Sukhendu Ghosh, Kolkata V. THE ITO,WD-25(2), KOLKATA, Kolkata

ITA 1221/KOL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1591 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 30-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARINDAM BHATTACHERJEE
• Keywords: Salary income; Initiation of penalty proceedings

Judgement Text

, D , IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH D KOLKATA BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI S.S.VISWANETHRA RAVI, JUDICIAL MEMBER ITA NO.1221/KOL/2016 ASSESSMENT YEAR:2009-10 SUKHENDU GHOSH 20/15A, SEAL LANE, TANGRA,KOLKATA-15 [ PAN NO.ALJPA 5721 E ] / V/S . INCOME TAX OFFICER, WRD-25(2), BAMBOOVILA, 169, A.J.C. BOSE ROAD, KOLKAKTA-14 /APPELLANT .. /RESPONDENT /BY APPELLANT NONE /BY RESPONDENT SHRI ARINDAM BHATTACHERJEE, ADDL. CIT-DR /DATE OF HEARING 07-12-2017 /DATE OF PRONOUNCEMENT 31-01-2018 /O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-19, KOLKATA DATED 30.03.2016. PENALTY LEVIED BY ASSESSING OFFICER U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 ( HEREINAFTER REFERRED TO AS THE ACT) VIDE HIS ORDER DATED 29.04.2013 FOR ASSESSMEN T YEAR 2009-10. 2. AT THE TIME OF HEARING, IT WAS NOTICED THAT THE NEITHER ANYBODY APPEARED ON BEHALF OF ASSESSEE NOR ANY ADJOURNMENT APPLICATION WAS FILED. HOWEVER, WE NOTICED THAT ISSUE RAISED BY THE ASSESSEE HAS BEEN SETTLED BY VARIOUS COURTS IN THEIR JUDGMENTS. THEREFORE, WE DECIDED TO DISPOSE OF THE APPEAL AFTE R CONSIDERING THE MATERIALS ITA NO.1221/KOL/2016 A.Y . 2009-10 SUKENDU GHOSH VS. ITO WD-25(2), KOL PAGE 2 AVAILABLE ON RECORDS AND HEARING THE LD. DR. ACCORD INGLY WE PROCEED TO ADJUDICATE THE ISSUE. 3. IN THIS APPEAL, THE ASSESSEE HAS CHALLENGED THE ORDER OF CIT(A) WHEREBY THE CIT(A) CONFIRMED THE ORDER OF AO IMPOSING PENALTY O N THE ASSESSEE U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (ACT). 4. THE FACTS AND CIRCUMSTANCES UNDER WHICH PENALTY U/S 271(1)(C) OF THE ACT WAS IMPOSED ON THE ASSESSEE BY THE AO ARE AS FOLLOWS :- THE ASSESSEE IS AN INDIVIDUAL AND DECLARED ITS INCO ME UNDER THE HEAD SALARY. THE ASSESSEE IN ITS INCOME TAX RETURN HAS NOT DISCL OSED THE SALARY INCOME RECEIVED FROM M/S WIPRO LTD, IBM INDIA PVT. LIMITED AND INTEREST INCOME. THEREFORE AN ADDITION AGGREGATING OF RS.3,03,716/- WAS MADE TO THE TOTAL INCOME OF THE ASSESSEE. IN RESPECT OF THE AFORESAID ADDITION MADE IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. THE INITIATION OF PENALTY PROCEEDINGS W AS MADE BY THE AO BY OBSERVING AS FOLLOWS: PENALTY PROCEEDINGS U/S.271(1)( C) OF THE ACT HAS BEEN INITIATED 5. IN THE PENALTY PROCEEDINGS, THE ASSESSEE TRIED TO EXPLAIN THAT THE AFORESAID INCOME WAS NOT OFFERED TO TAX DUE TO IGNORANCE OF L AW. THIS EXPLANATION WAS NOT ACCEPTED IN THE PENALTY PROCEEDINGS AND PENALTY U/. S 271(1)(C) OF THE ACT WAS IMPOSED ON THE ASSESSEE BY THE AO. THE ORDER OF AO WAS CONFIRMED BY CIT(A). 6. AGGRIEVED BY THE ORDER OF CIT(A) THE ASSESSEE HA S FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 7. THE LEARNED DR BEFORE US RELIED ON THE ORDER O F AUTHORITIES BELOW. HE LEFT THE ISSUE TO THE DISCRETION OF THE BENCH. 8. WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIA LS AVAILABLE ON RECORD. THE FACTS OF THE CASE HAVE ALREADY BEEN ELABORATED IN T HE PRECEDING PARAGRAPHS THEREFORE WE ARE NOT REPEATING THE SAME FOR THE SAKE OF BREVI TY. AT THE OUTSET, IT WAS NOTICED THAT THE SHOW CAUSE NOTICE ISSUED U/S 274 OF THE ACT BEF ORE IMPOSING PENALTY DOES NOT CONTAIN THE SPECIFIC CHARGE AGAINST THE ASSESSEE NA MELY AS TO WHETHER THE ASSESSEE ITA NO.1221/KOL/2016 A.Y . 2009-10 SUKENDU GHOSH VS. ITO WD-25(2), KOL PAGE 3 WAS GUILTY OF HAVING CONCEALED PARTICULARS OF INCOM E OR HAVING FURNISHED INACCURATE PARTICULARS OF INCOME. A COPY OF THE SHOW CAUSE NOT ICE U/S 274 OF THE ACT WAS FILED BEFORE US AND PERUSAL OF THE SAME REVEALS THAT AO H AS NOT STRUCK OUT THE IRRELEVANT PORTION IN THE SHOW CAUSE NOTICE AND THEREFORE THE SHOW CAUSE NOTICE DOES NOT SPECIFY THE CHARGE AGAINST THE ASSESSEE AS TO WHETHER THE C HARGE IS OF CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF INCOME. THE SAME IS REPRODUCED FOR THE PURPOSE OF READY REFERENCE: HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. 8.1. IN THIS REGARD WE NOTE THAT HONBLE KARNATAK A HIGH COURT IN THE CASE OF CIT VS. SSAS EMERALD MEADOWS IN ITA NO.380 OF 2015 DATED 23.11.2015 WHEREIN THE HONBLE KARNATAKA HIGH COURT FOLLOWING ITS OWN DECI SION IN THE CASE OF CIT VS MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565 TOOK A VIEW THAT IMPOSING OF PENALTY U/S 271(1)(C) OF THE ACT IS BAD IN LAW AND INVALID FOR THE REASON THAT THE SHOW CAUSE NOTICE U/S 274 OF THE ACT DOES NOT SPECIFY THE CHARGE AGAINST THE ASSESSEE AS TO WHETHER IT IS FOR CONCEALMENT OF PAR TICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE LD. COUNSEL F URTHER BROUGHT TO OUR NOTICE THAT AS AGAINST THE DECISION OF THE HONBLE KARNATAKA HIGH COURT THE REVENUE PREFERRED AN APPEAL IN SLP IN CC NO.11485 OF 2016 AND THE HONBLE SUPREME COURT BY ITS ORDER DATED 05.08.2016 DISMISSED THE SLP PREFERRED BY THE DEPARTMENT. THE LD. COUNSEL ALSO BROUGHT TO OUR NOTICE THE DECISION OF THE HON BLE BOMBAY HIGH COURT IN THE CASE OF CIT VS SHRI SAMSON PERINCHERY IN ITA NO.1154 OF 2014 DATED 05.01.2017 WHEREIN THE HONBLE BOMBAY HIGH COURT FOLLOWING THE DECISIO N OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS MANJUNATHA COTTON AND GINNING FACTORY (SUPRA) CAME TO THE CONCLUSION THAT IMPOSITION OF PENALTY O N DEFECTIVE SHOW CAUSE NOTICE WITHOUT SPECIFYING THE CHARGE AGAINST THE ASSESSEE CANNOT BE SUSTAINED. IT WAS ALSO NOTED THAT THE DECISION OF ITAT IN THE CASE OF SUVAPRASANNA BHATTACHARYA VS ACIT IN ITA NO.1303/KOL/2010 DATED 06.11.2015 WHEREIN IDENTICAL PROPOSITION HAS BEEN FOLLOWED BY THE TRIBUNAL. ITA NO.1221/KOL/2016 A.Y . 2009-10 SUKENDU GHOSH VS. ITO WD-25(2), KOL PAGE 4 8.2 WE HAVE ALREADY OBSERVED THAT THE SHOW CAUSE N OTICE ISSUED IN THE PRESENT CASE U/S 274 OF THE ACT DOES NOT SPECIFY THE CHARGE AGAINST THE ASSESSEE AS TO WHETHER IT IS FOR CONCEALING PARTICULARS OF INCOME OR FURNI SHING INACCURATE PARTICULARS OF INCOME. THE SHOW CAUSE NOTICE U/S 274 OF THE ACT DO ES NOT STRIKE OUT THE INAPPROPRIATE WORDS. IN THESE CIRCUMSTANCES, WE ARE OF THE VIEW THAT IMPOSITION OF PENALTY CANNOT BE SUSTAINED. WE, THEREFORE, HOLD TH AT IMPOSITION OF PENALTY IN THE PRESENT CASE CANNOT BE SUSTAINED AND THE SAME IS DI RECTED TO BE CANCELLED. ACCORDINGLY, AO IS DIRECTED. THIS GROUND OF ASSESSE ES APPEAL IS ALLOWED. 9. IN THE RESULT, ASSESSEES APPEAL STANDS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 31/01/2018 SD/- SD/- ( % ') ( ') (S.S.VISWANETHRA RAVI) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER *DKP, SR.P.S ) - 31/01/2018 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-SUKHENDU GHOSH, 20/15A, SEAL LANE, TANGR A, KOLKATA-15 2. /RESPONDENT-ITO, WARD-25(2), BAMBOOVILLA,169, A.J.C .BOSE RD, KOL-14 3. , - / CONCERNED CIT 4. - - / CIT (A) 5. . %%, , , / DR, ITAT, KOLKATA 6. 2 / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY HEAD OF OFFICE/DDO ,,