia

Floor, Indra Prakash Building, 21 Barakhamba Road, New Delhi
and also jewellery valuing Rs.2,02,52,864/- was found. During the
course of assessment proceedings, the Assessing Officer took note
that information had been received which related to the assessee
having accounts in HSBC Bank, Geneva. The Assessing Officer also
noted that during the course of search, the statement of assessee
was recorded u/s 132(4) of the Act on 20.01.2012 in which specific
query was raised as to whether the assessee had maintained any
bank accounts abroad to which the assessee had replied in the
negative. The Assessing Officer further observed in the assessment
order that further, during the course of assessment proceedings
u/s 153A of the Act, the statement of assessee was recorded on
03.12.2014 and the assessee was again specifically asked as to
whether the assessee maintained any bank accounts with HSBC,
Switzerland. The Assessing Officer further noted that the assessee
during the course of search, was shown a copy of the bank
statement with HSBC, Switzerland and the assessee had replied in
the negative. Thereafter, the Assessing Officer noted that from the
records and evidences, it was evident that the assessee had
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DCIT vs. Anurag Dalmia

opened/operated accounts in HSBC Bank, Switzerland. The
Assessing Officer further noted that there were four such
undisclosed accounts which were linked to the assessee. Thereafter,
the Assessing Officer proceeded to compute interest income from
these four Bank Accounts for the year under consideration at
Rs.1,47,12,333.41. This amount was added to the income of the
assessee u/s 69 of the Act as undisclosed interest income. Penalty
proceedings for concealment of particulars of income and/or filing
inaccurate particulars of such income were also initiated. Apart
from this undisclosed cash found at 2nd Floor, 2nd Floor, Indra
Prakash Building, 21 Barakhamba Road, New Delhi found during
the course of search was also added to the income of the assessee
and assessment was completed u/s143(3) of the Act.

2.1 Aggrieved, the assessee approached the Ld. CIT(A) who

deleted the addition pertaining to interest by following his order in

assessee’s own case for Assessment Year 2006-07 on identical facts.

The Ld. CIT(A) also deleted the addition with respect to the cash
5 ITA Nos.7861 & 7862 /Del/2017

DCIT vs. Anurag Dalmia

found at the premises on 2nd Floor, Indra Prakash Building, 21
Barakhamba Road, New Delh.

2.2 Subsequently, to the completion of the assessment as

above, penalty u/s 271(1)(c) of the Act to the tune of Rs.45,46,111/-

was imposed. Since, the Ld. CIT(A) had already deleted the addition

in quantum proceedings, the penalty imposed was also deleted by

the CIT(A).

2.3 Aggrieved by both these orders, the Department has now

approached this Tribunal and has raised the following grounds of

appeal:

ITA No.7861/Del/2017

“1. That on the facts and in the circumstances of the case,
the Ld. CIT(A) has erred in law and on facts in deleting the
addition of Rs.1,47,12,333/- made by the AO on account of
undisclosed interest income on the undisclosed deposits of Rs
36.78 crore in HSBC Bank, Geneva without appreciating the
fact that the assessee had no intent to disclose the Foreign
Bank Account as he had not given the department "Consent
Form" not the assessee had submitted any details regarding the
same during the assessment proceedings or appellate
proceedings or prior to that while filing the returns.

2. The Ld. CIT(A) has erred in deleting the addition of

Rs.6,08,750/- on account of undisclosed cash found during

search and seizure without appreciating the fact that the
6 ITA Nos.7861 & 7862 /Del/2017

DCIT vs. Anurag Dalmia

assessee had not submitted any documentary evidence in
support of his contention to the contrary viz to whom this cash
belongs.

3. That the ground of appeal are without prejudice to each

other.

4. That the appellant craves leave to add, amend, alter or
forgo any ground(s) of appeal either before or at the time of
hearing of the appeal.”

ITA No.7862/Del/2017

“1. That on the facts and in the circumstances of the case

the Ld. CIT (A) has erred in law and on facts in deleting the

Penalty of Rs.45,46,111/- which was imposed by the AO on

account of conceal interest income of Rs.1,47,12,333/- on

account of undisclosed interest income in HSBC Geneva.

2. That on the facts and in the circumstances of the case the
Ld. CIT(A) has erred in law and on facts in deleting the Penalty
disregarding the facts that the assessee has deliberately
concealed interest income of Rs. 1,47,12,333/- in HSBC,
Geneva.

3. That the grounds of appeals are without prejudice to each
other.

4. That the appellant craves leave to add, amend, alter or
forgo any ground(s) of appeal either before or at the time of
hearing of the appeal.”

3.0 The Ld. CIT-DR submitted that the information had been

received in terms of the information regarding the foreign bank

accounts which had been received in terms of the information
7 ITA Nos.7861 & 7862 /Del/2017

DCIT vs. Anurag Dalmia

exchange programme with the Government of France and that as
per the records, the name of the assessee, his friends and relatives
were appearing in the said information. It was submitted that this
information established that the assessee was beneficiary holder of
these accounts and, therefore, the Ld. CIT(A) was wrong in deleting
the quantum addition based on his order for Assessment Year
2006-07. The Ld. CIT-DR further submitted that the order of the
Ld. CIT(A) in Assessment Year 2006-07 was upheld by the Tribunal
but there was a basic difference in the facts between Assessment
Year 2006-07 and the present year now under consideration for the
reason that in Assessment Year 2006-07, the assessment was
completed u/s 153A of the Act and since no incriminating
document was found during the course of search, the Ld. CIT(A)
had deleted the addition whereas in the present year, the
assessment was completed u/s 143(3) of the Act and, therefore, on
factual matrix of the case, the Ld. CIT(A) should not have followed
his order in Assessment Year 2006-07. The Ld. CIT-DR also referred
to the order of the ITAT in assessee’s own case for Assessment Year
2014-15 wherein an identical addition on account of interest had
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DCIT vs. Anurag Dalmia

been deleted. The Ld. CIT-DR submitted that there was perversity in
the findings of the ITAT and, therefore, the same should not be
followed.

