Shri Anilkumar Manilal Shah, Ahmedabad V. The Income tax Officer,Ward-14(3), Ahmedabad

ITA 1423/AHD/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0529 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2009
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 10-09-2009
• Assessment Year: 2004-2005
• Appeal Filed On: 04-05-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: NEETA SHAH
• Assessee Lawyers: R K JINDAL
• Keywords: Opportunity of being heard; Principle of natural justice; Set aside
• Section: 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE SHRI P.K.BANSAL, ACCOUNTANT MEMBER AND SHRI MAHAVIR SINGH, JUDICIAL MEMBER ITA NO.1423/AHD/2009 ASSESSMENT YEAR: 2006-07 DATE OF HEARING:10.9.09 DRAFTED:16.9.09 SHRI ANILKUMAR MANILAL SHAH, 26-A, RIDHHI APARTMENT, PRAJAPATI PARK, OPP. MUNICIPAL GARDEN, B/H VASNA BRIDGE, AHMEDABAD PAN NOADSP6483N V/S . INCOME TAX OFFICER, WARD-14(3) AHMEDABAD (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI R.K. JINDAL, AR RESPONDENT BY:- SMT. NEETA SHAH, DR O R D E R PER MAHAVIR SINGH JUDICIAL MEMBER:- THIS APPEAL BY THE ASSESSEE IS ARISING OUT OF THE ORDER OF COMMISSIONER OF INCOME-TAX (APPEALS)-XXI, AHMEDABAD IN APPEAL NO. C IT(A)-XXI/AND/132/ WD.14(3)/08-09 DATED 02-01-2009. THE PENALTY UNDER DISPUTE WAS LEVIED BY THE INCOME-TAX OFFICER, WARD-14(1), AHMEDABAD U/S.271(1 )(C) OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE HI S ORDER DATED 23-09-2008. 2. THE ONLY ISSUE IN THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) CONFIRMING THE LEVY OF PENALTY BY THE ASSESSING OFF ICER U/S.271(1)(C) OF THE ACT AMOUNTING TO RS.46,779/-. 3. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE THR OUGH THE FACTS OF THE CASE. WE HAVE ALSO PERUSED THE PENALTY ORDER AS WELL AS T HE ORDER OF CIT(A). THE BRIEF FACTS LEADING TO THE ABOVE ISSUE THAT DURING THE CO URSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS CLAIMED EXEMPTION OF RS.3 ITA NO.1423/AHD/2009 A.Y. 2004-05 SH. ANILKUMR M SHAH V. ITO WD-14(3) , ABD PAGE 2 LAKHS U/S.10(10AA) OF THE ACT ON ACCOUNT OF GRATUIT Y, LEAVE ENCASHMENT, P.F. RECEIVED FROM EMPLOYER, I.E. AHMEDABAD ELECTRICITY CO. LTD. THE AO OBSERVED THAT THE ASSESSEE CAN CLAIM ONLY EARNED LEAVE AS ENTITLE D TO EXEMPTION AND SICK LEAVE OR OTHER LEAVE ARE NOT ENTITLED TO EXEMPTION UNDER THI S SECTION. ACCORDINGLY, AO MADE ADDITION OF RS.3 LAKHS IN THE ASSESSMENT ORDER PASS ED U/S.143(3) OF THE ACT ON 26- 03-2006. AGGRIEVED, THE ASSESSEE PREFERRED APPEAL B EFORE CIT(A). THE CIT(A) VIDE ORDER DATED 27-11-2006 DIRECTED THE ASSESSING OFFIC ER TO GRANT RELIEF U/S.10(10AA) OF THE ACT AT RS.1,44,066/- INSTEAD OF RS.1,12,896/-. ACCORDINGLY, THE ADDITION REMAINS AT RS.1,55,934/- AND THE TOTAL INCOME BE COMPUTED A FTER THE ORDER OF CIT(A) WAS AT RS.3,39,665/- AND THE DEPARTMENT APPEAL BEFORE THE ITAT WAS DISMISSED. ACCORDING TO AO THE ASSESSEE WAS ISSUED SHOW CAUSE NOTICE FOR LEVY OF PENALTY U/S.271(1)(C) OF THE ACT ON AN AMOUNT OF RS.1,55,93 4/-. WE FIND FROM THE ORDERS OF THE LOWER AUTHORITIES, I.E THE PENALTY ORDER PASSED BY THE AO U/S.271(1)(C) OF THE ACT AND THE APPELLATE ORDER OF THE CIT(A) THAT BEFORE N ONE OF THE AUTHORITIES BELOW, THE ASSESSEE HAS FILED EXPLANATION AND WE FIND THAT THE ASSESSEE WAS GIVEN ONLY SEVEN DAYS TIME TO SUBMIT HIS REPLY VIDE SHOW CAUSE NOTI CE DATED 05-08-2008 AND THE PENALTY ORDER WAS PASSED ON 23-09-2008. THE ASSESSE E HAS NOT FILED ANY REPLY AND THE AO LEVIED THE PENALTY. WE FIND THAT IN THE SHOW CAUSE NOTICE, AO HAS GIVEN SEVEN DAYS TIME TO FILE HIS REPLY. WE FEEL THAT NO REASONABLE OPPORTUNITY OF BEING HEARD WAS GIVEN TO THE ASSESSEE AND ACCORDINGLY, KE EPING IN VIEW OF PRINCIPLE OF NATURAL JUSTICE, WE SET ASIDE THIS PENALTY TO THE F ILE OF AO TO DECIDE AFRESH AFTER PROVIDING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. THIS ISSUE OF THE ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOS ES AS INDICATED ABOVE. 4. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STA TISTICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 06/11/2009 SD/- SD/- (P.K.BANSAL) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD, DATED : 06/11/2009 *DKP COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. ITA NO.1423/AHD/2009 A.Y. 2004-05 SH. ANILKUMR M SHAH V. ITO WD-14(3) , ABD PAGE 3 2. THE RESPONDENT. 3. THE CIT(APPEALS)-XXI, AHMEDABAD 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD