THE DISTRICT MINING OFFICER, Dewas V. THE JCIT (TDS), Indore

ITA 130/IND/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 5906 (ITAT-INDORE)
• Duration Of Justice: 5 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 18-02-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHD JAVED
• Assessee Lawyers: AVINASH GOUR
• Keywords: Ignorance of law

Judgement Text

DISTRICT MINING OFFICER ITA NO. 130/IND/2016 1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, JM & SHRI O.P. MEENA, AM ITA NO. 130/IND/2016 A.Y.2009-10 DISTRICT MINING OFFICER DEWAS PAN BPLMO4994D ::: APPELLANT VS JCIT (TDS) INDORE ::: RESPONDENT APPELLANT BY SHRI AVINASH GOUR RESPONDENT BY SHRI MOHD. JAVED DATE OF HEARING 4.8.2016 DATE OF PRONOUNCEMENT 4.8.2016 O R D E R PER SHRI D.T. GARASIA, JM THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LEARNED CIT(A),UJJAIN, DATED 9.11.2015. DISTRICT MINING OFFICER ITA NO. 130/IND/2016 2 2. THE ONLY GROUND OF APPEAL IS THAT THE LEARNED CIT(A) WAS NOT JUSTIFIED IN SUSTAINING THE PENALTY LEVIED U/S 272A(2)(K) OF THE ACT OVERLOOKING THE FACT THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE TO FILE THE TDS RET URN IN TIME. 3. WE HAVE HEARD BOTH THE SIDES. WE FIND THAT AN IDENTICAL ISSUE ON THE SAME FACTS HAD COME UP BEFORE T HIS BENCH OF THE TRIBUNAL IN ITA NO.624/IND/2016 AND VIDE ITS ORDER DATED 3.8.2016 THE TRIBUNAL OBSERVED AS UNDER :- 2. THE SUM AND SUBSTANCES OF THE GROUNDS OF APPEAL IS THAT THE LEARNED CIT(A) WAS NOT JUSTIFIED IN CONFIR MING THE PENALTY OF RS.92,000/- U/S 272A(2)(K) OF THE ACT FO R FAILURE ON THE PART OF THE ASSESSEE TO FURNISH THE RETURN WITH IN THE PRESCRIBED TIME. 3. BRIEFLY STATED, THE ASSESSEE IS A GOVERNME NT OFFICER. THE ASSESSEE WAS REQUIRED TO DEDUCT TDS AND DEPOSIT THE SAME IN GOVERNMENT ACCOUNT. THE ASSESSEE WAS ALSO DISTRICT MINING OFFICER ITA NO. 130/IND/2016 3 REQUIRED TO FURNISH THE QUARTERLY RETURN IN RESPECT OF THE TAX DEDUCTED. THERE WAS A DELAY ON THE PART OF THE ASSE SSEE IN SUBMISSION OF THE QUARTERLY STATEMENT IN FORM NO. 2 7EQ. THE LEARNED JCIT (TDS) LEVIED PENALTY OF RS.92,000/- U/ S 272A(2)(K) OF THE ACT. ON APPEAL, THE LEARNED CIT(A ) CONFIRMED THE ACTION OF THE ASSESSING OFFICER. NOW THE ASSESS EE IS IN APPEAL BEFORE THE TRIBUNAL. 4. BEFORE US, THE LEARNED COUNSEL FOR THE ASS ESSEE SUBMITTED THAT AN IDENTICAL ISSUE IN THE ASSESSEES OWN CASE HAD COME UP BEFORE THE ITAT, INDORE BENCH, INDORE, WHEREIN THE TRIBUNAL VIDE ITS ORDER DATED 20.5.2016 IN ITA NOS. 101 & 102/IND/2016 HAS CATEGORICALLY HELD THAT THE REVEN UE AUTHORITIES COULD NOT APPRECIATE THE FACTS AND SUBM ISSION THEREOF THAT THE TDS WAS TIMELY DEPOSITED AND TDS STATEMENTS WERE FILED VOLUNTARILY WITHOUT RECEIVING ANY NOTICE FROM THE INCOME-TAX DEPARTMENT. NO DEMAND IS OUTSTA NDING OUT OF TCS COLLECTED. HENCE, THERE WAS NO INTENTION OF THE ASSESSEE FOR THE DELAY AS NARRATED ABOVE . THE RELEVANT FINDINGS OF THE TRIBUNAL ARE AS UNDER :- DISTRICT MINING OFFICER ITA NO. 130/IND/2016 4 2. THE ASSESSEE IS A DISTRICT MINING OFFICER, WORK ING IN MINING DEPARTMENT UNDER GOVT. OF M.P. THE ASSESSEE HAD COLLECTED TCS AND DEPOSITED THE SAME TO THE CREDIT OF THE CENTRAL GOVT. ACCOUNT WITHIN STIPULATED TIME. HOWEV ER, THERE IS DELAY IN SUBMISSION OF QUARTERLY STATEMENT IN FORM 27EQ. THE ASSESSING OFFICER LEVIED PENALTY AT RS.1,27,050/- F OR THE ASSESSMENT YEAR 2010-11 AND RS.2,01,620/- FOR THE ASSESSMENT YEAR 2011-12. 3. THE MATTER CARRIED TO LD. CIT(A). THE L D. CIT(A) DISMISSED THE APPEALS OF THE ASSESSEE. 4. DURING THE COURSE OF HEARING, THE LD. AUTHORIZ ED REPRESENTATIVE HAS SUBMITTED BEFORE US THAT ASSESSE E COLLECTED AND DEPOSITED TCS ALONG WITH INTEREST. TH E ASSESSEE AND THE STAFF/OFFICIALS WORKING IN DEPARTMENT ARE N OT CONVERGENT WITH THE PROVISIONS OF THE ACT. THE STAF F TO WHICH THE TDS WORK WAS GIVEN BECAME TRANSFERRED AND THERE WAS LACK OF STAFF ALSO IN THE DISTRICT MINING OFFICE, R AJGARH. THERE WAS A CHANGE IN PROCESS OF FILING TDS STATEMENT FRO M MANUALLY TO ELECTRONIC MODE, FOR WHICH, SERVICES OF OUTSIDER AGENCY WAS REQUIRED AND FOR PAYMENT OF FEES TO THEM, THERE WAS NO DISTRICT MINING OFFICE BUDGET ALLOTTED. THEREFORE, IT REQUIR ED THE PERMISSION OF HIGHER AUTHORITY TO PAY THEM. BUT, TH E TDS WAS TIMELY DEPOSITED AND TDS STATEMENTS WERE FILED VOLU NTARILY WITHOUT RECEIVING ANY NOTICE FROM THE INCOME-TAX DE PARTMENT. THE ASSESSEE WAS UNDER BONA FIDE BELIEF THAT ONCE T AX AS COLLECTED WAS DEPOSITED THEN NO REQUIREMENT TO FILE RETURN IN FORM NO.27EQ IS LIABLE. NO DEMAND IS OUTSTANDING OU T OF TCS COLLECTED. HENCE, THERE WAS NO INTENTION OF THE ASS ESSEE FOR NON-DEPOSITION OF TCS. TCS RETURNS WERE DELAYED ONL Y DUE TO LATE COLLECTION OF TCS, WHICH WAS UNINTENTIONAL. ON THE OTHER HAND, LD. DR RELIED ON THE ORDERS OF AUTHORITIES BE LOW. 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND HAVE ALSO PERUSED THE MATERIAL AVAILABLE ON REC ORD. WE FOUND THAT THE ASSESSING OFFICER HELD THAT THE ASSE SSEE WAS IN DEFAULT BY NOT FILING THE FORM 27EQ ON TIME AND THE LD. CIT(A) DISMISSED THE APPEALS. AFTER HEARING THE RIVAL SUBM ISSIONS, WE DISTRICT MINING OFFICER ITA NO. 130/IND/2016 5 ARE OF THE VIEW THAT THE RATIO TAKEN IN THE JUDGMEN T OF HONBLE RAJASTHAN HIGH COURT IN THE CASE OF CIT VS. SUPERIN TENDING ENGINEER (2003) 260 ITR 641 IS APPLICABLE TO THE FA CTS AND CIRCUMSTANCES OF THE PRESENT CASE. HONBLE HIGH COU RT HELD THAT THE PURPOSE OF LEVY OF PENALTY U/S 272A(2)(C) APPEARS TO BE TO PUT PRESSURE ON THE OFFICERS TO PERFORM THEIR DUTY PUNCTUALLY IN THE PUBLIC INTEREST, BUT A TAX AUTHOR