Sureshbhai Makanshi Gadesha, RAJKOT-GUJARAT V. The Income Tax Officer, Ward-5(2), RAJKOT-GUJARAT

ITA 184/RJT/2013

• Counselvise Citation: 18424914 RSA 2013
• Duration Of Justice: 8 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 03-01-2014
• Assessment Year: 2005-2006
• Appeal Filed On: 03-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR J B JHAVERI DR
• Assessee Lawyers: DR ADHIA
• Section: 27; 148; 144; 273B; 142(1)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBULAL; RAJKOT BENCH, RAJKOT BEFORE SHRI T. K. SHARMA, JM AND SHRI B. R. JAIN, A M ITA NO. 184/RJT/2013 / ASSESSMENT YEAR : 2005-06 SHRI SURESHBHAI MAKANSHI GADESHA, AMARDEEP, 2-JAYANT K.G. SOCIETY, CLOSED STREET, NR. JAIN UPASHRAY, KRISHNA NAGAR MAIN ROAD, NR. ASHAPURA DAIRY FARM, RAJKOT PAN : AGHPG 5642 F ( / APPELLANT) THE ITO, WARD 5 (2), RAJKOT / RESPONDENT ! ' #$ / ASSESSEE BY SHRI D.R. ADHIA, AR % ! ' #$ / REVENUE BY DR. J. B. JHAVERI, DR # & ' ! ( / DATE OF HEARING 03.01.2014 ) ! ( / DATE OF PRONOUNCEMENT 09.01.2014 / ORDER .. , / T. K. SHARMA, J. M.: THIS APPEAL BY THE ASSESSEE IS AGAINST THE ORDER DATED 28.02.2013 OF LD. CIT(A) -IV, RAJKOT CONFIRMING THE PENALTY OF RS.10,000/- LEVIED BY THE ASSESSING OFFICER U/S 27 1(1)(B) OF THE INCOME-TAX ACT 1961. 2. THE FACTS, IN BRIEF, ARE THAT THE ASSESSEE IS AN INDIVIDUAL. FOR THE ASSESSMENT YEAR UNDER APPEAL NO RETURN WAS FILED BY THE ASSESS EE. THE ASSESSING OFFICER ISSUED NOTICE U/S 148 ON 06.02.2009 WHICH WAS SENT THROUGH SPEED POST AND THE SAME WAS RETURNED BACK WITH A REMARK THAT THE ASSESSEE HAS L EFT. THE ASSESSING OFFICER SERVED THE SAME BY AFFIXTURE THROUGH WARD INSPECTOR AT THE RESIDENTIAL PREMISE OF THE ASSESSEE ON 16.02.2009. NEITHER THE ASSESSEE NOR HIS AR ATTE NDED OR FILED ANY RETURN OF INCOME. SUBSEQUENTLY, THE ASSESSING OFFICER ISSUED NOTICE U/S 142(1) OF THE INCOME-TAX ACT ON 23.11.2009 TO THE ASSESSEE BY SPEED POST BUT THE SA ME WAS RETURNED BACK WITH THE POSTAL REMARKS LEFT. THEREFORE, THE SAID NOTICE W AS ALSO AFFIXED BY THE WARD INSPECTOR ON 05.12.2009 AT THE RESIDENTIAL PREMISE OF THE ASS ESSEE. THE ASSESSING OFFICER FRAMED ASSESSMENT U/S 144 OF THE INCOME-TAX ACT ON 31.12.2 009 DETERMINING THE TOTAL INCOME AT RS.10,00,000/-. THIS ASSESSMENT WAS FINALIZED ON THE BASIS OF ASSESSEES ADMISSION 184-RJT-2013 SURESHBHAI MAKANSHI GADESHA 2 BEFORE THE DIR, GANDHIDHAM. WHILE FINALIZING THE AS SESSMENT, THE ASSESSING OFFICER ALSO INITIATED PENALTY PROCEEDINGS U/S 271(1)(B) OF THE INCOME-TAX ACT. SUBSEQUENTLY, THE ASSESSING OFFICER LEVIED PENALTY U/S 271(1)(B) OF RS.10,000/- FOR THE NON-COMPLIANCE OF THE NOTICE U/S 142(1) OF THE INCOME-TAX ACT. ON APPEAL, IN THE IMPUGNED ORDER, LD. CIT(A) CONFIRMED THE PENALTY FOR THE DETAILED REASO N GIVEN IN PARAGRAPH NO.4, WHICH