Deepak Radhyesham Jhunjhunwala, Pune V. ACIT, Central Circle, Aurangabad

ITA 1735/PUN/2013

• Counselvise Citation: 173524514 RSA 2013
• Duration Of Justice: 1 year(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-09-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 11-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B C MALAKAR
• Assessee Lawyers: NILESH KHANDELWAL
• Keywords: Reasonable cause
• Section: 143(3); 142(1)

Judgement Text

INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDER KUMAR YADAV, JUDICIAL MEMBER AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NO. 1735/PN/2013 (ASSESSMENT YEAR : 2009-10) SHRI DEEPAK RADHYESHAM JHUNJHUNWALA, MSZK & ASSOCIATES, LEVEL 3, BUSINESS BAY, PLOT NO.84, WELLESELY ROAD, PUNE 411001 PAN NO.ACQPJ0657A .. APPELLANT VS. ACIT CENTRAL CIRCLE, AURANGABAD .. RESPONDENT ASSESSEE BY : SHRI NILESH KHANDELWAL DEPARTMENT BY : SHRI B.C. MALAKAR DATE OF HEARING : 17-09-2014 DATE OF PRONOUNCEMENT : 17-09-2014 ORDER PER R.K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 22-07-2013 OF THE CIT(A), AURANGABAD RELATING TO ASSESSMENT YE AR 2009-10. 2. THE ASSESSEE IN THE GROUNDS OF APPEAL HAS CHALLE NGED THE ORDER OF THE CIT(A) IN CONFIRMING THE LEVY OF PENALTY OF RS.10,000/- U/S.2 71(1)(B) OF THE I.T. ACT. 2.1 FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSES SEE IS AN INDIVIDUAL AND DERIVES INCOME FROM INSURANCE COMMISSION, PROFESSIONAL RECE IPTS, RENT AND CAPITAL GAINS BESIDES AGRICULTURAL INCOME. THE ASSESSEE FILED HI S RETURN OF INCOME ON 31-07-2009 DECLARING INCOME OF RS.20,74,375/-. 2.2 SINCE THIS CASE FELL UNDER COMPULSORY SCRUTINY CATEGORY, THE ASSESSING OFFICER ISSUED NOTICE U/S.143(2) AND 142(1) ON 28-09-2010 F IXING THE DATE OF HEARING ON 13-10- 2010 WHICH WAS DULY SERVED UPON THE ASSESSEE ON 29- 09-2010. THE ASSESSEE SOUGHT ADJOURNMENT AND THE CASE WAS ADJOURNED TO 29-10-201 0. ON 29-10-2010, THE ASSESSEE 2 FILED ADJOURNMENT PETITION SEEKING ADJOURNMENT OF T HE CASE AND THE CASE WAS ADJOURNED TO 18-11-2010. ON 18-11-2010, THE ASSESSEE FILED A NOTHER PETITION SEEKING ADJOURNMENT OF THE CASE AND THE CASE WAS ADJOURNED TO 01-12-201 0. THE ASSESSEE FILED ANOTHER PETITION SEEKING ADJOURNMENT OF THE CASE ON 01-12-2 010. DUE TO CHANGE OF THE INCUMBENT, THE SUCCESSOR ASSESSING OFFICER AGAIN IS SUED NOTICE U/S.142(1)/143(2) FIXING THE DATE OF HEARING ON 14-07-2011. THE ASSESSEE DI D NOT APPEAR, THEREFORE, ANOTHER NOTICE WAS ISSUED FIXING THE HEARING OF THE CASE ON 12-08-2011 AND THE CASE WAS ADJOURNED TO 18-08-2011 AT THE REQUEST OF THE ASSES SEE. ON 18-08-2011, THE ASSESSEE AGAIN SOUGHT ADJOURNMENT WITHOUT GIVING ANY REASONA BLE CAUSE AS STATED BY THE ASSESSING OFFICER. DUE TO THE ABOVE, THE ASSESSING OFFICER GAVE A FINAL OPPORTUNITY TO THE ASSESSEE TO APPEAR BEFORE HIM ON 21-09-2011 FAI LING WHICH IT WAS PROPOSED TO COMPLETE THE ASSESSMENT U/S.144. THE ASSESSING OFF ICER ALSO ASKED THE ASSESSEE TO EXPLAIN AS TO WHY PENALTY U/S.271(1)(B) SHALL NOT B E LEVIED. IT WAS EXPLAINED BY THE ASSESSEE THAT THERE WAS NO FAILURE FOR NON-COMPLIAN CE TO THE NOTICED ISSUED. REJECTING THE EXPLANATION GIVEN BY THE ASSESSEE THE ASSESSING OFFICER LEVIED PENALTY OF RS.10,000/- U/S.271(1)(B) OF THE I.T. ACT. 3. IN APPEAL THE LD.CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER BY OBSERVING AS UNDER : 6. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE AND RIVAL CONTENTIONS. ON PERUSAL OF THE SAME, IT HAS BEEN NOTICED THAT THE A .O. HAS FIXED VARIOUS DATES OF HEARINGS SUCH AS 13/10/2010, 29/10/2010, 18/ 11/2010, 01/12/2010, 29/07/2011 & 12/08/2011. THE APPELLANT HAS NOT COMPLIED OR ATTENDED ON THE ABOVE MENTIONED DATES OF HEARINGS AND HAS SOUGHT ADJOURNMENTS IN RESPECT OF 5 HEARINGS OUT OF 6 AND HA S NOT SOUGHT ADJOURNMENT IN RESPECT OF HEARING FIXED ON 29/07/201 1 AS PER THE DETAILED CHART FILED BY THE APPELLANT. THE A.O. HAS NOTED THA T THE ADJOURNMENTS WERE WITHOUT ANY REASONABLE CAUSE. THE A.O. HAS, THEREFORE, ISSUED NOTICE U/S 271(1)(B) ON 13/09/2011. THE APPELLANT HAS FILED WR ITTEN SUBMISSION ON 21/09/2011 AS POINTED OUT BY HIM IN THE TABULAR CHAR T AND COMPLIED WITH THE HEARING FIXED ON 21/09/2011. THE A.O. HAS, HOWEV ER, LEVIED PENALTY OF RS.10,000/- NOT IN RESPECT OF HEARING FIXED ON 21/09/ 2011 BUT IN RESPECT OF NON-COMPLIANCE/ATTENDANCE IN REGARD TO THE HEARING FIXED ON EARLIER 6 DATES OF HEARINGS. IT HAS ALSO BEEN OBSERVED THAT THE APPELL ANT HAS COMPLIED ON HEARING FIXED ON 21/09/2011 ONLY AFTER THE ISSUE OF SH OW CAUSE NOTICE FOR PENALTY U/S 271(1)(B) OF THE ACT IN RESPECT OF EARLIE R NON-COMPLIANCES. THEREFORE, THE CONTENTION OF THE APPELLANT THAT HE HAS COMPLIED WITH THE HEARING FIXED ON 21/09/2011 AND HAS FILED DETAILED SU BMISSION DATED 21/09/2011 AND HENCE PENALTY IS NOT LEVIABLE CANNOT BE ACCEPTED. THE PENALTY OF RS.10,000/- LEVIED BY THE A.O. U/S 271(1)( B) IS, THEREFORE, CONFIRMED. 3 3.1 AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASS ESSEE IS IN APPEAL BEFORE US. 4. AFTER HEARING BOTH THE SIDES, WE FIND UNDER IDEN TICAL CIRCUMSTANCES THE ASSESSING OFFICER HAD LEVIED PENALTY U/S.271(1)(B) OF RS.10,0 00/- EACH IN THE CASES OF SHRI RADHYESHAM JHUNJHUNWALA AND SMT. USHA RADHYESHAM JH UNJHUNWALA WHICH WAS UPHELD BY THE CIT(A). ON FURTHER APPEAL, THE TRIBU NAL VIDE ITA NOS. 1678 AND 1679/PN/2013 ORDER DATED 12-09-2014 FOR A.Y. 2009-1 0 CANCELLED THE PENALTY SO LEVIED BY OBSERVING AS UNDER : 4. WE HAVE HEARD THE SUBMISSIONS OF THE PARTIES AND PER USED THE RECORD. WE FIND SECTION 271(1)(B) READS AS UNDER: 271 (1) . . . . . . . (A) . . . . . . . (B) HAS FAILED TO COMPLY WITH A NOTICE [UNDER SUB-SEC TION (2) OF SECTION 115WD OR UNDER SUB-SECTION (2) OF SECTION 115WE OR] UNDER SUB-SECTION (1) OF SECTION 142 OR SUB-SECTION (2) OF SECT ION 143 [OR FAILS TO COMPLY WITH A DIRECTION ISSUED UNDER SUB-SECTIO N (2A) OF SECTION 142], OR 4.1 WE FIND THAT ON ALL THE DATES IN THIS CASE THE ASSE SSEE HAS FILED THE ADJOURNMENT LETTERS AND ALL THE ADJOURNMENTS ARE GRANTED BY THE ASSESSING OFFICER. MOREOVER, THE ASSESSEES ASSESSMENT IS ALSO COMPLETED U/S.143(3) OF THE ACT. THERE IS NO CONCEPT OF NON- COMPLIANCE ATTITUDE, BECAUSE ON EVERY DATE, THE ASSESS EE WAS SHOWING THE RESPONSE BY FILING THE ADJOURNMENT LETTERS . IF THE ASSESSING OFFICER WAS OF THE OPINION THAT THERE WAS NO RE ASONABLE CAUSE, HE COULD HAVE REJECTED THE ASSESSEES REQUEST FOR ADJOURNMENTS AND COULD HAVE PASSED THE BEST JUDGEMENT ASSESSMENT. NOWHERE THERE IS A SPECIFIC CHARGE IN THE AS SESSMENT ORDER ALSO THAT THE ASSESSEE DELIBERATELY ACTED IN DEFI ANCE OF LAW OR ACTED IN CONSCIOUS DISREGARD OF HIS OBLIGATIONS. 4.2 IN THE CASE OF HINDUSTAN STEEL LTD. VS. STATE OF ORISSA REPORTED IN 83 ITR 26 THE HONBLE SUPREME COURT HAS HELD AS UN DER : AN ORDER IMPOSING PENALTY FOR FAILURE TO CARRY OUT A STATUTORY OBLIGATION IS THE RESULT OF A QUASI CRIMINAL PROCEEDIN G, AND PENALTY WILL NOT ORDINARILY BE IMPOSED UNLESS THE PARTY OBLIGE D, EITHER ACTED DELIBERATELY IN DEFIANCE OF LAW OR WAS GUILTY OF CON DUCT CONTUMACIOUS OR DISHONEST, OR ACTED IN CONSCIOUS DISREGARD OF ITS OBLI GATION. PENALTY WILL NOT ALSO BE IMPOSED MERELY BECAUSE IT IS LAWFUL TO DO SO. WHETHER PENALTY SHOULD BE IMPOSED FOR FAILURE TO PERF ORM A STATUTORY OBLIGATION IS A MATTER OF DISCRETION OF THE AUTHORITY TO BE EXERCISED JUDICIALLY AND ON A CONSIDERATION OF ALL TH E RELEVANT CIRCUMSTANCES. 4.3 IN OUR OPINION, THERE IS NO JUSTIFICATION ON THE FACTS OF THIS CASE TO LEVY PENALTY ON THE ASSESSEE. WE ACCORDINGLY DELETE THE PENALTY AND ALLOW THE GROUND TAKEN BY THE ASSESSEE. 4 5. NOW WE TAKE UP ITA NO.1679/PN/2013. IN THIS CASE ALSO, THE ASSESSING OFFICER HAS LEVIED THE PENALTY OF RS.10,000/- U /S.271(1)(B) OF THE ACT FOR NON-COMPLIANCE WHICH HAS BEEN CONFIR MED BY THE LD.CIT(A). IT APPEARS THAT THE ASSESSEE FILED THE RETU RN OF INCOME FOR THE A.Y. 2009-10 ON 31-07-2009. THE ASSESSEES CASE WAS SELECTED FOR SCRUTINY. THE ASSESSEE WAS ISSUED NOTICES U/S.142(1) AN D 143(2) ON 21-09-2010 REQUIRING THE ASSESSEE TO ATTEND ON 27-10 -2010. THE ASSESSEES CHARTERED ACCOUNTANT FILED THE ADJOURNMENT LE TTERS REQUESTING THE ADJOURNMENT. FROM TIME TO TIME, THE CASE WAS ADJOURNED AND FINALLY THE ASSESSMENT ORDER WAS PASSED U/S. 143(3) ON 28-09-2011. IN THE OPINION OF THE ASSESSING OFFICER, THE ATTITUDE OF THE ASSESSEE WAS NON-COMPLYING, THEREFORE, HE LEVIED THE PENALTY U/S.271(1)(B) OF RS.10,000/-. THE LD.CIT(A) CONFIRMED THE PENALTY AND THE ASSESSEE IS IN APPEAL BEFORE US. 6. WE HAVE HEARD THE PARTIES. ON THE IDENTICAL SET OF FACTS, WE HAVE DELETED THE PENALTY IN THE CASE OF SHRI RADHYES HAM JHUNJHUNWALA IN ITA NO.1678/PN/2013. FOLLOWING OUR REASONS FOR DELETING THE PENALTY IN THE SAID CASE, WE ALSO DELETE THE PENALTY IN THIS CASE. ACCORDINGLY, THE GROUND TAKEN BY THE ASSESSEE IS ALLOWED. 4.1 SINCE THE FACTS IN THE INSTANT CASE ARE IDENTIC AL TO THE FACTS IN THE CASES OF SHRI RADHYESHAM JHUNJHUNWALA AND SMT. USHA RADHYESHAM JH UNJHUNWALA, THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THE TRIBUNAL CITED (SUPRA), WE SET-ASIDE THE ORDER OF THE CIT(A) AND DIRECT THE ASSESSING OFFICER TO C ANCEL THE PENALTY. 5. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. PRONOUNCED IN THE OPEN COURT ON 17-09-2014. SD/- SD/- (SHAILENDRA KUMAR YADAV) (R.K. PANDA) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE DATED: 17 TH SEPTEMBER 2014 SATISH COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. DEPARTMENT 3. CIT(A), AURANGABAD 4. CIT, AURANGABAD 5. THE D.R, A PUNE BENCH 6. GUARD FILE BY ORDER // TRUE COPY // SENIOR PRIVATE SECRETARY ITAT, PUNE BENCHES, PUNE