Shri Mohammad Kamil Qidwai, Bhopal V. The ITO 3(2), Bhopal

ITA 120/IND/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 61982 (ITAT-INDORE)
• Duration Of Justice: 2 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-05-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 02-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Keywords: Reasonable cause
• Section: 273B

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NOS.119 AND 120/IND/2012 A.Y. 2006-07 1. SMT. NIKHAT QIDWAI, BHOPAL PAN AAAPQ 4683 M 2. MOHAMMAD KAMIL QIDWAI, BHOPAL PAN AAAPQ 4684 N :: APPELLANTS VS ITO-3(2), BHOPAL :: RESPONDENT APPELLANT S BY NONE RESPONDENT BY SHRI ARUN DEWAN DATE OF HEARING 8 .05.2012 DATE OF PRONOUNCEMENT .05.2012 O R D E R PER JOGINDER SINGH , JUDICIAL MEMBER BOTH THESE APPEALS ARE BY DIFFERENT ASSESSEES ON T HE COMMON GROUND THAT THE LD. CIT(A) GRIEVOUSLY ERRED IN SUST AINING THE PENALTY OF RS.25,000/- EACH IMPOSED U/S 271-A OF THE ACT. 2 2. DURING HEARING, NOBODY IS PRESENT FOR THE RESPE CTIVE ASSESSEE WHEREAS SHRI ARUN DEWAN, LEARNED SENIOR DR IS PRESENT FOR THE REVENUE. MR. DEWAN DEFENDED THE IMPOSITION OF THE PENALTY LEVIED U/S 271-A OF THE ACT. 3. WE HAVE CONSIDERED THE SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THESE APPEALS WERE FI LED BY THE RESPECTIVE ASSESSEE ON 2.3.2012 AS IS EVIDENT FROM THE ORDER SHEET ENTRY OF EVEN DATE. REGISTERED AD NOTICES OF HEARING WERE SENT TO THE RESPECTIVE ASSESSEE WHICH WERE DULY REC EIVED AS IS EVIDENT FROM POSTAL ACKNOWLEDGEMENT, AVAILABLE ON R ECORD, THEREFORE, WE HAVE NO OPTION BUT TO PROCEED EXPARTE QUA-ASSESSEE ON THE BASIS OF MATERIAL AVAILABLE ON RECORD. SINCE THE FACTS AND THE ISSUE ARE IDENTICAL, THEREFORE, BOTH THESE APPE ALS CAN BE DISPOSED OF BY THIS COMMON AND CONSOLIDATE ORDER. 4. FIRST, WE SHALL TAKE APPEAL IN CASE OF SMT. NIK HAT QIDWAI (ITA NO.119/IND/2012). THE FACTS, IN BRIEF, ARE THA T THE ASSESSEE IS A POSTGRADUATE/M.SC. IN CHEMISTRY, TEACHES THE C HILDREN WHILE REMAINING AT HOME. THE ASSESSEE CLAIMS ANNUAL INCOM E OF RS.1,34,150/- FROM TEACHING. THE ASSESSEE DECLARED TOTAL INCOME 3 AT RS.1,59,000/- WHICH INCLUDES TEACHING AS WELL AS AGRICULTURE INCOME. AS PER THE ASSESSMENT ORDER, NO BOOKS OF AC COUNTS ARE MAINTAINED BY THE ASSESSEE AND THE ASSESSEE FILED I TS RETURN U/S 44AF OF THE ACT. THE AO DISALLOWED THE INCOME FROM TEACHING ON THE GROUND THAT SINCE THE INCOME EXCEEDS THE LIMIT OF RS.1,20,000/-, THE ASSESSEE IS SUPPOSE TO MAINTAIN BOOKS OF ACCOUNTS AS PER THE PROVISIONS OF SECTION 44AA(2)(I ) OF THE ACT. IN THE ABSENCE OF SUCH BOOKS, THE PENALTY OF RS.25,000 /- WAS IMPOSED U/S 271-A OF THE ACT. ON APPEAL, THE LD. CI T(A) AFFIRMED THE PENALTY WHICH IS UNDER CHALLENGE BEFORE THIS TR IBUNAL. BEFORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUN DER THE REPLY DATED 18.7.2008 