Deputy Commissioner of Income-tax, V. Shri Suyog Brahmadeo Raut, Pune

ITA 1249/PUN/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 7458 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 14-09-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 11-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 1 249 /P U N/20 1 5 / ASSESSMENT YEAR : 20 1 0 - 1 1 THE DY. COMMISSIONER OF INCOME TAX, CIRCLE 11, PUNE. . / APPELLANT VS. SHRI SUYOG BRAHMADEO RAUT, B - 2, 1001, REGENCY COSMOS, BANER ROAD, NEAR ORCHID SCHOOL, BANER, PUNE 411045 . / RESPONDENT PAN: A DQPR1872A . /CO NO. 38 /PUN/201 7 / ASSESSMENT YEAR : 20 10 - 11 (OUT OF ITA NO.1249/PUN/2015 ) SHRI SUYOG BRAHMADEO RAUT, B - 2, 1001, REGENCY COSMOS, BANER ROAD, NEAR ORCHID SCHOOL, BANER, PUNE 411045 / CROSS OBJECT OR PAN: ADQPR1872A VS. THE DY. COMMISSIONER OF INCOME TAX, CIRCLE 11, PUNE. . / RESPONDENT ASSESSEE BY : SHRI SHARAD SHAH REVENUE BY : SHRI AJAY MODI / DATE OF HEARING : 1 4 .0 9 .2017 / DATE OF PRONOUNCEMENT: 20 .0 9 .2017 2 ITA NO. 1249 /PUN/20 15 CO NO.38/PUN/2017 SHRI SUYOG BRAHMADEO RAUT / ORDER PER SUSHMA CHOWLA, JM: THE APPEAL FILED BY THE REVENUE IS AGAINST ORDER OF CIT(A) - 3 , PUNE , DATED 15 . 06 .201 5 RELATING TO ASSESSMENT YEAR 20 1 0 - 1 1 AGAINST DELETION OF PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT). THE ASSESSEE HAS FILED CROSS OBJECTIONS AGAINST THE APPEAL OF REVENUE. 2 . THE APPEAL FILED BY THE REVENUE AND THE CROSS OBJECTIONS FILED BY THE ASSESSEE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. THE REVENUE IN ITA NO.1249/PUN/2015 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - ON THE FACTS AND CIRCUMSTANCES OF THE CASE & IN LAW 1 . THE LD. CIT(A) ERRED IN DELETING THE PENALTY LEVIED BY THE ASSESSING OFFICER U/S 271(1)(C) OF THE I.T. A CT. 2 . THE LD. CIT(A) ERRED IN HOLDING THAT THERE WAS NO ELEMENT OF CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME UNDER THE PROVISIONS OF SEC.271( 1)(C) WHEN THE ASSESSEE HIMSELF HAD ACCEPTED THE IMPUGNED INCOME IN RESPECT OF WHICH PENALTY WAS IMPOSED, AS HIS OWN INCOME WHICH HE HAD FAILED TO DISCLOSE IN THE RETURN OF INCOME FILED. 3 . THE LD. CIT(A) FAILED TO APPRECIATE THAT THE PRESUMPTION OF CONCEALMENT AS CONTAINED IN EXPLANATION 1 SEC.271(1) WAS CLEARLY ATTRACTED IN THE CASE OF THE ASSESSEE A S THE ASSESSEE FAILED TO SUBSTANTIATE THE EXPLANATION OFFERED BY HIM WITH COGENT EVIDENCE AND PROVE THAT SUCH EXPLANATION WAS BONAFIDE. 4 . THE APPELLANT PRAYS THAT THE ORDER OF THE LD. CIT(A) BE HELD TO BE BAD IN LAW AND QUASHED IN SO FAR AS THE ISSUE OF LEV Y OF PENALTY U/S 271(1)(C) ON ACCOUNT OF UNEXPLAINED MONEY IS CONCERNED. 4. THE ASSESSEE IN CROSS OBJECTION NO.38/PUN/2017 HAS RAISED THE FOLLOWING GROUNDS OF OBJECTIONS: - 1. PENALTY PROCEEDINGS ARE INITIATED ON THE GROUND OF FURNISHING INACCURATE PARTICULARS OF INCOME, HOWEVER, PENALTY IS LEVIED ON THE GROUND OF CONCEALMENT OF INCOME. AND THEREFORE PENALTY ORDER PASSED BY THE LD. A.O. IS VOID. 3 ITA NO. 1249 /PUN/20 15 CO NO.38/PUN/2017 SHRI SUYOG BRAHMADEO RAUT 2. THE SHOW CAUSE NOTICE U.S. 274 R.W.S. 271(1)(C) FOR LEVY OF PENALTY IS WITHOUT SPECIFYING THE CHARG E AS WHETHER THE ASSESSEE HAS CONCEALED THE PARTICULARS OF INCOME OR FURNISHING ACCURATE PARTICULARS, THEREFORE, PENALTY ORDER IS VOID. 5. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT IN THE CROSS OBJECTIONS, THE ASSESSEE HAS RA ISED THE JURISDICTIONAL ISSUE AGAINST LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT, WHEREIN PENALTY PROCEEDINGS WERE INITIATED ON THE GROUND OF FURNISHING OF INACCURATE PARTICULARS OF INCOME AND PENALTY HAS BEEN LEVIED ON THE GROUND OF CONCEALMENT OF INCOME. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FAIRLY POINTED OUT THAT THE CIT(A) HAD DELETED PENALTY IN VIEW OF MERITS OF THE CASE. HOWEVER, SINCE JURISDICTIONAL ISSUE IS INVOLVED, HENCE, THE SAME MAY BE ADJUDICATED FIRST. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 7. WE HAVE HEARD THE RIVAL CONT ENTIONS AND PERUSED THE RECORD. THE ISSUE ARISING IN THE PRESENT APPEAL IS AGAINST LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. THE PERUSAL OF ASSESSMENT ORDER DATED 10.01.2013 REFLECTS THAT ADDITION UNDER SECTION 69A OF THE ACT WAS MADE AND PENAL TY PROCEEDINGS WERE INITIATED UNDER SECTION 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THEREAFTER, THE ASSESSING OFFICER PASSED PENALTY ORDER UNDER SECTION 271(1)(C) OF THE ACT AND IN VIEW OF THE ADDITION MADE UNDER SECTION 69A OF THE ACT, THE ASSESSING OFFICER HELD THE ASSESSEE TO HAVE DEFINITELY CONCEALED INCOME AND WAS LIABLE FOR PENALTY UNDER SECTION 271(1)(C) OF THE ACT. HENCE, THE ASSESSING OFFICER WAS SATISFIED THAT IT WAS A FIT CASE FOR LEVY OF PENALTY UNDER SECTION 271( 1)(C) OF THE ACT AND PENALTY OF RS.23,51,340/ - WAS LEVIED. WE FIND NO MERIT IN THE SAID ORDER PASSED LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT, 4 ITA NO. 1249 /PUN/20 15 CO NO.38/PUN/2017 SHRI SUYOG BRAHMADEO RAUT WHEREIN WHILE RECORDING SATISFACTION DURING THE COURSE OF ASSESSMENT PROCEEDINGS , THE ASSESSING OFFICE R WAS OF THE VIEW THAT PENALTY PROCEEDINGS ARE TO BE INITIATED UNDER SECTION 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICULARS OF INCOME. HOWEVER, WHEN PENALTY WAS LEVIED UNDER SECTION 271(1)(C) OF THE ACT, THE ASSESSING OFFICER CAME TO THE CONCL USION THAT THE ASSESSEE HAD CONCEALED ITS INCOME. THE PROVISIONS OF THE ACT RELATING TO LEVY OF PENALTY FOR CONCEALMENT UNDER SECTION 271(1)(C) OF THE ACT PROVIDE THAT THE SAID PENALTY COULD BE LEVIED EITHER WHERE THE ASSESSEE HAS CONCEALED ITS INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. IT IS THE REQUIREMENT OF THE ACT THAT WHILE COMPLETING ASSESSMENT, THE ASSESSING OFFICER SHOULD COME TO A FINDING AS TO WHICH LIMB OF SAID SECTION HAS NOT BEEN SATISFIED BY THE ASSESSEE AND GIVE SHOW CAUSE NOTIC E IN THIS REGARD TO THE ASSESSEE TO MEET THE CASE OF REVENUE AS TO WHETHER IT HAS CONCEALED ITS INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. HOWEVER, IN THE PRESENT CASE, WE FIND THAT THE ASSESSING OFFICER HAD INITIATED PENALTY PROCEEDINGS FOR SE COND LIMB I.E. FURNISHING OF INACCURATE PARTICULARS BUT LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT THAT THE ASSESSEE WAS TO HAVE CONCEALED ITS INCOME. THERE IS NO MERIT IN THE SAID STAND OF ASSESSING OFFICER. 8. THE HONBLE BOMBAY HIGH COURT IN C IT VS. SHRI SAMSON PERINCHERY IN INCOME TAX APPEAL NO.1154 OF 2014 WITH OTHER INCOME TAX APPEALS NOS.953 OF 2014, 1097 OF 2014 AND 1226 OF 2014, JUDGMENT DATED 05.01.2017 HAS HELD THAT WHERE INITIATION OF PENALTY IS ON ONE LIMB AND THE LEVY OF PENALTY IS O N OTHER LIMB, THEN IN THE ABSENCE OF PROPER SHOW CAUSE NOTICE TO THE ASSESSEE, THERE IS NO MERIT IN LEVY OF PENALTY . 5 ITA NO. 1249 /PUN/20 15 CO NO.38/PUN/2017 SHRI SUYOG BRAHMADEO RAUT 9. FOLLOWING THE SAME PARITY OF REASONING AS LAID DOWN BY THE HONBLE BOMBAY HIGH COURT (SUPRA), WE FIND NO MERIT IN THE PENALTY ORDER PAS SED UNDER SECTION 271(1)(C) OF THE ACT FOR NON - FULFILLMENT OF BASIC CONDITIONS OF THE ACT AND HENCE, THE SAME IS HELD TO BE INVALID. THE CROSS OBJECTIONS RAISED BY THE ASSESSEE ARE ALLOWED. THE APPEAL FILED BY THE REVENUE BECOMES INFRUCTUOUS BECAUSE OF THE DECISION ON JURISDICTIONAL ISSUE RAISED VIDE CROSS OBJECTIONS. HENCE, CROSS OBJECTIONS ARE ALLOWED AND GROUNDS OF APPEAL OF REVENUE ARE DISMISSED. 10 . IN THE RESULT, APPEAL OF REVENUE IS DISMISSED AND THE CROSS OBJECTIONS OF ASSESSEE ARE A LLOWED. ORDER PRONOUNCED ON THIS 2 0 T H DAY OF SEPTEMBER , 201 7 . SD/ - SD/ - (ANIL CHATURVEDI) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 2 0 T H SEPTEMBER , 201 7 . G G C C V V S S R R / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - 3 , PUNE ; 4. / THE PR. C IT - 2 , PUNE ; 5. , , / DR B , ITAT, PUNE; 6. / GUARD FILE. / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE