KHYALILAL MOHANLAL TATER, MUMBAI V. DCIT, CC- 8(2), MUMBAI

ITA 1382/MUM/2022

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 6475 (ITAT-MUMBAI)
• Duration Of Justice: 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2013-2014
• Appeal Filed On: 25-05-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: CHARMI SHROFF
• Keywords: Reasonable cause
• Section: 132; 144; 143(3); 142(1); 153A; 274; 143(2); 272A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL “H” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, AM AND SHRI SANDEEP SINGH KARHAIL, JM ITA Nos. 1381 to 1386/Mum/2022 (Assessment Years 2013-14 to 2018-19) Khya li lal Mohan lal T ater 3/4, Kapol W adi, M .G. road, Ghatkopar (W ), Mum bai-400 077 Vs. DCIT Central Circle 8(2) Room No.658, 6 th Floor, Aaykar Bhavan MK Road, Mumbai-400 020 (Appellant) (Respondent) PAN No. AAAPT4564C Assessee by : Ms. Charmi Shroff, AR Revenue by : Shri Tejinder Pal Singh Anand, DR Date of hearing: 16.08.2022 Date of pronouncement : 16.08.2022 O R D E R PER BENCH: 01. These are the six appeals filed by the assessee for six different assessment years starting from A.Y. 2013-14 to A.Y. 2018-19 against the confirmation of the penalty levied under Section 271(1)(b) & 272A(1)(d) of the Income-tax Act, 1961 (the Act) by the order of the Commissioner of Income Tax (Appeals)-50, Mumbai [the learned CIT(A)] dated 29 th March, 2022 of Rs.10,000/- for each of the assessment year. The solitary ground is against the confirmation of the penalty. Page | 2 ITA Nos.1381to 1386/Mum/2022 Khyalilal Mohanlal Tater; A.Y. 13-14 to 18-19 02. The brief facts of the case shows that search and seizure action under Section 132 of the Income-tax Act, 1961 (the Act) was carried out on Shilpi and Shine line group on 4 th October, 2018, along with the residential premises of the assessee. Therefore, the assessment proceedings for six assessment years i.e. from A.Y. 2013-14 to A.Y. 2018-19 were in progress. The learned Assessing Officer issued notice under Section 142(1) of the Act to the assessee through ITBA on 19 February 2020 for furnishing the details and requesting compliance on or before 5 March 2020. The assessee did not file any adjournment nor furnish any details and therefore, penalty proceedings under Section 271(1) (b) of the Act were initiated by issuing notice under Section 274 read with Section 271(1) (b) of the Act dated 8 th December, 2020, asking assessee to explain why penalty should not be levied for non compliance of notice u/s 142(1) of the Act. The show cause notice also stated that even till 16 th December, 2020, the assessee did not file any submissions in response to said notice and therefore, the learned Assessing Officer vide order dated 16 th December, 2020 levied the penalty of ₹ 10,000/- under Section 271(1)(b) of the Act. 03. The facts for A.Y. 2014-15 to A.Y. 2018-19, are identical except that for A.Ys. 2017-18 and 2018-19. In these appeals involved section 272A(1)(d) of the Act instead of 271(1)(b) of the Act. Page | 3 ITA Nos.1381to 1386/Mum/2022 Khyalilal Mohanlal Tater; A.Y. 13-14 to 18-19 04. The assessee preferred the appeal before the learned CIT (A) and submitted that assessee has inadvertently lost sight of the notice under Section 142(1) of the Act dated 19 February 2020 and therefore, there was a lapse. However, assessee submitted that as this was a search matter and several cases were going on before the learned AO, the same was missed out. It is however stated that assessment order itself records the date that on 5 March 2020 hearing took place. It was also stated that the assessee complied with that notices during the assessment proceedings and the assessment orders have been passed under Section 143(3) of the Act. It was submitted that vide notice under Section 142(1) of the Act, the income tax return and the details of the bank account along with other details were asked, which were submitted along with other details during the course of assessment proceedings. The learned CIT (A) rejected the contention of the assessee and held that assessee failed to bring on record any reasonable cause and accordingly, he dismissed the appeal of the assessee. Such is the fate of all these six appeals. Therefore, assessee is aggrieved with the order of the learned CIT (A) of all six years and has preferred the appeal before us. 05. The learned Authorized Representative appearing before us submitted the detailed paper book for all the six years. She further relied on several judicial precedents to submit that there is a reasonable cause for non-appearing before the learned Assessing Officer on the appointed date. On 5 th March, 2020, the date of hearing took place as per the Page | 4 ITA Nos.1381to 1386/Mum/2022 Khyalilal Mohanlal Tater; A.Y. 13-14 to 18-19 date of hearing mentioned in the assessment order itself and further where order under Section 143(3) of the Act has been passed and not under Section 144 of the Act, the subsequent compliance in the assessment proceedings should be considered as a good compliance and therefore, penalty should not have been levied. She further submitted that in several judicial precedents as cited before us, where the penalty has been deleted. She submitted identical paper books for six appeals. 06. The learned Departmental Representative vehemently supported the orders of the lower authorities. 07. We have carefully considered the rival contentions and perused the orders of the lower authorities. The brief facts of the case shows that pursuant to search under Section 132 of the Act on 4 th October, 2018, the case of the assessee were assessed under Section 153A of the Act. The learned Assessing Officer issued notice under Section 142(1) of the Act along with notice under Section 143(2) of the Act on 19 th February, 2020. As the several search case of the group were going on the assessee missed to comply with the above notice which fixed the date of hearing on 5 th March, 2020. The assessment order under Section 153A of the Act passed on 26 th April, 2021 for A.Y. 2014-15 which categorically states that hearing took place on 5 th March 2020. Further, in paragraph no. 2 and 3 of the assessment order, the learned Assessing Officer himself mentioned that notice under Section 142(1) of the Act was issued to the assessee along with notice under Page | 5 ITA Nos.1381to 1386/Mum/2022 Khyalilal Mohanlal Tater; A.Y. 13-14 to 18-19 Section 143(2) of the Act on 19 th February, 2020, In compliance to the same, the learned Authorized Representative of the assessee filed submissions. The same is considered and kept on record. Despite this categorical finding in the assessment order itself and mentioning in the body of the order date of hearing as 5 th March, 2020, The learned Assessing Officer held that assessee has failed to comply with notice under Section 142(2) of the Act, therefore, there was a contradictory finding in the order passed under Section 153A of the Act and the order levying the penalty under Section 271 (1)(b) of the Act. Further, the additions were made in the hands of the assessee were not because of the reasons that assessee did not furnish the requisite information but because of search related issues. It is also shown that the assessment has been made after considering of the details filed by the assessee under Section 153A of the Act read with section 143(3) of the Act. None of the assessment order was passed under Section 144 of the Act. This clearly shows that there are materials to suggest that the learned Assessing Officer was satisfied, on the whole, overall compliance made by the assessee during the assessment proceedings. In view of this, the penalty levied by the learned Assessing Officer under Section 271(1)(b) of the Act or under Section 272A (1)(d) of the Act deserves to be cancelled. The judicial precedent cited before us of the co-ordinate Benches in case of Globus Infocom Limited Vs. DCIT in ITA No. 738/Del/2014 dated 29 th June, 2016 and in case of DLF Commercial Enterprises Page | 6 ITA Nos.1381to 1386/Mum/2022 Khyalilal Mohanlal Tater; A.Y. 13-14 to 18-19 Vs. ACIT in ITA No.2530/Del/2018 dated 16 th February, 2021 supported the case of the assessee. 08. Accordingly, reversing the order of the lower authorities, we cancel the penalties levied under Section 271(1)(b) of the Act and section 272A(1)(d) of the Act of ₹10,000/- for each of these six assessment years. 09. In the result, all the six appeals filed by the assessee are allowed. Order pronounced in the open court on 16.08.2022. Sd/- Sd/- (SANDEEP SINGH KARHAIL) (PRASHANT MAHARISHI) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) Mumbai, Dated:16.08.2022 Sudip Sarkar, Sr.PS Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. The CIT(A) 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. BY ORDER, True Copy// Sr. Private Secretary/ Asst. Registrar Income Tax Appellate Tribunal, Mumbai