SHRI. KETAN J. SHAH, MUMBAI V. DCIT, CENTRAL CIRCLE 32, MUMBAI

ITA 1114/MUM/2009

• Counselvise Citation: [2010] 119 COUNSELVISE.COM (IT) 6223 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2001-2002
• Appeal Filed On: 18-02-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: SRAVAN KUMAR
• Keywords: Search and seizure; Question of law

Judgement Text

I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 1 IN THE INCOME TAX APPELLATE TRIBUNAL, A BENCH, MUMBAI. [CORAM: D.MANMOHAN, VICE PRESIDENT AND PRAMOD KUMAR , AM] I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 KETAN J. SHAH, . APPELLANT A-1, AMI DARSHAN SOCIETY, 4, DAHYABHAI PATEL ROAD, MUMBAI-97. PA NO.AMWPS 6223 R VS DY.COMMISSIONER OF INCOME TAX, CIRCLE -32, RESP ONDENT MUMBAI APPEARANCES: SHRI SATISH MODY, FOR THE ASSESSEE SHRI SRAVAN KUMAR, FOR THE ASSESSING OFFICER. O R D E R PER PRAMOD KUMAR: ITA NO.1113/M/2009: 1. BY WAY OF THIS APPEAL, THE ASSESSEE HAS CHALLENGED T HE CIT(A)S CONFIRMING THE PENALTY OF ` .1,69,260/- IMPOSED ON THE ASSESSEE U/S.271(1)(C) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2000-01. 2. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, SHRI SATISH MODY, LEARNED COUNSEL FOR THE ASSESSEE, INVITED OUR ATTENTION TO ASSESSEE S APPLICATION DATED 1 ST JULY, 2010 PRAYING ADMISSION OF AN ADDITIONAL GROUND OF APP EAL ON THE QUESTION OF ASSESSING OFFICERS JURISDICTION TO PASS THE IMPUGNED ORDE R AS THE IMPUGNED ORDER I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 2 WAS TIME BARRED. HE FURTHER SUBMITS THAT THE GRIEV ANCE SO RAISED GOES TO THE ROOT OF THE MATTER, THAT IT COULD NOT TAKEN UP EARLIER BONA FIDE, THAT IT RAISES A PURE QUESTION OF LAW ON UNDISPUTED FACTS AND THAT, IN THE EVENT OF THI S GRIEVANCE BEING UPHELD, ALL OTHER GROUNDS OF APPEAL WILL BE RENDERED INFRUCTUOUS. WE A RE THUS URGED TO TAKE UP THE ADDITIONAL GROUND OF APPEAL, AND ITS ADMISSION FIRST. LEARNED DEPARTMENTAL REPRESENTATIVE, ON THE OTHER HAND, SUBMITS THAT THE GR IEVANCE BEING SOUGHT TO BE RAISED DOES NOT ARISE OUT OF IMPUGNED ORDER PASSED BY T HE CIT (A). 3. THE ADDITIONAL GROUND OF APPEAL AS FILED BY WAY O F FORWARDING LETTER DATED 1 ST JULY, 2010, IS AS FOLLOWS: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE PENALTY ORDER U/S. 271(1)(C) OF THE INCOME TAX ACT, 1961 PASSED BY THE ASSESSING OFFICER ON 21.7.2008 IS BAD IN LAW ON IT IS BA RRED BY LIMITATION, AS THE SAME IS PASSED BEYOND THE PERIOD OF SI X MONTHS PRESCRIBED U/S. 275(1)(C) OF THE INCOME TAX ACT, 1961 . 4. HAVING REGARD TO THE FACT THE ABOVE GROUND OF AP PEAL INVOLVES A PURE QUESTION OF LAW, ARISING OUT OF UNDISPUTED FACTS, AND I N THE LIGHT OF THE HONBLE SUPREME COURTS JUDGEMENT IN THE CASE OF NTPC, 229 ITR 363 (SC), WE DEEM IT FIT AND PROPER TO ADMIT THE AFORESAID ADDITIONAL GROUND OF APPEAL AND DISPOSE OF THE SAME ON MERITS. 5. TO ADJUDICATE ON THIS GRIEVANCE, ONLY A FEW MATER IAL FACTS NEED TO BE TAKEN NOTE OF. THE ASSESSMENT, IN RESPECT OF WHICH THE IMPUGN ED PENALTY IS LEVIED, WAS FINALIZED ON 28.12.2007 AND ON THE SAME DATE, PENALT Y PROCEEDINGS UNDER SECTION 271(1)(C) WERE INITIATED BY THE ASSESSING OFFICER. THE IMPUGNED PENALTY ORDER, HOWEVER, WAS PASSED ON 21.7.2008 . IT IS ALSO NECESSARY T O TAKE NOTE OF THE FACT THAT NO APPEAL WAS PREFERRED AGAINST THE ASSESSMENT FINALIZED BY THE ASSESSING OFFICER. THE MANDATE OF SECTION 275(1)(C) IS CLEAR AND AMBIGUO US. IT PROVIDES THAT NO ORDER IMPOSING A PENALTY, INTER ALIA, UNDER SECTION 271(1)(C) CAN BE PASSED AFTER EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLET ED OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH ACTION FOR IMPOSITION OF PENAL TY IS INITIATED, WHICHEVER PERIOD EXPIRES LATER. THE OUTER LIMIT FOR IMPOSITION OF PEN ALTY UNDER SECTION 271(1)(C) (I.E. I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 3 DATE ON WHICH SIX MONTHS FROM THE END OF THE MONTH IN WHICH PROCEEDINGS ARE INITIATED ARE COMPLETED) WAS THUS 30 TH JUNE, 2008. WHEREAS THE IMPUGNED PENALTY ORDER IS PASSED ON 21.7.2008. THE IMPUGNED PENALTY OR DER IS THUS CLEARLY TIME BARRED. LEARNED DEPARTMENTAL REPRESENTATIVE COULD N OT POINT OUT ANY GOOD REASON AS TO WHY THE PROVISIONS OF SECTION 275(1)(C) OF THE AC T WOULD NOT APPLY TO THIS FACTUAL SCENARIO. IN VIEW OF THESE DISCUSSIONS, WE SEE ME RITS IN THE GRIEVANCE RAISED BY THE LEARNED COUNSEL FOR THE ASSESSEE. WE, ACCORDINGL Y, QUASH THE IMPUGNED PENALTY ORDER AS TIME BARRED. THE ASSESSEE GETS RELIEF A CCORDINGLY. 6. AS LEARNED COUNSEL FOR THE ASSESSEE HAS RIGHTLY POINTED THAT ONCE THE IMPUGNED ORDER IS FOUND TO BE TIME BARRED, ALL OTHER GRIEVANCES RAISED IN THE APPEAL ARE TO BE DISMISSED AS INFRUCTUOUS AND ACADEMIC. WE DO SO. 7. IN THE RESULT, APPEAL IS ALLOWED. ITA NOS.1114 TO 1117/M/2009: 8. BY WAY OF THESE APPEALS, THE ASSESSEE HAS CALLED INTO QUESTION THE CIT(A)S CONFIRMING THE PENALTY IMPOSED ON THE ASSESSEE U/S.271(1 )(C) OF THE INCOME TAX ACT, 1961, FOR THE ASSESSMENT YEARS 2001-02 TO 2004-05, RESPE CTIVELY. 9. THE SHORT GRIEVANCE WHICH IS RAISED BEFORE US IS THA T THE CIT (A) OUGHT TO HAVE DELETED THE PENALTY FOR THE REASON THAT THE RELATED INCOME WAS OFFERED TO TAX BY THE ASSESSEE IN THE COURSE OF STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT AND, THEREFORE, IMMUNITY FROM IMPOSITION OF PENALTY UNDER SECTION 271(1)(C) WAS AVAILABLE TO THE ASSESSEE. 10. THE FACTUAL ELEMENT EMBEDDED IN THIS CHALLENGE D O NOT STAND OUR SCRUTINY IN THE SENSE THAT THERE IS NOTHING ON RECORD TO SUGGEST TH AT THE ASSESSEE HAD DISCLOSED THE RELEVANT INCOME, IN CONNECTION WITH WHICH THE I MPUGNED PENALTY IS LEVIED IN THE COURSE OF STATEMENT UNDER SECTION 132(4) OF THE INCOME TAX ACT, 1961. THE ONLY EVIDENCE THAT THE LEARNED COUNSEL FOR THE ASSESSEE PRODU CED IN RESPECT OF THIS I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 4 SUBMISSION IS A COPY OF LETTER DATED 1.7.2005 ADDRESSED TO THE DEPUTY DIRECTOR OF INVESTIGATION, UNIT IV(3), MUMBAI WHICH STATES THAT TH E ASSESSEE HAD VOLUNTARILY OFFERED THE SUM OF ` .13.35 LAKHS AS INCOME OF THE BLOCK PERIOD DURING THE COURSE OF SEARCH AND SEIZURE OPERATION CARRIED ON BY THE ASSESSEE A ND BY WAY OF STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT. LEARNED C OUNSEL, HOWEVER, IS NOT IN A POSITION TO DEMONSTRATE AS TO HOW THE SAID FACTS ARE REF LECTED IN THE STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT AND ON THE CONTRARY HE FAIRLY ACCEPTS THAT THERE IS NO SUCH MENTION OF THIS DISCLOSURE IN THE STATEM ENT RECORDED UNDER SECTION 132(4) OF THE ACT. IN THIS VIEW OF THE MATTER, WE A RE UNABLE TO SEE ANY MERITS IN ASSESSES CHALLENGE THE CORRECTNESS OF PENALTY CONFIRMING BY THE CIT (A). NO OTHER SPECIFIC GRIEVANCES WERE RAISED OR ARGUMENTS WERE ADVAN CED BY THE ASSESSEE. FOR THE REASONS SET OUT ABOVE, WE CONFIRM THE ACTION OF T HE CIT (A) IN CONFIRMING THE IMPUGNED PENALTY AND DECLINE TO INTERFERE IN THE MA TTER. 11. IN THE RESULTS, APPEALS ARE DISMISSED. PRONOUNCED IN THE OPEN COURT ON 30 TH NOVEMBER, 2010 SD/- (D.MANMOHAN) (VICE PRESIDENT) SD/- (PRAMOD KUMAR) (ACCOUNTANT MEMBER) MUMBAI, DATED 30 TH NOVEMBER, 2010 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS)-C-VIII, MUMBA I 4. COMMISSIONER OF INCOME TAX, C-III MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH A, MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 5 DATE INITIALS 1. DRAFT DICTATED ON 30.11.10 PS 2. DRAFT PLACED BEFORE AUTHOR 30.11.10 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER AM/JM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5. APPROVED DRAFT COMES TO THE SR. PS PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER I.T.A NOS.1113 TO 1117/ MUM/2009 ASSESSMENT YEARS: 2000-2001 TO 2004-05 6