Pallavi Sood, New Delhi V. ACIT, New Delhi

ITA 1746/DEL/2015

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2055 (ITAT-DELHI)
• Duration Of Justice: 5 year(s) 8 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 27-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ATIGU AHMED
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI F BEN CH, NEW DELHI [THROUGH VIDEO CONFERENCE] BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO. 1746/DEL/2015 [A.Y 2010-11] MS. PALLAVI SOOD VS. THE A.C.I.T Y 72, G.F. HAUZ KHAS CIRCLE 32(1) NEW DELHI NEW DELHI PAN: APUPS 5251 E [APPELLANT] [RESPONDENT] ASSESSEE BY : SHRI SATYEN SETHI, ADV SHRI A.T. PANDA, ADV REVENUE BY : SHRI ATIGU AHMED, SR. DR DATE OF HEARING : 01.12.2020 DATE OF PRONOUNCEMENT : 04.12.2020 ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE CIT(A) 18, NEW DELHI DATED 26.02.2015 PERTAINING TO A.Y 2010-11. 2. THE SOLITARY GRIEVANCE OF THE ASSESSEE IS THAT T HE ASSESSING OFFICER ERRED IN LEVYING PENALTY UNDER SECTION 140A (3) OF THE INCOME- TAX ACT, 1961 [HEREINAFTER REFERRED TO AS 'THE ACT' FOR SHORT] . 3. FACTS ON RECORD SHOW THAT THE ASSESSEE FILED RET URN OF INCOME ON 26.09.2010, WHICH WAS SUBSEQUENTLY REVISED ON 27.03 .2013. AS PER THE RETURN OF INCOME, A SUM OF RS. 37,41,574/- HAS BEEN SHOWN AS TAX PAYABLE UNDER SECTION 140A OF THE ACT. SINCE THE TA X WAS NOT PAID TILL THE DATE OF FINALISATION OF ASSESSMENT UNDER SECTIO N 143(3) OF THE ACT, THE AO PROCEEDED TO LEVY PENALTY UNDER SECTION 140A (3) READ WITH SECTION 221(1) OF THE ACT AMOUNTING TO RS. 37,41,57 4/-. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A ) BUT WITHOUT ANY SUCCESS. 5. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE VEHE MENTLY STATED THAT THE PROVISIONS OF THE ACT RELATING TO LEVY OF PENALTY HAVE BEEN AMENDED BY THE DIRECT TAX LAWS AMENDMENT ACT, 1989. IT IS THE SAY OF THE LD. COUNSEL THAT WITH THIS AMENDMENT, IT HAS BE EN PROVIDED IN THE ACT THAT ANY DELAY IN PAYMENT OF SELF-ASSESSMENT TA X SHALL ATTRACT INTEREST AND NOT PENALTY. SINCE THE A.Y UNDER CONSI DERATION IS 201011, NO PENALTY SHOULD HAVE BEEN LEVIED BY THE ASSESSING OFFICER. 6. PER CONTRA, THE LD. DR SUPPORTED THE FINDINGS OF THE ASSESSING OFFICER. 7. WE HAVE CAREFULLY CONSIDERED THE ORDERS OF THE A UTHORITIES BELOW. THE RELEVANT PARAS OF THE CIRCULAR DATED 31.10.1989 ARE AS UNDER: 'PARA 4.17 : THE OLD PROVISIONS OF SUB-SECTION (3) OF THE SECTION PROVIDED FOR LEVY OF PENALTY FOR NON-PAYMENT OF SEL F-ASSESSMENT TAX, SINCE THE RATE OF MANDATORY INTEREST FOR FAILU RE TO PAY THE TAX HAS NOW BEEN INCREASED, IT IS NOT NECESSARY TO RETA IN THIS PROVISION ANY MORE. THE AMENDING ACT HAS ACCORDINGLY OMITTED THE SAID SUB SECTION (3). 4.18 : IN ORDER TO VEST THE POWER OF RECOVERY OF TA X AND INTEREST DUE UNDER THIS SECTION ON THE BASIS OF THE RETURN, AMENDING ACT 1987, HAS INSERTED A NEW SUB SECTION (3) IN THE SEC TION TO PROVIDE THAT IF ANY ASSES-SEE HAS NOT PAID SELF ASSESSMENT TAX AND INTEREST IN FULL BEFORE FILING THE RETURN, HE SHALL BE DEEME D TO BE AN ASSES- SEE IN DEFAULT IN RESPECT OF SUCH TAX AND INTEREST. ' QUITE CLEARLY, IF ONE IS TO READ THE EARLIER SECTIO N 140A(3) OF THE ACT AND THE AMENDED SECTION W.E.F. 1.4.1989 ALONG-W ITH THE EXPLANATORY NOTES TO THE AMENDMENT CONJOINTLY, IT I S CLEAR THAT THE EARLIER PROVISION PRESCRIBING FOR LEVY OF PENALTY F OR DEFAULT OUTLINED IN SUB-SECTION (1) OF SECTION 140A(3) HAS YIELDED PLACE TO MANDATORY CHARGING OF INTEREST FOR SUCH DEFAULT. TH E HEDDLE KNOWLEDGE PRIVATE LTD. AFORESAID LEGISLATIVE INTENT ALSO GETS STRENGTH BY THE FACT THAT SIMULTANEOUSLY THE LEGISL ATURE PRESCRIBED FOR MANDATORY CHARGING OF INTEREST UNDER SECTION 23 4B OF THE ACT FOR DEFAULT IN PAYMENT OF SELF-ASSESSMENT TAX W.E.F . 01.04.1989 ONWARDS. 8. THEREFORE, CONSIDERED IN THE AFORESAID LIGHT, IN OUR VIEW, THE FACT THAT THE AMENDED SECTION 140(3) WITH EFFECT FROM 01 .04.1989 DOES NOT ENVISAGE ANY PENALTY FOR NON-PAYMENT OF SELF-ASSESS MENT TAX, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN LEVYING THE IMPUGNED PENALTY BY MAKING RECOURSE TO SECTION 221 OF THE ACT. WE, ACCO RDINGLY, DIRECT THE ASSESSING OFFICER TO DELETE THE PENALTY IMPOSED UND ER SECTION 140A READ WITH SECTION 221(1) OF THE ACT. 9. IN THE RESULT,APPEAL OF THE ASSESSEE IN ITA NO. 1746/DEL/2015 IS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 04.12 .2020. SD/- SD/- [ SUDHANSHU SRIVASTAVA ] [N.K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 04 TH DECEMBER, 2020 VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI DATE OF DICTATION 01.12.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE 03.12.2020 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE 03.12.2020 DATE ON WHICH THE APPROVED DRAFT COMES TO 03.12.2020 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE 03.12.2020 DATE ON WHICH THE FAIR ORDER COMES BACK TO 03.12.2020 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON 03.12.2020 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 03.12.2020 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE DATE OF DISPATCH OF THE ORDER