Prem Shankar Mishra, Howrah V. ITO, Ward - 46(3), Kolkata

ITA 1585/KOL/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54584 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 1 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-10-2011
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 25-05-2010
• Assessment Year: 2001-2002
• Appeal Filed On: 09-09-2009
• Court: TRIBUNAL
• Department Lawyers: M BHATTACHARYA
• Assessee Lawyers: M K MUNDHRA
• Keywords: Gift; Deemed dividend
• Section: 246; 2; 143(3)

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH A, KOLKATA () BEFORE , ,, , , SHRI MAHAVIR SINGH, JUDICIAL MEMBER. /AND . .. . ! ! ! !. .. . , '# SHRI C.D.RAO, ACCOUNTANT MEMBER $ $ $ $ / ITA NO . 1585/KOL/2009 %& '(/ ASSESSMENT YEAR : 2001-02 (*+ / APPELLANT ) PREM SHANKAR MISHRA, KOLKATA (PAN : AEOPM 2139 J) - % - - VERSUS - . (-.*+/ RESPONDENT ) I.T.O., WARD-46(3), KOLKATA *+ / 0 '/ FOR THE APPELLANT: SHRI M.K.MUNDHRA -.*+ / 0 '/ FOR THE RESPONDENT: SHRI M.BHATTACHARYA 1%2 / !# /DATE OF HEARING : 25.10.2011. 3' / !# /DATE OF PRONOUNCEMENT : 25.10.2011 '4 / ORDER ( (( ( . .. . ! ! ! !. .. . ) )) ), , , , '# PER SHRI C.D.RAO, AM THIS APPEAL IS FILED BY ASSESSEE AGAINST THE ORDER DATED 11.05.2009 OF THE LD. CIT(A)-XXX, KOLKATA PERTAINING TO A.YR. 2001-02. 2. THE ONLY ISSUE RAISED BY ASSESEE IS RELATING TO LEVYING OF PENALTY U/S 271(1)(C ) OF THE IT ACT. ASSESSEE. 3. THE VERY FIRST GROUND RAISED BY ASSESSEE IS THA T IN THE FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT(A) ERRED IN NOT TREATING THE P ENALTY ORDER U/S 271(1)(C) DATED 31.3.2008 AS TIME-BARRED IN VIEW OF PROVISO TO SECT ION 275(1)(A) EFFECTIVE FROM 1 ST JUNE, 2003. 2 4. THE BRIEF FACTS OF THIS ISSUE ARE THAT LD. ASSE SSING OFFICER LEVIED PENALTY OF RS.1,77,312/- I.E. 200% OF THE TAX SOUGHT TO BE EVA DED BY OBSERVING AS UNDER :- IN THIS CASE ASST. WAS COMPLETED U/S 143(3) ON A T OTAL INCOME OF RS.5,41,200/- RETURNED INCOME WAS RS.69,840/- THE A.O. MADE AN AD DITION, INTER ALIA, RS.1,69,442/- ON A/C OF DEEMED DIVIDEND, RS.1,35,00 0/- AS BOGUS GIFT, RS.1,20,000/- AS UNDISCLOSED INCOME (AS THE ASSESSEE FAILED TO EXPLA IN THE SOURCE OF MONEY) AND RS.23,000/- AS BOGUS AGRICULTURAL INCOME. THE ASSES SEE PREFERRED APPEAL AND THE LD.CIT(A) CONFIRMED THE ABOVE ADDITIONS. THE ASSESS EE PREFERRED APPEAL BEFORE THE I.T.A.T.. LD. I.T.A.T. AFTER RECALLING THE DISMISSE D EARLIER ORDER SET ASIDE THE ORDER OF THE CIT(A) AND RESTORED THE MATTER TO THE FILE OF T HE AO WITH THE SPECIFIC DIRECTION TO COMPUTE THE ACCUMULATED PROFIT UPTO THE DATE OF PAY MENT OF LOAN/ADVANCE BY THE COMPANY TO THE ASSESSEE AND ACCORDINGLY CALCULATE T HE DEEMED DIVIDEND INCOME. OTHER GROUNDS OF THE ASSESEE I.E. ADDITION ON A/C O F GIFT, LOAN ETC. WERE, HOWEVER, DISMISSED BY THE ITAT SINCE THOSE WERE NOT RAISED. THE A.O. BY HIS ORDER DATED 12.12.07 CALCULATED THE DEEMED DIVIDEND INCOME AS PER DIRECTION OF ITAT AND ISSUED NOTICE U/S 271( 1)(C) FIXING THE DATE OF HEARING ON 10.1.08. AS THE OTHER ADDITIONS WERE UPHELD BY THE CIT(A) AND THE APPEAL OF THE ASSESSEE BEFORE ITAT ON THESE GROUNDS HAVE BEEN DIS MISSED, PENALTY U/S 271(1)(C) CLEARLY ATTRACTS IN THIS CASE FOR DEFAULT OF THE AS SESSEE FOR NOT SHOWING HIS CORRECT INCOME. 4.1. ON APPEAL LD. CIT(A) HAS CONFIRMED THE SAME BY RELYING ON THE DECISION OF HIGH COURT IN THE CASE OF SETH PANCHHI RAM & CO. V. CIT (1991) 92 ITR 289, 294 (HP) BY OBSERVING AS UNDER :- THE A.O. COMPLETED ASSESSMENT MAKING ADDITION TOWA RDS BOGUS GIFT OF RS.1,35,000/- UNDISCLOSED INCOME OF RS.1,20,000/-, AGRICULTURAL I NCOME OF RS.23,000/- AND DEEMED DIVIDEND. THE APPELLANT HAS NOT FILED ANY EXPLANATI ON IN RESPONSE TO THE PENALTY NOTICES. IN VIEW OF THE EXPLANATION (1) U/S 271(1)( C) THE APPELLANT HAS NOT SUBMITTED VALID EXPLANATION FOR THE INCOME WHICH IS ADDED DUR ING THE ASSESSMENT PROCEEDINGS. AS PER EXPLANATION, THE INCOME ADDED IS DEEMED TO B E CONCEALED INCOME OF THE APPELLANT. THE A.O. IS CORRECT AS PER LAW IN LEVYIN G OF PENALTY U/S 271(1)(C). THE AOS ACTION IS UPHELD. 4.2. AGGRIEVED BY THIS ASSESSEE IS IN APPEAL BEFOR E US. 5. AT THE TIME OF HEARING THE LD. COUNSEL APPEARIN G ON BEHALF OF ASSESSEE BY REFERRING TO THE VARIOUS PAGES OF THE PAPER BOOK TH E RELEVANT DETAILS OF PASSING OF ORDER U/S 143(3), ORDER PASSED BY LD. CIT(A), CONSEQUENT TO THE ORDER PASSED BY AO TO GIVE EFFECT TO THE ORDER OF LD. CIT(A), ORDER OF THE ITA T AND ORDER OF AO GIVING EFFECT TO THE ORDER OF THE TRIBUNAL AND THE DATE OF ORDERS U/ S 271(1)(C) AND BY REFERRING TO THE PROVISION OF SECTION 275(1)(A) OF THE IT ACT CONTEN DED THAT ORDER PASSED BY AO U/S 271(1)(C) OF THE IT ACT IS BARRED BY LIMITATION IN ACCORDANCE WITH THE PROVISIONS 3 CONTAINED IN SUB-SECTION 1(A) OF SECTION 275 OF THE IT ACT. THEREFORE HE REQUESTED TO SET ASIDE THE ORDERS OF THE REVENUE AUTHORITIES. HE ALSO RELIED ON SEVERAL CASE LAWS AND FILED COPIES OF THE SAME IN THE PAPER BOOK. 6. ON THE OTHER HAND, THE LD. DR APPEARING ON BEHAL F OF THE REVENUE HAS RELIED ON THE ORDERS OF THE REVENUE AUTHORITIES AND FURTHER C ONTENDED THAT LD. CIT(A) HAS RIGHTLY CONFIRMED BASED ON THE FACT THAT THE FACTS OF THE P RESENT CASE ARE SIMILAR TO THAT OF THE ONE THE LD. CIT(A) HAS RELIED ON THE DECISION OF TH E HIGH COURT IN THE CASE OF SETH PANCHHI RAM & CO. V. CIT (1991) 92 ITR 289, 294 (HP ). THEREFORE HE REQUESTED TO UPHELD THE ORDERS OF THE REVENUE AUTHORITIES. 7. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF MATERIALS AVAILABLE ON RECORD, THE UNDISPUTED FACTS APPEARING FROM THE RECORDS ARE AS UNDER :- I) ORDER PASSED U/S 143(3) ON 31.03.2004 WHICH IS APPE ARING AT PAGE 7 OF THE PAPER BOOK II) ORDER PASSED BY LD. CIT(A) (IN APPEAL AGAINST ORDER U/S 143(3) ON 04.01.2005 WHICH IS APPEARING AT PAGE 11 OF THE PAP ER BOOK III) ORDER PASSED BY LD. ITO TO GIVE EFFECT TO ORDER DT. 04.01.2005 OF LD. CIT(A) ON 20.01.2005 WHICH IS APPEARING AT PAGE 18 & 19 OF THE PAPER BOOK IV) ORDER PASSED BY HONBLE TRIBUNAL (IN ASSESSEES APP EAL AGAINST LD. CIT(A)S ORDER) ON 10.11.2006 WHICH IS APPEARING AT PAGE 22 OF THE PAPER BOOK V) ORDER OF HONBLE TRIBUNAL RECEIVED BY ASSESSEE-COMP ANY ON 17.11.2006 WHICH IS APPEARING AT PAGE 23 OF THE PAPER BOOK VI) ORDER U/S 254 PASSED BY LD. ITO TO GIVE EFFECT TO O RDER OF HONBLE TRIBUNAL ON 12.12.2007 WHICH IS APPEARING AT PAGE 24 OF THE PAPER BOOK. VII) ORDER PASSED U/S 271(1)(C) OF THE IT ACT DATED 31.0 8.2008 7.1. THE PROVISION OF SECTION 275(1)(A) OF THE IT A CT, 1961 READS AS UNDER :- BAR OF LIMITATION FOR IMPOSING PENALTIES. 275 (1) NO ORDER IMPOSING A PENALTY UNDER THIS CHAPTER SHALL BE PASSED 4 [(A) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTH ER ORDER IS THE SUBJECT MATTER OF AN APPEAL TO THE COMMISSIONER (APPEALS) U NDER SECTION 246 [OR SECTION 246A] OR AN APPEAL TO THE APPELLATE TRIBUNA L UNDER SECTION 253, AFTER THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCE EDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITI ATED, ARE COMPLETED, OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE APPELLATE TRI BUNAL IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER PERIO D EXPIRES LATER: [ PROVIDED THAT IN A CASE WHERE THE RELEVANT ASSESSMENT OR OT HER ORDER IS THE SUBJECT-MATTER OF AN APPEAL TO THE COMMISSIONER(APP EALS) UNDER SECTION 246 OR SECTION 246A, AND THE COMMISSIONER (APPEALS) PAS SES THE ORDER ON OR AFTER THE 1 ST DAY OF JUNE, 2003 DISPOSING OF SUCH APPEAL, AN ORD ER IMPOSING PENALTY SHALL BE PASSED BEFORE THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR IMPO SITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR WITHIN ONE YEAR FORM T HE END OF THE FINANCIAL YEAR IN WHICH THE ORDER OF THE COMMISSIONER (APPEALS) IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER IS LATER;] 7.2. ON PERUSAL OF THE ABOVE FACTS IN THE LIGHT OF THE PROVISIONS OF SUB-SECTION (1)(A) OF SECTION 275 OF THE IT ACT WE ARE OF THE VIEW TH AT THE LAST DATE FOR COMPLETION OF PENALTY PROCEEDINGS U/S 271(1)(C) OF THE IT ACT WIL L BE SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE COMMISSIONER (APPEA LS) OR, AS THE CASE MAY BE, THE APPELLATE TRIBUNAL IS RECEIVED BY THE CHIEF COMMISS IONER OR COMMISSIONER. IN THIS CASE AS PER THE CERTIFICATE ISSUED BY ASSTT. REGIST RAR OF TRIBUNAL , ITAT, KOLKATA AS ASSISTNT PUBLIC INFORMATION OFFICER THE ORDER OF TH E TRIBUNAL IN ASSESSEES CASE WAS SENT TO LD. COMMISSIONER OF INCOME-TAX, WB-XVI, AAY AKAR BHAVAN, 2 ND FLOOR, ROOM NO.39, P-7, CHOWRINGHEE SQUARE, KOLKATA-700069 ON 4 .12.2006. THEREFORE WE ARE OF THE VIEW THAT THE REVENUE IS SUPPOSED TO PASS PENAL TY ORDER U/S 271 (1)(C) OF THE IT ACT BEFORE 30.06.2007. IN THIS CASE THE PENALTY ORDER U /S 271(1)(C) OF THE IT ACT HAS BEEN PASSED BY AO ON 31.03.2008 WHICH IS BEYOND THE TIME PRESCRIBED U/S 275 (1)(A) OF THE IT ACT. THEREFORE WE QUASH THE PENALTY ORDER PASSED BY AO U/S 271(1)(C) OF THE IT ACT BY OBSERVING THE SAME AS PASSED BEYOND THE DATE S PRESCRIBED U/S 275 (1)(A) OF THE IT ACT. 5 8. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 25.10.2011. SD/- SD/- , , , , MAHAVIR SINGH, JUDICIAL MEMBER . .. . ! ! ! !. .. . , , , , '# '# '# '# , C.D.RAO, ACCOUNTANT MEMBER. ( (( (!# !# !# !#) )) ) DATE: 25.10.2011. '4 / -5 6'5'7- COPY OF THE ORDER FORWARDED TO: 1. PREM KUMAR MISHRA, B-84, SHREE KUNJ, 51, DOBSON ROA D, HOWRAH-711101. 2 THE I.T.O., WARD-46(3), KOLKATA. 3. THE CIT, 4. THE CIT(A)-XXX, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA .5 -/ TRUE COPY, '4%1/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES R.G.(.P.S.)