READS AS UNDER:- 4. I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS OF THE APPELLANT, THE ASSESSMENT ORDERS PASSED U/S 144 AND PENALTY ORDER PASSED U/S 271(1)(B) OF THE IT ACT 1961. FROM THE FACTS OF THE CASE IT IS QUITE EVIDENT THAT IT IS A DELIBERATE ACT ON THE PART OF THE APPELLANT NOT TO COMPLY WITH THE STATUTORY NOTICES ISSUED UNDER RELEVANT SECTIONS OF THE IT ACT 1961. THE APPELLANT HAS NOT COMPLIED WITH THE NOTICE ISSUED U/S 142(1) DURING THE COURSE OF ASSES SMENT PROCEEDINGS. ON PERUSAL OF ASSESSMENT ORDER, IT CAN BE SEEN THAT TH E NOTICE U/S 142(1) HAS BEEN AFFIXED ON THE ADDRESS PROVIDED BY THE APPELLANT. T HEREFORE, THIS AMOUNTS TO VALID SERVICE. HENCE THE ACTION OF THE ASSESSING OFFICER IN LEVYING PENALTY U/S 271(1)(B) FOR NON-COMPLIANCE TO THE NOTICE ISSUED U/S 142(1) O THE IT ACT 1961 IS JUSTIFIED. NO INTERFERENCE IS THEREFORE CALLED FOR IN RESPECT OF THE PENALTY LEVIED BY THE ASSESSING OFFICER AT RS.10,000/- FOR ONE DEFAULT U/ S 271(1)(B) OF THE IT ACT 1961. AGGRIEVED WITH THE ORDER OF LD. CIT(A) CONFIRMING T HE PENALTY OF RS.10,000/- LEVIED BY THE ASSESSING OFFICER U/S 271(1)(B) OF TH E ACT, THE ASSESSEE IS NOW IN APPEAL BEFORE THIS TRIBUNAL. 3. AT THE TIME OF HEARING BEFORE US, ON BEHALF OF T HE ASSESSEE, SHRI D.R. ADHIA, AR APPEARED AND POINTED OUT THAT THE ASSESSING OFFICER LEVIED THE PENALTY U/S 271(1)(B) OF THE ACT AND LD. CIT(A) CONFIRMED THE SAME WITHOUT C ONSIDERING THE STATUTORY POSITION. THE NOTICE U/S 142(1) OF THE INCOME-TAX ACT DATED 2 3.11.2009 WAS ISSUED AND SENT TO THE ASSESSEE BY SPEED POST BUT THE SAME WAS RETURNE D BACK WITH THE POSTAL REMARKS LEFT. THEREFORE, THE SAME WAS AFFIXED BY THE WARD INSPECTOR ON 05.12.2009 AT THE RESIDENTIAL PREMISES OF THE ASSESSEE. THUS, THE ASS ESSING OFFICER ADMITS THAT AT BOTH THE TIMES NOTICES WERE SENT ONLY AT RESIDENTIAL PRE MISES OF THE ASSESSEE. THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE ALSO DREW OUT ATTENTION TO PARAGRAPH NO.3 ON PAGE NO.1 OF THE ASSESSMENT ORDER WHERE THE ASSE SSING OFFICER HAS MENTIONED AS UNDER:- 3. THE WHEREABOUTS OF THE ASSESSEE IS NOT KNOWN AN D SEVERAL NOTICES ISSUED BY THIS OFFICE EITHER RETURN BACK UNSERVED OR SERVE D BY AFFIXTURE. DURING THE COURSE OF ASSESSMENT PROCEEDING A LETTER WAS ISSUED TO THE POLICE COMMISSIONER 184-RJT-2013 SURESHBHAI MAKANSHI GADESHA 3 OF RAJKOT TO TRACE OUT THE PERSON CONCERN. HOWEVER, NO REPLY IS RECEIVED TILL DATE. THIS OFFICE HAS ALSO WRITTEN SEVERAL LETTERS TO THE DRI, GANDHIDHAM (KUTCH) TO OBTAIN NECESSARY DOCUMENTARY EVIDENCE AS REGARD TO SHOW CAUSE NOTICES AND TO KNOW THE PRESENT STATUS OF THE ASSESSEE. THE DRI GA NDHIDHAM (KUTCH) VIDE LETTER NO.F.NO.DRI/RRU/INV.13/2005 DATED 24.12.2009 INFORMED THAT THE PRESENT WHEREABOUTS OF THE CONCERNED ASSESSEE ARE NOT KNOWN TO THIS OFFICE. 