B.S.Ranga, by L/R B.R.Shamala, CHENNAI V. ITO, CHENNAI

ITA 1827/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4481 (ITAT-CHENNAI)
• Duration Of Justice: 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 22-02-2017
• Assessment Year: 2001-2002
• Appeal Filed On: 16-06-2016
• Court: TRIBUNAL
• Assessee Lawyers: T VASUDEVAN SHRI SHIVA
• Section: 143(3); 246; 148

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , . , BEFORE SHRI CHANDRA POOJARI , ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY , J UDICIAL MEMBER ./ I.T.A.NO. 1827 /MDS/2016 / ASSESSMENT YEAR :20 0 1 - 0 2 B.S. RANGA BY L/R B.R. SHAMALA, NO. 21 (10), JUDGE JAMBULINGAM STREET, MYLAPORE, CHENNAI 600 004. [PAN: A EGPR1348E ] VS. THE INCOME TAX OFFICER, MEDIA WARD ( 2 ), C HENNAI . ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI T. VASUDEVAN, ADVOCATE / RESPONDENT BY : SHRI SHIVA SRINIVAS , J CIT / DATE OF HEARING : 22 . 0 2 .201 7 / DATE OF P RONOUNCEMENT : 16 . 0 5 .201 7 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 1 4 , CHENNAI DATED 29 . 0 3 .201 6 RELEV ANT TO THE ASSESSMENT YEAR 20 0 1 - 0 2 PASSED UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 [ ACT IN SHORT]. 2. T HE APPEAL OF THE ASSESSEE IS FOUND TO HAVE BEEN FILED LATE BY TWO DAYS IN FILING THE APPEAL. BY FILING CONDONATION PETITION IN SUPPORT OF AN AFFIDAVIT, THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE SIGNATORY OF I.T.A. NO. 1827 /M/16 2 THE ASSESSEE WAS AWAY FROM STATION AND THEREFORE COULD NOT ABLE TO SIGN THE APPEAL PAPER AND FILED THE SAME IN TIME BEFORE THE TRIBUNAL. IT WAS ALSO SUBMITTED THAT THE DELA Y WAS NEITHER WILFUL NOR WANTON AND REQUESTED FOR CONDONING THE SHORT DELAY OF TWO DAYS AND TO ADMIT THE APPEAL FOR HEARING. THE LD. DR DID NOT OBJECT TO THE SUBMISSIONS OF THE LD. COUNSEL FOR THE ASSESSEE . ACCORDINGLY, WE CONDONE THE DELAY OF TWO DAYS IN FILING THE APPEAL AND ADMIT THE APPEAL FOR HEARING. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS A PROPRIETOR OF M/S. VIKRAM STUDIOS, CHENNAI AND FILED THE RETURN OF INCOME IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE ACT ISSUED ON THE ASSESSEE ON 11.09.2002 ADMITTING A TOTAL LOSS OF .5,98,315.75. THIS RETURN WAS PROCESSED UNDER SECTION 143(1) OF THE ACT AND THE CASE WAS SELECTED FOR SCRUTINY BY ISSUING NOTICE UNDER SECTION 143(2) OF THE ACT. IN RESPONSE TO THE ABOVE NOTICES, THE ASSESSEE S AR P RODUCED BOOKS OF ACCOUNTS, VOUCHERS, BANK STATEMENT, COPY OF THE AGREEMENT TO W ARDS PURCHASE OF NEGATIVE RIGHTS, ETC. BEFORE THE ASSESSING OFFICER. AFTER VERIFICATION OF PARTICULARS FILED BY THE ASSESSEE, THE ASSESSMENT UNDER SECTION 143(3) R.W.S. 147 OF TH E ACT WAS COMPLETED ON 10.03.2004 BY MAKING VARIOUS ADDITIONS. AGAINST THE ADDITIONS, THE ASSESSING OFFICER FURTHER INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT . AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE, THE ASSESSING OFFICER H AS OBSERVED THAT THE ASSESSEE HAS WILFULLY CONCEALED I.T.A. NO. 1827 /M/16 3 AND FURNISHED INACCURATE PARTICULARS OF INCOME IN ORDER TO AVOID TAX. THUS, THE ASSESSING OFFICER LEVIED PENALTY OF .2,45,000/ - UNDER SECTION 271(1)(C) OF THE ACT DATED 29.03.2010. 4 . THE ASSESSEE CA RRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A), WHO HAS CONFIRMED THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE. 5 . ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. C OUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT WHILE INITIATING THE PENALTY PROCEEDINGS, THE ASSESSING OFFICER HAS NOT RECORDED THE REQUISITE SATISFACTION FOR THE PURPOSE OF INITIATING AND LEVY OF PENALTY AS TO CONCEALMENT OR FURNISHING INACCURATE PARTICULARS OF INCOME AND THEREFORE, THE PENALTY PROCEEDINGS ARE VOID IN LAW AND PRAYED FOR DELETING THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT . BEFORE THE LD. CIT(A) THAT AS PER ASSESSMENT ORDER, THE TAXES WERE PAID ON 02.04.2004 EVEN BEFORE THE DUE DATE A ND PRAYED FOR CANCELLING THE PENALTY ORDER. IT WAS ALSO SUBMITTED THAT THE CONFIRMING THE ADDITIONS, THE LD. CIT(A) PASSED THE APPELLATE ORDER DATED 11.12.2008 AND THEREAFTER, AFTER LAPSE OF MORE THAN ONE YEAR, THE ASSESSING OFFICER HAS INITIATED PENALTY P ROCEEDINGS, WHICH IS BARRED BY LIMITATION UNDER SECTION 275(1)(A) OF THE ACT AND PRAYED FOR QUASHING THE PENALTY ORDER. I.T.A. NO. 1827 /M/16 4 6 . ON THE OTHER HAND, THE LD. DR SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 7 . WE HAVE HEARD BOTH SIDES, PERUSED THE MATERIALS AVA ILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CASE , THE ASSESSMENT WAS SUBJECT MATTER OF APPEAL BEFORE THE LD. CIT(A) AND THE APPELLATE ORDER WAS PASSED VIDE ORDER DATED 11.12.2008 CONFIRMING THE ADDITIONS MADE BY THE ASSESSING OFFICER. AGAINST THE APPELLATE ORDER, THE ASSESSEE HAS NOT PREFERRED ANY FURTHER APPEAL BEFORE THE TRIBUNAL. IN PURSUANCE TO THE APPELLATE ORDER, THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS AND LEVIED THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT VIDE HIS ORDER DATED 29.03.2010. UNDER THESE CIRCUMSTANCES, I T IS RELEVANT TO REPRODUCE THE PROVISIONS OF SECTION 275(1) (A) OF THE ACT FOR REFERENCE: 275. (1)] NO ORDER IMPOSING A PENALTY UNDER THIS CHAPTER SHALL BE PASSED (A) IN A CASE WHERE THE RELE VANT ASSESSMENT OR OTHER ORDER IS THE SUBJECT MATTER OF AN APPEAL TO THE COMMISSIONER (APPEALS) UNDER SECTION 246 [OR SECTION 246A] OR AN APPEAL TO THE APPELLATE TRIBUNAL UNDER SECTION 253 , AFTER THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, I N THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE APPELLATE TRIBUNAL IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER PERIOD EXPIRES LATER : [PROVIDED THAT IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTHER ORDER IS THE SUBJECT - MATTER OF AN APPEAL TO THE COMMISSIONER (APPEALS) UNDER SECTION 246 OR SECTION 246A, AND THE COMMISSIONER (A PPEALS) PASSES THE ORDER ON OR AFTER THE 1ST DAY OF JUNE, 2003 DISPOSING OF SUCH APPEAL, AN ORDER IMPOSING PENALTY SHALL BE PASSED BEFORE THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR IMPOSITION OF PENALTY HAS BEEN I.T.A. NO. 1827 /M/16 5 INITIATED, ARE COMPLETED, OR WITHIN ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORDER OF THE COMMISSIONER (APPEALS) IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER IS L ATER;] 8. IN VIEW OF THE ABOVE PROVISIONS OF SECTION, THE ASSESSING OFFICER SHOULD HAVE COMPLETED THE PENALTY PROCEEDINGS AND PASS ORDER UNDER SECTION 271(1)(C) OF THE ACT BEFORE THE EXPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE O F WHICH ACTION FOR THE IMPOSITION OF PENALTY IS WARRANTED OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE LD. CIT(A). IN THIS CASE, THE PENALTY ORDER WAS NOT PASSED BEFORE THE EXPIRY OF FINANCIAL YEAR AND THUS, WE ARE OF THE OPINION THAT THE PENALTY ORDER UNDER SECTION 271(1)(C) OF THE ACT PASSED BY THE ASSESSING OFFICER IS BARRED BY LIMITATION AS PROVIDED UNDER PROVISO TO SECTION 275(1) OF THE ACT AND LIABLE TO BE QUASHED. ACCORDINGLY, THE PENALTY ORDER PASSED UNDER SECTION 271(1)(C) OF T HE ACT IS QUASHED AND ALLOWED THE APPEAL FILED BY THE ASSESSEE. 9 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED ON THE 16 TH MAY , 201 7 AT CHENNAI. SD/ - SD/ - ( CHANDRA POOJARI ) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 16 . 0 5 .201 7 V M/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.