M/s. Gupta Metal Sheets Ltd., Delhi V. DCIT, Faridabad

ITA 1947/DEL/2016

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0589 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 8 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2005-2006
• Appeal Filed On: 11-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATISH KR GUPTA
• Keywords: Opportunity of being heard; Retrospective amendment; Question of law; Right to appeal; Documents seized
• Section: 271(1)(c); 153A; 274; 73; 132; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH D, NEW DELHI BEFORE SH. BHAVNESH SAINI, JUDICIAL MEMBER DR. B. R. R. KUMAR, ACCOUNTANT MEMBER ITA NO. 1947/DEL./2016 : ASSTT. YEAR : 2005-06 ITA NO. 1948/DEL./2016 : ASSTT. YEAR : 2006-07 ITA NO. 1949/DEL./2016 : ASSTT. YEAR : 2007-08 M/S GUPTA METAL SHEETS LTD., ROOM NO. 2, 1 ST FLOOR, 5948- 5949, BASTI HARPHOOL SINGH, SADAR THANA ROAD, DELHI VS DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-II, FARIDABAD (APPELLANT) (RESPONDENT) PAN NO. AABCG0343G ASSESSEE BY : SH. SATYEN SETHI, ADV. REVENUE BY : SH. SATISH KR. GUPTA, SR. DR DATE OF HEAR ING: 21 . 10 .201 9 DATE OF PRONOUNCEMENT: 24 .12 .201 9 ORDER PER DR. B. R. R. KUMAR, ACCOUNTANT MEMBER: THE PRESENT APPEALS HAVE BEEN FILED BY THE ASSESSE E AGAINST THE ORDERS OF THE LD. CIT(A)-3, GURGAON DAT ED 05.02.2016. 2. SINCE, THE ISSUES INVOLVED IN BOTH THE APPEALS A RE COMMON, THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY COMMON ORDER. 3. IN ITA NO. 1947/DEL/2016, FOLLOWING GROUNDS HAVE BEEN RAISED BY THE ASSESSEE: 1. THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN CONFIRMING THE PENALTY OF RS.2,00,828/- IMPOSED BY ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 2 THE ASSESSING OFFICER, U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (THE ACT). 4. THE ASSESSEE HAS ALSO RAISED ADDITIONAL GROUNDS WHICH ARE AS UNDER: '1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE ORDER LEVYING PENALTY UNDER AMENDED EXPLAN ATION 5A(B) TO SECTION 271(1)(C) IS BAD IN LAW AND VOID-A B-INITIO, FOR THE SAME WAS NOT APPLICABLE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, EXPLANATION 5A TO SECTION 2 71(1)(C) IVAS NOT APPLICABLE TO ASSESSMENT YEAR 2005-06, FOR THE SEAR CH WAS CONDUCTED ON 30.7.2009, WHEREAS EXPLANATION 5A TO SECTION 271(1)(C) RECEIVED THE ASSENT OF THE PRESID ENT OF INDIA ON 13.8.2009. 3. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, ORDER LEVYING PENALTY IS WITHOUT JURISDICTION AND BAD IN LAW, FOR THE NOTICE UNDER SECTION 274 READ WITH SEC TION 271(1)(C) DATED 23.12.2011, THE WORDS 'HAVE CONCEAL ED THE PARTICULARS OF YOUR INCOME' OR 'FURNISH INACCUR ATE PARTICULARS OF SUCH INCOME' WERE NOT CROSSED OUT. 4. WITHOUT PREJUDICE, THE ORDER LEVYING PENALTY IS WITHOUT JURISDICTION AND BAD IN LAW, FOR NO PROPER SATISFAC TION WAS RECORDED BY THE ASSESSING OFFICER. 5. THE ASSESSEE HAS TAKEN ADDITIONAL GROUND PERTAIN ING TO LEVY OF PENALTY U/S 271(1)(C) OF THE INCOME TAX ACT, 1961. IT WAS CONTENDED THAT THE INSTANT CASE OF THE ASSESSEE IS COVERED UNDER T HE PROVISIONS OF SECTION 271AAA. ADMISSION OF THE ADDITIONAL GROUND HAS BEEN OPPOSED IN PRINCIPLE BY THE LD. DR AND ARGUED THAT THE FACTS OF THE CASE DO NOT ENTITLE ADMISSION OF ADDITIONAL GROUNDS. 6. WE HAVE PERUSED THE JUDGMENT OF THE HONBLE APEX COURT IN THE CASE OF NATIONAL THERMAL POWER CO. LTD. VS COMMISSI ONER OF INCOME TAX ON 4 DECEMBER, 1996, (229 ITR 383) ON THIS ISSUE. T HE RELEVANT PORTION OF THE JUDGMENT IS AS UNDER: ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 3 UNDER SECTION 254 OF THE INCOME-TAX ACT, THE APPELLATE TRIBUNAL MAY, AFTER GIVING BOTH THE PARTIES TO THE APPEAL AN OPPORTUNITY OF BEING HEARD, PASS SUCH ORDERS THEREO N AS IT THINKS FIT. THE POWER OF THE TRIBUNAL IN DEALING WI TH APPEALS IS THUS EXPRESSED IN THE WIDEST POSSIBLE TERMS. THE PU RPOSE OF THE ASSESSMENT PROCEEDINGS BEFORE THE TAXING AUTHOR ITIES IS TO ASSESS CORRECTLY THE TAX LIABILITY OF AN ASSESSEE I N ACCORDANCE WITH LAW. IF, FOR EXAMPLE, AS A RESULT OF A JUDICIA L DECISION GIVEN WHILE THE APPEAL IS PENDING BEFORE THE TRIBUNAL, IT IS FOUND THAT A NON-TAXABLE ITEM IS TAXED OR A PERMISSIBLE DEDUCT ION IS DENIED, WE DO NOT SEE ANY REASON WHY THE ASSESSEE S HOULD BE PREVENTED FROM RAISING THAT QUESTION BEFORE THE TRI BUNAL FOR THE FIRST TIME, SO LONG AS THE RELEVANT FACTS ARE ON RE CORD IN RESPECT OF THAT ITEM. WE DO NOT SEE ANY REASON TO RESTRICT THE POWER OF THE TRIBUNAL UNDER SECTION 254 ONLY TO DECIDE THE GROUNDS WHICH ARISE FROM THE ORDER OF THE COMMISSIONER OF I NCOME-TAX (APPEALS). BOTH THE ASSESSEE AS WELL AS THE DEPARTM ENT HAVE A RIGHT TO FILE AN APPEAL/CROSS-OBJECTIONS BEFORE THE TRIBUNAL. WE FAIL TO SEE WHY THE TRIBUNAL SHOULD BE PREVENTED FR OM CONSIDERING QUESTIONS OF LAW ARISING IN ASSESSMENT PROCEEDINGS ALTHOUGH NOT RAISED EARLIER. 6. IN THE CASE OF JUTE CORPORATION OF INDIA LTD. V. C.I.T . . THIS COURT, WHILE DEALING WITH THE POWERS OF THE APPELLA TE ASSISTANT COMMISSIONER OBSERVED THAT AN APPELLATE AUTHORITY H AS ALL THE POWERS WHICH THE ORIGINAL AUTHORITY MAY HAVE IN DEC IDING THE QUESTION BEFORE IT SUBJECT TO THE RESTRICTIONS OR L IMITATIONS, IF ANY, PRESCRIBED BY THE STATUTORY PROVISIONS. IN THE ABSENCE OF ANY STATUTORY PROVISION, THE APPELLATE AUTHORITY IS VESTED WITH ALL THE PLENARY POWERS WHICH THE SUBORDINATE AUTHOR ITY MAY HAVE IN THE MATTER. THERE IS NO GOOD REASON TO JUST IFY CURTAILMENT OF THE POWER OF THE APPELLATE ASSISTANT COMMISSIONER IN ENTERTAINING AN ADDITIONAL GROUND R AISED BY THE ASSESSEE IN SEEKING MODIFICATION OF THE ORDER O F ASSESSMENT PASSED BY THE INCOME-TAX OFFICER. THIS C OURT FURTHER OBSERVED THAT THERE MAY BE SEVERAL FACTORS JUSTIFYING THE RAISING OF A NEW PLEA IN AN APPEAL AND EACH CAS E HAS TO BE CONSIDERED ON ITS OWN FACTS. THE APPELLATE ASSISTAN T COMMISSIONER MUST BE SATISFIED THAT THE GROUND RAIS ED WAS BONA FIDE AND THAT THE SAME COULD NOT HAVE BEEN RAI SED EARLIER FOR GOOD REASONS. THE APPELLATE ASSISTANT COMMISSIO NER SHOULD EXERCISE HIS DISCRETION IN PERMITTING OR NOT PERMITTING THE ASSESSEE TO RAISE AN ADDITIONAL GROUND IN ACCOR DANCE WITH ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 4 LAW AND REASON. THE SAME OBSERVATIONS WOULD APPLY T O APPEALS BEFORE THE TRIBUNAL ALSO. 7. THE VIEW THAT THE TRIBUNAL IS CONFINED ONLY TO I SSUES ARISING OUT OF THE APPEAL BEFORE THE COMMISSIONER OF INCOME -TAX (APPEALS) TAKES TOO NARROW A VIEW OF THE POWERS OF THE APPELLATE TRIBUNAL [VIDE, E.G., C.I.T, V. ANAND PRASAD (DELHI), C.I.T . V. KARAMCHANDPREMCHAND P. LTD. AND C.I.T. V. CELLULOSE PRODUCTS OF INDIA LTD . . UNDOUBTEDLY, THE TRIBUNAL WILL HAVE THE DISCRETION TO ALLOW OR NOT ALLOW A NEW GROUND TO BE RAISED. BUT WHERE THE TRIBUNAL IS ONLY REQUIRED TO CONSIDER A Q UESTION OF LAW ARISING FROM THE FACTS WHICH ARE ON RECORD IN T HE ASSESSMENT PROCEEDINGS WE FAIL TO SEE WHY SUCH A QU ESTION SHOULD NOT BE ALLOWED TO BE RAISED WHEN IT IS NECES SARY TO CONSIDER THAT QUESTION IN ORDER TO CORRECTLY ASSESS THE TAX LIABILITY OF AN ASSESSEE. 8. THE REFRAMED QUESTION, THEREFORE, IS ANSWERED IN THE AFFIRMATIVE, I.E., THE TRIBUNAL HAS JURISDICTION TO EXAMINE A QUESTION OF LAW WHICH ARISES FROM THE FACTS AS FOUN D BY THE AUTHORITIES BELOW AND HAVING A BEARING ON THE TAX L IABILITY OF THE ASSESSEE. WE REMAND THE PROCEEDINGS TO THE TRIB UNAL FOR CONSIDERATION OF THE NEW GROUNDS RAISED BY THE ASSE SSEE ON THE MERITS. 7. THE BACKGROUND LEADING TO ADDITIONAL GROUND IS T HAT FOR THE ASSESSMENT YEAR 2005-06, RETURN DECLARING INCOME OF RS.1,48,33,570/- WAS FILED ON 28.10.2005. ON 30.07.2009, A SEARCH & SEIZURE OPERATION U/S 132(1) WAS CONDUCTED ON THE ASSESSEE, WHO IS ENGAGE D IN THE BUSINESS OF MANUFACTURE AND TRADING OF METAL SHEETS. DURING THE COURSE OF SEARCH, CERTAIN DOCUMENTS WERE SEIZED AND THE ASSESSEE HAD MADE SURRENDER OF RS.10.50 CRORES. OUT OF SURRENDER OF RS.10.50 CRORE S, A SUM OF RS.3.50 CRORES WAS IN RESPECT OF ASSESSMENT YEAR 2009-10 AN D THE REMAINING RS.7 CRORES WAS IN RESPECT