4. FROM THE ABOVE, THE LD. AUTHORIZED REPRESENTATIV E OF THE ASSESSEE POINTED OUT THAT NOTICE U/S 142 (1) WAS NOT RECEIVED BY THE ASS ESSEE AND HE WAS ALSO NOT AWARE OF THE PROCEEDINGS BECAUSE OF CIRCUMSTANCES BEYOND HIS CONTROL AND EVEN POLICE COMMISSIONER AND DRI GANDHIDHAM ALSO WITNESS THAT T HE WHEREABOUTS OF THE ASSESSEE WERE NOT KNOWN AND THEREFORE WHEN THE ASSESSEE WAS NOT AWARE OF THE SERVICE OF THE NOTICE, HE COULD NOT COMPLY WITH THE SAME. THUS, TH E NON-COMPLIANCE IS FOR NON-RECEIPT OF INFORMATION/AWARENESS WHICH CONSTITUTES REASONAB LE CAUSE WITHIN THE MEANING OF SECTION 273B OF THE INCOME-TAX ACT, 1961. 5. THE LD. AR OF THE ASSESSEE FURTHER POINTED OUT T HAT WHENEVER THE ASSESSEE WAS CALLED FOR HE ATTENDED BEFORE THE DRI GANDHIDHAM FR OM TIME TO TIME, WHICH SHOWS THAT WHENEVER THERE WAS INFORMATION/AWARENESS THE ASSESS EE INDEED COMPLIED BEFORE THE DRI, GANDHIDAHM. THEREFORE, THE ASSESSING OFFICER S HOULD NOT HAVE LEVIED THE PENALTY U/S 271(1)(B) OF THE INCOME-TAX ACT. 6. ON THE OTHER HAND, DR. J.B. JHAVERI, DR, APPEARE D ON BEHALF OF THE REVENUE VEHEMENTLY SUPPORTED THE ORDER OF LD. CIT(A). HE PO INTED OUT THAT THE NOTICE U/S 142(1) WAS DULY SERVED THROUGH AFFIXTURE AND IT WAS THE DU TY OF THE ASSESSEE TO COMPLY WITH THE SAME. 7. AFTER HEARING BOTH THE SIDES, WE HAVE CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. TECHNICALLY, IT IS TRUE THAT TH ERE WAS SERVICE OF NOTICE U/S 142(1) THROUGH AFFIXTURE. HOWEVER, IT IS ALSO PERTINENT TO NOTE THAT THE DEPARTMENT COULD NOT SERVE THE NOTICE THROUGH SPEED POST AS THE SAME WER E RETURNED BY THE POSTAL AUTHORITY WITH THE REMARKS LEFT. THIS CLEARLY INDICATES TH AT AT THE RELEVANT TIME THE ASSESSEE WAS NOT RESIDING AT THE SAID ADDRESS. BE THAT IT MA Y BE, KEEPING IN VIEW OF THE PECULIAR 184-RJT-2013 SURESHBHAI MAKANSHI GADESHA 4 FACTS OF THE CASE WHICH ARE NARRATED BY THE LD. AR OF THE ASSESSEE, WE ARE OF THE VIEW THAT THIS IS NOT A FIT CASE FOR LEVYING PENALTY U/S 271(1)(B) OF THE INCOME-TAX ACT, 1961. THEREFORE, PENALTY OF RS.10,000/- LEVIED BY THE ASS ESSING OFFICER U/S 271(1)(B) OF THE INCOME-TAX IS HEREBY CANCELLED. 4. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. THIS ORDER PRONOUNCED IN OPEN COURT ON THE DATE MEN TIONED HEREINABOVE. SD/- SD/- (B. R. JAIN) (T. K. SHARM A) $( #*% / ACCOUNTANT MEMBER #*% /JUDICIAL MEMBER *$+ ,*-/ ORDER DATE 09.01.2014 /RAJKOT *BT / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT- SHRI SURESHBHAI MAKANSHI GADESHA, RAJK OT 2. /RESPONDENT- THE ITO, WARD 5 (2),RAJKOT 3. #-2- & 3 / CIT-V, RAJKOT 4. & 3 - / CIT(A)-IV, RAJKOT 5 . 678 , , / DR, ITAT, RAJKOT 6 . 89 :; / GUARD FILE. *$+ #$ / BY ORDER , TRUE COPY PRIVATE SECRETARY, , INCOME TAX APPELLATE TRIBUNAL, RAJKOT.