Arjun Oruganti , Warangal V. Income Tax Officer, Ward-5, Warangal

ITA 1155/Hyd/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 8826 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB-A
• Next Hearing Date: 17-02-2021
• Assessment Year: 2010-2011
• Appeal Filed On: 17-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: A Y AGAINST OF CITA HYDERABAD
• Keywords: Tax effect; Set aside
• Section: 143(3); 142(1); 22; 147; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH : HYDERABAD (THROUGH VIDEO CONFERENCING ) BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NOS. 1154 & 1155/HYD./2019 A.Y. 2010 - 11 SRI ARJUN ORUGANTI VS. ITO, WARD 5 WARANGAL WARANGAL [PAN: AAEPO8461F] (APPELLANT) (RESPONDENT) F OR APPELLANT : SH. A.V. RAGHURAM, ADV. FOR RESPONDENT : SH. SUNIL KUMAR PANDEY, D.R. DATE OF HEARING : 17/02/2021 DATE OF PRONOUNCEMENT : 22 /03/2021 O R D E R PER SMT. P. MADHAVI DEVI, J.M. BOTH THESE APPEALS ARE FILED BY ASSESSEE FOR THE A.Y 2010 - 11 AGAINST THE ORDER OF CIT(A) - 3, HYDERABAD DATED 8.5.2019 CONFIRMING LEVY OF PENALTY U/S 271(1)(B) OF THE INCOME TAX ACT, 1961 [IN SHORT THE ACT] . 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, AN INDIVIDUAL, ENTERED INTO A DEVELOPMENT AGREEMENT - CUM - GPA WITH M/S LAXMI CONSTRUCTIONS VIDE REGISTERED DOCUMENT NO. 3817/2009 DATED 31.7.2009 ALONG WITH ANOTHER PERSON . THE AO OBSERVED THAT THE ASSE S SEE HAS NOT FILED HIS RETURN OF INCOME ADMITTING INCOME DERIVED FROM THE SAID TRANSACTIONS AN D TH EREFORE ASSESSMENT WAS REOPENED BY ITA NOS. 1154 & 1155/HYD/19 AY 2010 - 11 SH. ARJUN ORUGANTI, HYD. 2 WAY OF ISSU ANCE OF NOTICE U /S 148 OF THE ACT AND ASSESSMENT WAS COMPLETED U/S 144/ 147 VIDE ORDER DATED 2 2.12.2017 DETERMINING TOTAL INCOME OF THE ASSESSEE AT RS.90,78,366/ - THEREAFTER, NOTICE U/S 271(1)(B) WAS ISSUED TO ASSESSEE FOR NON - OFFERING THE INCOME TO TAX. HOWEVER , NONE APPEARED FOR ASSESSEE AND THEREFORE AO LEVIED PENALTY OF RS. 10,000 / - FOR EACH DAY OF NON - COMPLIANCE TO THE NOTICE U/S 142 (1) I.E. TOTAL OF RS.20,000/ - PENALTY WAS LEVIED U/S 271(1)( B ) OF THE ACT. 2.1. AGGRIEVED , ASSESSEE APPEALED BEFORE THE CIT(A) BUT AS NONE APPEARED BEFORE THE CIT(A) AS WELL , HE DISMISSED ASSESSEES APPEAL. T HE ASSESSEE IS IN SECOND APPEAL BEFORE US BY RAISING THE FOLLOWIN G GROUNDS OF APPEAL . 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE COMMISSIONER (APP EALS) ERRED IN SUSTAINING THE ORDER OF PENALTY PASSED BY THE AO U/S 271 (1)(B) OF THE ACT. 2. T HE COMMISSIONER (APPEALS) FAILED TO APPRECIATE THE CONTENTION OF THE APP ELLANT THAT THE NOTICES WERE NOT PROPERLY SERVED ON THE APPEL1ANT AND TH EREFORE THE PENALTY LEVIED OF RS.20, 000 FOR TWO ALLEGED VIOLATIONS IS ILLEGAL AND INC ORRECT . 3. THE COMMISSION ER (A P PEALS) OUGHT TO HAVE CALLED FOR THE RECORD AND VERIFIED OR HIMSELF ABOUT THE CONTENTIONS RAISED BY THE APPEL1ANT RATHER THAN BLINDLY R E LY ING THE CONTENTS OF THE ASST. ORDER. 4. WITHOUT PREJUDICE TO ANY OF THE GROUNDS, THE COMMISSIONER (APPEALS) OUGH T T O HAVE APPRECIATED THAT THE APPEL1ANT IS AN UNEDUCATED PERSON AND DID NOT KN OW THE CONSEQUENCES OF THE NOTICES AL1EGEDLY ISSUED BY THE AO AND THEREFORE SHOULD NOT HAVE BEEN VISITED WITH PENALTY. (TAX EFFECT - RS.20, 000 ) F OR THESE AND OTHER GROUNDS T HAT MAY BE URGED, IT IS PRAYED THAT THE APPEAL M AY BE ALLOWED. 2.2. LD. C OUNSEL FOR THE ASSESSEE REITERATED SUBMISSIONS MADE BEFORE THE CIT(A) THAT NOTICES U/S 142(1) WERE NOT SERVED ON ASSESSEE AND ALSO THAT EVEN IF IT IS TO ITA NOS. 1154 & 1155/HYD/19 AY 2010 - 11 SH. ARJUN ORUGANTI, HYD. 3 BE PRESUMED THAT THE NOTICES WERE SERVED, THE ASSESSEE BEING UNEDUCATED , D ID NOT HAVE KNOWLEDGE TO COMPREHEND THE CONTENTS OF NOTICES. HE ALSO SUBMITTED THE APPEAL AGAINST ASSESSMENT ORDER FILED BY THE ASSESSEE BEFORE THE CIT(A) IS PENDING WITH THE CIT(A). HE THEREFORE PRAYED THAT THIS APPEAL ALSO MAY BE SET ASIDE TO THE FILE OF CIT(A). 2.3. LD. DR RELIED ON THE ORDERS OF THE AUTHORITIES BELOW. 3. HAVING REGARD TO RIVAL CONTENTIONS AND MATERIAL PLACED ON RECORD AND ALSO TO THE FACT THAT THE A PPEAL AGAINST THE ASSESSMENT ORDER U/S 143(3) R.W.S. 147 OF THE ACT IS PENDING BEFORE THE CIT(A) AND THIS APPEAL OF ASSESSEE WAS DISMISSED FOR NON - APPEARANCE AND NOT ON MERITS, WE DEEM IT FIT AND PROPER TO REMAND THE ISSUE TO FILE OF CIT(A) FOR DE - NO VO CONSIDERATION IN ACCORDANCE WITH LAW. 4. IN THE RESULT ASSESSEES APPEAL S ARE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED ON 22 ND MARCH, 202 1 . SD/ - SD/ - (A. MOHAN ALANKAMONY) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 22 ND MARCH, 202 1 . *GMV COPY FORWARDED TO: 1. SH. ARJUN ORUGANTI, C/O SRI AV RAGHURAM, ADVOCATE, FLAT NO.610, 6 TH FLOOR, BABUKHAN ESTATE, BASHEERBAGH , HYDERABAD 500 001 2. ITO, WARD 5, WARANGAL 3. ACIT, WARANGAL RANGE, WARA N GAL . 4. CIT(A) - 3 , HYDERABAD 6. PR.CIT - 3 , HYDERABAD 7. DR, ITAT, HYDERABAD. 8. GUARD FILE.