OF ASSESSMENT YEAR 2010-11. T HE LD. AR SUBMITTED THAT SINCE THE SURRENDER WAS IN RESPECT OF EXPENSES /PAYMENTS MADE OUTSIDE THE BOOKS, THEREFORE, THE ASSESSING OFFICER WHILE MAKING THE ASSESSMENT ALLOCATED THE SURRENDER TO THE YEARS TO WHICH IT PERTAINED TO, AS UNDER: ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 5 ASSESSMENT YEAR AMOUNT OF SURRENDER 2004-05 : 46,500 2005 - 06 : 5,59,802 2006 - 07 : 11,48,590 2007-08 : 15,87,245 2008 - 09 : 49,20,229 2009 - 10 : 3,75,29,772 2010 - 11 : 5,94,89,848 TOTAL : 10,52,81,989 8. THE LD. AR SUBMITTED THAT THE SURRENDER MADE FOR ASSESSMENT YEARS 2009-10 AND 2010-11 WAS ALLOCATED TO ASSESSMENT YEA RS 2004-05 TO 2010-11. IT WAS ALSO ARGUED THAT THE AGGREGATE ADDI TION FOR ALL THE YEARS WAS SAME AS SURRENDERED BY THE ASSESSEE. 9. IT WAS ARGUED THAT OUT OF SURRENDER OF RS.10.50 CR., RS.5,59,802/- WAS ALLOCATED TO THE ASSESSMENT YEAR 2005-06 AND AC CORDINGLY, THE ASSESSMENT WAS MADE AT THE TOTAL INCOME OF RS.1,53, 93,372/-. HAVING COMPLETED THE ASSESSMENT, THE ASSESSING OFFICER LEV IED PENALTY U/S 271(1)(C) R/W EXPLANATION 5A, OBSERVING THAT '....F ROM THE ABOVE, IT IS ALSO SEEN THAT SUB-SECTION (B) OF EXPLANATION 5A TO SECT ION 271(1)(C) IS ALSO CLEARLY APPLICABLE IN THE SAID CASE'. 10. THE LD. CIT (A) HAS UPHELD THE ORDER OF THE ASS ESSING OFFICER LEVYING PENALTY OF RS.2,00,828/- UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961. ON THE GROUNDS THAT ASSESSEE WAS ALSO COVERED U/S 132 IN THE SEARCH CONDUCTED ON 30.07.2009, THE ASSESSEE FILED HIS RETURN U/S 139 AT AN INCOME OF RS.1,48,33,570/- AND THE SAME HAS BEEN TREATED AS RETURNED FILED IN RESPONSE TO NOTICE U/S 153A OF THE ACT. FU RTHER, ADDITION OF RS.5,59,802/- WAS MADE DURING THE YEAR UNDER CONSID ERATION BY THE AO ON THE BASIS OF THE DOCUMENTS SEIZED DURING THE SEARCH WHICH WERE RELATED TO THE ASSESSEE WHICH THE ASSESSEE HAS ALSO ADMITTED T O THIS UNDISCLOSED INCOME AS STATED IN THE ASSESSMENT ORDER BY THE ASS ESSING OFFICER. ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 6 11. HEARD THE ARGUMENTS OF BOTH THE PARTIES AND PER USED THE MATERIAL AVAILABLE ON RECORD. 12. WE FIND THAT, EXPLANATION 5A TO SECTION 271(1)( C) WAS INTRODUCED FOR THE FIRST TIME BY THE FINANCE ACT, 2007 AND WAS AME NDED W.R.E.F. 1.6.2007 BY THE FINANCE ACT, 2009, EXPLANATION 5A TO SECTION 271(1)(C) IS APPLICABLE TO CASES WHERE SEARCH WAS CONDUCTED ON OR AFTER 1.6 .2007. THE PROVISIONS OF THE RELEVANT PROVISIONS OF THE ACT ARE AS UNDER: [ EXPLANATION 5A. WHERE, IN THE COURSE OF A SEARCH I NITIATED UNDER SECTION 132 ON OR AFTER THE 1ST DAY OF JUNE, 2007 , THE ASSESSEE IS FOUND TO BE THE OWNER OF (I) ANY MONEY, BULLION, JEWELLERY OR OTHER VALUABLE ART ICLE OR THING (HEREAFTER IN THIS EXPLANATION REFERRED TO AS ASSET S) AND THE ASSESSEE CLAIMS THAT SUCH ASSETS HAVE BEEN ACQUIRED BY HIM BY UTILISING (WHOLLY OR IN PART) HIS INCOME FOR ANY PR EVIOUS YEAR; OR (II) ANY INCOME BASED ON ANY ENTRY IN ANY BOOKS OF ACCOU NT OR OTHER DOCUMENTS OR TRANSACTIONS AND HE CLAIMS THAT SUCH E NTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR TRANSACTIONS REPRESENTS HIS INCOME (WHOLLY OR IN PART) FOR ANY PREVIOUS YEA R, WHICH HAS ENDED BEFORE THE DATE OF SEARCH AND, (A) WHERE THE RETURN OF INCOME FOR SUCH PREVIOUS YEAR H AS BEEN FURNISHED BEFORE THE SAID DATE BUT SUCH INCOME HAS NOT BEEN DECLARED THEREIN; OR (B) THE DUE DATE FOR FILING THE RETURN OF INCOME FOR SU CH PREVIOUS YEAR HAS EXPIRED BUT THE ASSESSEE HAS NOT FILED THE RETURN, THEN, NOTWITHSTANDING THAT SUCH INCOME IS DECLARED BY HIM IN ANY RETURN OF INCOME FURNISHED ON OR AFTER THE DATE OF SEARCH, HE SHALL, FOR THE PURPOSES OF IMPOSITION OF A PENALTY UNDER CLAUSE (C) OF SUB-SEC TION (1) OF THIS SECTION, BE DEEMED TO HAVE CONCEALED THE PARTICULARS OF HIS INC OME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME.] ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 7 13. FURTHER, WE ALSO FIND THAT, SECTION 271AAA WAS ALSO INTRODUCED BY THE FINANCE ACT, 2007 AND IS APPLICABLE TO CASES WH ERE SEARCH HAS BEEN INITIATED ON OR AFTER 1 ST DAY OF JULY 2007 (I.E. 1.6.2007). THE PROVISIONS OF THE RELEVANT PROVISIONS OF THE ACT ARE AS UNDER: [ PENALTY WHERE SEARCH HAS BEEN INITIATED. 271AAA. (1) THE ASSESSING OFFICER MAY, NOTWITHSTANDING ANYT HING CONTAINED IN ANY OTHER PROVISIONS OF THIS ACT, DIRECT THAT, IN A CASE WHERE SEARCH HAS BEEN INITIATED UNDER SECTION 132 ON OR AFTER THE 1ST DAY OF JUNE, 2007 [BUT BEFORE THE 1ST DAY OF JULY, 2012], THE ASSESSEE SHALL PAY BY WAY OF PENALTY, IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM, A SUM COMPUTED AT T HE RATE OF TEN PER CENT OF THE UNDISCLOSED INCOME OF THE SPECIFIED PREVIOUS YEAR. (2) NOTHING CONTAINED IN SUB-SECTION (1) SHALL APPL Y IF THE ASSESSEE, (I) IN THE COURSE OF THE SEARCH, IN A STATEMENT UNDER S UB- SECTION (4) OF SECTION 132 , ADMITS THE UNDISCLOSED INCOME AND SPECIFIES THE M ANNER IN WHICH SUCH INCOME HAS BEEN DERIVED; ( II ) SUBSTANTIATES THE MANNER IN WHICH THE UNDISCLOSED I NCOME WAS DERIVED; AND (III) PAYS THE TAX, TOGETHER WITH INTEREST, IF ANY, IN RE SPECT OF THE UNDISCLOSED INCOME. (3) NO PENALTY UNDER THE PROVISIONS OF CLAUSE (C) O F SUB-SECTION (1) OF SECTION 271 SHALL BE IMPOSED UPON THE ASSESSEE IN RESPECT OF T HE UNDISCLOSED INCOME REFERRED TO IN SUB-SECTION (1). (4) THE PROVISIONS OF SECTIONS 274 AND 275 SHALL, SO FAR AS MAY BE, APPLY IN RELATION TO THE PENALTY REFERRED TO IN THIS SECTION . EXPLANATION.FOR THE PURPOSES OF THIS SECTION, ( A ) 'UNDISCLOSED INCOME' MEANS (I) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENT ED, EITHER WHOLLY OR PARTLY, BY ANY MONEY, BULLION, JEWELLERY OR OTHER VALU ABLE ARTICLE OR THING OR ANY ENTRY IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS OR TRANSACTIONS FOUND IN THE COURSE OF A SEARCH UNDER SECTION 132 , WHICH HAS ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 8 (A) NOT BEEN RECORDED ON OR BEFORE THE DATE OF SEARCH I N THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN T HE NORMAL COURSE RELATING TO SUCH PREVIOUS YEAR; OR (B) OTHERWISE NOT BEEN DISCLOSED TO THE [PRINCIPAL CHIEF COMMISSIONER OR] CHIEF COMMISSIONER OR [PRINCIPAL COMMISSIONER OR] COMMISSIONER BEFORE THE DATE OF SEARCH; OR (II) ANY INCOME OF THE SPECIFIED PREVIOUS YEAR REPRESENT ED, EITHER WHOLLY OR PARTLY, BY ANY ENTRY IN RESPECT OF AN EXP ENSE RECORDED IN THE BOOKS OF ACCOUNT OR OTHER DOCUMENTS MAINTAINED IN THE NORMAL COURSE RELATING TO THE SPECIFIED PREVIOUS YE AR WHICH IS FOUND TO BE FALSE AND WOULD NOT HAVE BEEN FOUND TO BE SO HAD THE SEARCH NOT BEEN CONDUCTED; (B) 'SPECIFIED PREVIOUS YEAR' MEANS THE PREVIOUS YEAR ( I ) WHICH HAS ENDED BEFORE THE DATE OF SEARCH, BUT THE DATE O F FILING THE RETURN OF INCOME UNDER SUB-SECTION (1) O F SECTION 139 FOR SUCH YEAR HAS NOT EXPIRED BEFORE THE DA TE OF SEARCH AND THE ASSESSEE HAS NOT FURNISHED THE RETURN OF IN COME FOR THE PREVIOUS YEAR BEFORE THE SAID DATE; OR ( II ) IN WHICH SEARCH WAS CONDUCTED.] 14. SINCE IN THE PRESENT CASE SEARCH WAS CONDUCTED ON 30.7.2009, HENCE SECTION 271AAA IS APPLICABLE FOR THE ASSESSME NT YEAR 2010-11 ONLY AS THE DATE OF FILING THE RETURN OF INCOME UNDER SU B-SECTION (1) OF SECTION 139 FOR SUCH YEAR HAS NOT EXPIRED BEFORE THE DATE O F SEARCH. 15. EXPLANATION 5A(B) TO SECTION 271(1)(C) WAS APPL ICABLE FOR THE ASSESSMENT YEARS 2005-06, 2006-07 AND 2007-08 AS TH E DATE FOR FILING THE RETURNS HAS ALREADY BEEN EXPIRED AND THE ASSESS EE HAS NOT DECLARED THIS INCOME IN THE RETURNS. FROM THE ASSESSMENT ORD ERS, WE FIND THAT THE ASSESSEE HAS NOT DECLARED THE SURRENDERED INCOME IN THE RETURNS FILED IN ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 9 RESPONSE TO THE NOTICE ISSUED U/S 153A(1)(A). THUS, THE SUBMISSIONS OF THE LD. AR ARGUING THAT THE INCOME SURRENDERED HAS BEEN REFLECTED/ASSESSED IS NOT CORRECT ON FACTS. RATHER, IT IS THE ADDITION MADE BY THE ASSESSING OFFICER BASED ON THE MATERIAL FOUN D AND SEIZED DURING THE COURSE OF SEARCH. 16. FROM THE ABOVE, THE FOLLOWING CONCLUSIONS CAN B E DRAWN: 1. THE ASSESSEE HAS NOT DECLARED ANY INCOME IN THE RET URNS FILED IN RESPONSE TO THE NOTICE ISSUED U/S 153A(1)(A) MOR E THAN WHAT HAS BEEN DECLARED IN THE REGULAR RETURNS. 2. THE ADDITION HAS BEEN MADE BY THE REVENUE BASED ON THE SEIZED MATERIAL. 3. THE DUE DATE OF FILING OF RETURN HAS ALREADY BEEN E XPIRED. 4. THE LD. AR CONTENTION THAT THE PRESIDENTIAL ASSENT HAS BEEN RECEIVED ON 13.08.2009, HENCE NOT APPLICABLE CANNOT BE ACCEPTED AS THE PROVISIONS OF THE ACT CLEARLY SAYS THAT THIS PROVISION IS APPLICABLE WITH RETROSPECTIVE EFFECT F ROM 01.06.2007. 17. KEEPING IN VIEW, SINCE NO PRIMA FACIE CASE CAN BE MADE ON APPLICABILITY OF ANY LEGAL GROUND ON THIS ISSUE, WE HEREBY DECLINE TO ADMIT THE ADDITIONAL GROUNDS TAKEN BY THE ASSESSEE ON THI S ISSUE. 18. REGARDING THE GROUNDS RELATING TO ISSUE OF NOTI CE U/S 274 READ WITH SECTION 271(1)(C) DATED 23.12.2011, WE FIND THAT TH E ASSESSING OFFICER HAS NOT SPECIFIED UNDER WHICH LIMB OF THE PROVISION S OF SECTION 271(1)(C), THE PENALTY IS BEING INITIATED AND LEVIED. THE SPEC IFIC MENTION WHETHER THE PENALTY IS LEVIED WHETHER FOR CONCEALMENT OF PARTIC ULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME. THE JU DGMENT OF HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF PCIT VS SA HARA INDIA LIFE INSURANCE CO. LTD. IN ITA NO. 475/2019 DATED 02.08.2019 AFFIR MED AS UNDER: ITA NOS. 1947, 1948 & 1949/DEL/2016 GUPTA METAL SHEETS L TD. 10 21. THE RESPONDENT HAD CHALLENGED THE UPHOLDING OF THE PENALTY IMPOSED UNDER SECTION 271(1)(C) OF THE ACT, WHICH WAS ACCEPTED BY THE ITAT. IT FOLLOWED THE DECISION OF THE KARNATAKA HIGH COURT IN CIT VS MANJUNATHA COTTON & GINNING FACTORY 359 ITR 565 (KAR) AND OBSERVED THAT THE NOT ICE ISSUED BY THE AO WOULD BE BAD IN LAW IF IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) THE PENALTY PROCEEDINGS HAD BE EN INITIATED UNDER I.E. WHETHER FOR CONCEALMENT OF PAR TICULARS OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE KARNATAKA HIGH CURT HAD FOLLOWED THE ABOVE JUDG MENT IN THE SUBSEQUENT ORDER IN COMMISSIONER OF INCOME TAX V. SSAS EMERALD MEADOWS (2016) 73 TAXMAN.COM 241 (KAR.), TH E APPEAL AGAINST WHICH WAS DISMISSED BY THE SUPREME C OURT OF INDIA IN SLP NO. 11485 OF 2016 BY ORDER DATED 5 TH AUGUST, 2016. 19. HENCE, RESPECTFULLY FOLLOWING THE ABOVE JUDGMEN T, WE HEREBY HOLD THAT THE PENALTY LEVIED BY THE ASSESSING OFFICER IS LIABLE TO BE OBLITERATED. 20. IN THE RESULT, THE APPEALS OF THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24/12/2019. SD/- SD/- (BHAVNESH SAINI) (DR. B. R. R. KUMAR) JUDICIAL MEMBER ACCO UNTANT MEMBER DATED: 24/12/2019 *SUBODH* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR