Dinesh Kumar, CHENNAI V. ACIT, CHENNAI

ITA 1491/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8164 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-01-2017
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 03-01-2017
• Assessment Year: 2008-2009
• Appeal Filed On: 25-05-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Keywords: Bonafide belief; TDS
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 142(1); 250

Judgement Text

, ' ' , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . , . , $ % BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ' ( / APPELLANT BY : SHRI N. VIJAY KUMAR, CA. +,' ( / RESPONDENT BY : SHRI A.V. SREEKANTH, JCIT ( /DATE OF HEARING : 03.01.2017 ( /DATE OF PRONOUNCEMENT : 04.01.2017 /O R D E R PER BENCH: THE ASSESSEE FILED AN APPEAL AGAINST THE COMMON O RDER PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) - 5 IN ITA NO. 2,3,5,6,7,8/CIT(A) - 5/14-15 DATED 21.03.2016 FOR THE ASSESSMENT YEARS 2 007-08, 2008-09, 2009- ./ I.T.A. NO. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 / ASSESSMENT YEAR :2007-08, 2008-09, 2009-10, 2009-10 , 2010-11, 2011-12 & 2012-13 SHRI DINESH KUMAR, ARIHANT SHRISHAKTHI APARTMENTS, NO. 77, SYDENHAMS ROAD, 6 TH FLOOR, PERIAMET, CHENNAI 600 003. [PAN: AAACP 9339C] VS. ASSISTANT COMMISSIONER OF INCOME TAX, NON- CORPORATE CIRCLE 4, CHENNAI. ( / APPELLANT) ( /RESPONDENT) :-2-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 10, 2010-11, 2011-12 & 2012-13 PASSED U/S. 271F OF THE ACT AND ITA NO. 4/CIT(A) -5/14-15, DATED 21.03.2016 FOR THE ASSESSM ENT YEAR 2009-10 PASSED U/S. 272A(1)(C) AND 250 OF THE INCOME TAX ACT. SIN CE, THE ISSUES IN THESE APPEALS ARE COMMON, THE APPEALS ARE CLUBBED AND HEA RD TOGETHER AND DISPOSED OFF BY THE COMMON ORDER. FOR THE SAKE OF CONVENIENCE, WE FIRST TAKE UP FACTS NARRATED IN APPEAL ITA NO. 1490/MDS/2016 F OR THE ASSESSMENT YEAR 2007-08. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS: 2.1 FOR THAT THE COMMISSIONER OF INCOME TAX (APPEAL S) ERRED IN DISMISSING THE APPEAL IN-LIMINE IN THE FACTS AND C IRCUMSTANCES OF THE CASE. 2.2 FOR THAT THE COMMISSIONER OF INCOME TAX (APPEAL S) FAILED TO APPRECIATE THAT NO NOTICE U/S. 156 WAS ISSUED ON T HE APPELLANT IN THE INSTANT CASE. 2.3 FOR THAT THE COMMISSIONER OF INCOME TAX (APPEAL S) FAILED TO APPRECIATE THAT THE ASSESSING OFFICER ERRED IN INV OKING THE PROVISIONS OF SECTION 271F AND LEVYING A PENALTY OF RS. 5,000 /- ON THE APPELLANT. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL AND ASSESSED TO INCOME TAX BY ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE -X, :-3-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 CHENNAI. THE LD. AO ISSUED NOTICE U/S. 142(1) OF T HE ACT DATED 08.04.2013 REQUIRING THE ASSESSEE TO FILE RETURN OF INCOME BEF ORE 19.04.2013. SINCE, THE ASSESSEE HAS NOT FILED THE RETURN OF INCOME WITHIN THE DUE DATE U/S. 139(1), THE LD. AO HAS INITIATED PENALTY PROCEEDINGS AND LE VIED PENALTY U/S. 271F OF THE ACT AND PASSED ORDER DATED 07.03.2014. 4. AGGRIEVED BY THE ORDER, THE ASSESSEE FILED AN AP PEAL WITH THE CIT(A). IN THE APPELLANT PROCEEDINGS THE LD. AR OF THE ASSESSEE ARGUED THAT THE ASSESSING OFFICER HAS ERRED IN LEVYING THE PENA LTY U/S. 271F OF THE ACT IRRESPECTIVE OF THE FACT THAT THE ASSESSEE WAS UNDE R BONAFIDE BELIEF THAT THE TAX PAYABLE BY THE ASSESSEE IS LESS THAN THE TAX CR EDIT ON TDS AND ENTITLED FOR REFUND AND THE ASSESSEE FILED RETURN OF INCOME IN R ESPONSE TO NOTICE U/S. 142(1) OF THE ACT. HENCE, THE ACTION OF ASSESSING OFFICER IS BAD IN LAW AND PRAYED FOR DELETION OF PENALTY. THE LD. CIT(A) CON SIDERED THE GROUNDS AND SUBMISSIONS OF THE ASSESSEE AND FINDINGS OF THE ASS ESSING OFFICER ON LEVY OF PENALTY. FURTHER, THE LD. AR FILED THE WRITTEN SUB MISSIONS ON 28.04.2015 ON APPLICABILITY OF PROVISIONS OF SECTION 271F OF THE ACT WITH SUPPORTING JUDICIAL DECISIONS REFERRED AT PAGE 3 TO 10 OF THE ORDER. T HE LD. CIT(A) IN THE COURSE OF HEARING ON 07.03.2016 FOUND THAT THE ASSESSEE HA S NOT FILED ORIGINAL DEMAND NOTICE ALONG WITH FORM-35. SINCE, THE ORIGI NAL DEMAND NOTICE WAS NOT AVAILABLE ON RECORD, THE LD. CIT(A) IS OF THE O PINION THAT IN SPITE OF GIVING ADEQUATE OPPORTUNITY, THE ASSESSEE HAS NOT FILED AN Y EXPLANATIONS FOR THE :-4-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 DEFECTS OR FILED THE ORIGINAL DEMAND NOTICE AND ACC ORDINGLY CONSIDERED THE GROUNDS, WRITTEN SUBMISSIONS AND PENALTY ORDER AND THE MATERIAL ON RECORD AND TREATED THE APPEAL AS DEFECTIVE AND DISMISSED T HE APPEAL IN-LIMINE. 5. AGGRIEVED BY THE CIT(A) ORDER, ASSESSEE HAS ASSA ILED AN APPEAL BEFORE THE TRIBUNAL. BEFORE US, THE LD. AR SUBMITT ED THAT THE LD. CIT(A) ERRED IN DISMISSING THE APPEAL IN-LIMINE WITHOUT CO NSIDERING THE FACTS AND CIRCUMSTANCES OF THE CASE. THE NOTICE OF DEMAND U/ S. 156 OF THE ACT WAS NOT ISSUED TO THE ASSESSEE BY THE LD. AO. THE ASSESSIN G OFFICER LEVIED PENALTY U/S. 271F OF THE ACT IRRESPECTIVE OF THE FACT THAT ASSESSEE HAS FILED RETURN OF INCOME IN COMPLIANCE TO NOTICE U/S. 142(1) OF THE A CT AND PRAYED FOR DELETION OF THE PENALTY U/S. 271F OF THE ACT. CONTRA, THE L D. DR RELIED ON THE ORDERS OF THE CIT(A). 6. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATE RIAL ON RECORD AND JUDICIAL DECISIONS. THE LD. AR CONTENTION THAT THE ORDER OF THE ASSESSING OFFICER IN LEVYING THE PENALTY CANNOT BE SUSTAINED AS THE ASSESSEE WAS NOT PROVIDED WITH THE ORIGINAL DEMAND NOTICE U/S. 156 O F THE ACT. THE LD. CIT(A) THOUGH CONSIDERED THE FACTS AND THE PROVISIONS OF L EVY OF PENALTY U/S. 271F AND JUDICIAL DECISIONS BUT DUE TO NON-ENCLOSURE OF ORIGINAL DEMAND NOTICE ALONG WITH FORM NO. 35 TREATED APPEAL AS DEFECTIVE AND DISMISSED. WHEREAS, THE LD. DR OF THE REVENUE SUBMITTED THE LETTER DATE D 02.01.2017 ISSUED BY :-5-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 THE ASSESSING OFFICER CONFIRMING THAT AS PER THE RE CORDS, NO DEMAND NOTICE HAS BEEN ENCLOSED ALONG WITH THE PENALTY ORDERS. 7. WE FOUND STRENGTH IN THE SUBMISSIONS OF THE LD. AR ON NON-ISSUANCE OF DEMAND NOTICE U/S. 156 OF THE ACT BY THE ASSESSI NG OFFICER. CONSIDERING THE APPARENT FACTS, MATERIAL ON RECORD AND SUBMISSI ONS OF THE LD. DR ON DEMAND NOTICE, WE ARE OF THE OPINION THE ISSUES ARE TO BE ADJUDICATED BY THE LD. CIT(A) CONSIDERING THE LETTER DATED 02.01.2017 FILED BY THE REVENUE. ACCORDINGLY, WE REMIT THE ABOVE MATTER TO THE FILE OF CIT(A) TO ADJUDICATE IN ACCORDANCE WITH LAW AND THE ASSESSEE SHOULD BE PROV IDED WITH ADEQUATE OPPORTUNITY BEING HEARD BEFORE THE DISPOSAL OF APPE AL AND GROUNDS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSE. 8. IN THE RESULT, THE APPEALS FILED BY THE ASSESSEE IN ITA NO. 1490/MDS/2016 FOR THE ASSESSMENT YEAR 2007-08 IS AL LOWED FOR STATISTICAL PURPOSE. SIMILARLY, ITA NO. 1491/MDS/2016 FOR THE ASSESSMENT YEAR 2008-09, ITA NO. 1493/MDS/2016 FOR THE ASSESSMENT YEAR 2009- 10, ITA NO. 1494/MDS/2016 FOR THE ASSESSMENT YEAR 2010-11, ITA NO 1495/MDS/2016 FOR THE ASSESSMENT YEAR 2011-12 & ITA NO. 1496/MDS/2016 FOR THE ASSESSMENT YEAR 2012-13 ARE ALSO ALLOWED FOR STATISTICAL PURPO SE. :-6-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 9. NOW WE TAKE UP, ITA NO. 1492/MDS/2016 FOR THE AS SESSMENT YEAR 2009-10, WHERE THE ASSESSEE HAS FILED AN APPEAL AGA INST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) PASSED U/S. 27 2A(1)(C) AND 250 OF THE INCOME TAX ACT, WHERE THE ASSESSING OFFICER HAS ISS UED SUMMONS TO THE ASSESSEE TO APPEAR ON 17.10.2013 AND 16.01.2014. S INCE, THE ASSESSEE HAS NOT APPEARED NOR SUBMITTED ANY DOCUMENTS AS REQUIRE D IN THE SUMMONS, THE LD. AO LEVIED PENALTY U/S. 272A(1)(C) OF THE ACT RS . 20,000/- AND PASSED ORDER ON 07.03.2014. 10. AGGRIEVED BY THE ASSESSING OFFICER ORDER, THE A SSESSEE FILED AN APPEAL WITH THE CIT(A). IN APPELLATE PROCEEDINGS, THE LD. AR ARGUED THAT THE ASSESSEE HAS RESPONDED TO THE NOTICE ISSUED BY THE LD. AO AND REQUESTED TIME TO GATHER INFORMATION AND TO FILE DETAILS, BUT THE LD. AO HAS FAILED TO CONSIDER THE EXPLANATIONS AND REASONS SUBMITTED BY THE ASSESSEE. THE ASSESSEE HAS NOT COMMITTED ANY DEFAULT OR FAILURE I NCOMPLIANCE OF PROVISIONS WHICH WARRANTED FOR LEVY OF PENALTY U/S. 272A(1)(C) OF THE ACT. THE LD. CIT(A) CONSIDERED THE GROUNDS AND THE WRITTEN SUBMI SSIONS FILED BY THE ASSESSEE ON 28.04.2015 REFERRED AT PARA 4.1 OF PAGE 3 TO 7 AND CAME TO A CONCLUSION IN THE HEARING PROCEEDINGS ON 07.03.2016 AND INFORMED TO THE LD. AR THAT THE ASSESSEE HAS NOT FILED THE ORIGINAL DEM AND NOTICE ALONG WITH FORM 35. AND SINCE THERE IS NO RESPONSE FROM THE ASSESS EE NOR ANY EXPLANATIONS, THE LD. CIT(A) CONSIDERED THE SUBMISSIONS OF THE AS SESSEE, FINDINGS OF THE :-7-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 ASSESSING OFFICER AND MATERIAL ON RECORD AND TREATE D THE APPEALS AS DEFECTIVE AND DISMISSED THE APPEAL. 11. AGGRIEVED BY THE ORDER, THE ASSESSEE FILED AN A PPEAL BEFORE THE TRIBUNAL. BEFORE US, THE LD. AR ARGUED THAT THE CI T(A) HAS ERRED IN DISMISSING THE APPEAL IN-LIMINE AND FAILED TO APPRE CIATE THAT THE ASSESSING OFFICER HAS NOT ISSUED DEMAND NOTICE U/S. 156 OF TH E ACT ON LEVY OF PENALTY AND CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF TH E ASSESSING OFFICER WHICH IS CONTRA TO FACTS AND LAW. CONTRA, THE LD. DR RELIED ON THE ORDERS OF THE CIT(A). 12. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MAT ERIAL ON RECORD AND JUDICIAL DECISIONS. THE LD. AR CONTENTION THAT THE ASSESSING OFFICER HAS NOT ISSUED DEMAND NOTICE AND THE APPEAL CANNOT BE TREAT ED AS DEFECTIVE. THE LD. DR OF THE REVENUE SUBMITTED THE CORRESPONDENCE OF T HE ASSESSING OFFICER DATED 02.01.2017, WHERE THE ASSESSING OFFICER CONFI RMS FROM THE RECORD THAT NO DEMAND NOTICE HAS BEEN ENCLOSED ALONG WITH THE P ENALTY ORDERS. WE CONSIDERING THE APPARENT FACTS, MATERIAL ON RECORD AND SUBMISSIONS OF DR, THE LD. CIT(A) HAS NOT ADJUDICATED THE ISSUES IN APPEAL AND DISMISSED IN-LIMINE. WE ARE OF THE OPINION THAT THE DISPUTED MATTER HAS TO BE ADJUDICATED BY THE CIT(A) ON MERITS AND ACCORDINGLY, REMIT THE ISSUE T O THE FILE OF CIT(A) AND ASSESSEE SHOULD BE PROVIDED WITH ADEQUATE OPPORTUNI TY OF HEARING BEFORE :-8-: I.T.A. NOS. 1490, 1491, 1492, 1493, 1494, 1495 & 1496/MDS/2016 DISPOSAL OF APPEAL AND THE GROUND OF ASSESSEE IS AL LOWED FOR STATISTICAL PURPOSE. 13. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN IT A NO. 1492/MDS/2016 IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON WEDNESDAY, THE 04TH DAY OF JANU ARY, 2017 AT CHENNAI. SD/- ( . ) (ABRAHAM P. GEORGE) / ACCOUNTANT MEMBER SD/- ( . ) (G. PAVAN KUMAR) ! /JUDICIAL MEMBER /CHENNAI, 2 /DATED: 04TH JANUARY, 2017 JPV ( +$45 65 /COPY TO: 1. ' /APPELLANT 2. +,' /RESPONDENT 3. 7 ( )/CIT(A) 4. 7 /CIT 5. 5 +$$ /DR 6. /GF