M/s. M & Company, Kashmir V. The Deputy. Commissioner of Income-tax, Srinagar

ITA 149/ASR/2013

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 8679 (ITAT-AMRITSAR)
• Duration Of Justice: 9 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-08-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 06-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 271(1)(c); 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92; 73

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR. BEFORE DR. M. L. MEENA, ACCOUNTANT MEMBER AND SH. ANIKESH BANERJEE, JUDICIAL MEMBER I.T.A. No. 149/Asr/2013 Assessment Year: 2005-06 M/s M & Co. Tax Hariwatnu, tangmarg, Kashmir. [PAN: AAHFM6716G] (Appellant) Vs. DCIT Circle-3, Srinagar. (Respendent) Appellant by Sh. Nipun Khanna, CA. Respondent by Sh. S.M.Surendra Nath Sr.D. R. Date of Hearing 06.07.2022 Date of Pronouncement 10.08.2022 ORDER Per: Anikesh Banerjee, JM: The instant appeal was filed by the assessee against the order of the ld. Commissioner of Income Tax (Appeal) Jammu, [in brevity the CIT(A)] bearing appeal no. 195/2009-10 date of order 18.12.2012, for A.Y. 2005-06. The said appeal was arising out from the order of the ld. DCIT, Circle-3, Srinagar, Campat Jammu order passed u/s 271(1)(c) dated of order 27.01.2010. I.T.A. No. 149/Asr/2013 2 2. The assessee has taken following grounds before the Bench which is extracted as below: “1. That the Assessment Order passed by Ld. Assessing Officer u/s. 271( l)(c) of the Income-tax Act, 1961, is illegal, arbitrary and contrary to the facts on records and this illegality pervades over all other grounds of appeal, that the Worthy CIT(A) has further erred in confirming the same. 2. That the Ld. AO erred in levying the penalty u/s.271(l)(c) of the Income- tax Act, 1961 of Rs.23,55,210 and the Worthy CIT(Appeals) has further erred in confirming the decision of Ld. AO. 3. That the Worthy CIT(Appeals) has failed to take cognizance of the fact that’ Concealment of income/furnishing of inaccurate particulars of income’ are two independent charges u/s.271(l)(c) and both can not run concurrently as the AO failed to bring these charges in his Show Cause Notice and has by-passed the submissions and case law cited by the appellant at their favor and the Worthy CIT(Appeals) has similarly erred in approving the same. 4. That the Ld. AO has erred in perfunctorily ignored the decision of High Courts/Supreme Court and 1TAT, Amritsar Bench and the Worthy CIT(Appeals) has similarly erred in affirming the erroneous decision of the Ld. AO. 5. That the appellant craves the right to add, alter or/and amend the above ground of appeal either at or before the hearing.” 3. The brief fact is that the assessment was made u/s 271(1)(c) of the Act adequate basis the tax was levied and the total evaded tax by the assessee Rs.9996463/-. The ld. AO initiated penalty u/s 271(1)(c) and levied penalty on basis of 100% of tax amount to Rs. 2355210/-. The aggrieved assessee filed an appeal before the ld. CIT(A) and the ld. CIT(A) uphold the order of the ld.AO. The main grievance was that the notice initiated by the ld. AO was not determined the allegation of the assessee whether it is concealed income or furnished inaccurate I.T.A. No. 149/Asr/2013 3 particular of income. The ld. Counsel so enclosed the notice issued by the ld AO u/s 274/271(1)(c) of the Act vide notice dated 27.12.2007 which is reproduced hereunder: I.T.A. No. 149/Asr/2013 4 4. The ld. DR vehemently argued and relied on the order of the ld. CIT(A). The ld. DR further mentioned that in the assessment order passed u/s 143(3) dated 27.12.2007 by the ld. AO. The ld. AO specifically mentioned that the penalty proceedings u/s 271(1)(c) is initiated for final opportunity of the assessee. In the assessment order the conclusion was made as ‘inaccurate particular of income’. So the mistake initiation of notice is not accepted. Also in the notice the particular allegation was marked. 5. We heard the rival submission and considered the documents available in record. The ld. Counsel for the assessee filed written argument on 07.06.2022 which is kept to record. This particular notice it is a self defective and the ld. AO did not mention the nature of concealment in the notice issued u/s 274/271(1)(c). The ld. AO had marked in both the heads in notice. The counsel laid down that in the absence of such specific notice, the notice would be invalid as held in various judicial pronouncements including the decision of Hon’ble Karnataka High Court in CIT V/s SAS’s Emerald Meadows (73 Taxmann.com 241) against which Special Leave Petition (SLP) filed by the department stood dismissed by Hon’ble Supreme Court which is reported as 73 Taxmann.com 248. The notice u/s 274/271(1)(c) of the Act is not carrying the specific limb. Therefore, this is a case where both the parts of the offences i.e., concealment of income as well as I.T.A. No. 149/Asr/2013 5 furnishing of inaccurate particulars of income were involved. The decision of Jaipur Tribunal (Third Member) in the case of Grass Field Farms and Resorts P. Ltd. (159 ITD 31) was referred to confirm the impugned penalty. Finally, respectfully following the binding judicial precedents as cited aforesaid, we are of the considered opinion that the impugned penalty is not sustainable on legal grounds. Hence, by deleting the same, we allow the appeal of the assessee. 6. In the result the appeal of the assessee is allowed. Order pronounced in the open court on 10.08.2022 Sd/- Sd/- (Dr. M. L. Meena) (ANIKESH BANERJEE) Accountant Member Judicial Member AKV Copy of the order forwarded to: (1)The Appellant (2) The Respondent (3) The CIT (4) The CIT (Appeals) (5) The DR, I.T.A.T. True Copy By Order