G.Malliga, CHENNAI V. DCIT, CHENNAI

ITA 1374/CHNY/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 5877 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-11-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 20-06-2017
• Assessment Year: 1996-1997
• Appeal Filed On: 04-06-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: N DEVANATHAN
• Section: 142(1); 27

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , !, # $% BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER ./ ITA NOS.1372, 1373 & 1374/MDS/2015 ( )( / ASSESSMENT YEAR : 1995-96 & 1996-97 SMT. G. MALLIGA, NO.13, 6 TH CROSS STREET, LAKE AREA, NUNGAMBAKKAM, CHENNAI - 600 034. PAN : AFFPM 4644 A V. THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE II(1), CHENNAI - 600 034. (+,/ APPELLANT) (-.+,/ RESPONDENT) +, / 0 / APPELLANT BY : SH. N. DEVANATHAN, ADVOCATE -.+, / 0 / RESPONDENT BY : SHRI N. MADHAVAN, ADDL.CIT 1 / 2# / DATE OF HEARING : 12.10.2017 3 ) / 2# / DATE OF PRONOUNCEMENT : 09.11.2017 / O R D E R PER BENCH: THESE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE RESPECTIVE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), PUDUCHERRY, FOR THE ASSESSMENT YEARS 1995-96 AND 19 96-97. SINCE COMMON ISSUE ARISE FOR CONSIDERATION IN ALL THESE A PPEALS, WE HEARD THESE APPEALS TOGETHER AND DISPOSING OF THE SAME BY THIS COMMON ORDER. 2 I.T.A. NOS.1372 TO 1374/MDS/15 2. LET US FIRST TAKE THE ASSESSEES APPEALS IN I.T. A. NO.1372 & 1374/MDS/2015. 3. SH. N. DEVANATHAN, THE LD.COUNSEL FOR THE ASSESS EE, SUBMITTED THAT FOR ASSESSMENT YEARS 1995-96 AND 199 6-97, THE ASSESSING OFFICER LEVIED PENALTY UNDER SECTION 271( 1)(B) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). ACCORDI NG TO THE LD. COUNSEL, THE CIT(APPEALS) WITHOUT CONSIDERING THE P ROVISIONS OF LAW, RESTRICTED THE PENALTY TO ` 5000/-. REFERRING TO SECTION 271(1)(B) OF THE ACT, THE LD.COUNSEL SUBMITTED THAT PENALTY CAN BE LEVIED PROVIDED THE ASSESSEE FAILED TO COMPLY WITH THE NOT ICE ISSUED UNDER SECTION 142(1) OR 143(2) OF THE ACT. REFERRING TO THE PENALTY ORDER, THE LD.COUNSEL SUBMITTED THAT THE AUTHORIZED REPRES ENTATIVE OF THE ASSESSEE SHRI R. GOPALAKRISHNAN APPEARED BEFORE THE ASSESSING OFFICER AND ALSO FILED WRITTEN SUBMISSION. THEREFO RE, ACCORDING TO THE LD. COUNSEL, AT THE BEST, IT CAN BE CONSIDERED AS DELAY IN COMPLYING WITH THE DIRECTION OF THE ASSESSING OFFIC ER AND IT IS NOT A CASE OF FAILURE TO COMPLY WITH THE NOTICE ISSUED UN DER SECTION 142(1) OR 143(2) OF THE ACT. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE CIT(APPEALS) OUGHT TO HAVE DELETED THE ENTIRE PENALTY LEVIED BY THE ASSESSING OFFICER. 3 I.T.A. NOS.1372 TO 1374/MDS/15 4. ON THE CONTRARY, SHRI N. MADHAVAN, THE LD. DEPAR TMENTAL REPRESENTATIVE, SUBMITTED THAT THOUGH THE ASSESSEE FILED THE WRITTEN SUBMISSION THROUGH HER AUTHORIZED REPRESENTATIVE SH RI GOPALAKRISHNAN, THE REASON FOR DELAY IN FURNISHING DETAILS WAS NOT FURNISHED. THEREFORE, ACCORDING TO THE LD. D.R., T HE ASSESSING OFFICER HAS RIGHTLY LEVIED PENALTY UNDER SECTION 27 1(1)(B) OF THE ACT. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. WE HAVE ALSO CAREFULLY GONE THROUGH THE PROVISIONS OF SECTION 27 1(1)(B) OF THE ACT. IN CASE THE ASSESSEE FAILS TO COMPLY WITH THE NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SECTION 142(1) OR 143(2 ) OF THE ACT, THE ASSESSING OFFICER CAN LEVY PENALTY. IN THIS CASE, AS RIGHTLY POINTED OUT BY THE LD.COUNSEL, IT IS NOT A CASE OF FAILURE OF THE ASSESSEE IN COMPLYING WITH THE NOTICE ISSUED BY THE ASSESSING O FFICER, BUT A CASE OF DELAY IN FURNISHING THE DETAILS. FAILURE T O COMPLY WITH NOTICE IS ONE THING AND DELAY IN FURNISHING THE DETAILS IS ANOTHER THING. SINCE THERE WAS NO FAILURE ON THE PART OF THE ASSES SEE TO COMPLY WITH THE NOTICE ISSUED BY THE ASSESSING OFFICER UND ER SECTION 142(1) OR 143(2) OF THE ACT, THIS TRIBUNAL IS OF TH E CONSIDERED OPINION THAT PENALTY CANNOT BE LEVIED UNDER SECTION 271(1)( B) OF THE ACT. 4 I.T.A. NOS.1372 TO 1374/MDS/15 THEREFORE, AS RIGHTLY SUBMITTED BY THE LD.COUNSEL F OR THE ASSESSEE, THE CIT(APPEALS) OUGHT TO HAVE DELETED THE PENALTY IN TOTO. 6. FROM THE PENALTY ORDER IT APPEARS THAT THE DELAY AROSE BECAUSE OF PENDENCY OF CRIMINAL PROCEEDING AND POLI CE INVESTIGATION. IN THOSE CIRCUMSTANCES, LEVY OF PEN ALTY UNDER SECTION 271(1)(B) OF THE ACT IS NOT JUSTIFIED. ACCORDINGLY , ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE PENALTY OF ` 5000/- LEVIED BY THE ASSESSING OFFICER FOR BOTH THE ASSESSMENT YEARS IS DELETED. 7. NOW COMING TO I.T.A. NO.1373/MDS/2015, THE ASSES SEE HAS CHALLENGED THE CORRECTNESS OF PENALTY LEVIED BY THE ASSESSING OFFICER UNDER SECTION 271(1)(C) OF THE ACT. 8. SH. N. DEVANATHAN, THE LD.COUNSEL FOR THE ASSESS EE, SUBMITTED THAT THE ASSESSING OFFICER LEVIED PENALTY OF ` 3000/- ON THE GROUND THAT THE AGRICULTURAL INCOME SHOWN TO THE EX TENT OF ` 15,000/- WAS NOT SUBSTANTIATED. ACCORDING TO THE LD. COUNSE L, THE ASSESSEE IS OWNING AGRICULTURAL LAND AND EARNING THE AGRICUL TURAL INCOME REGULARLY IS NOT IN DISPUTE. IN FACT, THIS IS THE LEASE AMOUNT RECEIVED FROM VARIOUS FARMERS ON LEASING OUT THE AGRICULTURA L LAND. THEREFORE, ACCORDING TO THE LD. COUNSEL, THERE CANNOT BE ANY P ENALTY UNDER 5 I.T.A. NOS.1372 TO 1374/MDS/15 SECTION 271(1)(C) OF THE ACT. IN FACT, ACCORDING T O THE LD. COUNSEL, THE ASSESSEE HAS NOT FURNISHED ANY INACCURATE PARTI CULARS OR CONCEALED ANY PART OF INCOME, THEREFORE, THE CIT(AP PEALS) IS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIED BY THE A SSESSING OFFICER. 9. ON THE CONTRARY, SHRI N. MADHAVAN, THE LD. DEPAR TMENTAL REPRESENTATIVE, SUBMITTED THAT THE ASSESSEE COULD N OT SUBSTANTIATE THE CLAIM OF AGRICULTURAL INCOME, THEREFORE, THE AS SESSING OFFICER ASSESSED ` 15,000/- AS INCOME FROM OTHER SOURCES. HENCE, ACCORDING TO THE LD. D.R., THE ASSESSING OFFICER LE VIED PENALTY WHICH WAS RIGHTLY CONFIRMED BY THE CIT(APPEALS). 10. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EIT HER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE DISCLOSED ` 15,000/- TOWARDS AGRICULTURAL INCOME AND CLAIMED BE FORE THE ASSESSING OFFICER THAT THIS IS THE LEASE AMOUNT RECEIVED ON LETTING OUT THE LAND TO VARIOUS FARMERS. THE ASSES SING OFFICER FOUND THAT THE ASSESSEE COULD NOT FURNISH ANY DETAILS. T HE FACT REMAINS THAT THE ASSESSEE DISCLOSED ` 15,000/- AND CLAIMED THE SAME AS AGRICULTURAL INCOME. MERELY BECAUSE THE ASSESSEE C OULD NOT SUBSTANTIATE THAT THE INCOME WAS FROM AGRICULTURE, IT CANNOT BE SAID THAT THERE WAS CONCEALMENT OF INCOME. MOREOVER, I T CANNOT ALSO BE 6 I.T.A. NOS.1372 TO 1374/MDS/15 SAID THAT THE ASSESSEE HAS FURNISHED INACCURATE PAR TICULARS OF INCOME. THE MATTER WOULD STAND DIFFERENTLY IN CASE THE ASSESSEE FAILS TO DISCLOSE THE INCOME. THE ASSESSEE DISCLOS ED ` 15,000/- AND CLAIMED EXEMPTION ON THE GROUND THIS IS FROM AGRICU LTURE. MAKING A CLAIM BEFORE THE ASSESSING OFFICER CANNOT BE CONSTR UED TO BE FURNISHING OF INACCURATE PARTICULARS OR CONCEALING ANY PART OF INCOME IN VIEW OF THE JUDGMENT OF APEX COURT IN CIT V. REL IANCE PETROPRODUCTS PVT. LTD. (322 ITR 158). THEREFORE, WE ARE UNABLE TO UPHOLD THE ORDERS OF THE AUTHORITIES BELOW LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT. ACCORDINGLY, THE ORD ERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE PENALTY OF ` 3,000/- LEVIED BY THE ASSESSING OFFICER IS DELETED. 11. IN THE RESULT, ALL THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED. ORDER PRONOUNCED ON 9 TH NOVEMBER, 2017 AT CHENNAI. SD/- SD/- ( ! ) ( . . . ) (SANJAY ARORA) (N.R.S. GANESAN) # / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 5 /DATED, THE 9 TH NOVEMBER, 2017. KRI. 7 I.T.A. NOS.1372 TO 1374/MDS/15 / -267 87)2 /COPY TO: 1. +, /APPELLANT 2. -.+, /RESPONDENT 3. 1 92 () /CIT(A) 4. 1 92 /CIT, 5. 7: -2 /DR 6. ;( < /GF.