Shweta Soni, Indore V. The I T O Ward-2(3), Indore

ITA 04/Ind/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 7625 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 04-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PUNEET KUMAR
• Keywords: Gift; Reasonable cause
• Section: 271(1)(c); 143(3); 274; 139(1); 22; 27

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.04/IND/2019 ASSESSMENT YEAR: 2005-06 APPELLANT BY SHRI VIJAY BANSAL, AR REVENUE BY SHRI PUNEET KUMAR, SR. DR DATE OF HEARING 22 .01.2020 DATE OF PRONOUNCEMENT 29 .01.2020 O R D E R PER MANISH BORAD, AM. THE ABOVE CAPTIONED APPEAL FILED AT THE INSTANCE OF ASSESSEE PERTAINING TO ASSESSMENT YEAR 2005-06 IS DIRECTED A GAINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS)- I (IN SHORT LD.CIT(A)], INDORE DATED 16.11.2018 WHICH IS ARIS ING OUT OF THE ORDER U/S 271(1)(C) OF THE INCOME TAX ACT 1961(IN S HORT THE ACT) DATED 29.06.2017 FRAMED BY ITO-2(3) INDORE. SHWETA SONI INDORE VS. ITO - WARD 2(3) INDORE (APPELLANT) (REVENUE ) PAN NO. APVPS0101G ITANO.04/IND/2019 SHRI SHWETA SONI 2 2. ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL; 1. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING TH E PENALTY U/S 271(1)(C) OF RS.28,500/- WHEREIN THE NOTICE OF IMPO SING PENALTY. THE LD. ASSESSING OFFICER WAS NOT SURE ABOUT THE EX ACT CHARGE FOR IMPOSING PENALTY WHETHER FOR CONCEALMENT OF INC OME OR FILING OF INACCURATE PARTICULARS OF INCOME WHICH IS QUITE UNJUST, ILLEGAL, AND AGAINST THE FACTS OF THE CASES. 2. THE LD. CIT(A) HAS ERRED IN CONFIRMING PENALTY O F RS.28,500/- U/S 271(1)(C) ON ADDITION U/S 68, ALTHOUGH ALL THE DOCUMENTS RELEVANT IDENTITY, GENUINENESS AND CREDITWORTHINESS OF THE DONOR WAS FILED BEFORE LEARNED ASSESSING OFFICER, W HICH IS QUITE, UNJUST, ILLEGAL AND AGAINST THE FACTS OF THE CASE. 3. BRIEF FACTS OF THE CASE AS CULLED OUT FROM THE R ECORDS ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND FILED INCOME TAX RETU RN FOR A.Y. 2005- 06 ON 31.07.2005 DECLARING INCOME OF RS.1,29,130/-. ASSESSMENT U/S 143(3) OF THE ACT WAS COMPLETED ON 27.09.2007 W HEREIN ADDITION FOR UNEXPLAINED GIFT OF RS.1,00,000/- WAS MADE FOR THE FAILURE ON THE PART OF THE ASSESSEE TO PROVE THE GE NUINENESS OF TRANSACTIONS, CREDITWORTHINESS AND CAPACITY OF DONO R. PENALTY PROCEEDINGS WERE INITIATED. SUBSEQUENTLY, VIDE ORDE R DATED 29.06.2017 PENALTY OF RS.28,500/-WAS LEVIED U/S 271 (1)(C) OF THE ACT. 4. ASSESSEE FAILED TO GET ANY RELIEF BEFORE THE LD. CIT(A) WHO DID NOT ALLOW THE ASSESSEES LEGAL GROUND CHALLENGING THE L EGALITY OF NOTICE ISSUED U/S 274 R.W.S 271(1)(C) OF THE ACT AND ALSO DISMISSED THE ASSESSEES GROUNDS ON MERITS. 5. NOW ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. ITANO.04/IND/2019 SHRI SHWETA SONI 3 6. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE RAIS ED THE LEGAL ISSUE CHALLENGING THE VALIDITY OF NOTICE U/S 274 R.W.S 27 1(1)(C) OF THE ACT REFERRING TO THE JUDGMENT OF HON'BLE APEX COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LTD. VS. CIT 229 ITR 383 . HE FURTHER REFERRING TO THE HON'BLE JURISDICTIONAL HIGH COURT S JUDGMENT IN THE CASE OF PR. CIT VS. KULWANT SING BHATIA IN ITANO.09/2018 DATED 09.05.2018 SUBMITTED THAT THE NOTICE ISSUED TO THE ASSESSEE IS DEFECTIVE AS NO SPECIFIC CHARGE HAS BEEN MENTIONED ON MERITS. HE SUBMITTED THAT ALLEGED GIFT WAS DULY EXPLAINED AS D ONOR HAS GIVEN AN AFFIDAVIT ACCEPTING THE TRANSACTIONS. PAN NO. OF PINKI BHATIA I.E. DONOR AND HIS BANK STATEMENT WAS ALSO FILED WHICH I S SUFFICIENT TO PROVE THE IDENTITY, GENUINENESS AND CREDITWORTHINES S OF THE DONOR, SMT. PINK BHATIA. 7. PER CONTRA, LD. DEPARTMENTAL REPRESENTATIVE (DR) VEHEMENTLY ARGUED SUPPORTING THE ORDERS OF LOWER AUTHORITIES. 8. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. THE ASSESSEE HAS CHALLENGED THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT AT RS.28,500/- RAISING LEGAL I SSUE AS WELL AS ON MERITS. AS FAR AS, THE LEGAL ISSUE IS CONCERNED WHI CH IS ADMITTED, IN VIEW OF THE JUDGMENT OF HON'BLE APEX COURT IN THE C ASE OF NATIONAL THERMAL POWER CO. LTD.(SUPRA) WHEREIN THE ASSESSEE HAS CHALLENGED THE LEGALITY OF NOTICE U/S 274 R.W.S 271(1)(C) OF T HE ACT. THE COPY OF NOTICE IS REPRODUCED BELOW:- OFFICE OF THE INCOME TAX OFFICER -2( 3), INDORE ITANO.04/IND/2019 SHRI SHWETA SONI 4 AAYAKAR BHAWAN ANNEX, ROOM NO. L08, OPP. WHITE CHURCH, INDORE PAN APVPS0101G DATE 29.12.2016 TO, KUMARI SHWETA SONI, 02, SHANKAR NAGAR, SAKET, INDORE SIR, NOTICE UNDER SECTION 274 READ WITH SECTION 271(1)(C ) OF INCOME TAX ACT, 1961 WHEREAS IN THE COURSE OF PROCEEDINGS BEFORE ME FOR THE ASSESSMENT YEAR 2005-06, IT APPEARS TO ME THAT YOU: - X *HAVE WITHOUT REASONABLE CAUSE FAILED TO FURNISH THE RETURN OF INCOME WHICH YOU WERE REQUIRED TO FURNISH BY A NOTICE GIVE N UNDER SECTION 22(1 )/22(2)/34 OF THE INDIAN INCOME- TAX ACT, 1922, OR WHICH YOU WERE REQUIRED TO FURNISH UNDER SECTION 139(1) OR BY A NO TICE GIVEN UNDER SECTION 139(2)/148 OF THE INCOME-TAX ACT, 1961, NO , DATED , OR HAVE WITHOUT REASONABLE CAUSE FAILED TO FURNISH IT WITHIN THE TIME ALLOWED AND IN THE MANNER REQUIRED BY THE SAID SECTION 139( 1) OR BY SUCH NOTICE. X *HAVE WITHOUT REASONABLE CAUSE FAILED TO COMPLY WITH A NOTICE UNDER SECTION 22(4)/23(2) OF THE INDIA INCOME-TAX A CT, 1922, OR UNDER SECTION 142(1)/143(2) OF THE INCOME-TAX ACT, 1961 NO , DATED \I '*HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR .......... , FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. YOU ARE HEREBY REQUESTED TO APPEAR BEFORE ME AT 1 .00 P .M. ON 17.01.2017 AND SHOW CAUSE WHY AN ORDER IMPOSING A P ENALTY ON YOU SHOULD NOT BE MADE UNDER SECTION 271 OF THE INCOME-TAX ACT , 1961. IF YOU DO NOT WISH TO AVAIL YOURSELF OF THIS OPPORTUNITY OF BEING HEAR D IN PERSON OR THROUGH AUTHORIZED REPRESENTATIVE YOU MAY SHOW CAUSE IN WRI TING ON OR BEFORE THE SAID DATE WHICH BE WILL BE CONSIDERED BEFORE ANY SUCH OR DER IS MADE UNDER SECTION 271(1). SD/- (D.C. SHARMA) ITANO.04/IND/2019 SHRI SHWETA SONI 5 I.TO-2(3), INDORE 9. FROM PERUSAL OF THE ABOVE NOTICE, WE FIND THAT B OTH THE CHARGES I.E. CONCEALING PARTICULARS OF INCOME AND FURNISHIN G INACCURATE PARTICULARS OF INCOME ARE MENTIONED. NONE OF THEM I S STRIKED DOWN WHICH SHOWS THAT ASSESSING OFFICER HAS NOT SATISFIE D HIMSELF ABOUT THE CHARGE TO BE LEVELED AGAINST THE ASSESSEE. 10. IN THE SIMILAR SET OF FACTS AND THE LEGAL ISSUE RAISED BEFORE US, WE FIND THAT HON'BLE JURISDICTIONAL HIGH COURT IN T HE CASE OF PR. CIT VS. KULWANT SING BHATIA(SUPRA) AFTER REFERRING TO THE JUDGMENT OF HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565 AND ANOTHER JUDGMENT OF HON'BLE KARNATAKA HIGH COURT IN THE CAS E OF CIT VS. SSAS EMERLD MEADOWS ITANO.380 OF 2015 DATED 23.11.2015 ALLOWED THE ASSESSEES APPEAL AND DELETED PENALTY L EVIED U/S 271(1)(C) OF THE ACT, SINCE THE SHOW CAUSE NOTICE D ID NOT SATISFIED THE REQUIREMENT OF LAW AS IT WAS NOT SPECIFIC. 11. WE, THEREFORE, RESPECTFULLY FOLLOWING THE JUDGM ENT OF HON'BLE JURISDICTIONAL HIGH COURT REFERRED ABOVE AND OBSERV ING THE FACT THAT THE ASSESSING OFFICER FAILED THE LEVEL SPECIFIC CHA RGE AGAINST THE ASSESSEE BY ISSUING DEFECTIVE NOTICE AND THIS BEING A FATAL ERROR RENDERS THE NOTICE LIABLE TO BE QUASHED. WE, ACCORD INGLY ORDER SO AND DELETE THE PENALTY OF RS.28,500/- AND ALLOW THE LEGAL GROUND RAISED BY THE ASSESSEE. SINCE WE HAVE ALREADY DELET ED THE PENALTY ALLOWING LEGAL GROUND DEALING WITH THE MERITS OF TH E CASE IS MERELY ACADEMIC IN NATURE. ITANO.04/IND/2019 SHRI SHWETA SONI 6 12. IN THE RESULT APPEAL OF THE ASSESSEE STANDS ALL OWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 29.01.20 20. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 29 TH JANUARY, 2020 PATEL/PS COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE