GIRDHAR B. PATHAK, MUMBAI V. ACIT 19(2), MUMBAI

CO 141/MUM/2014

• Counselvise Citation: [2014] 122 COUNSELVISE.COM (IT) 9878 (ITAT-MUMBAI)
• Duration Of Justice: 1 month(s) 12 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 03-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2008-2009
• Appeal Filed On: 22-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ADAGIRI
• Keywords: Period of limitation; Speculation loss; Time period of passing order; Revised return

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL G , BENCH MUMBAI , BEFORE : SHRI R.C.SHARMA , A M & SHRI SANJAY GARG, J M ITA NO. 6739 / MUM/20 1 2 ( ASSESSMENT YEAR : 200 8 - 0 9 ) ACIT - 19(2), MUMBAI - 400 012 VS. SHRI GIRDHAR B. PATHAK, 411E, MILTON APARTMENTS, JUHU KOLIWADA, SANTACRUZ (W), MUMBAI - 54 PAN/GIR NO. : A A HPP 3666 N ( APPELLANT ) .. ( RESPONDENT ) AND NO. 141 /MUM/20 14 (ARISING OUT OF ITA NO. 6739 /MUM/20 12 ) ( ASSESSMENT YEAR :200 8 - 0 9 ) SHRI GIRDHAR B. PATHAK, 411E, MILTON APARTMENTS, JUHU KOLIWADA, SANTACRUZ (W), MUMBA I - 54 VS. ACIT - 19(2), MUMBAI - 400 012 PAN/GIR NO. : AAACB 0465 O /REVENUE BY : SHRI B. YADAGIRI /ASSESSEE BY : SHRI VIJAY MEHTA DATE OF HEARING : 2 4 TH JULY , 201 4 DATE OF PRONOUNCEMENT : 3 RD SEPT., 201 4 O R D E R PER R.C.SHARMA ( A .M.) : REVENUE HAS FILED AN APPEAL WHEREAS THE ASSESSEE HAS FILED CROSS OBJECTION AGAINST THE ORDER CIT(A ) , DATED 31 - 8 - 2012 FOR THE ASSESSMENT YEAR 200 8 - 0 9 , IN THE MATTER OF IMPOSITION OF PENALTY U/S. 271(1)(C) OF TH E I.T. ACT . ITA NO. 6739 /1 2 & CO141/14 2 2 . RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORD PERUSED. FACTS IN BRIEF ARE THAT T HE ASSESSEE IS AN INDIVIDUAL, ENGAGED IN THE BUSINESS OF CONSULTANCY SERVICES AND DEALING IN SHARES. RETURN OF INCOME WAS FILED AT A LOSS OF RS. 52.27 LAKHS. RETURN WAS SELECTED FOR SCRUTINY. DURING THE COURSE OF ASSESSMENT, ASSESSEE COMPILED THE DETAILS OF TRADING LOSSES IN THE SHARE MARKET AND FOUND THAT THE LOSS AMOUNTING TO RS.11,88,786/ - WAS INCURRED IN CASH MARKET WHICH WAS A SPECULATIVE LOSS AND NOT A BUSINESS LOSS, HE, THEREFORE, IMMEDIATELY FILED A REVISED STATEMENT OF HIS COMPUTATION OF INCOME/LOSS BEFORE THE AO SUO MOTO. THIS FACT HAS ALREADY BEEN MENTIONED BY THE AO IN PARA 6 OF THE ASSESSMENT ORDER DATED 29 - 11 - 2010. ASSESSEE ALSO FURNISHED THE BIFURCATION OF BUSINESS LOSS UNDER THE HEADS TRADING AND SPECULATIVE LOSS. HOWEVER, THE AO ALLOWED SPECULATION LOSS OF RS. 11,88,786/ - TO BE CARRIED FORWARD. THUS, THERE WAS NO ADDITION AT ALL IN THE A SSESSMENT YEAR AND THE TRADING LOSS CLAIMED BY THE ASSESSEE WAS MERELY BIFURCATED BETWEEN THE TRADING LOSS AND SPECULATIVE LOSS IN THE ASSESSMENT ORDER ON THE BASIS OF INFORMATION FURNISHED BY THE ASSESSEE HIMSELF DURING THE ASSESSMENT PROCEEDINGS. THE AO OBSERVED THAT HAD THE CASE NOT BEEN TAKEN UP FOR SCRUTINY THIS FACT WOULD NOT HAVE COME TO LIGHT AND THE ASSESSEE BECAME WISE AFTER HIS CASE GOT SELECTED FOR SCRUTINY. HE THEREFORE, CONCLUDED THAT ASSESSEE IS NOT VOLUNTARILY FILED A REVISED RETURN OF INCOM E SHOWING THE CASH MARKET LOSS AS SPECULATIVE LOSS AND ONLY BEING QUESTIONED ABOUT THE LOSSES AND CALLING FOR THE DETAILS OF NATURE OF LOSS, THE ASSESSEE FILED A REVISED ITA NO. 6739 /1 2 & CO141/14 3 COMPUTATION AGREEING TO THE LOSS BEING A SPECULATIVE LOSS. FOR SUCH CHANGE OF HEAD OF INCOME, THE AO LEVIED PENALTY U/S. 271(1)(C) AMOUNTING TO RS. 4,10,000/ - . 3 . BY THE IMPUGNED ORDER, CIT(A) DELETED THE PENALTY AFTER HAVING THE FOLLOWING OBSERVATIONS : - 10. I HAVE CAREFULLY GONE THROUGH THE IMPUGNED PENALTY ORDER AND THE SUBMISSIONS OF T HE APPELLANT, I HAVE ALSO GONE THROUGH THE ASSESSMENT ORDER. THE APPELLANT IS AN INDIVIDUAL AND DERIVES INCOME FROM CONSULTANCY AND DEALING IN SHARES. THE APPELLANT FILED THE RETURN OF INCOME, DECLARING A LOSS OF RS.52,27,456/ - . DURING THE COURSE OF ASSESS MENT PROCEEDINGS, AS I FIND FROM THE ASSESSMENT ORDER, THE APPELLANT FILED THE REVISED COMPUTATION OF HIS INCOME WHEREIN THE APPELLANT POINTED OUT TO THE A.O. THAT THE LOSSES OF RS.11.88,786/ - WHICH IS CLUBBED WITH THE BUSINESS LOSSES IS, IN FACT, A PECUL ATION LOSS. THE A.O. HAS ACCEPTED THE APPELLANT'S REVISED COMPUTATION OF INCOME. I ALSO FIND THAT THE APPELLANT HAS SUO MOTO FILED THE REVISED COMPUTATION OF INCOME DURING ASSESSMENT PROCEEDINGS PRIOR TO THE PIN POINTING OF ANY INACCURACY IN THE PARTICULAR OF INCOME BY THE A.O. THUS, I NOTICE THAT THE BONAFIDE OF THE APPELLANT IN THIS REGARD CANNOT BE DOUBTED. 11. IT IS NOTICED FROM THE PENALTY ORDER THAT THE A.O. HAS OBSERVED THAT THE APPELLANT FILED A REVISED COMPUTATION OF INCOME AFTER THIS HAS BEEN PO INTED OUT BY THE A.O. AT THE ASSESSMENT STAGE. I FIND THAT THIS OBSERVATION OF THE A.O. DOES NOT SEEM TO BE CORRECT. THE RECORDS CLEARLY INDICATE THAT IT IS THE APPELLANT WHO HIMSELF SUO MOTO GAVE A BIFURCATION OF BUSINESS LOSSES AS WELL AS SPECULATION LOS SES AT THE ASSESSMENT STAGE OF HIS OWN THUS, THERE IS NOTHING ON RECORD TO SUGGEST THAT THE A.O. HAS POINTED OUT ANY INACCURACY IN THE PARTICULARS OF THE APPELLANT. 12. THE MOOT QUESTION IN THIS APPEAL IS WHETHER THE APPELLANT HAS CONCEALED ANY INCOME OR FILED INACCURATE PARTICULARS OF INCOME. PENALTY U/S.271(1)(C) OF THE ACT CAN BE LEVIED ONLY WHERE IT IS FOUND THAT EITHER THE APPELLANT HAS CONCEALED HIS INCOME OR FILED INACCURATE PARTICULARS OF INCOME LEADING TO CONCEALMENT OF INCOME. THE RECORDS INDICAT E THAT THERE IS NEITHER CONCEALMENT OF INCOME NOR INACCURATE PARTICULARS OF INCOME FILED BY THE APPELLANT. THE APPELLANT HAS FILED A LOSS RETURN AND ITA NO. 6739 /1 2 & CO141/14 4 THE LOSS HAS MERELY BEEN BIFURCATED UNDER THE TWO HEADS VIZ. 'BUSINESS LOSS' AND 'SPECULATION LOSS' ON THE BASIS OF DETAILS FURNISHED BY THE APPELLANT SUO MOTO. BOTH THE LOSSES HAVE BEEN ALLOWED TO BE CARRIED FORWARD AND TO BE SET OFF AGAINST THE RESPECTIVE INCOME IN SUBSEQUENT ASSESSMENT YEARS. NO ADDITION OF ANY KIND HAS BEEN MADE IN THE ASSESSMENT ORDER. EVE N IF THERE WAS ANY INACCURACY IN THE PARTICULARS OF INCOME, THE SAME HAS BEEN SET RIGHT BY THE APPELLANT AT THE ASSESSMENT STAGE ITSELF AND THAT TOO SUO MOTO. I AM THEREFORE, OF THE CONSIDERED VIEW THAT THE APPELLANT HAS NEITHER CONCEALED HIS INCOME NOR H AS FILED ANY INACCURATE PARTICULARS OF INCOME. 13. THE ARS HAVE BROUGHT TO MY NOTICE A NUMBER OF COURT DECISIONS CITED SUPRA FAVOURING HIS STAND IN THE MATTER. THE DECISION OF HON'BLE DELHI HIGH COURT IN THE CASE OF C1T V. M/S.AURIC INVESTMENTS & SECURITI ES LTD., CITED SUPRA, IS DIRECTLY APPLICABLE TO THE FACTS OF THE APPELLANT'S CASE WHEREIN THE HON'BLE DELHI HIGH COURT HAS HELD THAT THE MERE TREATMENT OF THE BUSINESS LOSS AS SPECULATION LOSS BY THE A.O. DOES NOT AUTOMATICA LL Y WARRANT THE INFERENCE OF CON CEALMENT OF INCOME AND THEREFORE, THE CANCELLATION OF PENALTY WAS VALID. FURTHER, THE ARS RELIANCE ON BOMBAY ITAT DECISION IN THE CASE OF ITO V. GACL FINANCE LTD., CITED SUPRA, WHEREIN THE HON'BLE ITAT HAS HELD THAT WHETHER THE ASSESSEE HAS CLAIMED LOSSES FROM TRADING IN SHARES AND FURNISHED ALL THE RELEVANT MATERIALS, THE LOSS AS DEEMED SPECULATION LOSS BY INVOKING THE EXPLANATION TO SECTION 73 OF THE ACT, NO PENALTY U/S.271(1)(C) OF THE ACT CAN BE LEVIED AS THERE WAS NEITHER ANY CONCEALMENT OF INCOME NOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE HON'BLE SUPREME COURT IN THE CASE OF CIT, AHD V. RELIANCE PETROPRODUCTS PVT.LTD. CITED SUPRA, THE HON'BLE COURT HAS GIVEN A DETAILED EXPLANATION TO THE MEANING OF WORD 'PARTICULAR' AND HELD THAT THERE WAS NO FINDING BY THE A.O. THAT THE DETAILS FILED -- BY THE APPELLANT WERE EITHER INCORRECT OR ERRONEOUS OR FALSE AND THEREFORE, NO PENALTY U/S.271(1)(C) OF THE ACT IS EXIGIBLE. SIMILARLY, THE ARS HAVE BROUGHT TO MY NOTICE OTHER CAT E NA OF CASES WHEREIN IT HAS BEEN HELD THAT PENALTY U/S.271(1)(C) OF THE ACT IN THE SIMILAR SET OF FACTS AS PREVAILING IN THE APPELLANT'S CASE CANNOT BE LEVIED. 14. I. THEREFORE, HOLD THAT THE APPELLANT HAS NOT COMMITTED ANY DEFAULT SO AS TO COME WITHIN THE MISCHIEF OF SECTION 271(1 )(C) OF THE ACT. THERE IS NO CONCEALMENT OF INCOME NOR FILING OF INACCURATE PARTICULARS OF INCOME AND ACCORDINGLY, I HOLD THAT THIS IS NOT A FIT CASE WHERE PENALTY U/S.271(1)(C) CAN BE LEVIED. ACCORDINGLY, I DIRECT THE AO TO DELETE THE PENALTY OF RS. 4,10, 000/ - LEVIED U/S. 271(1)(C) OF THE ACT. ITA NO. 6739 /1 2 & CO141/14 5 4 . AGAINST THE ABOVE ORDER OF CIT(A), REVENUE IS IN APPEAL HERE BEFORE US. ASSESSEE HAS ALSO FILED CROSS OBJECTION ALLEGING THAT PENALTY ORDER PASSED BY THE AO WAS BEYOND THE LIMITATION PERIOD, AND, THEREFORE, SHOULD BE TREATED AS ANNULLED. 5 . IT WAS CONTENDED BY THE LEARNED AR THAT DURING THE COURSE OF ASSESSMENT PROCEEDINGS, ASSESSEE HAS VOLUNTARILY FILED THE REVISED COMPUTATION WITHOUT BEING POINTED OUT BY THE AO. OUR ATTENTION WAS INVITED TO THE FINDINGS RECORDE D BY THE CIT(A) TO THE EFFECT THAT OBSERVATION OF THE AO TO THE EFFECT THAT ASSESSEE HAS FILED REVISED COMPUTATION OF INCOME AFTER THIS HAS BEEN POINTED OUT BY THE AO AT THE ASSESSMENT STAGE, IS FACTUALLY INCORRECT INSOFAR AS THE RECORDS CLEARLY INDICATE THAT IT IS THE ASSESSEE, WHO HIMSELF SUO MOTU GAVE A BIFURCATION OF BUSINESS LOSS AS WELL AS SPECULATION LOSS AT THE ASSESSMENT STAGE OF HIS OWN. AS PER LEARNED AR NEITHER THERE WAS ANY CONCEALMENT OF INCOME NOR ASSESSEE HAS FILED INACCURATE PARTICULARS, T HEREFORE, CIT(A) WAS JUSTIFIED IN DELETING THE PENALTY AFTER RECORDING DETAILED FINDING AT PARA 114 TO 14 OF HIS APPELLATE ORDER WHEREIN HE HAS CLEARLY OBSERVED THAT ASSESSEE HAS FILED LOSS RETURN AND THE LOSS HAS MERELY BEEN BIFURCATED UNDER TWO HEADS ON THE BASIS OF DETAILS FURNISHED BY THE ASSESSEE SUO MOTU. LEARNED AR FURTHER CONTENDED THAT THIS PENALTY ORDER PASSED BY THE AO ON 23 - 6 - 2011 AND THE CIT(A) HAS DECIDED THE APPEAL ON 31 - 8 - 2012, WHICH IS BARRED BY LIMITATION ITA NO. 6739 /1 2 & CO141/14 6 UNDER THE PROVISIONS OF SUB - SECTION 3 OF SECTION 275 OF THE I.T. ACT. LEARNED AR PLACED ON RECORD THE ORDER OF THE COORDINATE BENCH IN THE CASE OF TUSHAR B. SADA, PASSED IN ITA NO. 455/M/2012, ORDER DATED 11 - 10 - 2013 , WHEREIN UNDER SIMILAR FACTS AND CIRCUMSTANCES PENALTY WAS DELETED BY TRIBUN AL. 6 . ON CONTRARY, LEARNED DR RELIED ON THE ORDER OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. ZOOM COMMUNICATIONS PVT. LTD., 191 TAXMAN 179 AND HONBLE SUPREME COURT IN THE CASE OF MAK DATA (P) LTD. (2013) 38 TAXMAN.COM 448 . 7 . WE HAVE CONSI DERED RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM THE RECORD THAT PENALTY WAS LEVIED WITH REFERENCE TO THE CHANGE IN HEAD OF INCOME. THIS CHANGE IN HEAD OF INCOME FROM BUSINESS LOSS TO SPECULATION LOSS WAS F ILED BY THE ASSESSEE HIMSELF DURING THE COURSE OF ASSESSMENT PROCEEDINGS WITHOUT ANY POINTING OUT BY THE AO. IN THIS REGARD, THE CIT(A) HAS CATEGORICALLY RECORDED A FINDING TO THE EFFECT THAT ASSESSEE HIMSELF SUO MOTU GAVE BIFURCATION OF BUSINESS LOSS AS W ELL AS SPECULATION LOSS AT THE TIME OF ASSESSMENT STAGE OF HIS OWN, THUS, THERE WAS NOTHING ON RECORD TO SUGGEST THAT AO HAS POINTED OUT ANY INACCURACY IN THE PARTICULARS OF THE ASSESSEE. THE CIT(A) ALSO RECORDED A FINDING TO THE EFFECT THAT THERE WAS NEIT HER ANY CONCEALMENT OF INCOME NOR INACCURATE PARTICULARS OF INCOME WAS FILED BY THE ASSESSEE. ITA NO. 6739 /1 2 & CO141/14 7 INSOFAR AS ASSESSEE HAS FILED SAID LOSS RETURN AND THE LOSS HAS MERELY BEEN BIFURCATED UNDER THE TWO HEADS NAMELY BUSINESS LOSS AND SPECULATION LOSS ON THE BASIS OF DETAILS FURNISHED BY THE ASSESSEE SUO MOTU. WE FOUND THAT BOTH LOSS HAVE BEEN ALLOWED TO BE CARRIED FORWARD TO BE SET UP AGAINST THE RESPECTIVE INCOME IN SUBSEQUENT YEARS. WE FOUND THAT NO ADDITION O F ANY KIND WAS MADE BY THE AO IN THE ASSESSMENT ORDER. WITH REFERENCE TO THE REVISED COMPUTATION FILED, IT WAS ACCEPTED BY THE AO AND THE ASSESSEE HAS ALSO NOT FILED ANY APPEAL AGAINST THE SAME, IT CLEARLY INDICATES THAT ASSESSEE HIMSELF HAS OFFERED VARIATION IN THE HEAD OF INCOME AND ALSO ACCEPTED THE SAME W ITHOUT GOING FURTHER IN APPEAL. AFTER APPLYING VARIOUS JUDICIAL PRONOUNCEMENTS AND ALSO DECISION OF HON BLE SUPREME COURT IN THE CASE OF RELIANCE PETROPRODUCTS PVT. LTD. , 322 ITR 158 , THE CIT(A) DELETED THE IMPOSITION OF PENALTY. CASE LAW CITED BY THE LEAR NED DR IN CASE OF ZOOM COMMUNICATIONS (SUPRA) IS NOT APPLICABLE TO THE FACTS OF THE CASE INSOFAR AS IN CASE OF ZOOM COMMUNICATIONS (SUPRA), ASSESSEE MADE A CLAIM WHICH WAS NOT ONLY INCORRECT IN LAW BUT ALSO WITHOUT ANY BASIS AND THE EXPLANATION FURNISHED B Y HIM FOR MAKING SUCH CLAIM AND IT WAS FOUND TO BE NOT BONAFIDE. HOWEVER, IN THE INSTANT CASE BEFORE US, ASSESSEE WITHOUT BEING PINPOINTED BY THE AO DURING ASSESSMENT PROCEEDINGS ITSELF FILED REVISED BIFURCATION OF NATURE OF INCOME/LOSS. IN THE CASE OF MAK DATA (P) LTD. (SUPRA), AFTER SURRENDER OF CERTAIN AMOUNT RECEIVED AS SHARE APPLICATION MONEY WAS MADE BY ITA NO. 6739 /1 2 & CO141/14 8 ASSESSEE IN VIEW OF DETECTION MADE BY THE AO IN SEARCH CONDUCTED IN CASE OF ASSESSEES SISTER CONCERN. HONBLE SUPREME COURT HELD THAT SUCH SURRENDER OF INCOME NOT BEING VOLUNTARY IN NATURE, THEREFORE, AO WAS HELD TO BE JUSTIFIE D IN LEVYING PENALTY U/S.271(1)(C) OF THE I.T. ACT. HOWEVER, IN THE INSTANT CASE BEFORE US, ASSESSEE AT ITS OWN FILED A REVISED STATEMENT OF COMPUTATION OF INCOME WHEREIN PROPE R BIFURCATION OF INCOME UNDER TRADING AND SPECULATION LOSS WAS MADE. THUS, THE FACTS OF THE INSTANCE CASE IS DISTINGUISHABLE FROM THE FACTS IN THE CASE OF MAK DATA (P) LTD. (SUPRA) . 8 . IN VIEW OF THE ABOVE, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF CIT( A) FOR DELETING THE PENALTY AND, THEREFORE, APPEAL OF REVENUE IS DISMISSED . 9 . THE ASSESSEE HAS ALSO FILED CROSS OBJECTION ALLEGING THAT PENALTY ORDER PASSED BY THE AO DATED 23 - 6 - 2011 IS BARRED BY LIMITATION, THEREFORE, SHOULD BE ANNULLED. 10. THE CROSS OB JECTION FILED BY THE ASSESSEE IS DELAYED BY 46 DAYS. IT WAS SUBMITTED BY LEARNED AR THROUGH CONDONATION APPLICATION THAT DUE TO MEDICAL GROUND AND DEATH OF CLOSE RELATIVE DURING THAT PERIOD, ASSESSEE COULD NOT FILE THE CROSS OBJECTION WITHIN THE STIPULATED PERIOD. IT WAS, THEREFORE, REQUESTED THAT THE DELAY SHOULD BE CONDONED AND CROSS OBJECTION SHOULD BE DECIDED ON MERIT. 11. WE HAVE CONSIDERED THE REASONS GIVEN FOR DELAY IN FILING THE CROSS OBJECTION, WHICH ARE MAINLY ATTRIBUTED TO THE SICKNESS OF THE ITA NO. 6739 /1 2 & CO141/14 9 AS SESSEE FORM 31 - 5 - 2014 TO 8 - 6 - 2014. THE BROTHER - IN - LAW OF THE ASSESSEE EXPIRED ON 11 - 6 - 2014 AND ASSESSEE HAD TO RUSH OUT OF MUMBAI AND DURING CONTINUATION OF RELIGIOUS RITES FOR 13 DAYS, ASSESSEE REMAINED IN GWALIOR. AFTER COMING BACK FROM GWALIOR THE WIFE OF ASSESSEE WAS ADMITTED IN BREACH CANDY HOSPITAL ON 13 - 7 - 2014 AND REMAINED IN HOSPITAL FOR 9 DAYS. KEEPING IN VIEW THE REASONS GIVEN FOR DELAY IN FILING CROSS OBJECTION, WE CONDONE THE SAME AND THE CROSS OBJECTION OF THE ASSESSEE IS BEING HEARD ON MERIT. 12. WE FOUND THAT IN THE ASSESSMENT ORDER PASSED U/S.143(3) ON 29 - 11 - 2010 , THE AO HAS TREATED BUSINESS LOSS AS SPECULATIVE LOSS AND THIS WAS THE REASON FOR LEVY OF PENALTY U/S. 271(1)(C) . AS THE ASSESSEE HIMSELF HAS FILED THE REVISED STATEMENT OF HIS COMPU TATION BEFORE THE AO SUO MOTU , NO APPEAL WAS FILED AGAINST THE ORDER OF AO. UNDER PROVISIONS OF SECTION 2 75 (1)(C) , NO ORDER IMPOSING PENALTY SHALL BE PASSED U/S. 271(1)(C) IN CASE WHERE NO APPEAL IS FILED BEFORE THE CIT(A), AFTER THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH ACTION FOR IMPOSITION OF PENALTY IS INITIATED, WHICHEVER PERIOD EXPIRES LATER. I N THE INSTANT CASE THE ORDER OF THE AO IN THE COURSE OF WHICH ACTION FOR IMPOSITION OF PENALTY WAS INITIATED IS DATED 29 - 11 - 2010 . THE PENALTY ORDER U/S.271(1)(C) HAS BEEN PASSED ON 23 - 6 - 2011. AS PER PROVISIONS OF SECTION 275(1 )(C), THIS PENALTY ORDER COULD HAVE BEEN ITA NO. 6739 /1 2 & CO141/14 10 PASSED EITHER BEFORE EXPIRY OF FINANCIAL YEAR IN WHICH ASSESSMENT ORDER WAS PASSED I.E. 31 - 3 - 2011 OR WITHIN SIX MONTHS FROM THE END OF THE MONTH IN WHICH ACTION FOR IMPOSITION OF PENALTY IS INITIATED I.E. 29 - 5 - 2011 . THUS, THE PENALTY ORDER WAS O UGHT TO HAVE BEEN PASSED EITHER BEFORE 31 - 3 - 2011 OR BEFORE 29 - 5 - 2011, WHEREAS ACTUALLY IT WAS PASSED ON 23 - 6 - 2011. THUS, THE PENALTY ORDER SO PASSED BY THE AO IS BARRED BY LIMITATION UNDER THE PROVISIONS OF SECTION 275 (1)(C), ACCORDINGLY THE SAME IS QUAS HED. 1 3 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED WHEREAS THE CROSS OBJECTION FILED BY THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 03/09/ 201 4 . 03/09/ 2014 SD/ - SD/ - ( ) ( SANJAY GARG ) ( ) ( R.C.SHARMA ) / JUDICIAL MEMBER / ACCOUNTAN T MEMBER MUMBAI ; DATED 03/09 /2014 /PKM , PS COPY OF THE ORDER FORWARDED TO : / BY ORDER, ( ASSTT. REGISTRAR) / ITAT, MUMBAI 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE CIT(A), MUMBAI. 4. / CIT 5. / DR, ITAT, MUMBAI 6. GUARD FILE. //TRUE COPY//