SHRI JOSEPH M JOY, BHILAI V. DEPUTY COMMISSIONER OF INCOME TAX 1(1), , BHILAI

ITA 11/RPR/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2712 (ITAT-RAIPUR)
• Duration Of Justice: 6 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2015-2016
• Appeal Filed On: 23-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RITUPARAN NAMDEO
• Section: 271(1)(c); 274

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER AND MS. SUCHITRA KAMBLE, JUDICIAL MEMBER ITA NO.11/RPR/2018 ASSESSMENT YEAR : 2015-16 SHRI JOSEPH M. JOY, MIG-1/931, HUDCO BHILAI (CG). VS. DCIT- 1(1), BHILAI (CG). PAN : AERPJ2923A (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S. R. RAO, ADV. DEPARTMENT BY : SHRI RITUPARAN NAMDEO, DR DATE OF HEARING : 09-08-2018 DATE OF PRONOUNCEMENT : 09-08-2018 O R D E R PER R. K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 03.11.2017 OF THE LD. CIT(A)-II, RAIPUR (CG) RELATI NG TO ASSESSMENT YEAR 2015-16. 2. LEVY OF PENALTY OF RS.37,870/- U//S 271(1)(C) OF THE I.T. ACT, 1961 BY THE ASSESSING OFFICER AND CONFIRMED BY THE LD. CIT(A) I S THE ONLY ISSUE RAISED BY THE ASSESSEE IN THE GROUNDS OF APPEAL. 3. THE LD. COUNSEL FOR THE ASSESSEE AT THE TIME OF HEARING FILED AN ADDITIONAL GROUND WHICH READS AS UNDER :- IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN DISMISSING THE AP PEAL BY CONFIRMING THE PENALTY ORDER WHICH IS ILLEGAL, BAD-IN-LAW AND WITHOUT JURI SDICTION BEING BASED ON SHOW CAUSE 2 ITA NO.11/RPR/2018 NOTICE ISSUED U/S 274 READ WITH SECTION 271(1)(C) O F THE INCOME-TAX ACT, 1961 WITHOUT SPECIFYING THE NATURE OF DEFAULT I.E. WHETHER THERE IS CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME AND CONTRARY TO THE LAW LAID DOWN BY HONBLE SUPREME COURT IN THE CASE OF CIT VS. SSAS EMERALD MEADOWS IN SLP CC NO.11485/2016. 4. RELYING ON VARIOUS DECISIONS, LD. COUNSEL FOR TH E ASSESSEE SUBMITTED THAT THIS GROUND BEING A LEGAL ONE AND ALL FACTS ARE ALR EADY ON RECORD THE ADDITIONAL GROUND SHOULD BE ADMITTED. 5. THE LD. DR ON THE OTHER HAND OPPOSED THE ADMISSI ON OF THE ADDITIONAL GROUND. 6. AFTER HEARING BOTH THE SIDES, THE ADDITIONAL GRO UND RAISED BY THE ASSESSEE BEING A LEGAL ONE IS ADMITTED FOR ADJUDICATION 7. THE LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET, REFERRING TO COPY OF THE NOTICE U/S 274 R.W.S. 271, COPY OF WHICH IS PLACED AT PAGE 67 OF THE PAPER BOOK, SUBMITTED THAT THE SHOW CAUSE NOTICE ISSUED U/S 274 R.W.S. 271 DID NOT DEFINE THE NATURE OF DEFAULT I.E. WHETHER THE PENALTY IS LEVIE D FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. HE SUBMITTED THAT THE ASSESSING OFFICER IMPOSED THE PENALTY U/S 271(1)(C) IN THIS CASE ON THE GROUND THAT THE ASSESSEE HAS CONCEALED HIS INCOME AND FURN ISHED INACCURATE PARTICULARS OF INCOME. REFERRING TO THE DECISION OF THE HONBL E KARNATAKA HIGH COURT IN THE CASE OF CIT VS. M/S SSAS EMERALD MEADOWS VIDE ITA NO.380 OF 2015 ORDER DATED 23.11.2015, HE SUBMITTED THAT THE HON'B LE HIGH COURT IN THE SAID DECISION, FOLLOWING THE DECISION IN THE CASE OF MAN JUNATH COTTON AND GINNING 3 ITA NO.11/RPR/2018 FACTORY REPORTED IN 359 ITR 565, HAD UPHELD THE DEC ISION OF THE TRIBUNAL CANCELLING THE PENALTY AND DISMISSED THE APPEAL FIL ED BY THE REVENUE ON THE GROUND THAT THE NOTICE ISSUED BY THE ASSESSING OFFI CER U/S 274 R.W.S. 271 IS BAD IN LAW SINCE IT DID NOT SPECIFY UNDER WHICH LIMB OF SECTION 271(1)(C) PENALTY PROCEEDINGS HAVE BEEN INITIATED. HE SUBMITTED THAT THE SLP FILED BY THE REVENUE HAS BEEN DISMISSED BY THE HONBLE SUPREME C OURT. REFERRING TO VARIOUS DECISIONS FILED IN THE PAPER BOOK, HE SUBMI TTED THAT UNDER IDENTICAL CIRCUMSTANCES VARIOUS BENCHES OF THE TRIBUNAL ARE C ANCELLING THE PENALTY SO LEVIED WHERE THE INAPPROPRIATE WORDS ARE NOT STRUCK OFF FROM THE NOTICE ISSUED U/S 274 R.W.S. 271 OF THE ACT. HE ACCORDINGLY SUBM ITTED THAT ON THIS PRELIMINARILY GROUND ITSELF THE ORDER OF THE LD. CI T(A) SUSTAINING THE PENALTY LEVIED BY THE ASSESSING OFFICER SHOULD BE SET-ASIDE AND THE PENALTY SHOULD BE CANCELLED. 8. THE LD. DR ON THE OTHER HAND HEAVILY RELIED ON T HE ORDER OF THE LD. CIT(A). HE SUBMITTED THAT MERE NON-STRIKING OF THE INAPPROPRIATE WORDS WILL NOT INVALIDATE THE INITIATION OF PENALTY PROCEEDING S AND THE PROVISIONS OF SECTION 292B/292BB WILL COME TO RESCUE OF THE DEPARTMENT. 9. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSA L OF THE NOTICE ISSUED U/S 274 R.W.S. 271 SHOWS THAT THE INAPPROPRIATE WORDS IN TH E SAID NOTICE HAS NOT BEEN STRUCK OFF I.E. THE NOTICE DOES NOT SPECIFY UNDER W HICH LIMB OF SECTION 271(1)(C) 4 ITA NO.11/RPR/2018 THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E. WHE THER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. WE FIND THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF M/S SSA S EMERALD MEADOWS (SUPRA) HAS OBSERVED AS UNDER :- 3. THE TRIBUNAL HAS ALLOWED THE APPEAL FILED BY TH E ASSESSEE HOLDING THE NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SECTION 274 R EAD WITH SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) TO BE BA D IN LAW AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, THE PENALTY P ROCEEDINGS HAD BEEN INITIATED I.E., WHETHER FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE TRIBUNAL, WHILE ALLOWING THE APPEAL OF THE ASSESSEE, HAS RELIED ON THE DECISION OF THE DIVISION BENCH OF THI S COURT RENDERED IN THE CASE OF COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON A ND GINNING FACTORY (2013) 359 ITR 565. 4. IN OUR VIEW, SINCE THE MATTER IS COVERED BY JUDG MENT OF THE DIVISION BENCH OF THIS COURT, WE ARE OF THE OPINION, NO SUBSTANTIAL Q UESTION OF LAW ARISES IN THIS APPEAL FOR DETERMINATION BY THIS COURT. THE APPEAL IS ACCO RDINGLY DISMISSED. 10. WE FIND THE SLP FILED BY THE REVENUE HAS BEEN D ISMISSED BY THE HONBLE APEX COURT. FURTHER, THE VARIOUS BENCHES OF THE TR IBUNAL FOLLOWING THE ABOVE DECISIONS ARE CANCELLING THE PENALTY SO LEVIED BY T HE ASSESSING OFFICER AND CONFIRMED BY THE LD. CIT(A) ON ACCOUNT OF NON-STRIK ING OF THE INAPPROPRIATE WORDS FROM THE NOTICE ISSUED U/S 274 R.W.S. 271 OF THE ACT. SINCE IN THE INSTANT CASE, THE ASSESSING OFFICER HAS NOT STRUCK OFF THE INAPPROPRIATE WORDS IN THE NOTICES ISSUED U/S 274 R.W.S. 271, THEREFORE, THE N OTICE DOES NOT SPECIFY UNDER WHICH LIMB OF SECTION 271(1)(C) THE PENALTY PROCEED INGS HAD BEEN INITIATED I.E. WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THEREFORE, THE PENALTY PROCEEDINGS BECOME BAD IN LAW. WE, THEREFORE, 5 ITA NO.11/RPR/2018 SET-ASIDE THE ORDER OF THE LD. CIT(A) AND DIRECT TH E ASSESSING OFFICER TO CANCEL THE PENALTY SO LEVIED. THE APPEAL FILED BY THE ASS ESSEE IS ACCORDINGLY ALLOWED. 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ITSELF I.E. ON THIS 09 TH AUGUST, 2018. SD/- SD/- (SUCHITRA KAMBLE) (R. K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 09-08-2018. SUJEET COPY OF ORDER TO: - 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT 4) THE CIT(A) 5) THE DR, I.T.A.T., RAIPUR. BY ORDER //TRUE COPY// SR. PRIVATE SECRETARY ITAT, RAIPUR