THE ITO (TDS), WARD - 3(2), Vijayawada V. The Head Post Master, Khammam

ITA 167/VIZ/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1992 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 28-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D KOMALI KRISHNADR
• Assessee Lawyers: M SYAMALA RAO POST MASTER
• Keywords: Reasonable cause

Judgement Text

ITA NO.167/VIZAG/2014 THE HEAD POST MASTER, KHAMMAM 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.167/VIZAG/2014 ( / ASSESSMENT YEAR: 2008-09) ITO(TDS) , WARD - 3(2) , VIJAYAWADA VS. THE HEAD POST MASTER KHAMMAM [PAN: HYDPO 153 9G ] ( % / APPELLANT) ( &'% / RESPONDENT) / APPELLANT BY : SMT. D. KOMALI KRISHNA,DR / RESPONDENT BY : SHRI M. SYAMALA RAO, POST MASTER / DATE OF HEARING : 18.03.2016 / DATE OF PRONOUNCEMENT : 31.03.2016 / O R D E R PER V. DURGA RAO, JUDICIAL MEMBER: THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF CIT(A), VIJAYAWADA DATED 24.1.2014 FOR THE ASSESSME NT YEAR 2008-09. 2. FACTS ARE IN BRIEF THAT A SURVEY OPERATION U/S 1 33A OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED AS THE ACT) WAS CONDUCTED IN THE ITA NO.167/VIZAG/2014 THE HEAD POST MASTER, KHAMMAM 2 OFFICE PREMISES OF THE ASSESSEE. DURING THE COURSE OF SURVEY, IT WAS NOTICED BY THE ASSESSING OFFICER THAT THE ASSESSEE HAD NOT FILED E-TDS, QUARTERLY RETURNS/STATEMENTS U/S 200(3) OF THE ACT IN FORM NO.24Q & 26Q. ACCORDINGLY, U/S 272A(2)(K) OF THE ACT, LEVIE D PENALTY OF RS.12,55,900/-. IT WAS SUBMITTED BEFORE THE A.O. T HAT THE ASSESSEE IS RUNNING WITH ACUTE SHORTAGE OF STAFF AND ATTENDING SEVERAL SPECIAL WORKS I.E. CORE BANKING, INDIRAMMA HOUSING SCHEMES AND OP ENING OF BELOW POVERTY LINE SB ACCOUNTS, NREGS, ETC. HOWEVER, THE A.O. HAS REJECTED THE EXPLANATION OF THE ASSESSEE AND PENALTY WAS LEV IED. 3. ON APPEAL, THE LD. CIT(A) BY CONSIDERING THE ENT IRE SUBMISSIONS OF THE ASSESSEE, IT WAS OBSERVED THAT TO ATTRACT PENAL TY U/S 272A(2)(K) OF THE ACT, THERE SHOULD BE A WILLFUL DEFAULT OR GROSS NEGLIGENCE ON THE PART OF THE ASSESSEE. THERE IS NO WILLFUL DEFAULT OR GR OSS NEGLIGENCE IN THE PRESENT CASE AND MERE TECHNICAL OR VENIAL BREACH OF THE PROVISIONS OF THE ACT NO PENALTY CAN BE LEVIED WHEN THE EXPLANATION O F THE ASSESSEE IS BONAFIDE AND DELETED THE PENALTY IMPOSED BY THE A.O . THE RELEVANT ORDER IS EXTRACTED AS UNDER: 5. I HAVE GONE THROUGH THE ORDER OF THE AC, THE SU BMISSIONS MADE BY THE APPELLANT AND ALSO EVERY OTHER MATERIAL AVAILABLE O N RECORD. IN ADDITION TO THE SUBMISSIONS MADE, THE LEARNED AR HAS EXPLAINED THAT THERE IS REASONABLE CAUSE FOR NON FILING OF TDS RETURNS. IT IS EXPLAINED THAT THE DEFAULT WAS OCCURRED DUE TO ACUTE SHORTAGE OF STAFF AND DUE TO INADVERTENCE AND IGNOR ANCE AND NOT BY ANY NEGLIGENT OR DELIBERATE ATTITUDE. IT IS EXPLAINED THAT AS AGA INST THE SANCTIONED STRENGTH OF 18 ITA NO.167/VIZAG/2014 THE HEAD POST MASTER, KHAMMAM 3 POSTAL ASSISTANTS, THE APPELLANT IS WORKING WITH ON LY 8 POSTAL ASSISTANTS AND IN ADDITION TO NORMAL DUTIES, THE APPELLANT IS ENTRUST ED WITH IMPLEMENTATION OR PARTICIPATION IN SEVERAL GOVERNMENT SCHEMES SUCH AS AADHAR CARDS, INDIRAMMA HOUSING SCHEMES, NATIONAL RURAL EMPLOYMENT GUARANTE E SCHEME WORKS ETC. IT IS ALSO STATED THAT THE FILING OF E-TDS RETURNS IS ENT IRELY A FOREIGN JOB TO THE APPELLANT AND ADMINISTRATIVE AND BUDGETARY SANCTIONS FOR THIS PURPOSE HAD ALSO TAKEN TIME. IT IS FURTHER STATED THAT THE PAN, ADDRESS OF NSS AGEN TS WERE NOT READILY AVAILABLE WITH THE APPELLANT TO FILE THE E-TDS RETURNS. 5.1 THE REASONS PUT FORTH BY THE APPELLANT FOR NON- FILING OF TDS RETURNS APPEAR TO BE REASONABLE AND IN MY HUMBLE OPINION TH E APPELLANT'S CASE WOULD NOT ATTRACT THE IMPUGNED PENALTY UNDER SECTION 272A(2)( K) SINCE THERE IS NO WILLFUL DEFAULT OR GROSS NEGLIGENCE ON THE PART OF THE APPE LLANT. IT IS WELL-SETTLED LAW THAT AN ORDER IMPOSING PENALTY IS A RESULT OF QUASI-CRIM INAL PROCEEDINGS AND PENALTY SHOULD NOT ORDINARILY BE IMPOSED UNLESS THE PARTY O BLIGED EITHER ACTED DELIBERATELY IN DEFIANCE OF LAW OR WAS GUILTY OF CONDUCT, CONTUM ACIOUS OR DISHONEST, OR ACTED IN CONSCIOUS DISREGARD OF ITS OBLIGATION. NO PENALTY S HOULD BE IMPOSED IF THE APPELLANT WAS ACTING IN HONEST AND GENUINE BELIEF IN A PARTIC ULAR MANNER. AS HELD BY THE SUPREME COURT IN HINDUSTAN STEEL LIMITED V STATE OF ORISSA, REPORTED IN (1972) 83 ITR 26, PENALTY SHOULD NOT BE IMPOSED MERELY BECAUS E IT IS LAWFUL TO DO SO. WHETHER PENALTY SHOULD BE IMPOSED FOR FAILURE TO PE RFORM A STATUTORY OBLIGATION IS A MATTER OF DISCRETION OF THE AUTHORITY TO BE EXERC ISED JUDICIALLY AND ON CONSIDERATION OF ALL THE RELEVANT CIRCUMSTANCES. EV EN IF A MINIMUM PENALTY IS PRESCRIBED, THE AUTHORITY COMPETENT TO IMPOSE PENAL TY WILL BE JUSTIFIED IN REFUSING TO IMPOSE THE PENALTY, WHEN THERE IS A TECHNICAL OR VENIAL BREACH OF THE PROVISIONS OF THE ACT OR WHEN THE BREACH FLOWS FROM A BONA FID E BELIEF THAT THE OFFENDER IS NOT LIABLE TO ACT IN THE MANNER PRESCRIBED BY THE STATU TE. IN THE CIRCUMSTANCES, I AM OF THE VIEW THAT THE AO WAS NOT JUSTIFIED IN LEVYIN G PENALTY U/S 271A(2)(K) FOR ALL THE THREE ASSESSMENT YEARS UNDER CONSIDERATION. 3. WE HAVE GONE THROUGH THE ORDER OF LD. CIT(A). TH E LD. CIT(A) BY CONSIDERING THE DETAILED EXPLANATION GIVEN BY THE A SSESSEE DELETED THE ADDITION MADE BY THE A.O. WE FIND NO INFIRMITY IN T HE ORDER PASSED BY LD. CIT(A). THIS APPEAL FILED BY THE REVENUE IS DI SMISSED. ITA NO.167/VIZAG/2014 THE HEAD POST MASTER, KHAMMAM 4 4. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 31 ST MAR16. SD/- SD/- ( . ) ( . ) (G. MANJUNATHA) (V. DURGA RAO) /ACCOUNTANT MEMBER /JUDICIAL MEMBER ! /VISAKHAPATNAM: % /DATED : 31.03.2016 VG/SPS '! (! /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE ITO(TDS), VIJAYAWADA 2. / THE RESPONDENT HEAD POST MASTER, HEAD POST OFF ICE, RAILWAY STATION ROAD, KHAMMAM, ANDHRA PRQADESH-507002. 3. ) / THE CIT(TDS), VIJAYAWADA 4. ) ( ) / THE CIT(A), VIJAYAWADA. 5. ! , , , , ! / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // /0 , (SR.PRIVATE SECRETARY) , , ! / ITAT, VISAKHAPATNAM