Gurukul Technologies Pvt. Ltd., New Delhi V. ITO, Noida

ITA 1603/DEL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 4091 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2002-2003
• Appeal Filed On: 28-03-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N O N E
• Keywords: Invalid notice; Opportunity of being heard
• Section: 142(1); 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C , NEW DELHI BEFORE SH. N. K. SAINI, AM AND SH. K. N. CHARY , JM ITA NO. 1603/DEL/2016 : ASSTT. YEAR : 2002 - 03 ITA NO. 1606/DEL/2016 : ASSTT. YEAR : 2003 - 04 GURUKUL TECHNOLOGIES PVT. LTD., ROOM NO. 207, 2 ND FLOOR, G. K. HOUSE, 187A, SANT NAGAR, EAST OF KAILASH, DELHI - 110065 VS INCOME TAX OFFICER, WARD - 1(1), NOIDA (APPELLANT) (RESPONDENT) PAN /GIR NO. AABCG8284C ASSESSEE BY : N ONE REVENUE BY : SH. ARUN KUMAR YADAV, SR. DR DATE OF HEARING : 20.12 .201 7 DATE OF PRONOUNCE MENT : 23 .01 .201 8 ORDER PER N. K. SAINI, AM : THESE TWO APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS EACH DATED 27.01.2016 OF LD. CIT(A) - I, NOIDA. 2. FOLLOWING COMMON GROUNDS HAVE BEEN RAISED IN THESE APPEAL S : 1. THAT THE LEARNED CIT(A) ERRED ON FACTS AND IN LAW IN NOT HOLDING THAT THE IMPUGNED PENALTY ORDER DATED 25.09.2013 LEVYING PENALTY UNDER SECTION 271(1)(B) OF THE INCOME TAX ACT, 1961('THE ACT') IS NOT JUSTIFIED IN FACT OF LAW BECAUSE NO NOTICE WAS EVER SERVED UPON THE ASSESSEE. 2. THAT THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE PENALTY AS THERE WAS NO DEFAULT COMM ITTED BY THE ITA NO S. 1603 & 1606 /DE L/2016 GURUKUL TECHNOLOGIES PVT. LTD. 2 ASSESSEE UNDER THE PROVISION OF SEC. 271(1)(B), WHEN THE DEFAULT WAS FOR GOOD AND SUFFICIENT REASON. 3. THAT SINCE THE NOTICE U/S 144/263 HAS BEEN ISSUED BY AN INCOME TAX OFFICER OF NOIDA WHO WAS NOT HAVING ANY JURISDICTION IN THE MATTER AND THEREFORE ASSESSMENT MADE ON THE BASIS OF INVALID NOTICE U/S 144/263 BY THE LEARNED ASSESSING OFFICER IS BAD IN LAW AND LIABLE TO BE QUASHED AND ANNULLED. 4. THAT THE APPELLANT CRAVE LEAVE TO ADD OR ALTER ANY OR MORE GROUND OF APPEAL AS MAY BE DEEMED FI T AT THE TIME OF HEARING. IT IS THEREFORE PRAYED TO KINDLY DELETE THE PENALTY CONFIRMED BY THE LEARNED C1T(A). 3. THE COMMON ISSUE IS INVOLVED IN BOTH THESE APPEALS WHICH WERE HEARD TOGETHER SO THESE ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE AND BREVITY. 4. FACTS OF THE CASE IN BRIEF ARE THAT THE AO COMPLETED THE ASSESSMENT U/S 144 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) FOR BOTH THE ASSESSMENT YEARS AND ALSO INITIATED THE PENALTY PROCEEDINGS U/S 271(1)(B) OF THE ACT AND SINCE NO COMPLIANCE WAS MADE BY THE ASSESSEE TO THE NOTICES ISSUE D U/S 142(1) OF THE ACT, T HE AO LEVIED THE PENALTY OF RS.10,000/ - FOR EACH OF THE ASSESSMENT YEAR UNDER CONSIDERATION. ITA NO S. 1603 & 1606 /DE L/2016 GURUKUL TECHNOLOGIES PVT. LTD. 3 5. BEING AGGRIEVED THE ASSESSEE CARRIED THE MATTER TO THE LD. CIT(A) AND SUBMITTED THAT THE AO WHO PASSED THE PENALTY ORDER S HAD NO JURISDICTION AND THEREFORE, THE PENALTY ORDERS WERE BAD IN LAW. THE LD. CIT(A) DID NOT FIND MERIT IN THE SUBMISSIONS OF THE ASSESSEE BY OBSERVING THAT THE PROVISIONS O F SECTION 274(2)(A) OF THE ACT CONFERS JURISDICTION UPON AN INCOME TAX OFFICER TO IMPOSE A PENALTY UP TO RS.10,000/ - BEYOND WHICH SUCH AN AO CANNOT ACT ON HIS OWN AND REQUIRES THE APPROVAL OF HIS SUPERIOR AND IN THIS CASE THE QUANTUM OF PENALTIES IMPOSED W AS RS.10,000/ - EACH AND THEREFORE, THERE WAS NO ERROR ON THE PART OF THE AO. ACCORDINGLY, THE PENALTY WAS CONFIRMED. 6. NOW THE ASSESSEE IS IN APPEAL. DURING THE COURSE OF HEARING NOBODY WAS PRESENT ON BEHALF OF THE ASSESSEE NEITHER ANY ADJOURNMENT WAS SO UGHT. WE, THEREFORE, PROCEEDED EX - PARTE QUA THE ASSESSEE AND THE APPEALS HAVE BEEN DECIDED ON MERIT AFTER HEARING THE LD. DR. 7. WE HAVE CONSIDERED THE SUBMISSIONS OF LD. DR AND THE MATERIAL ON RECORD, IT IS NOTICED THAT THE CONTENTION OF THE ASSESSEE IN THE GROUNDS OF APPEAL IS THAT NOTICE U/S 144 OF THE ACT HAS BEEN ISSUED BY AN INCOME TAX OFFICER AT NOIDA WHO WAS NOT HAVING JURISDICTION. THIS ISSUE WAS ALSO ITA NO S. 1603 & 1606 /DE L/2016 GURUKUL TECHNOLOGIES PVT. LTD. 4 AGITATED BY THE ASSESSEE BEFORE THE LD. CIT(A) WHO SUSTAINED THE PENALTY WITHOUT GIVING AN ANSWER TO THE AFORESAID CONTENTION OF THE ASSESSEE. HE SIMPLY STATED THAT THE ITO CAN IMPOSED AN PENALTY UP TO RS.10,000/ - . HOWEVER, HE HAS NOT ADJUDICATED THIS ISSUE AGITATED BY THE ASSESSEE THAT THE ITO NOIDA WAS NOT HAVING JURISDICTION TO ISSUE THE NOTICE. WE , THEREFORE, DEEM IT APPROPRIATE TO SET ASIDE THIS ISSUE BACK TO THE FILE OF THE LD. CIT(A) FOR FRESH ADJUDICATION IN ACCORDANCE WITH LAW AFTER PROVIDING DUE AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 8 . IN THE RESULT, THE APPEAL S OF THE A SSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES . ( ORDER PRON OUNCED IN THE COURT ON 23 /01 / 2018 ) SD/ - SD/ - ( K. N. CHARY ) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER D ATED: 23 /01/2018 * SUBODH* COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(APPEALS) 5 . DR: ITAT ASSISTANT REGISTRAR