ITY CANNOT INFLICT PENALTY IN ROUTINE MANNER. THUS, THE PENALT Y U/S 272A(2)(C) CANNOT BE LEVIED IN A ROUTINE MANNER. TH E DISCRETION VESTED WITH THE AUTHORITY IS TO BE EXERC ISED JUDICIOUSLY ON CONSIDERATION OF ALL THE RELEVANT CI RCUMSTANCES. A BONA FIDE BREACH CANNOT LEAD TO A PENALTY U/S 272 A(2)(C). IN THE INSTANT CASE, THOUGH IGNORANCE OF LAW IS NO EXC USE BUT STILL, THE PRESCRIBED AUTHORITIES WERE REQUIRED TO EXAMINE ALL THE RELEVANT FACTS AND CIRCUMSTANCES OF THE CASE AND TO ASCERTAIN IF IT WAS A DELIBERATE OR NEGLIGENT OR AN INADVERTENT DEFAULT. IN CASE OF NEGLIGENCE, IT WOULD BE A SOUND EXERCISE OF DISCRETION TO INFLICT MINIMUM OR NOMINAL PENALTY BUT IN THE CA SE OF INADVERTENT OFFICE MISTAKE, IT WOULD NOT BE A SOUND EXERCISE OF JUDICIAL OR QUASI-JUDICIAL POWER TO INFLICT A PENAL TY ON THE HEAD OF THE PUBLIC OFFICE. ON CONSIDERATION OF FACTS AND SU BMISSION THEREOF, WE FIND THAT THERE IS NO CONSCIOUS BREACH OF LAW IN THE PRESENT CASE. THE RATIO LAID DOWN IN THE CASE OF HI NDUSTAN STEEL LTD. VS. STATE OF ORISSA (1973) 83 ITR 26 (SC ) FURTHER SUPPORTS THE CASE OF THE ASSESSEE. THE REVENUE AUTH ORITIES COULD NOT APPRECIATE THE FACTS AND SUBMISSION THERE OF THAT THE TDS WAS TIMELY DEPOSITED AND TDS STATEMENTS WERE FI LED VOLUNTARILY WITHOUT RECEIVING ANY NOTICE FROM THE I NCOME-TAX DEPARTMENT. NO DEMAND IS OUTSTANDING OUT OF TCS COL LECTED. HENCE, THERE WAS NO INTENTION OF THE ASSESSEE FOR T HE DELAY AS NARRATED ABOVE. THEREFORE, ON CONSIDERATION OF FACT S AND CIRCUMSTANCES IN THE LIGHT OF THE JUDICIAL PRONOUNC EMENTS, WE SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND D ELETE THE PENALTY FOR BOTH THE YEARS UNDER CONSIDERATION. 6. IN THE RESULT, BOTH THE APPEALS ARE ALLOWED. DISTRICT MINING OFFICER ITA NO. 130/IND/2016 6 5. WE FIND THAT THE FACTS OF THIS APPEAL ARE IDE NTIAL, THEREFORE, FOLLOWING THE ABOVE ORDER OF THE TRIBUNA L, SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE THE PENALTY OF RS.92,000/- LEVIED BY THE ASSESSING OFFICER AND CON FIRMED BY THE LEARNED CIT(A). 6. IN TH E RESULT , THE APPEAL OF THE ASSESSEE IS ALLOWED. 4. SINCE THE FACTS AND CIRCUMSTANCES OF THE PRESENT C ASE ARE IDENTICAL WITH THE ABOVE CASE DECIDED BY THE TRIBUN AL, WE , THEREFORE, FOLLOWING THE REASONINGS GIVEN THEREIN, S ET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND DELETE T HE PENALTY OF LEVIED BY THE ASSESSING OFFICER AND CONFI RMED BY THE LEARNED CIT(A). IN THIS VIEW OF THE MATTER, THIS GROUND OF APPEAL STANDS ALLOWED. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED . PRONOUNCED IN OPEN COURT ON 4 AUGUST, 2016 (O.P. MEENA) (D.T. G ARASIA) ACCOUNTANTMEMBER JUDICIAL MEMB ER 4 AUGUST, 2016 DN/- DISTRICT MINING OFFICER ITA NO. 130/IND/2016 7 DISTRICT MINING OFFICER ITA NO. 130/IND/2016 8