Shree Manibhandar Veer Education Trust, Ambala City V. ITO (TDS), Panchkula

ITA 1319/CHANDI/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 68497 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 20-02-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 19-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J S NAGAR
• Keywords: Opportunity of being heard; Reasonable cause; Condonation of delay; Revised return
• Section: 273B; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES A CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R. SOOD, ACOCUNTANT MEMBER ITA NO.1319/CHD/2012 ASSESSMENT YEAR: 2008-09 SHREE MANIBHANDAR VEER EDUCATION VS THE ITO (TDS) TRUST, PANCHKULA AMBALA CITY PAN NO. RTKS08362E (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI J.S. NAGAR DATE OF HEARING : 10.09.2013 DATE OF PRONOUNCEMENT : 13.09.2013 ORDER PER BHAVNESH SAINI, JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF LD. CIT(A), PANCHKULA DATED 15.10.2012 FOR ASSESSMENT Y EAR 2008-09 CHALLENGING THE LEVY OF PENALTY U/S 272B OF THE I.T . ACT. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ITO (TDS) WHILE GOING THROUGH THE QUARTERLY RETURN INFORM NO. 26Q FILED B Y THE ASSESSEE NOTICED THAT IT HAS OMITTED TO QUOTE PAN NUMBER / HAS QUOTE D INVALID PAN IN FIVE CASES. AS PER THE ASSESSING OFFICER, THE ASSESSEE WAS GIVEN OPPORTUNITIES TO EXPLAIN HIS POSITION TO FILE THE CORRECT DETAILS BUT THE ASSESSEE DID NOT RESPOND, THEREFORE, THE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE HAS COMMITTED A DEFAULT U/S 139A(5B) OF THE ACT FOR WHI CH PENALTY U/S 2 272B(1) OF THE ACT WAS LEVIABLE. THE ASSESSING OFF ICER ACCORDINGLY LEVIED PENALTY OF RS. 10,000/- VIDE ORDER DATED 10. 3.2011. 3. THE PENALTY ORDER WAS CHALLENGED BEFORE THE LD. CIT(A). THE WRITTEN SUBMISSIONS OF THE ASSESSEE IS QUOTED IN TH E APPELLATE ORDER IN WHICH THE ASSESSEE BRIEFLY EXPLAINED THAT IT IS A EDUCATIONAL SOCIETY AND IS RUNNING THE ACTIVITIES OF THAT OF SCHOOL FROM W HERE ACTIVITY OF TRANSPORTATION OF STUDENTS ARE CARRIED AND FOR THIS PURPOSE THE SCHOOL HAS ENGAGED TRANSPORTERS WHO ARE UNEDUCATED DRIVERS AND HAS PROVIDED INCORRECT PAN NUMBERS AND HAVE FILED THEIR QUARTERL Y TDS FROM IN PRESCRIBED FORM ON 16.7.2007. THE ASSESSEE SUBMITT ED BEFORE THE ASSESSING OFFICER THAT THERE WERE MINOR MISTAKES BY GIVING VERBAL INFORMATION REGARDING PAN BY UNEDUCATED DRIVERS. TH E DETAILS OF THE SAME ARE NOTED IN PARA 4 OF THE APPELLATE ORDER. IT WAS ALSO SUBMITTED THAT THE TAX DEDUCTED WAS SMALL I.E. RS. 859/- DURING THIS Q UARTER AND PENALTY OF RS. 10,000/- HAVE BEEN IMPOSED AGAINST TAX DEDUCTED WHILE THE SAME HAS BEEN DEPOSITED INTO THE GOVERNMENT ACCOUNT. IT IS S TATED THAT ASSESSEE HAS NOT REVISED ITS RETURN OF TDS FOR THE QUARTER-1 BE CAUSE THE TDS RETURN FOR THIS QUARTER WAS FILED IN PROPER FORM AND FVU FILE COULD NOT BE AVAILABLE AND THE ASSESSING OFFICER HAS NOT CONSIDERED THE S AME. THE ASSESSEE REQUESTED FOR CONDONATION OF DELAY IN FILING THE RE VISED RETURN. THE ASSESSEE, THEREFORE, SUBMITTED THAT SINCE THE TDS AMOUNT IS VERY SMALL AND NUMBER OF DEDUCTEES ARE ONLY TWO, THEREFORE, FU RTHER REVISED RETURN COULD NOT BE FILED. THE LD. CIT(A) DID NOT HOWEVER ACCEPT THIS CONTENTION OF THE ASSESSEE. THE LD. CIT(A) NOTED TH AT ASSESSEE DID NOT AVAIL TO THE OPPORTUNITY OF BEING HEARD BEFORE THE ASSESSING OFFICER. THE LD. CIT(A) FOUND THAT PENALTY IS LEVIABLE FOR DEFAU LT U/S 139A(5B)(IV) OF THE INCOME TAX ACT AND ASSESSEE SHALL HAVE TO QUOTE THE PAN OF THE PERSONS TO WHOM SUCH INCOME / SUM HAS BEEN PAID IN ALL THE STATEMENTS. 3 THE ASSESSEE QUOTED INVALID PAN OF TWO OF THE ASSES SEE AND ALSO FAILED TO FILE THE REVISED RETURN, THEREFORE, THE APPEAL OF THE ASSESSEE WAS DISMISSED. 4. NO BODY REPRESENTED THE ASSESSEE DURING THE COUR SE OF HEARING. THE LD. DR RELIED ON THE ORDERS OF THE AUTHORITIES BELO W. 5. ON CONSIDERATION OF THE FACTS OF THE CASE AND WR ITTEN SUBMISSIONS QUOTED BY THE LD. CIT(A) IN THE APPELLATE ORDER, WE ARE OF THE VIEW THAT ASSESSEES CASE CLEARLY FALLS UNDER THE EXCEPTION A S PROVIDED U/S 273 B OF THE INCOME TAX ACT. SECTION 273 B OF THE INCOME TA X ACT PROVIDES THAT NO PENALTY SHALL BE IMPOSABLE U/S 272B OF THE INCOM E TAX ACT ON THE PERSON OR THE ASSESSEE AS THE CASE MAY BE FOR ANY F AILURE REFERRED TO IN THE SAID PROVISIONS IF ASSESSEE PROVES THAT THERE WAS R EASONABLE CAUSE FOR THE SAID FAILURE. IN THE CONTEXT OF PENALTY PROVISIONS, WORD REASONABLE CAUSE WOULD MEAN A CASE WHICH IS BEYOND THE CONTROL OF TH E ASSESSEE. REASONABLE CAUSE MEANS WHICH PREVENTS A REASONABL E MAN OF ORDINARY PRUDENCE ACTING UNDER NORMAL CIRCUMSTANCES WITHOUT NEGLIGENCE OR INACTION OR WANT OF BONAFIDE. IT IS NOT IN DISPUTE THAT ASSESSEE DEDUCTED THE SMALL TDS OF RS. 859/- AND ALSO FILED THE REQUI RED RETURN OF TDS WITHIN TIME. THERE WAS A MINOR MISTAKE IN GIVING I NFORMATION REGARDING PAN NUMBER BY TWO DRIVERS AND THE DETAILS OF THE SA ME ARE NOTED IN PARA 4 OF THE APPELLATE ORDER, WOULD REVEAL THAT THERE WAS MINOR VARIATION IN QUOTING THE CORRECT PAN NUMBER. THE ASSESSEE EXPLAI NED THAT THOSE PAN NUMBERS WHICH HAVE BEEN QUOTED IN THE PRESCRIBED RE TURN HAVE BEEN PROVIDED BY THE UNEDUCATED DRIVERS ON VERBAL INFORM ATION. THUS, THE ASSESSEE BONAFIDLY ACTED UPON THE INFORMATION PROVI DED BY THE UNEDUCATED DRIVERS AND AS SUCH IT WAS BEYOND THE CONTROL OF TH E ASSESSEE TO QUOTE THE CORRECT PAN NUMBERS. THE ASSESSEE ACTED BONAFIDLY BY DEDUCTING TDS 4 AND BY FILING THE REQUIRED RETURN OF TDS. THE AMO UNT IS VERY SMALL AS AGAINST THE PENALTY LEVIED. CONSIDERING THE NATURE OF ACTIVITY CARRIED ON BY THE ASSESSEE I.E THE EDUCATIONAL ACTIVITIES AND THE SMALLNESS OF THE AMOUNT INVOLVED OF TDS IN WHICH WRONG PAN NUMBER WA S QUOTED, WE ARE OF THE VIEW THAT ASSESSEE HAD A REASONABLE CAUSE FO R FAILURE TO QUOTE THE CORRECT PAN NUMBERS OF THE DRIVERS. NOTHING HAS BE EN BROUGHT TO OUR NOTICE, IF THE ASSESSEE HAS BEEN BLATANTLY QUOTING WRONG PAN NUMBERS. FROM THE PECULIAR FACTS OF THIS CASE AND SMALLNESS OF THE AMOUNT INVOLVED IN QUESTION, WE ARE OF THE VIEW THAT BENEFIT OF EXC EPTION AS PROVIDED U/S 273B OF THE ACT CAN BE GIVEN FOR CANCELLATION OF TH E PENALTY. 6. IN VIEW OF THE ABOVE DECISION, WE SET SIDE THE O RDER OF THE AUTHORITIES BELOW AND CANCEL THE PENALTY. THE ASSE SSEE IS DIRECTED TO BE CAREFUL IN FUTURE. WE CLARIFY THAT THIS ORDER SHAL L NOT BE TREATED AS PRECEDENT FOR OTHER CASES AS IT IS BASED ON PECULIA R FACTS OF THIS CASE AS NOTED ABOVE. WITH THESE OBSERVATIONS, THE APPEAL O F THE ASSESSEE IS ALLOWED. 7. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 13/09/2013 SD/- SD/- (T.R. SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 13 TH SEPTEMBER, 2013 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR BY ORDER, (ASSISTANT REGISTRAR) ITAT, CHANDIGARH 5