Siddhi Vinayak Cement Pvt. Ltd.,(Merged with Nirma Limited), Ahmedabad V. The DCIT, Circle-4(1)(1), Ahmedabad

ITA 1965/AHD/2018

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 2514 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 18-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: VIRENDRA OJHA
• Section: 143(3); 142(1); 143(2); 27; 144

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, VICE-PRESIDENT AND SHRI PRADIPKUMAR KEDIA, ACCOUNTANT MEMBER ITA NO.1965/AHD/2018 / ASSTT.YEAR : 2013-14 SIDDHI VINAYAK CEMENT P.LTD. (MERGED WITH NIRMA LTD) NIRMA HOUSE, ASHRAM ROAD AHMEDABAD 380009. PAN : AALCS 7628 G. VS. DCIT, CIR.4(1)(1) AMBAWADI AHMEDABAD. ( APPLICANT ) ( RESPONENT ) ASSESSEE BY : SHRI VIRENDRA OJHA, SR.DR REVENUE BY : SHRI HIMANSHU SHAH, AR / DATE OF HEARING : 24/11/2020 / DATE OF PRONOUNCEMENT: 27/11/2020 56/ O R D E R PER RAJPAL YADAV, VICE-PRESIDENT ASSESSEE IS IN APPEAL AGAINST ORDER OF LD.CIT(A)-8, AHMEDABAD DATED 14.8.2018 FOR THE ASSTT.YEAR 2013-14. 2. ONLY GRIEVANCE INVOLVED IN THIS APPEAL IS THAT T HE LD.CIT(A) HAS ERRED IN CONFIRMING PENALTY UNDER SECTION 271(1)(B) OF THE I NCOME TAX ACT, 1961 AMOUNTING TO RS.10,000/-. 3. AS THE FACTS EMERGES FROM THE RECORD, IN RESPONS E TO THE RETURN OF INCOME FILED BY THE ASSESSEE ON 29.11.2013 DECLARI NG TOTAL LOSS AT RS. (-) 7,84,02,992/-, THE CASE OF THE ASSESSEE WAS SELECT ED FOR SCRUTINY ASSESSMENT UNDER SECTION 143(2) ON 4.9.2014. AFTER CONSIDERIN G THE DETAILS AND ITA NO.1965/AHD/2018 2 EXPLANATIONS OF THE ASSESSEE, THE ASSESSMENT WAS FI NALIZED AT RS.59,72,264/- UNDER SECTION 143(3) OF THE ACT. HOWEVER, IN THE M EANWHILE, PENALTY UNDER SECTION 271(1)(B) OF THE ACT WAS INITIATED AND LEVI ED AN AMOUNT OF RS.10,000/- FOR NON-COMPLIANCE OF NOTICE DATED 2.2.2016 ISSUED UNDER SECTION 142(1) OF THE ACT. THIS LEVY OF PENALTY BY THE AO UNDER SECT ION 271(1)(B) OF THE ACT WAS CHALLENGED BEFORE THE FIRST APPELLATE AUTHORITY , BUT GOT NO RELIEF. THEREFORE, ASSESSEE IS BEFORE THE TRIBUNAL CHALLENG ING ACTION OF THE REVENUE AUTHORITIES IN IMPOSITION OF PENALTY UNDER SECTION 271(1)(B) OF THE ACT. 4. BEFORE US, THE LD.COUNSEL FOR THE ASSESSEE SUBMI TTED THAT NON- COMPLIANCE OF NOTICE DATED 2.2.2016 ISSUED DURING T HE COURSE OF ASSESSMENT PROCEEDINGS WAS IN FACT GOT MISPLACED BY THE CLERK OF THE ASSESSEE. HOWEVER, ASSESSEES REPRESENTATIVES ATTENDED THE HEARING BEF ORE THE AO AND SUBMITTED REQUIRED DETAILS, AND COMPLIED WITH VARIOUS NOTICES ISSUED DURING THE COURSE OF HEARING. WHILE FINALIZING ASSESSMENT UNDER SECT ION 143(3) OF THE ACT, THE LD.AO HAS IN FACT NOTED THIS FACT IN THE ASSESSMENT ORDER, THEREFORE, THERE IS NO DEFAULT ON THE PART OF THE ASSESSEE SO AS TO ATTRAC T PROVISION OF SECTION 271(1)(B) OF THE ACT. HE FURTHER SUBMITTED THAT W HEN ASSESSMENT WAS FRAMED UNDER SECTION 143(3) AND NOT UNDER SECTION 144 OF T HE ACT, ON THE BASIS OF DETAILS SUBMITTED, THEN ASSESSEE CANNOT BE TREATED AS NON-COOPERATIVE, WHICH NECESSITATES IMPOSITION OF PENALTY UNDER SECTION 27 1(1)(B). IN SUPPORT OF HIS SUBMISSIONS, THE LD.COUNSEL FOR THE ASSESSEE RELIED UPON DECISION OF ITAT, AHMEDABAD BENCH IN THE CASE OF RAJ ENTERPRISE IN IT A NO.958/AHD/2011 DATED 4.3.2015, AND DECISION IN THE CASE OF KANAK C ASTOR P.LTD., ITA NO.1810/AHD/2012 DATED 29.6.2016. ACCORDINGLY, HE S UBMITTED THAT THERE IS NO SUFFICIENT REASON FOR THE REVENUE AUTHORITIES IN IMPOSITION OF IMPUGNED PENALTY WHICH DESERVES TO BE DELETED. ON THE OTHE R HAND, THE LD.CIT-DR SUPPORTED THE CASE OF THE REVENUE AND RELIED ON THE IR ORDERS. ITA NO.1965/AHD/2018 3 5. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND GONE TH ROUGH THE RECORD CAREFULLY. THE CASE OF THE REVENUE IS THAT SINCE A SSESSEE HAS NOT COMPLIED WITH NOTICE DATED 2.2.206 ISSUED DURING THE COURSE OF ASSESSMENT PROCEEDINGS, LEVY OF PENALTY UNDER SECTION 271(1)(B) OF THE ACT IS JUSTIFIED. HOWEVER, THE FACT IS THAT IN THE ASSESSMENT FRAMED UNDER SECTION 143(3) OF THE ACT, THE ASSESSEES REPRESENTATIVE ATTENDED THE HEARING AND SUBMITTED REQUIRED DETAILS DURING THE COURSE OF HEARING, AND BASED ON THE SAME , ASSESSMENT WAS FRAMED. THIS FACT HAS BEEN RECORDED BY THE AO IN THE ASSESS MENT ORDER ITSELF, THEREFORE, IT CANNOT BE STATED THAT THE ASSESSEE WA S NON-COOPERATIVE AND IN DEFAULT SO AS TO ATTRACT PENALTY UNDER SECTION 271( 1)(B) OF THE ACT. IN THE CASE LAWS RELIED UPON BY THE LD.COUNSEL FOR THE ASSESSEE CITED (SUPRA), ITAT HELD THAT WHEN AN ASSESSMENT WAS MADE UNDER SECTION 143( 3) AND NOT UNDER SECTION 144 OF THE ACT, SUBSEQUENT COMPLIANCE IN THE ASSESS MENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE SO AS TO MITIGATE ONE SINGLE INSTANCE OF DEFAULT COMMITTED EARLIER, AND IGNORED BY THE AO WHILE FRAM ING ASSESSMENT UNDER SECTION 143(3), LEVY OF PENALTY UNDER SECTION 271(1 )(B) OF THE ACT IS NOT JUSTIFIABLE. IN THE INSTANT CASE, WE DO NOT FIND A NY COMPELLING REASONS TO IMPOSE PENALTY UNDER SECTION 271(1)(B) OF THE ACT, AND THEREFORE, WE DELETE THE SAME AND CANCEL THE ORDERS OF THE REVENUES AUT HORITIES PASSED UNDER SECTION 271(1)(B) OF THE ACT. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE COURT ON 27 TH NOVEMBER, 2020 AT AHMEDABAD. S D / - (PRADIPKUMAR KEDIA) ACCOUNTANT MEMBER S D / - (RAJPAL YADAV) VICE-PRESIDENT AHMEDABAD; DATED 27/11/2020