M/s. A.P. Engineering Corporation, Kolkata V. ITO, Ward-51(4), Kolkata, Kolkata

ITA 1217/KOL/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 87642 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 5 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-01-2015
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 21-08-2012
• Court: TRIBUNAL
• Department Lawyers: K L KANAK
• Keywords: Principle of natural justice; Reasonable cause; Non passing of speaking order
• Section: 273B; 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH: KOLKATA [BEFORE SHRI MAHAVIR SINGH, JM & SHRI SHAMIM YAHYA AM ] I.T.A NO S.1217&1218 /KOL/2012 ASSESSMENT YEAR: 2007 - 08 M/S.A.P.ENGINEERING CORPORATION VS. I.T.O., WARD - 51(4 ) KOLKATA KOLKATA (APPEL LANT) ( RESPONDENT) (PAN: AAFFA 1359 E) FOR THE APPELLANT : NONE FOR THE RESPONDENT : SHRI K.L.K ANAK, JCIT, SR.DR DATE OF HEARING : 29 .01.2015. DATE OF PRONOUNCEMENT: 29 .01.2015. ORDER PER SHRI SHAMIM YAHYA, AM : THESE APPEAL S B Y THE ASSESSEE ARE DIRECTED AGAINST THE RESPECTIVE ORDER S OF LD. CIT(A) - XX XII , KOLKATA FOR ASSESSMENT YEAR 2007 - 08 CONFIRMING LEVY OF PENALTY OF RS.5,000/ - U/S 271F OF THE ACT AND RS.6 4,341/ - U/S 273 B OF THE ACT RESPECTIVELY. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE. WE HAVE HEARD THE LD. DR. IN OUR CONSIDERED OPINION THE MATTER CAN BE DISPO SED OF AFTER HEARING THE LD. DR AND PERUSING THE RECORDS. 3. IN THIS CASE PENALTY U/S 271F OF THE ACT OF RS.5,000/ - WAS LEVIED ON THE ASSESEE FOR NOT FURNISHING TH E RETURN ON TIME AMOUNTING TO RS.5,000/ - AND PENALTY U/S 273B OF THE ACT WAS LEVIED FOR NOT GETTING THE ACCOUNTS AUDITED U/S 44AB OF THE ACT AMOUNTING TO RS.64,341/ - . THE REASONABLE CAUSE SUBMITTED BY THE ASSESSEE FOR THE DELAY WAS THAT THE ASSESSE WAS IN THE CONTRACT BUSINESS AND THE ASSESSEE DID NOT RECEI VE THE TDS CERTIFICATES ON TIME. FURTHERMORE THERE WAS A DELAY IN OBTAINING THE BANK STATEMENTS. IT WAS ALSO THE PLEA OF THE ASSESSEE THAT THESE ASPECTS WERE DULY CONVEYED ITA NOD.1217&1218/KOL/2012 M/S.A.P.ENGINEERING CORPORATION A.YR.2007 - 08 2 TO THE AO AND THE ASSESSEE DID NOT RECEIVED NOTICE U/S 142(1) OF THE ACT. THE PLEA OF THE ASSESSEE WAS REJECTED BY THE AO IN THE RESPECTIVE ORDERS. 3.1. UPON ASSESSEE S APPEAL THE LD. CIT(A) REPRODUCED THE ASSESSEE S SUBMISSIONS IN HIS APPELLATE ORDER AND QUOTED VERY LACONICALLY THAT THE REASONS MENTIONED BY THE ASSESSE E ARE NOT ACCEPTABLE. WE FIND THAT THE LD. CIT(A) DID NOT EVEN BOTHER TO WRITE DOWN AS TO WHAT WAS THE REASON SUBMITTED BY THE ASSESSEE FOR FAILING TO COMPLY WITH THE ACT. IN SUCH CIRCUMSTANCES IN OUR CONSIDERED OPINION ORDER OF THE LD. CIT(A) IS A NON SPEAKING ORDER AND ACCORDINGLY IS NOT SUSTAINABLE. THE HON BLE APEX COURT IN THE CASE OF SAHARA INDIA (FIRM) VS CIT & ANOTHER 300 ITR 403 (SC) HAS HELD THAT EVEN ADMINISTRATIVE ORDER HAS TO BE CONSISTENT WITH THE RULES OF NATURAL JUSTICE. 4. AS REGARDS THE MERITS OF THE CASE WE FIND THAT THE ASSESSEE HAD SUBMITTED THAT THERE WAS A DELAY IN RECEIVING CERTIFICATES AS WELL AS BANK STATEMENTS FROM THE BANKS. THESE FACTS LED TO THE DELAY AND FAILURE ON THE PART OF THE ASSESSE E FOR THE COMPLIANCE. THIS ASPECT WAS DULY COMMUNICATED TO THE AO. WE FIND THAT NO REASON HAS BEEN MENTIONED BY THE AUTHORITIES BELOW AS TO WHY THE AFORESAID PLEAS OF THE ASSESSEE SHOULD NOT BE ACCEPTED. IN THIS CIRCUMSTANCES IN OUR CONSIDERED OPINION THE CONDUCT OF THE ASSESSEE IS NOT CONTUMACIOUS TO WARRANT LEVY OF PENALTY. IN THIS REGARD WE PLACE RELIANCE UPON THE ORDER OF THE HON BLE APEX COURT IN THE CASE OF HINDUSTAN STEEL LTD VS STATE OF ORISSA 83 ITR 26 (SC) WHEREIN IT WAS HELD THAT : AN ORDER IMPOSING PENALTY FOR FAILURE TO CARRY OUT A STATUTORY OBLIGATION IS THE RESULT OF A QUASI - CRIMINAL PROCEEDING, AND PENALTY WILL NOT ORDINARILY BE IMPOSED UNLESS THE PARTY OBLIGED EITHER ACTED DELIBERATELY IN DEFIANCE OF LAW OR WAS GUILTY OF COND UCT CONTUMACIOUS OR DISHONEST, OR ACTED IN CONSCIOUS DISREGARD OF ITS OBLIGATION. PENALTY WILL NOT ALSO BE IMPOSED MERELY BECAUSE IT IS LAWFUL TO DO SO. WHETHER PENALTY SHOULD BE IMPOSED FOR FAILURE TO PERFORM A STATUTORY OBLIGATION IS A MATTER OF DISCRETI ON OF THE AUTHORITY TO BE EXERCISED JUDICIALLY AND ON A CONSIDERATION OF ALL THE RELEVANT CIRCUMSTANCES. EVEN IF A MINIMUM PENALTY IS PRESCRIBED, THE AUTHORITY COMPETENT TO IMPOSE THE PENALTY WILL BE JUSTIFIED IN REFUSING TO IMPOSE PENALTY, WHEN THERE IS A TECHNICAL OR VENIAL BREACH OF THE PROVISIONS OF THE ACT WHERE THE BREACH FLOWS FROM A BONA FIDE BELIEF THAT THE OFFENDER IS NOT LIABLE TO ACT IN THE MANNER PRESCRIBED BY THE STATUTE. ITA NOD.1217&1218/KOL/2012 M/S.A.P.ENGINEERING CORPORATION A.YR.2007 - 08 3 IN THE BACKGROUND OF THE AFORESAID DISCUSSION AND PRECEDENT WE SET ASI DE THE ORDERS OF THE AUTHORITIES B ELOW AND DELETE LEVY OF PENALTY IN BOTH THE APPEALS. 5. IN THE RESULT THE APPEAL S OF THE ASSESSEE STAND ALLOWED. ORDE R PRONOUNCED IN THE OPEN COURT ON 30.01.2015. SD/ - SD/ - [ MAHAVIR SINGH ] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 30.01.2015. R.G.(.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . M/S.A.P.ENGINEERING CORPORATION, AF/321, RABINDRA PALLY, TALBAGAN, KRISHANAPUR, KOLKATA - 700101. 2 I.T.O., WARD - 51(4 ), KOLKATA. 3 . CIT(A) - X XX II , KOLKATA 4. CIT - KOLKATA. 5. CIT - DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES