Central Bank of India, Chandigarh V. ITO (TDS), Panchkula

ITA 1122/CHANDI/2011

• Counselvise Citation: [2012] 119 COUNSELVISE.COM (IT) 7412 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 22-11-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAI SHREE SHARMA
• Assessee Lawyers: SHALINI KAPOOR
• Keywords: Reasonable cause; Corroborative evidences
• Section: 273B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE MS.SUSHMA CHOWLA, JUDICIAL MEMBER AND SHRI MEHAR SINGH, ACCOUNTANT MEMBER ITA NO. 1122/CHD/2011 ASSESSMENT YEAR: 2006-07 CENTRAL BANK OF INDIA, V ITO (TDS), MANIMAJRA, PANCHKULA. SCF 272-273, MOTOR MARKET, CHANDIGARH. PAN: RTKCO-1700G (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. SHALINI KAPOOR RESPONDENT BY : SMT.JAISHREE SHARMA DATE OF HEARING : 19.01.2012 DATE OF PRONOUNCEMENT : 25.01.2012 ORDER PER MEHAR SINGH, AM THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER DATED 09.09.2011 PASSED BY THE LD . CIT(A) U/S 250(6) OF THE INCOME-TAX ACT,1961 (IN SHORT 'TH E ACT'). 2. IN THIS APPEAL, THE ASSESSEE HAS RAISED THE FOLL OWING GROUNDS OF APPEAL: 1. THE LD. CIT(A) IS WRONG IN LEVYING A PENALTY OF RS.30,000/- U/S 272B OF THE INCOME-TAX ACT,1961 AS THERE WAS A REASONABLE CAUSE FOR SUCH FAILURE. THE DEDUCTOR ACTED BONAFIDE AND DEDUCTED THE TDS, AND ON THE BELIEF OF DEDUCTEE QUOTED PANS/NO PANS PROVIDED AND THE RETURN WAS ACCORDINGLY FILED. 2 2. THE LD. CIT(A) IS WRONG IN LEVYING PENALTY AS U/ S 139/A, 139A(5)(C), 139A(5B), 139A(5A), THE DEDUCTEE SHOULD BE HELD RESPONSIBLE FOR PROVIDING AND QUOTING VALID PAN TO THE DEDUCTOR. 3. IN VIEW OF ALL THESE AND SUCH OTHER GROUNDS, WHI CH MAY BE TAKEN AT THE TIME OF HEARING, THE APPEAL MAY PLEASE BE ALLOWED AND JUSTICE RENDERED. 3. THE BRIEF FACTS OF THE CASE ARE THAT ITO(TDS) LE VIED PENALTY OF RS.30,000/- @ RS.10,000/- PER DEFAULT VI DE ORDER DATED 28.09.2010. LD. CIT(A) UPHELD THE IMPUGNED P ENALTY ON THE GROUND OF NON-ATTENDANCE AND NON-FILING OF A NY REPLY BY THE ASSESSEE. 4. THE RELEVANT WRITTEN SUBMISSION FILED BY THE ASS ESSEE, IS REPRODUCED HEREUNDER : 2.2 EVEN DURING THE APPELLATE PROCEEDINGS, THE APPELLANT HAS SHOWN HIS INABILITY TO REVISE THE RET URN DUE TO TECHNICAL REASONS, BEYOND THE CONTROL OF APPELLANT, ON THE BASIS OF WHICH ADJOURNMENT WAS SOUGHT. BUT THE LD CIT(A) HAD CONFIRMED THE PENALT Y BY IGNORING THE FACT THAT THERE WAS REASONABLE CAUSE F OR SUCH FAILURE AND THE DEDUCTOR ACTED BONAFIDE AND DEDUCTED THE TDS AND DEPOSITED IT TO THE CREDIT OF CENTRAL GOVERNMENT AND FILLED HIS QUARTERLY TDS STATEMENT FAIRLY AND AGAIN TRYING TO REVISE THE RET URN WITH CORRECT PAN NUMBERS WHICH ARE NOT AVAILABLE WI TH THE APPELLANT. 2.3 IN RESPECT OF GROUND NO. 1 & 2, FURTHER IT IS SUBMITTED THAT AS PER SECTION 272B THE PENALTY SHOU LD BE IMPOSED ON THE DEDUCTEE FOR NON CITING THE PAN T HE PENALTY CANNOT BE IMPOSED ON THE DEDUCTOR. IN SUPPO RT OF ABOVE CONTENTION, THE APPELLANT IS RELYING ON FO LLOWING 3 JUDGMENTS: IN FINANCIAL CO-OP BANK LTD. V ITO (2009) 116 ITD 397 (AHD), IT WAS HELD THAT THE DEDUCTEE IS LIABLE FOR PENALTY UNDER SECTION 272B FOR NOT CITING THE PAN NO., THE PENALTY CANNOT BE IMPOSED ON THE DEDUCTOR. 3. FURTHER, IT HAS BEEN SUBMITTED THAT THE APPELLAN T HAS ACTED BONAFIDE AND DEDUCTD THE AMOUNT FROM THE PAYMENT MADE BY HIM TOWARDS TDS AND DEPOSITED IT WITH THE GOVERNMENT IN TIME. NOW THE ABOVE FUNDS AR E IN THE CUSTODY OF GOVERNMENT ONLY AND THERE IS NO CONCEALMENT ON THE PART OF THE APPELLANT. NEITHER T HE APPELLANT HAS FURNISHED ANY INACCURATE PARTICULARS. THE APPELLANT HAS REASONABLE CAUSE FOR THE SAID FAILURE AS TO COMPLY WITH THE NOTICES ISSUED. THE APPELLANT H AS TAKEN ADJOURNMENT ON THE GROUNDS OF REVISING THE RE TURN BY INPUTTING THE CORRECT {AN BUT THE APPELLANT CANN OT TRACE THE DEDUCTEE IN SUPPORT OF HIS REASONABLE EFF ORTS DUE TO WHICH THE RETURN CANNOT BE REVISED AS IT IS TH4E TECHNICAL REQUIREMENT FOR QUOTING CORRECT PAN TO VA LIDATE THE RETURN NOW THE APPELLANT PRAYS FOR RELIEF UNDER SECTION 273B WHERE IT HAS BEEN PROVIDED THAT NO PENALTY SHALL BE IMPOSABLE ON THE PERSON OR THE ASSESSEE, AS THE CASE MAY BE, FOR ANY FAILURE REFER RED TO IN THE PROVISIONS OF SECTIONS 271(1)(B), 271A, 271A A, 271B, 271BA, 271C, 271CA (W.E.F. 1.4.2007) 271D, 271E, 271FB, 271G, 271A(1)(C), 272(2), 272AA(1), 272BB(1), 272BBB(1), 272BB(1A), 273(1)(B), 273(2)(B)/(C) IF PROVES THAT THERE WAS REASONABLE C AUSE FOR THE SAID FAILURE. 4. FURTHER THIS IS TO KINDLY SUBMITTED THAT THE PEN ALTY U/S 272B IS FIXED AT RS.10,000/- AND IS NOT RS.10,0 00/- PER DEFAULT AS PROVIDED U/S 272A. 4 5. WE HAVE CAREFULLY PERUSED THE RIVAL SUBMISSIONS AND THE RELEVANT RECORD IN THE MATTER AND FOUND THAT TH E CASE OF THE ASSESSEE IS COVERED BY THE DECISION OF THE HON' BLE ITAT AHMEDABAD BENCH IN THE CASE OF FINANCIAL COOPERATIV E BANK LTD. V ITO (2009) 116 ITD 358 (AHD.). THE RELEVANT PART OF THE DECISION IS REPRODUCED HEREUNDER : SECTION 272B, READ WITH SECTION 139A OF THE INCOME -TAX ACT,1961 AND RULES 114B TO 114D OF THE INCOME-TAX RULES, 1962 PENALTY FOR FAILURE TO COMPLY WITH PROVISIONS OF SECTION 139A-ASSESSMENT YEAR 2006-07- ASSESSEE, ENGAGED IN BUSINESS OF BANKING, WAS TO GE T EITHER PERMANENT ACCOUNT NUMBERS (PANS) OF DEPOSITO RS OR FORM NO.60 DULY FILLED IN BY THEM AS SPECIFIED I N SECTION 139A AND RULES 114B TO 114D-ASSESSEE OBTAINED FORM NO.60 FROM DEPOSITORS WHO DID NOT HAV E PANS BUT IN SOME CASES EITHER SAID FORM HAD NOT BEE N COMPLETELY FILLED UP OR SUPPORTING EVIDENCE WITH RE SPECT TO ADDRESSES OF DEPOSITORS WAS NOT AVAILABLE-AO IMPOSED PENALTY UNDER SECTION 272B FOR SAID FAILURE OF ASSESSEE-WHETHER ASSESSEE-BANK COULD BE PENALIZED F OR ITS FAILURE TO OBTAIN COMPLETELY FILLED IN FORM NO. 60 AND/OR SUPPORTING EVIDENCE WITH RESPECT TO ADDRESSE S OF THE DEPOSITORS-HELD,NO. 6. THE ASSESSEE HAS MADE EFFORT TO REVISE THE RETUR N BUT FAILED DUE TO TECHNICAL REASONS BEYOND THE CONTROL OF THE APPELLANT. THE CIT(A) UPHELD THE LEVY OF PENALTY B Y IGNORING THE EXISTENCE OF SUCH REASONABLE CAUSE. IT IS SETTL ED PROPOSITION THAT NO-ONE IS EXPECTED TO PERFORM IMPOSSIBILITIES. IN VIEW OF THIS, THE CASE OF THE ASSESSEE ALSO FALLS U/S 273B OF THE ACT. FURTHER, THE PROVISIONS OF SECTION 272B OF THE ACT, CONTEMPLATE PENALTY, IF A PERSON Q UOTES OR INTIMATES A NUMBER WHICH IS FALSE, AND WHICH HE EIT HER 5 KNOWS OR BELIEVES TO BE FALSE OR DOES NOT BELIEVE T O BE TRUE. THE CASE OF THE ASSESSEE, IN VIEW OF ABOVE DISCUSSI ON, DOES NOT FALL UNDER ANY OF THE CATEGORY ENVISAGED BY THE PROVISIONS OF THE ACT. 7. IN VIEW OF THE ABOVE FACTUAL AND LEGAL DISCUSSIO NS, WE DO NOT UPHELD THE CONFIRMATION OF PENALTY BY THE CI T(A) AND, HENCE, THE PENALTY ORDER IS CANCELLED. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 25 TH JAN.,2012. SD/- SD/- (SUSHMA CHOWLA) (MEHAR SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 25 TH JAN.,2012. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT,DR ASSISTANT REGISTRAR, ITAT CHANDIGARH