4.0 The Ld. CIT-DR also submitted that the penalty imposed

was consequential and the sustenance of the penalty would depend

on the outcome of the quantum appeal filed by the Department.

5.0 Per contra, the Ld. AR placed reliance on the order of the

ITAT in assessee’s own case in Assessment Year 2014-15 and

submitted that in view of the finding of the Tribunal that since the

quantum pertaining to bank deposits itself had been deleted, no

addition on account of interest could be sustained, the addition in

this year also should be deleted. The Ld. AR also submitted that the

information received under the information exchange programme

related to Assessment Years 2006-07 and 2007-08 and not to the

year under consideration. The Ld. AR submitted that the quantum

as well as the penalty had been rightly deleted by the Ld. CIT(A).

6.0 We have heard the rival submissions and have also

perused the material on record. We have also gone through the
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DCIT vs. Anurag Dalmia

order of the Co-ordinate Bench of the ITAT in assessee’s own case

for Assessment Year 2014-15 in ITA No.6542/Del/2017 wherein an

identical addition on account of interest has been deleted on the

ground that the ITAT had earlier deleted the addition on account of

investment in the bank accounts itself. The relevant observations of

the Co-ordinate Bench are contained in paragraph-5 of the said

order. The same is reproduced herein under for a ready reference.

“5.0 We have carefully heard the rival contentions of the
learned departmental representative as well as the learned
authorised representative and perused the orders of the lower
authorities. The learned authorised representative submitted a
photocopy of the appellate order dated 15th of February 2018
passed by the coordinate bench in the case of the assessee for
assessment year 2006 - 07 and 2007 - 08 in quantum appeal.
He also submitted a copy of the order of the coordinate bench
dated 23 August 2019 in case of the assessee for assessment
year 2008 - 09. He also submitted a chart for the various years
wherein the addition of notional interest on account of balance
in the alleged foreign bank account of the assessee starting
from assessment year 2006 - 07 to assessment year 2014 - 15
are added by the learned assessing officer and deleted by the
learned CIT - A. We have carefully considered the order of the
coordinate bench in ITA number 5395 and 5396/del/2017 for
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DCIT vs. Anurag Dalmia

assessment year 2006 - 07 and 2007 - 08 dated 15th of
February 2018 wherein the addition on account of investment in
the bank account itself was deleted. As the quantum addition
itself has been deleted by the coordinate bench with respect to
balance in the foreign bank account, there is no question of
making an addition on account of the notional interest on that
balance. With respect to the main addition in paragraph number
14 the coordinate bench has held that revenue has several
other options left but not the action u/s 153A read with the
second proviso thereto. Therefore, when the assessee is not
found to be owner of any bank account, till now, there is no
reason to uphold the interest on such bank balances. If the
assessee is not owner of the amount lying in the bank account,
naturally the interest income cannot be added in the hands of
the assessee. Even otherwise if the revenue gets any
information with respect to the ownership of the money lying in
the bank account with HSBC bank Geneva, then the provisions
of explanation 2 (d) of Section 148 applies and the interest
income can be added in the hands of the assessee. The time
limit available with the revenue according to the provisions of
Section 149 (1) (C) is up to 16 years. Therefore, we do not find
any infirmity in the order of the learned CIT - A, at present, in
deleting the addition on account of interest in the hands of the
assessee for this year with respect to the alleged the holding of
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DCIT vs. Anurag Dalmia

bank balance in the HSBC bank Geneva account, as the
addition on the quantum itself has been deleted.”

6.1 The Ld. CIT-DR has submitted that there is perversity in

the order of the ITAT in Assessment Year 2014-15. However, how

that order was perverse was not demonstrated before us with

evidence and, therefore, being bound by judicial discipline, we have

no choice but to respectfully follow the order passed by the Co-

ordinate bench in assessee’s own case for Assessment Year 2014-15

as above mentioned. Accordingly, we find no reason to deviate from

the findings of the Ld. CIT(A) in the quantum proceedings in the

year under consideration and we uphold the same.

7.0 In the result, the Department’s appeal bearing ITA

No.7861/Del/2017 stands dismissed.

8.0 Since, we have upheld the deletion of the quantum

addition by the Ld. CIT(A) in the foregoing paragraphs, there is

again no reason to deviate from the findings of the Ld. CIT(A) in

deleting the penalty imposed against the quantum addition. We

uphold the deletion of penalty by the Ld. CIT(A).
12 ITA Nos.7861 & 7862 /Del/2017

DCIT vs. Anurag Dalmia

9.0 In the result, ITA No.7862/Del/2017 stands dismissed.

10. In the final result, both the appeals of the Revenue stand

dismissed.

Order pronounced on 13th April, 2021.

Sd/- Sd/-
(G.S.PANNU) (SUDHANSHU SRIVASTAVA)
VICE PRESIDENT
Dated:13/04/2021 JUDICIAL MEMBER
PK/Ps
Copy forwarded to: ASSISTANT REGISTRAR
1. Appellant ITAT NEW DELHI
2. Respondent
3. CIT
4. CIT(Appeals)
5. DR: ITAT