Vijay Kumar Sood, Shimla V. DCIT, CC-II, Chandigarh

ITA 1068/CHANDI/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 8172 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-04-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 09-04-2019
• Assessment Year: 2011-2012
• Appeal Filed On: 10-08-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KULTEJ SINGH BAINS SR DR
• Keywords: Condonation of delay; Bonafide mistake; Ignorance of law; Set aside
• Section: 271(1)(c)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH B CHANDIGARH !, ' # $ , $ % & ' ( ) , *+ # BEFORE: SMT. DIVA SINGH, JM & SMT.ANNAPURNA GUPTA, AM ./ ITA NO. 1068/CHD/2018 / ASSESSMENT YEAR : 2011-12 SHRI VIJAY KUMAR SOOD, S/O SHRI MAST RAM SOOD, SANJAY SADAN, CHOTTA SHIMLA (HP). VS THE DCIT, CENTRAL CIRCLE-II, CHANDIGARH. ./ PAN NO: ADNPS8077K / APPELLANT / RESPONDENT ! ' / ASSESSEE BY : SHRI SUDHIR SEHGAL # ! ' / REVENUE BY : SHRI KULTEJ SINGH BAINS, SR.DR $ % ! &/ DATE OF HEARING : 09.04.2019 '()* ! &/ D ATE OF PRONOUNCEMENT : 10.04.2019 *,/ ORDER PER DIVA SINGH THE PRESENT APPEAL HAS BEEN FILED BY THE ASSESSEE A SSAILING THE CORRECTNESS OF THE ORDER DATED 21.05.2018 OF LD. CIT(APPEALS)-3 GU RGAON PERTAINING TO 2011-12 ASSESSMENT YEAR ON THE FOLLOWING GROUNDS : 1. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS OF THE CA SE BY UPHOLDING PENALTY U/S. 271 AAA IMPOSED BY THE LD. AO. 2. THE LD. C1T(A) HAS ERRED IN LAW AND FACTS OF THE CA SE BY UPHOLDING PENALTY ORDERS ON THE GROUND THAT APPEAL WAS CONSIDERABLY D ELAYED DESPITE THE FACT THAT ORIGINAL JOINT APPEAL AGAINST ORDERS U/S. 271(L)(C) AND 271 AAA WAS FILED IN TIME. 3. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS OF THE CA SE BY UPHOLDING PENALTY IMPOSED EVEN WHEN THE QUANTUM ADDITIONS STAND DELET ED IN APPEAL BEFORE THE IT AT. 4. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND ANY GROU ND/S OF APPEAL BEFORE THE FINAL DISPOSAL OF THE APPEAL. 2. AT THE TIME OF HEARING, PARTIES WERE HEARD ONLY IN RESPECT OF GROUND NO. 2. 3. THE LD. AR INVITING ATTENTION TO THE PAPER BOOK CONSISTING OF 5 PAGES SUBMITTED THAT THE ASSESSEE ADMITTEDLY HAD FILED ONE APPEAL A GAINST THE TWO ORDERS. COPY OF THE GROUNDS FILED IN THE PAPER BOOK, IT WAS SUBMITTED, WOULD SUPPORT THE SAID ARGUMENTS. AFFIDAVIT OF THE C.A. AFFIRMING THE FACT THAT IT WA S HIS MISTAKEN ADVICE ON ACCOUNT OF WHICH A SINGLE APPEAL WAS FILED WAS REFERRED TO. ACCORDI NGLY, IT WAS HIS PRAYER THAT SINCE EVEN ON MERITS THE CLAIM OF THE ASSESSEE WAS ALLOWABLE, DIS MISSAL OF THE ASSESSEE'S APPEAL ON THE ITA NO. 1068/CHD/2018 A.Y. 2011-12 PAGE 2 OF 4 GROUNDS OF LIMITATION IN THE FACTS AS ARGUED WAS NO T CORRECT. COPY OF THE ORDER DATED 22.03.2017 IN ITA 307 TO 312/CHD/2014 PERTAINING TO 2006-07 TO 2011-12 ASSESSMENT YEARS WAS FILED. 4. THE LD. SR.DR RELIED UPON THE ORDER, HOWEVER WAS UNABLE TO STATE WHETHER THE RELEVANT DOCUMENTS WERE AVAILABLE BEFORE THE CIT(A) FOR DECIDING THE DELAY. THE LD. AR IN REPLY SUBMITTED THAT SINCE THESE DOCUMENTS WERE NOT ADDRESSED BY THE CIT(A), THE ISSUE MAY BE REMANDED FOR VERIFICATION OF FACTS. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE IMPUGNED ORDER SHOWS THAT THE ASSE SSEE ADDRESSED THE DELAY BEFORE THE FIRST APPELLATE AUTHORITY BY WAY OF THE FOLLOWING S UBMISSIONS : 3 . THE APPELLANT HAS MADE FOLLOWING SUBMISSIONS IN T HE APPLICATION FOR CONDONATION OF DELAY:- REQUEST FOR CONDONATION OF DELAY IN SUBMITTING THE APPEAL THE ASSESSEE HAD RECEIVED ORDERS IMPOSING PENAL TY U/S 271(L)(C) AS WELL AS ORDERS U/S 271AAA FOR THE RELEVANT ASSESSMENT TOGET HER. THE UNDERSIGNED ON BEHALF OF THE ASSESSEE HAD FILED A COMMON APPEAL AG AINST BOTH THESE ORDERS BEFORE YOUR GOODSELF. THE ORDERS DELETING THE PENALTY IMPO SED U/S 271(L)(C) HAVE ALREADY BEEN PASSED IN FAVOUR OF THE ASSESSEE. ON REALIZING THAT A SEPARATE APPEAL WAS TO BE SUBMI TTED BY THE ASSESSEE AGAINST THE ORDER IMPOSING PENALTY U/S 271AAA THE ASSESSEE WAS ADVISED TO SUBMIT THIS APPEAL WHICH IS DELAYED CONSIDERABLY DUE TO THE APP ARENT ADVICE GIVEN BY ME. IT IS PRAYED THAT SINCE THE ORIGINAL APPEAL WAS IN TIME THIS APPEAL MAY KINDLY BE ENTERTAINED. 6. WE FIND ON GOING THROUGH THE IMPUGNED ORDER THAT THE SAID SUBMISSIONS HAVE NOT BEEN ADDRESSED. ALIVE TO THE DEPARTMENTAL CONCERNS WHET HER THE RELEVANT DOCUMENTS WERE AVAILABLE BEFORE THE CIT(A), WE SET ASIDE THE ISSUE IN TERMS OF THE PRAYER BACK TO THE FILE OF THE LD. CIT(A) WITH THE DIRECTION TO VERIFY THE FAC T NAMELY, WHETHER IN THE FORM NO. 35 AND COPY OF GROUNDS DATED 21.04.2015 FILED IN THE PENAL TY PROCEEDINGS U/S 271(1)(C) OF THE ACT HAS THE ASSESSEE ALSO SOUGHT RELIEF QUA THE ORDER U /S 271AAA; ALSO AND WHETHER IN THE COPY OF THE GROUNDS FILED IN THE PENALTY PROCEEDINGS U/S 271(1)(C), THE FOLLOWING GROUNDS WERE RAISED AS GROUND NO. 4 ALONGWITH GROUND NO. 3 IN TH E PENALTY APPEAL U/S 271(1)(C) : 3. THE LD. DCIT ERRED BY IMPOSING PENALTY U/S. 271(1)( C) FOR ADDITIONS MADE UNDER DEEMING PROVISIONS OF SECTION 69C. 4. THE LD. DCIT ERRED BY IMPOSING PENALTY U/S. 271 AAA ON AMOUNT SURRENDERED, OFFERED FOR TAXATION AND TAX PAID THEREON. 6.1 IN CASE THE FACTS AS CANVASSED BY THE ASSESSEE ARE FOUND TO BE CORRECT, WE FIND THAT THE OCCASION FOR THE LD. COMMISSIONER TO DISMISS TH E APPEAL HOLDING THAT IGNORANCE OF LAW CANNOT BE A JUSTIFIABLE REASON THE ORDER CANNOT BE UPHELD. LOOKING AT THE FACTS OF THE PRESENT CASE WE FIND OURSELVES UNABLE TO CONCUR WIT H THE CONCLUSION DRAWN. IN THE FACTS OF THE PRESENT CASE SHRI DINESH KUMAR SOOD, C.A. AS PE R THE COPY OF HIS AFFIDAVIT FILED ON RECORD HAS PLEADED A BONAFIDE MISTAKE IN GIVING THE WRONG ADVICE. IN THE CIRCUMSTANCES, WE ARE, EVEN OTHERWISE UNABLE TO HOLD HOW THE ASSES SEE CAN BE PENALIZED FOR NO FAULT OF ITS ITA NO. 1068/CHD/2018 A.Y. 2011-12 PAGE 3 OF 4 OWN. THE ASSESSEE HAVING ENGAGED A COUNSEL ADMITTE DLY HAS ACTED DULY, DILIGENTLY AND RESPONSIBLY. FOR READY REFERENCE WE EXTRACT THE RE LEVANT PORTION FROM THE COPY OF THE AFFIDAVIT FILED : THAT I ADVISED THE ASSESSEE TO FILE SINGLE APPEAL BEFORE THE LD. CIT(A) AGAINST ORDERS IMPOSING PENALTY U/S 271(1)(C) AND 271AAA ON THE BONA FIDE BELIEF THAT A SINGLE APPEAL CAN BE FILED AGAINST THESE TWO ORDERS RECEIVED ON SAME DATE BY THE ASSESSEE. THAT ON REALIZING THE MISTAKE A SEPARATE APPEAL WAS SUBMITTED FOR PENALTY IMPOSED UNDER SECTION 271AAA WHICH WAS DELAYED DUE TO BONA FIDE MISTAKE ON MY PART. 6.2. IN THE FACTS OF THE PRESENT CASE, WE HAVE SEEN THAT NO UNDUE ADVANTAGE HAS BEEN DERIVED BY THE ASSESSEE BY FILING THE APPEAL LATE A ND NO VESTED RIGHT OF THE REVENUE CAN BE SAID TO HAVE BEEN DISTURBED IN CASE THE DELAY IS CO NDONED. IT WOULD INFACT NOT BE OUT OF CONTEXT TO QUOTE FROM THE LANDMARK DECISION OF THE APEX COURT IN THE CASE OF COLLECTOR, LAND ACQUISITION VS MST. KATIJI & OTHERS 167 ITR 47 1 (S.C.) WHERE APART FROM NOTICING VARIOUS OTHER PRINCIPLES WHICH THEIR LORDSHIPS CONS IDERED NECESSARY TO HIGHLIGHT, THEIR LORDSHIPS IN AMBIGUOUS TERMS EMPHASIZED THAT IT MUST BE GRASPED THAT JUDICIARY IS RESPECTED NOT ON ACCOUNT OF ITS POWER TO LEGALIZE I NJUSTICE ON TECHNICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO DO SO. IT WOULD ALSO BE APPROPRIATE TO RE- VISIT THE VARIOUS OTHER GUIDING PRINCIPLES LAID D OWN IN THE AFORESAID DECISION BY THEIR LORDSHIPS WHO HELD : ..IT IS COMMON KNOWLEDGE THAT THIS COURT HAS B EEN MAKING A JUSTIFIABLY LIBERAL APPROACH IN MATTERS INSTITUTED IN THIS COUR T. BUT THE MESSAGE DOES NOT APPEAR TO HAVE PERCOLATED DOWN TO ALL THE OTHER COU RTS IN THE HIERARCHY. AND SUCH A LIBERAL APPROACH IS ADOPTED ON PRINCIPL E AS IT IS REALIZED THAT:- 1. ORDINARILY, A LITIGANT DOES NOT STAND TO BENEFIT BY LODGING AN APPEAL LATE. 2. REFUSING TO CONDONE DELAY CAN RESULT IN A MERITO RIOUS MATTER BEING THROWN OUT AT THE VERY THRESHOLD AND CAUSE OF JUSTICE BEING DE FEATED. AS AGAINST THIS WHEN DELAY IS CONDONED THE HIGHEST THAT CAN HAPPEN IS TH AT A CAUSE WOULD BE DECIDED ON MERITS AFTER HEARING THE PARTIES. 3. EVERY DAYS DELAY MUST BE EXPLAINED DOES NOT M EAN THAT A PEDANTIC APPROACH SHOULD BE MADE. WHY NOT EVERY HOURS DELAY , EVERY SECONDS DELAY? THE DOCTRINE MUST BE APPLIED IN A RATIONAL COMMON S ENSE PRAGMATIC MANNER. 4. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERA TIONS ARE PITTED AGAINST EACH OTHER, CAUSE OF SUBSTANTIAL JUSTICE DESERVES TO BE PREFERRED FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEIN G DONE BECAUSE OF A NON- DELIBERATE DELAY. 5. THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR ON ACCOUNT OF CULPABLE NEGLIGENCE, OR ON ACCOUNT OF MALA FIDES . A LITIGANT DOES NOT STAND TO BENEFIT BY RESORTING TO DELAY. IN FACT HE RUNS A SE RIOUS RISK. 6. IT MUST BE GRASPED THAT JUDICIARY IS RESPECTED N OT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHNICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO DO SO. 7. ACCORDINGLY, WITH THE AFORESAID OBSERVATIONS AND DIRECTIONS IN TERMS OF THE PRONOUNCEMENT MADE IN THE OPEN COURT, WE SET ASIDE THE IMPUGNED ORDER BACK TO THE FILE ITA NO. 1068/CHD/2018 A.Y. 2011-12 PAGE 4 OF 4 OF THE LD. CIT(A) TO VERIFY THE FACTS WHETHER THE A SSESSEE IN THE YEAR UNDER CONSIDERATION HAD CHALLENGED THE PENALTY IMPOSED U/S 271(1)(C) AN D 271AAA OF THE ACT BY FILING A SINGLE APPEAL. IN CASE, ON FACTS THE PLEADINGS OF THE ASSESSEE ARE FOUND TO BE CORRECT, THE MISTAKE AT BEST, WE HOLD, CAN BE SAID TO BE A TECHN ICAL MISTAKE WHICH STANDS CORRECTED. THE LD. CIT(A) IN THE CIRCUMSTANCES SUBJECT TO VERIFICA TION IS DIRECTED TO CONDONE THE DELAY AND PROCEED TO PASS THE ORDER ON MERITS IN ACCORDANCE W ITH LAW. NEEDLESS TO SAY THAT THE ASSESSEE SHALL BE GIVEN REASONABLE OPPORTUNITY O F BEING HEARD. SAID ORDER WAS PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10.04.2019. SD/- SD/- ( % & ' ( ) ) ( ! ) (ANNAPURNA GUPTA) (DIVA SINGH) *+ #/ ACCOUNTANT MEMBER ' #/ JUDICIAL MEMBER