CHALLENGING THE IMPOSITION OF PENALTY BEFORE THE LD. AO. ESA ,E ,L LH DSESLV~ZH LS IKSLV XZSTQ,SV EFGYK GWW ?KJ IJ CPPKSA DKS VHFPAX DJRH GWW ESJH OKF'KZD USV FJLHOV :I;S 134150 GS VKSJ ;GH JKF'K ESJH OKF'KZD V K; GS TKS VK;DJ VF/FU;E DS VUQLKJ EFGYKVKSA DS FY, :I;S 135000 RD VK;DJ EQDR GS ,OA CPPKSA LS VHFP AX IQHL EKFLD IZKIR GKSRH GS FTLS ESA DKIH ESA UKSV DJ YSRH GWW JKF'K VF/D IZKIR UGHA GKSUS LS ESA /KJK 44 AA(2)(I) DS RGR ,DKMUV UGHA FY[K LDH 1 IF THE AFORESAID CLAIM OF THE ASSESSEE IS ANALYSED IN THE LIGHT OF SECTION 273B OF THE ACT, WE FIND THAT THE ASSESSEE, BEING A POSTGRADUATE IN CHEMISTRY, DOING A NOBLE CAUSE OF T EACHING, 4 THEREFORE, SHE WAS UNDER THE IMPRESSION THAT THE FE MALES ARE EXEMPTED FROM TAXATION UPTO A LIMIT OF RS.1,35,000/ - AND SPECIFICALLY SHE IS NOTING DOWN THE AMOUNTS RECEIVE D FROM CHILDREN IN THE NOTEBOOK, THEREFORE, THERE WAS A RE ASONABLE CAUSE FOR SUCH FAILURE, IF ANY, CONSEQUENTLY, KEEPING IN VIEW THE TOTALITY OF FACTS AND THE CIRCUMSTANCES, THE ASSESSEE DESERV ES THE LENIENT VIEW. THE WORD REASONABLE CAUSE IN SEC. 273B MUST NECESSARILY HAVE A RELATION TO THE FAILURE ON THE PART OF THE A SSESSEE TO COMPLY WITH THE REQUIREMENT OF THE LAW WHICH HE/SHE HAD FAILED TO COMPLY WITH. A CONSTRUCTION WHICH WOULD PRESERVE THE EXERCISE OF THE POWERS IN FAVOUR OF THE ASSESSEE IN THE CIRC UMSTANCES WHICH WARRANT IT IS TO BE PREFERRED TO A CONSTRUCTI ON WHICH WOULD RESULT IN THE LIKELYHOOD OF DENIAL OF RELIEF. OUR V IEW IS FORTIFIED BY THE DECISION FROM HONBLE MADRAS HIGH COURT IN KALA KRITHI VS. ITO (253 ITR 754) (MAD). THE CASE OF THE ASSESSEE I S ON MUCH STRONGER FOOTING BECAUSE THE ASSESSEE OFFERED ITS I NCOME U/S 44AF OF THE ACT. IT HAS BEEN SPECIFICALLY MENTIONED IN THE ASSESSMENT ORDER THAT IN RESPONSE TO NOTICE U/S 142 (1) OF THE ACT, THE ASSESSEE ALONG WITH THE REPLY FILED, FURNI SHED THE COPY OF CAPITAL ACCOUNT AND BALANCE-SHEET, MEANING THEREBY, THE 5 ASSESSEE WAS MAINTAINING THE RECORD. UNDER SUCH CIR CUMSTANCES, SINCE THE ISSUE WAS DEBATABLE AND THERE WAS NO CONC EALMENT OF INCOME, THEREFORE, MERELY ON TECHNICAL GROUND, NO P ENALTY SHOULD HAVE BEEN IMPOSED, CONSEQUENTLY, THE LD. AO IS DIRE CTED TO DELETE THE PENALTY. 5. SINCE THE FACTS ARE IDENTICAL, OUR AFORESAID DE CISION WILL BE APPLICABLE TO THE APPEAL IN ITA NO.120/IND/2012 ALSO. WE ARE MAKING IT CLEAR THAT OUR AFORESAID DECISION PERTAIN S TO THE AFORESAID APPEALS ONLY, THAT TOO, UNDER THE PECULIA R FACTS AND CIRCUMSTANCES, THEREFORE, THIS ORDER MAY NOT BE QUO TED FOR FUTURE REFERENCES IN OTHER APPEALS. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEES A RE ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 9.5 .2012. SD SD (R.C.SHARMA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL ME MBER DATED: 9.5.2012 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE