Sub Registrar , Joara V. Director of Income TRax (I & CI), Bhopal

ITA 108/Ind/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5268 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 2 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2019
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2015-2016
• Appeal Filed On: 20-02-2018
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R.S. AMBEDKAR
• Keywords: Reasonable cause
• Section: 28; 273B; 274

Judgement Text

SUB REGISTRAR JAORA ITA NO.108/IND/2018 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE HON'BLE KUL BHARAT, JUDICIAL MEMBER AND HON'BLE MANISH BORAD, ACCOUNTANT MEMBER ITA NO.108/IND/2018 ASSESSMENT YEAR 2015-16 REVENUE BY S HRI R.S. AMBEDKAR , SR.DR ASSESSEE BY SHRI S.S. DESHPANDE , CA DATE OF HEAR ING 08. 0 5 .2019 DATE OF PRONOUNCEMENT 16 . 0 5 .2019 O R D E R PER MANISH BORAD, AM. THIS APPEAL IS FILED AT THE INSTANCE OF THE ASSESSE E PERTAINING TO ASSESSMENT YEAR 2015-16 AND IS DIRECTED AGAINST THE ORDER OF LD. DIRECTOR OF INCOME TAX(I&CI) (IN SHORT DIT(I&CI), BHOPAL DATED 29.12.2017 FRAMED U/S 271FA R.W.S. 274 OF THE INCO ME TAX ACT 1961(IN SHORT THE ACT). 2. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF AP PEAL; SUB REGISTRAR JAORA, O/O SUB REGISTRAR JAORA, COURT AREA JAORA DIST, RATLAM VS. DIRECTOR OF INCOME TAX (I&CI), BHOPAL ( APPELLANT ) (RESPONDENT ) T AN NO. BPLS07417E SUB REGISTRAR JAORA ITA NO.108/IND/2018 2 THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LEARNED DIT(I&CI) HAS ERRED IN IMPOSING PENALTY OF RS.3,51,500/- UNDER SECTION 271FA OF THE ACT NON FILING OF AIR RETURN W ITHOUT CONSIDERING REASONABLE CAUSE. THE APPELLANT PRAYS TO GRANT RELIEF AS STATED ABOVE . THE APPELLANT CRAVES, LEAVE TO ADD, ALTER OR MODIFY ANY OF THE FOREGOING GROUNDS OF APPEAL IF AND WHEN NECESSARY. 3. BRIEFLY STATED FACTS AS CULLED OUT FROM THE REC ORDS ARE THAT THE ASSESSEE IS LOCAL AUTHORITY UNDER THE STATE GOVERNM ENT OF MADHYA PRADESH IN THE NAME OF OFFICE OF SUB REGISTRAR JAOR A, COURT AREA, JAORA, RATLAM. AS PER THE PROVISIONS OF SECTION 28 5BA OF THE ACT THE ASSESSEE IS REQUIRED TO SUBMIT A STATEMENT IN F ORM 61B FOR EVERY FINANCIAL YEAR BY 31 ST MAY OF FOLLOWING THAT YEAR. IN FINANCIAL YEAR 2014-15 THE DUE DATE OF FILING OF INFORMATION IN PRESCRIBED FORM NO.61B WAS 31.5.2015. THIS DATE WAS EXTENDED BY THE INCOME TAX DEPARTMENT TO 10.9.2015. THE ASSESSEE FAILED TO FI LE THE ANNUAL INFORMATION RETURN (AIR) AS REQUIRED AS PER THE PRO VISIONS OF SECTION 285BA. SHOW CAUSE NOTICE WAS ISSUED BY THE LD. DIRECTOR OF INCOME TAX (I&CI) ON 26.11.15 TO FILE NECESSARY INFORMATION LATEST BY 15.12.2015 BUT NO COMPLIANCE WAS RECEIVED. AGAI N NOTICE WAS ISSUED ON 31.03.2016 U/S 271FA R.W.S. 274 OF THE AC T FOR LEVYING SUB REGISTRAR JAORA ITA NO.108/IND/2018 3 PENALTY FOR NON FILING OF THE INFORMATION. NONE AT TENDED ON THE DATE OF HEARING. LAST OPPORTUNITY WAS GIVEN TO APPEAR B EFORE 17.11.2017 AND THE ASSESSEE AGAIN FAILED TO COMPLY WITH THE N OTICE. LD. DIRECTOR OF INCOME TAX (I&CI) ACCORDINGLY LEVIED TH E PENALTY U/S 271FA OF THE ACT @RS.500/- FOR THE PERIOD OF DELAY OF 703 DAYS AND COMPUTED THE PENALTY AT RS.3,51,500/-. AGGRIEVED A SSESSEE IS NOW IN APPEAL BEFORE THE TRIBUNAL. 4. LD. COUNSEL FOR THE ASSESSEE REFERRING TO THE PA PER BOOK SUBMITTED THAT THE PRINCIPAL SECRETARY, DEPARTMENT OF COMMERCIAL TAX, MADHYA PRADESH GAVE A LETTER TO LD. CHIEF COMM ISSIONER OF INCOME TAX GIVING REFERENCE TO THE TECHNICAL ERROR IN WEB ENABLED PORTAL FOR E-REGISTRATION OF THE DOCUMENTS PERTAINI NG TO IMMOVABLE PROPERTIES SINCE JULY, 2015 MENTIONED THAT DUE TO N ON INTEGRATION OF THE DEPARTMENTS PORTAL WITH INCOME TAX DEPARTMEN TS PORTAL FOR PAN AUTHENTICATION, THE POINTS WERE CUT DOWN FROM G OVERNMENT OF MADHYA PRADESH PART. IT WAS FURTHER SUBMITTED THAT THE ANNUAL INFORMATION REPORT WAS FINALLY SUBMITTED ON 14.12.2 017 CONTAINING ALL NECESSARY INFORMATION AS REQUIRED. HE PRAYED T HAT THE PENALTY SHOULD NOT HAVE BEEN RELIEVED AS THE GOVERNMENT DEP ARTMENT WAS SUB REGISTRAR JAORA ITA NO.108/IND/2018 4 FACING TECHNICAL PROBLEM DUE TO WHICH NECESSARY INF ORMATION COULD NOT PREPARED. 5. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE VEHEM ENTLY ARGUED AND SUPPORTING THE ORDER OF LD. DIRECTOR OF INCOME TAX (I&CI). HE ALSO SUBMITTED THAT THERE WAS NO COMPLI ANCE TO THE NUMBER OF NOTICES ISSUED TO THE ASSESSEE WHICH SHOW S THE CASUAL APPROACH OF THE ASSESSEE TOWARDS THE NOTICES ISSUE D BY INCOME TAX DEPARTMENT. 6. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. THE ASSESSEE IS A LOCAL AUTHORIT Y CONTROLLED BY STATE GOVERNMENT OF MADHYA PRADESH AND CARRIES OUT THE WORK OF REGISTRATION OF THE DOCUMENTS PERTAINING TO TRANSFE R OF IMMOVEABLE PROPERTIES. THE ASSESSEE IS COVERED UNDER THE LIST OF PERSONS PROVIDED U/S 285BA SUB SECTION (I) OF THE ACT AND I S UNDER OBLIGATION TO FURNISH AIR FOR THE FINANCIAL TRANSA CTION OR REPORTABLE ACTION IN FORM NO.61B. AS PER PROVISIONS OF SECTIO N 285BA(II) OF THE ACT ASSESSEE WAS REQUIRED TO FURNISH STATEMENT IN FORM NO.61B FOR EVERY FINANCIAL YEAR BY 31 ST MAY OF THE FOLLOWING YEAR. THE DUE DATE FOR FINANCIAL YEAR 2014-15 WAS 31.5.2015 WHICH WAS SUB REGISTRAR JAORA ITA NO.108/IND/2018 5 SUBSEQUENTLY EXTENDED TO 10.12.2015. THE ASSESSEE FAILED TO FILE THE INFORMATION BY 10.5.2016. NOTICES WERE ISSUED BY THE REVENUE AUTHORITIES TO FILE THE DETAILS LATEST BY 15.12.201 5 BUT NO COMPLIANCE WAS MADE. THEREAFTER SHOW CAUSE NOTICE U/S 271FA R.W.S. 274 OF THE ACT WAS ISSUED ON 31.3.2016 FOR IMPOSING THE PENALTY FOR THE LAPSE IN NOT FILING THE ANNUAL INFO RMATION REPORT BUT THERE WAS NO COMPLIANCE TO THESE NOTICES. ASSESSEE ALSO FAILED TO APPEAR ON DATES FIXED FOR HEARING ON 17.11.2017 AND 21.12.2017. FOR THIS REASON PENALTY OF RS.3,51,500/- WAS WORKED OUT @ RS.500/- FOR THE DELAY OF 703 DAYS (FROM 16.12.2015 TO 17.11.2017). 7. WE OBSERVE THAT THE AMOUNT OF PENALTY IS COMPUTE D AS PER THE PROVISIONS OF SECTION 271FA OF THE ACT WHICH PROVID ES THAT BEFORE 1.04.2018 PENALTY OF RS.100/-PER DAY MAY BE CHARGE D FOR NUMBER OF DAYS DELAY. SECTION 273B OF THE ACT PROVIDES FO R NOT LEVYING PENALTY IN CERTAIN CASES IF THE ASSESSEE PROVES THA T THERE WAS A REASONABLE CAUSE FOR THE FAILURE. THIS SECTION ALS O REFERS TO THE PENALTY OF SECTION 271FA OF THE ACT. REFERENCE WAS MADE TO VARIOUS CORRESPONDENCES WITH THE CHIEF SECRETARY, GOVT. OF MADHYA PRADESH, DEPARTMENT OF COMMERCIAL TAXES AND CHIEF C OMMISSIONER SUB REGISTRAR JAORA ITA NO.108/IND/2018 6 OF INCOME TAX AS WELL AS SECRETARY, FINANCE DEPARTM ENT OF REVENUE WHICH TALKS ABOUT THE TECHNICAL PROBLEM DUE TO WHIC H NON INTEGRATION OF THE DEPARTMENTS PORTAL WITH THE INCO ME TAX DEPARTMENTAL PORTAL FOR PAN AUTHENTICATION WAS NOT ACHIEVED. THIS PROBLEM WAS SOLVED AT LATER STAGE AND FINALLY ASSES SEE FILED ANNUAL INFORMATION REPORT FOR FINANCIAL YEAR 2014-15 ON 14 .12.2017. CERTAINLY THERE WAS A DELAY BUT THERE WAS REASONABL E CAUSE FOR SUCH DELAY. 8. HOWEVER LOOKING TO THE FACT THAT THE ASSESSEE HA S NOT GIVEN ANY REPLY TO THE NUMEROUS NOTICES ISSUED BY THE INC OME TAX DEPARTMENT DELETING TOTAL PENALTY WILL NOT BE A GOO D MESSAGE TO THE VARIOUS GOVERNMENT DEPARTMENTS WHO ARE BOUND TO SUP PLY THE INFORMATION TO THE INCOME TAX DEPARTMENT WHICH PER SE HELPS IN CHECKING THE TAX EVASION AS WELL AS ASSESSING THE C ORRECT INCOME OF VARIOUS PERSONS. WE NOTICE THAT THE ASSESSING AUT HORITY HAS COMPUTED THE PENALTY @RS.500/- PER DAY WHICH WAS CH ANGED FROM RS.100/- TO RS.500/- W.E.F. 1.4.2018, THEREFORE THE PENALTY IF ANY HAS TO BE COMPUTED @RS.100/- PER DAY. FURTHER WHEN THE ASSESSEE DID NOT APPEAR ON 15.12.2015 WHY THE ACTION WAS NO T TAKEN AGAINST THE ASSESSEE, THE REASON IS BEST KNOWN TO T HE REVENUE AUTHORITIES WHO WAITED FOR ALMOST 2 YEARS TO COMPUT E THE PENALTY. FROM 10.9.2015 TO 15.12.2015 A TOTAL NUMBER OF DAYS FOR THE FAILURE ON THE PART OF THE ASSESSEE IS 97 DAYS. IN OUR CONS IDERED VIEW, SUB REGISTRAR JAORA ITA NO.108/IND/2018 7 TOTALITY OF THE FACTS AND IN THE INTEREST OF JUSTIC E AND FAIR TO BOTH THE PARTIES WE HOLD THAT SUSTAINING THE PENALTY OF RS.9 700/- (97 DAYS X RS.100/- PER DAY) ON THE ASSESSEE WILL BE JUSTIFIE D AND IT WILL BE A MESSAGE TO THE GOVERNMENT AUTHORITIES, SO THAT IN F UTURE SUCH CASUAL APPROACH SHOULD NOT BE TAKEN AND COMPLIANCE TO THE STATUTORY REQUIREMENTS INCLUDING REPLY OF NOTICES B Y INCOME TAX DEPARTMENT SHOULD BE ADHERED TO. WE ACCORDINGLY S USTAIN PENALTY OF RS.9,700/- AND DELETE THE REMAINING AMOUNT OF PE NALTY OF RS.3,41,800/- AND PARTLY ALLOW THE ASSESSEES APPEA L. 9. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PART LY ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 16.05.20 19. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 16 MAY, 2019 /DEV COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER ASSISTANT REGISTRAR, ITAT, INDORE