M/s Mehfil Hospitality Ltd., Chandigarh V. JCIT (TDS), Chandigarh

ITA 19/CHANDI/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90177 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 26-05-2015
• Assessment Year: 2010-2011
• Appeal Filed On: 06-01-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: TEJ MOHAN
• Keywords: Reasonable cause
• Section: 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NOS. 18 & 19/CHD/2015 (ASSESSMENT YEAR : 2010-11 MEHFIL HOSPITALITY LTD., VS. THE J.C.I.T.(TDS), # 230, SECTOR 9-C, CHANDIGARH. CHANDIGARH. PAN: AACCM5289J (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI TEJ MOHAN RESPONDENT BY : SHRI S.K.MITTAL, DR DATE OF HEARING : 26.05.2015 DATE OF PRONOUNCEMENT : 27.05.2015 O R D E R PER BHAVNESH SAINI, J.M. : BOTH THE APPEALS FILED BY THE ASSESSEE ARE DIRECTE D AGAINST THE DIFFERENT ORDERS OF THE LEARNED COMMISS IONER OF INCOME TAX (APPEALS), CHANDIGARH DATED 28.11.2014 F OR ASSESSMENT YEAR 2010-11 (FINANCIAL YEAR 2009-10 (26 Q, 1 ST & 2 ND QUARTERS), CHALLENGING THE LEVY OF PENALTY UNDER S ECTION 272A(2)(K) OF THE INCOME TAX ACT. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE PERSON RESPONSIBLE HAD FAILED TO FILE QUARTERLY TDS RETURN S IN FORM NO.26Q FOR 1 ST AND 2 ND QUARTERS BY RESPECTIVE DUE DATES. IN RESPONSE TO THE PENALTY NOTICE, THE ASSESSEE FILED REPLY BUT 2 THE ASSESSING OFFICER WAS NOT SATISFIED WITH THE EX PLANATION AND LEVIED PENALTY FOR BOTH THE QUARTERS. 3. BEFORE THE LEARNED CIT (APPEALS), THE ASSESSEE CHALLENGED THE PENALTY ORDER AND WRITTEN SUBMISSION WAS FILED, WHICH IS QUOTED IN THE IMPUGNED ORDER, IN WH ICH THE ASSESSEE EXPLAINED THAT THE DELAY WAS UNINTENTIONAL AND WAS NOT DELIBERATE AND NO REVENUE LOSS HAS BEEN CAUSED TO THE REVENUE DEPARTMENT. THEREFORE, THE PENALTY MAY NO T BE IMPOSED. THE LEARNED CIT (APPEALS) CONSIDERED THE SUBMISSION OF THE ASSESSEE WITH REFERENCE TO PROVIS IONS OF SECTION 200(3) OF THE ACT WITH RULE 31A(2) OF THE I NCOME TAX RULES AND NOTED THAT THE ASSESSEE HAS TO FILE E-TDS RETURNS IN PRESCRIBED FORM BY DUE DATE AS MENTIONED IN THE RUL ES. HOWEVER, THE ASSESSEE HAS NOT FILED THE SAME WITHIN THE PERIOD PRESCRIBED UNDER THE LAW. IT WAS ALSO NOTE D THAT IN THESE PROVISIONS NO DIRECT LOSS OF REVENUE IS TO BE CONSIDERED AND ONLY THE DELAY HAS TO BE CONSIDERED. THE LEAR NED CIT (APPEALS) ALSO NOTED THAT IF THE CONTENTION OF THE ASSESSEE IS ACCEPTED THEN NO PENALTY WOULD BE IMPOSED AGAINST A NY PERSON AND THE SAME WOULD BE AGAINST THE INTENTION OF THE LEGISLATURE. THE LEARNED CIT (APPEALS) ALSO NOTED THAT THE INFORMATION CONTAINED IN THE TDS STATEMENTS IS UTIL IZED BY THE DEPARTMENT IN ENSURING PROPER ASSESSMENT OF TAX IN THE CASE OF THE PERSONS FROM WHOSE INCOME-TAX HAS BEEN DEDUC TED AT SOURCE. THE LEARNED CIT (APPEALS) ALSO CONSIDERED THE CASE LAWS CITED BY THE ASSESSEE AND NOTED THAT THESE JUD GMENTS ARE NOT APPLICABLE AND ACCORDINGLY DISMISSED BOTH THE A PPEALS OF THE ASSESSEE. 3 4. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND CONSIDERED THE FINDINGS IN THE IMPU GNED ORDER. THE ASSESSEE IN RESPONSE TO SHOW CAUSE N OTICE FOR LEVY OF PENALTY, SUBMITTED BEFORE THE ASSESSING OFF ICER THAT THE DELAY IN FILING THE TDS RETURNS WAS THE RESULT OF SUFFERING LOSS IN BUSINESS, WHICH ULTIMATELY LED TO THE CLOSE R OF THE BUSINESS. IT WAS SUBMITTED THAT THE DELAY IS TECH NICAL IN NATURE AND PENALTY MAY NOT BE IMPOSED. HOWEVER, T HE ASSESSEE HAS NOT RAISED ANY SUCH PLEA BEFORE THE LE ARNED CIT (APPEALS). THE ONLY EXCEPTION TO THE RULE WAS THA T IF THE ASSESSEE IS ABLE TO PROVE THAT THERE WAS ANY REASONABLE/SUFFICIENT CAUSE FOR NOT FILING THE TDS RETURNS IN QUESTION WITHIN THE PRESCRIBED PERIOD, THE PENALTY COULD BE CANCELLED. HOWEVER, THE REPLY OF THE ASSESSEE WOU LD CLEARLY INDICATE THAT THE ASSESSEE HAS NOT BEEN ABLE TO PRO VE IF THE ASSESSEE HAS ANY REASONABLE CAUSE OF FAILURE TO COM PLY WITH THE PROVISIONS OF LAW. NO EVIDENCE OR MATERIAL WA S PRODUCED BEFORE THE AUTHORITIES BELOW IN SUPPORT OF SUCH CON TENTION TO PROVE REASONABLE CAUSE ON BEHALF OF THE ASSESSEE. ON THE LAST DATE, THE ASSESSEE SOUGHT TIME TO FILE PAPER B OOK IN SUPPORT OF THE SUBMISSIONS THAT THE ASSESSEE HAS AN Y REASONABLE CAUSE FOR FAILURE TO COMPLY WITH THE PRO VISIONS OF LAW. HOWEVER, ON THE DATE OF HEARING FIXED FOR TH AT PURPOSE, THE ASSESSEE IS NOT ABLE TO PRODUCE ANY EVIDENCE OR MATERIAL BEFORE US TO PROVE IF THE ASSESSEE HAS ANY REASONAB LE CAUSE FOR FAILURE TO COMPLY WITH THE PROVISIONS OF LAW. NO PAPER BOOK IS ALSO FILED AS WAS REQUESTED EARLIER. IT IS, THEREFORE, CLEAR THAT THE ASSESSEE HAS FAILED TO PROVE IF IT H AS ANY 4 REASONABLE CAUSE FOR FAILURE TO COMPLY WITH THE PRO VISIONS OF LAW. THEREFORE, BOTH THE APPEALS OF THE ASSESSEE HAVE NO MERIT AND ARE ACCORDINGLY DISMISSED. 5. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 27 TH DAY OF MAY, 2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 27 TH MAY, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH