Raghavi Finance Ltd., New Delhi V. ITO Ward-20(4), New Delhi

ITA 1664/DEL/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8636 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-01-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2003-2004
• Appeal Filed On: 28-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 271(1)(c); 274

Judgement Text

1 , . . , IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH S.M.C, NEW DELHI , ' BEFORE MS. SUSHMA CHOWLA, JUDICIAL MEMBER $ / ITA NO.1664/DEL/2019 % % / ASSESSMENT YEAR 2003-04 RAGHAVI FINANCE LTD., 10, COMMUNITY CENTRE-II, ASHOK VIHAR, PHASE-II, NEW DELHI-110052. PAN-AAACR5879F .......... &' /APPELLANT VS THE ITO, WARD-20(4), NEW DELHI. . ()&' / RESPONDENT &'*+ / APPELLANT BY : MS. RANO JAIN, ADV., SHRI PRANSHU SINGHAL, CA & MS. MANSI JAIN, CA ()&'*+ / RESPONDENT BY : SH. PRADEEP SINGH GAUTAM, SR.DR *,- / DATE OF HEARING : 15.01.2020 ./ *,- / DATE OF PRONOUNCEMENT: .01.2020 0 / ORDER PER SUSHMA CHOWLA, JM THE PRESENT APPEAL FILED BY ASSESSEE IS AGAINST ORD ER OF CIT(A)-7, NEW DELHI DATED 10.01.2019 RELATING TO ASSESSMENT Y EAR 2003-04 AGAINST PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOM E-TAX ACT, 1961 (IN SHORT THE ACT). 2. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS A GAINST THE LEVY OF PENALTY FOR CONCEALMENT OF INCOME U/S 271(1)(C) OF THE ACT. ITA NO.1664/DEL/2019 ASSESSMENT YEAR 2003-04 2 3. THE ASSESSING OFFICER HAS INITIATED THE PENALTY PRO CEEDINGS FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. HO WEVER, IN THE PENALTY ORDER, THE ASSESSING OFFICER LEVIED THE PENALTY FOR CONCEALMENT OF INCOME. 4. THE LD. DR PLACED RELIANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 5. I HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED T HE RECORD. THE ISSUE WHICH ARISES IN THE PRESENT APPEAL IS AGAINST THE LEVY OF PENALTY FOR CONCEALMENT OF INCOME U/S 271(1)(C) OF THE ACT. 6. PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AR E ATTRACTED WHERE THE ASSESSEE HAD EITHER CONCEALED ITS INCOME OR FURNISH ED INACCURATE PARTICULARS OF INCOME. FOR DEFAULT OF EITHER OF TH E LIMBS OF THE SAID SECTION, THE ASSESSEE CAN BE HELD LIABLE FOR LEVY OF PENALTY OF CONCEALMENT. HOWEVER, THE ASSESSING OFFICER WHILE INITIATING PEN ALTY PROCEEDINGS HAS TO COME TO A FINDING IN THIS REGARD. IN THE PRESENT C ASE, I FIND THAT THE ASSESSING OFFICER HAS FAILED TO RECORD THE SATISFAC TION AS TO WHICH LIMB OF THE SAID SECTION HAS NOT BEEN FULFILLED BY THE ASSE SSEE. IN THE ABSENCE OF THE SAME I.E. WHERE THE ASSESSEE HAS NOT BEEN GIVEN ANY SHOW CAUSE NOTICE AS TO WHICH LIMB OF SECTION 271(1)(C) OF THE ACT H AS NOT BEEN FULFILLED BY THE ASSESSEE, THE LEVY OF THE PENALTY IN THIS CIRCU MSTANCES IS NOT JUSTIFIED. IN THIS REGARD, I FIND SUPPORT FROM THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. SHRI SAMSON PERINCHERY (2017) 392 ITR 4 (BOM) . 7. FURTHER, THE PLEA OF THE ASSESSEE IS BEFORE US I S THAT EVEN THE NOTICE ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT SUFFERS FROM INFIRMITY, AS THE ITA NO.1664/DEL/2019 ASSESSMENT YEAR 2003-04 3 INAPPROPRIATE LIMB HAS NOT BEEN STRUCK OFF. THE LD .AR BEFORE US HAD PRODUCED THE ORIGINAL NOTICE ISSUED TO THE ASSESSEE IN THIS REGARD. THERE IS MERIT IN THE PLEA OF THE ASSESSEE. THE HONBLE DE LHI HIGH COURT IN PR.CIT VS SAHARA INDIA LIFE INSURANCE COMPANY LTD. IN ITA NO.475/2019 JUDGEMENT DATED 02.08.2019 HAS HELD THAT IN SUCH FA CTS WHERE THE LIMB OF THE SECTION IS NOT STRUCK OFF IN THE NOTICE ISSUED U/S 274 R..W.S. 271(1)(C) OF THE ACT, THEN THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT SUFFERS FROM INFIRMITY. APPLYING THE SAID PRINCIPLE AND ALSO AP PLYING THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. SHRI SAMSON PERINCHERY (SUPRA) AS THE ASSESSING OFFICER HAS FAILED TO RECORD PROP ER SATISFACTION IN THE ASSESSMENT ORDER WHILE INITIATING THE PENALTY P ROCEEDINGS U/S 271(1)(C) OF THE ACT AND ALSO WHILE ISSUING NOTICE, PENALTY L EVIED FOR CONCEALMENT U/S 271(1)(C) OF THE ACT IS NOT JUSTIFIED. ACCORDI NGLY, WE DIRECT THE ASSESSING OFFICER TO DELETE THE SAME. 8. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JANUARY 2020. SD/- (SUSHMA CHO WLA) /JUDICIAL MEMBER / DATED : 17 TH JANUARY, 2020 . * AMIT KUMAR * ITA NO.1664/DEL/2019 ASSESSMENT YEAR 2003-04 4 0*(,1232,4 COPY OF THE ORDER IS FORWARDED TO : 1. &' / THE APPELLANT 2. ()&' / THE RESPONDENT 3. 5, 6 7 / THE CIT(A) 4. 8 5, / THE PR. CIT 5. 6. 29:(, ; ; / DR, ITAT, DELHI :<%=4 GUARD FILE. 0 / BY ORDER , )2,(, // TRUE COPY // > ?@ A , ; ASSISTANT REGISTRAR, ITAT, DELHI