Shri Jayminkumar Uttamlal Solanki, Vadodara V. The Income Tax Officer, Ward-4(1)(1), Baroda

ITA 1631/AHD/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4171 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 05-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P B PARMAR
• Keywords: Principle of natural justice; Set aside
• Section: 271(1)(c); 274; 48; 272(1)(c); 54

Judgement Text

, SMC IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI , MANISH BORAD, ACCOUNTANT MEMBER ./ ITA NO.1631/AHD/2018 { / ASSESSMENT YEAR: 2012-13 JAYMINKUMAR UTTAMLAL SOLANKI B-36, GANGA JAMNA SOCIETY, OPP. GOLDEN SILVER APPT. B/D PIYAR COMPLEX, SUBHANPURA, VADODARA PAN NO.AEPPS 1347 M VS ITO, WARD-4(1)(1) VADODARA ! / (APPELLANT) '# ! / (REVENUE) APPELLANT BY : SHRI P.B. PARMAR, AR REVENUE BY : SHRI : MUKESH JAIN, SR. DR / DATE OF HEARING : 27/02/2020 / DATE OF PRONOUNCEMENT: 27 /02/2020 $%/ O R D E R PER SHRI MANISH BORAD, A.M: THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-4, VADODARA DATED 12.01.2018 PERTAINING TO ASSESSMENT YEAR 2012-13 WHICH IS ARIS ING OUT OF THE ORDER U/S 271(1)(C) OF THE INCOME TAX AC T 1961(HEREINAFTER CALLED AS THE ACT) FRAMED ON 05.02.2015 BY ITO, WARD -4(1)(1), VADODARA. THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: ITA NO.1631/AHD/2018 JAMMIN UTTAMLAL SOLANKI FOR AY 2012-13 2 1. THE LD. CIT(A) HAS ERRED BOTH IN LAW AND ON THE FACTS OF THE CASE IN CONFIRMING THE PENALTY WHEN SHOW CAUSE NOTICE U/S 274 R.W.S.271(1)(C) OF THE ACT DID NOT SPECIFY THE EXACT CHARGE AS TO WHETHER THE PENALTY IS LEVIED FOR CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. SUCH A DEFECT RENDERS THE PENALTY VOID AB INITIO AND IS ALSO A VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE. 2. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CONFIRMING THE ACTION OF AO IN INITIATING AND LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT WITHOUT RECORDING MANDATORY SATISFACTION AS CONTEMPLATED UNDER THE ACT AT THE TIME OF FRAMING THE ASSESSMENT ORDER. 3. THE LD. CIT(A) HAS ERRED BOTH IN LAW AND ON THE FACTS OF THE CASE IN CONFIRMING THE PENALTY OF RS.2,98,275/- LEVIED U/S 271(1)(C) OF THE ACT ON DISALLOWANCE OF DEDUCTION OF RS.13,42,259/- U/S 54 OF THE ACT AND DISALLOWANCE OF INDEXED COST OF IMPROVEMENT OF RS.1,05,674/- U/S 48 OF THE ACT. 4. IN ANY CASE, THE IMPUGNED PENALTY ORDER IS BARRED BY LIMITATION AND THUS WITHOUT JURISDICTION AND ILLEGAL. 5. IN ANY CASE, QUANTIFICATION OF THE PENALTY IS ERRONEOUS AND EXCESSIVE. 6. BOTH THE LOWER AUTHORITIES HAVE PASSED THE ORDERS WITHOUT PROPERLY APPRECIATING THE FACTS AND THEY FURTHER ERRED IN GROSSLY IGNORING VARIOUS SUBMISSIONS, EXPLANATIONS AND INFORMATION SUBMITTED BY THE APPELLANT FROM TIME TO TIME WHICH OUGHT TO HAVE BEEN CONSIDERED BEFORE PASSING THE IMPUGNED ORDER. THIS ACTION OF THE LOWER AUTHORITIES IS IN CLEAR BREACH OF LAW AND PRINCIPLES OF NATURAL JUSTICE AND THEREFORE DESERVES TO BE QUASHED. ITA NO.1631/AHD/2018 JAMMIN UTTAMLAL SOLANKI FOR AY 2012-13 3 2. THE REGISTRY INFORMED THAT THE PRESENT APPEAL IS TIME BARRED BY 51 DAYS. APPLICATION FOR CONDONATION OF D ELAY ALONG WITH AFFIDAVIT IS PLACED ON RECORD. 3. ON PERUSAL OF THE SAME WE OBSERVE THAT AGAINST T HE PENALTY ORDER PASSED BY THE LD. AO ASSESSEE IN BONA FIDE BELIEF FILED A RECTIFICATION APPLICATION AS A LEGA L REMEDY. QUANTUM PROCEEDINGS WERE GOING ON BEFORE TH E TRIBUNAL. THE CONCERNED ADVOCATE FILED VARIOUS DETA ILS IN THE QUANTUM PROCEEDINGS AND ALSO INQUIRED AS TO WHETHER THE ASSESSEE HAS PREFERRED AN APPEAL AGAINS T THE PENALTY ORDER. AT THIS JUNCTURE ASSESSEE CAME T O KNOW ABOUT HIS MISTAKE OF HAVING NOT FILED THE APPE AL BEFORE THE TRIBUNAL. SUBSEQUENTLY, THE APPEAL WAS PREFERRED AN APPEAL BEFORE THE TRIBUNAL ON 05.07.20 18. 4. IN OUR CONSIDERED VIEW THE ASSESSEE HAS A REASON ABLE CAUSE FOR THE SAID DELAY IN FILING THE APPEAL AND N OT CONDONING THE DELAY WILL KEEP THE JUSTICE AWAY FROM THE ASSESSEE. WE, THEREFORE, IN THE INTEREST OF JUSTICE CONDONE THE DELAY AND ADMIT THE APPEAL FOR ADJUDICATION. ITA NO.1631/AHD/2018 JAMMIN UTTAMLAL SOLANKI FOR AY 2012-13 4 5. ON MERIT LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE QUANTUM ADDITION ON WHICH THE PENALTY HAS BEEN LEVIED, HAS ALREADY BEEN SET ASIDE TO THE ASSESSING OFFICER FOR AFRESH ADJUDICATION BY THE HONBLE TRIB UNAL VIDE ITANO. 2910/AHD/2015 DATED 24.05.2019. 6. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE (DR) VEHEMENTLY ARGUED SUPPORTING THE ORDERS OF LOWER AUTHORITIES. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD PLACED BEFORE US. THE ASSESSEE HAS CHALLENGE D THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT AT RS.2,98,275/- CONFIRMED BY THE LD. CIT(A). THIS PEN ALTY IS LEVIED ON DISALLOWANCE OF DEDUCTION U/S 54 OF TH E ACT AT RS.13,42,259/- AND DISALLOWANCE OF INDEXED COST OF IMPROVEMENT U/S 48 OF THE ACT AT RS.1,05,674/-. 8. WE OBSERVE THAT IN THE QUANTUM PROCEEDINGS COORDINATE BENCH VIDE ITS ORDER DATED 24.05.2019 HA S RESTORED ALL THE ISSUES ON MERITS TO LD. ASSESSING OFFICER FOR AFRESH ADJUDICATION OBSERVING AS FOLLOW S: 4. HAVING HEARD THE RIVAL CONTENTIONS AND HAVING PERUSED THE MATERIAL ON RECORD, I DEEM IT FIT AND ITA NO.1631/AHD/2018 JAMMIN UTTAMLAL SOLANKI FOR AY 2012-13 5 PROPER TO ADMIT THIS LEGAL PLEA BUT, AS IT HAS NOT BEEN EXAMINED BY THE AUTHORITIES BELOW, REMIT THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR ADJUDICATION DE NOVO BY WAY OF A SPEAKING ORDER. AS I AM REMITTING THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR FRESH ADJUDICATION ON THE ABOVE PLEA ALL OTHER ISSUED ARE LEFT OPEN TOO. LET THE MATTER BE EXAMINED, ON MERITS-IF NECESSARY, AFRESH ORDERED, ACCORDINGLY. 9. SINCE THE QUANTUM ADDITION IS STILL PENDING BEFO RE LD. AO FOR AFRESH ADJUDICATION, PENALTY LEVIED U/S 271( 1)(C) OF THE ACT WILL NOT STAND FOR AT THIS POINT OF TIME AND THE SAME NEEDS TO BE DELETED. HOWEVER, THE LD. AO WILL BE AT LIBERTY TO DECIDE ON LEVYING OF THE PENALTY SUBS EQUENT TO THE ADJUDICATION OF ISSUES ON MERITS. THUS, PENA LTY U/S 272(1)(C) OF THE ACT AT RS. 2,98,275/- IS DELET ED. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOW ED. ORDER PRONOUNCED IN THE OPEN COURT ON 27 .02.2020. SD/- SD/- (MAHAVIR PRASAD) JUDICIAL MEMBER ( MANISH BORAD) ACCOUNTANT MEMBER AHMEDABAD; DATED 27/02/2020 PATEL, PS ITA NO.1631/AHD/2018 JAMMIN UTTAMLAL SOLANKI FOR AY 2012-13 6 $% & ''() *$)' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! / CONCERNED CIT 4. ! ( ) / THE CIT(A)- XV, AHMEDABAD 5. $%& '' , , )*++ / DR, ITAT, AHMEDABAD 6. &,- . / GUARD FILE. $% + / BY ORDER, TRUE COPY ,/ - ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD