RAJ KISHORE SINGH, RAIGARH V. INCOME TAX OFFICER, RAIGARH

ITA 118/RPR/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2707 (ITAT-RAIPUR)
• Duration Of Justice: 1 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 25-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K JAIN
• Assessee Lawyers: S R RAO
• Keywords: Depreciation
• Section: 143(3)

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.118/RPR/2018 ASSESSMENT YEAR : 2010-11 RAJ KISHORE SINGH, PROP. BASUDEO BUS SERVICE, KABIR CHOWK, JUTE MILL ROAD, RAIGARH (CG). VS. ITO- 1, RAIGARH (CG). PAN : AUPPS6770E (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI S. R. RAO, ADV. DEPARTMENT BY : SHRI D. K. JAIN, 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 02.04.2018 OF THE LD. CIT(A), BILASPUR (CG) RELATIN G TO ASSESSMENT YEAR 2010-11. 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS ENGAGED IN BUS-PLYING BUSINESS. THE RETURN OF INCOME FOR THE IMPUGNED AS SESSMENT YEAR WAS FILED ON 29.03.2011 DECLARING TOTAL INCOME OF RS.4,95,680/-. THE ASSESSMENT WAS COMPLETED U/S 143(3) DETERMINING THE TOTAL INCOME A T RS.8,90,080/- WHEREIN THE 2 ITA NO.118/RPR/2018 ASSESSING OFFICER MADE ADDITION ON ACCOUNT OF DISAL LOWANCE OF DEPRECIATION OF RS.3,58,151/- AND DISALLOWANCE OUT OF EXPENSES OF R S.50,000/-. THE ASSESSEE DID NOT FILE ANY APPEAL. SUBSEQUENTLY, THE ASSESSI NG OFFICER LEVIED PENALTY OF RS.1,05,000/- U/S 271(1)(C) OF THE I.T. ACT, 1961 O N ACCOUNT OF EXCESS CLAIM OF DEPRECIATION. 3. IN APPEAL, THE LD. CIT(A) UPHELD THE ACTION OF T HE ASSESSING OFFICER. 4. AGGRIEVED WITH SUCH ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. THE LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET, REFERRING TO THE NOTICE ISSUED U/S 274 R.W.S. 271 SUBMITTED THAT THE SHOW C AUSE NOTICE ISSUED U/S 274 R.W.S. 271 DID NOT DEFINE THE NATURE OF DEFAULT I.E . WHETHER THE PENALTY IS LEVIED FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INAC CURATE 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 CONCE ALED HIS INCOME AND FURNISHED INACCURATE PARTICULARS OF INCOME. REFERRING TO THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. M/S SSA S EMERALD MEADOWS VIDE ITA NO.380 OF 2015 ORDER DATED 23.11.2015, HE SUBMI TTED THAT THE HON'BLE HIGH COURT IN THE SAID DECISION, FOLLOWING THE DECISION IN THE CASE OF MANJUNATH COTTON AND GINNING FACTORY REPORTED IN 359 ITR 565, HAD UPHELD THE DECISION OF THE TRIBUNAL CANCELLING THE PENALTY AND DISMISSE D THE APPEAL FILED BY THE 3 ITA NO.118/RPR/2018 REVENUE ON THE GROUND THAT THE NOTICE ISSUED BY THE ASSESSING OFFICER U/S 274 R.W.S. 271 IS BAD IN LAW SINCE IT DID NOT SPECIFY U NDER 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 HON BLE SUPREME COURT. REFERRING TO VARIOUS DECISIONS FILED IN THE PAPER B OOK, HE SUBMITTED THAT UNDER IDENTICAL CIRCUMSTANCES VARIOUS BENCHES OF THE TRIB UNAL ARE CANCELLING 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 AC CORDINGLY SUBMITTED THAT ON THIS PRELIMINARILY GROUND ITSELF THE ORDER OF THE L D. CIT(A) SUSTAINING THE PENALTY LEVIED BY THE ASSESSING OFFICER SHOULD BE SET-ASIDE AND THE PENALTY SHOULD BE CANCELLED. 6. 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. 7. 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) THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E. WHE THER FOR CONCEALMENT OF 4 ITA NO.118/RPR/2018 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. 8. WE FIND THE SLP FILED BY THE REVENUE HAS BEEN DI SMISSED 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.118/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. 9. 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