G.D. Educational Society, Noida V. CIT(A)- 1, Noida

ITA 1997/DEL/2018

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 6059 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 22-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR SENIOR
• Keywords: Principle of natural justice; Benefit of exemption; Set aside
• Section: 271(1)(c); 143(3); 12A; 201; 12; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH C : NEW DELHI) BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI KULDIP SINGH, JUDICIAL MEMBER (THROUGH VIDEO CONFERENCE) ITA NO.1997/DEL./2018 (ASSESSMENT YEAR : 2009-10) ITA NO.1999/DEL./2018 (ASSESSMENT YEAR : 2013-14) G.D. EDUCATIONAL SOCIETY, VS. CIT (A) 1, 73, SECTOR 34, NOIDA. NOIDA 201 301. (PAN : AAATG0992E) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SOMIL AGGARWAL, ADVOCATE REVENUE BY : SHRI RAJESH KUMAR, SENIOR DR DATE OF HEARING : 02.09.2021 DATE OF ORDER : 02.09.2021 O R D E R PER KULDIP SINGH, JUDICIAL MEMBER : APPELLANT, G.D. EDUCATION SOCIETY (HEREINAFTER REFERRED TO AS THE ASSESSEE SOCIETY) BY FILING THE PRESENT APPEA LS SOUGHT TO SET ASIDE THE IMPUGNED ORDERS BOTH DATED 25.09.2017 PAS SED BY THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, NOIDA QUA T HE ITA NO.1997/DEL./2018 ITA NO.1999/DEL./2018 2 ASSESSMENT YEARS 2009-10 & 2013-14 ON THE IDENTICAL GROUNDS EXCEPT THE DIFFERENCE IN AMOUNT INTER ALIA THAT:- 1. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANC ES OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN I MPOSING PENALTY U/S 271(1)(C) ON THE ENHANCED INCOME (RS.L, 59,84,559/- & RS.3,96,46,053/- FOR AYS 2009-10 & 2013-14 RESPECTI VELY) AND THAT TOO WITHOUT .ASSUMING JURISDICTION AS PER LAW AND T HAT TOO WITHOUT QUANTIFYING THE PENALTY AMOUNT AND THE IMPUGNED PEN ALTY ORDER BEING ILLEGAL AND VOID AB-INITIO AND WITHOUT CONSID ERING THE SUBMISSIONS OF ASSESSEE AND WITHOUT OBSERVING THE P RINCIPLES OF NATURAL JUSTICE AND IN ANY CASE IS BARRED BY LIMITA TION. 2. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN I MPOSING PENALTY U/S 271(1)(C) AND THAT TOO WITHOUT RECORDIN G MANDATORY 'SATISFACTION' AS PER LAW. 3. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN I MPOSING THE IMPUGNED PENALTY AND PASSING THE IMPUGNED PENALTY O RDER AND THAT TOO . WITHOUT RECORDING THE MANDATORY SATISFAC TION AS PER LAW AND WITHOUT ISSUING/SERVING VALID NOTICE U/S 271(1) (C) AND WITHOUT LEVYING A CLEAR CHARGE WHETHER THERE WAS CONCEALMEN T OF INCOME OR FURNISHING OF INACCURATE PARTICULARS. 4. THAT HAVING REGARD TO THE FACTS AND CIRCUMSTANCE S OF THE CASE, LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN P ASSING THE IMPUGNED PENALTY ORDER BASED ON INCORRECT FACTS THA T IN QUANTUM PROCEEDINGS THE APPELLANT HAS NOT FILED ANY APPEAL BEFORE HON'BLE ITAT, WHEREAS AN APPEAL HAS BEEN PREFERRED BEFORE H ON'BLE ITAT AGAINST THE APPELLATE ORDER AND THIS VERY FACT HAS BEEN CONVEYED BEFORE LD. CIT(A) VIDE LETTER DATED 24-08- 2017. 5. THAT IN ANY CASE AND IN ANY VIEW OF THE MATTER, ACTION OF LD. CIT(A) IN IMPOSING PENALTY U/S 271(1)(C), IS BA D IN LAW AND AGAINST THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. BRIEFLY STATED THE FACTS NECESSARY FOR ADJUDICAT ION OF THE CONTROVERSY AT HAND ARE : ASSESSEE SOCIETY BEING RE GISTERED UNDER SECTION 12A OF THE INCOME-TAX ACT, 1961 (FOR SHORT THE ACT) FILED RETURN OF INCOME FOR ASSESSMENT YEARS 2009-10 & 201 3-14 CLAIMING NIL INCOME, HOWEVER ASSESSING OFFICER (AO) AFTER TREATING ITA NO.1997/DEL./2018 ITA NO.1999/DEL./2018 3 THE ASSESSEE SOCIETY AS A COMMERCIAL ENTITY HAS W ITHDRAWN THE BENEFIT OF EXEMPTION FROM INCIDENCE OF TAX AS CLAIM ED U/S 11 OF THE ACT AND HAS MADE ADDITION OF RS.2,64,215/- & RS.9,5 4,275/- FOR AYS 2009-10 & 2013-14 RESPECTIVELY. ASSESSMENT FRA MED BY THE AO HAS BEEN UPHELD BY THE LD. CIT (A). 3. ASSESSEE CARRIED THE MATTER BEFORE THE TRIBUNAL BY WAY OF FILING THE APPEALS WHO HAS ACCEPTED THE APPEALS FOR STATISTICAL PURPOSES BY REMITTING THE CASE BACK TO AO TO DECIDE AFRESH. 4. IN THE MEANTIME, LD. CIT (A) ALSO ASSUMED THE JU RISDICTION TO INITIATE THE PENALTY PROCEEDINGS AGAINST THE ASSESS EE SOCIETY U/S 271(1)(C) OF THE ACT AND THEREBY ORDERED TO LEVY TH E PENALTY ON THE ENHANCED INCOME ON THE ASSUMPTION, RECORDED IN PARA 3 OF THE PENALTY ORDER, THAT, AS THE ASSESSEE HAS NOT FILED APPEAL BEFORE THE TRIBUNAL, THE PENDING PENALTY PROCEEDINGS ARE TO BE INITIATED IN TERMS OF SECTION 275 OF THE ACT AS THE APPLICABLE L IMITATION DATE IS 30.09.2017. 5. FEELING AGGRIEVED WITH THE PENALTY ORDER, THE AS SESSEE SOCIETY HAS COME UP BEFORE THE TRIBUNAL BY WAY OF F ILING THE PRESENT APPEALS. 6. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVES OF THE PARTIES TO THE APPEAL, GONE THROUGH THE DOCUMENTS R ELIED UPON AND ITA NO.1997/DEL./2018 ITA NO.1999/DEL./2018 4 ORDERS PASSED BY THE REVENUE AUTHORITIES BELOW IN T HE LIGHT OF THE FACTS AND CIRCUMSTANCES OF THE CASE. 7. UNDISPUTEDLY, ASSESSEE BEING A SOCIETY REGISTERE D U/S 12A OF THE ACT FILED RETURN DECLARING INCOME AT NIL FOR AY S 2009-10 & 2013-14 CLAIMING EXEMPTION U/S 11 OF THE ACT IN THE STATUS OF AOP(T), WHICH WAS SUBJECTED TO SCRUTINY. IT IS ALS O NOT IN DISPUTE THAT AO DENIED THE BENEFIT OF SECTIONS 11 & 12 OF T HE ACT TO THE ASSESSEE SOCIETY AND THEREBY FRAMED THE ASSESSMENT AT THE TOTAL INCOME OF RS.6,92,430/- & RS.81,63,605/- FOR AYS 20 09-10 & 2013-14 RESPECTIVELY. IT IS ALSO NOT IN DISPUTE TH AT THE LD. CIT(A) HAS ENHANCED THE ASSESSED INCOME OF THE ASSESSEE SO CIETY TO RS.1,59,84,559/- & RS.3,96,46,053/- FOR AYS 2009-10 & 2013-14 RESPECTIVELY. 8. LD. AR FOR THE ASSESSEE CHALLENGING THE IMPUGNED PENALTY ORDERS PASSED BY THE LD. CIT (A) CONTENDED THAT WHE N INCOME FOR YEAR UNDER ASSESSMENT HAS BEEN ASSESSED AT N IL BY THE AO IN DE NOVO ASSESSMENT PURSUANT TO THE ORDER PASSED BY THE COORDINATE BENCH OF THE TRIBUNAL VIDE ORDER DATED 3 0.07.2018 IN ITA NOS.3923/DEL/2017 & 3925/DEL/2017 FOR AYS 20 09-10 & 2013-14 RESPECTIVELY, PENALTY LEVIED IN THESE CASES IS NOT SUSTAINABLE AND PLACED ON RECORD THE ORDER DATED 30 .07.2018 (SUPRA) PASSED BY THE TRIBUNAL. ITA NO.1997/DEL./2018 ITA NO.1999/DEL./2018 5 9. HOWEVER, ON THE OTHER HAND, LD. DR FOR THE REVEN UE HAS RELIED UPON THE ORDER PASSED BY THE LD. CIT (A). 10. WHEN UNDISPUTEDLY ASSESSMENT HAS BEEN FRAMED IN THESE CASES U/S 143(3) READ WITH SECTION 254 OF THE ACT V IDE ORDER DATED 10.12.2019 AT NIL INCOME FOR BOTH THE YEARS, CONS EQUENTIAL PENALTY LEVIED BY THE LD. CIT (A) IS NOT SUSTAINABL E, WHO HAS ASSUMED THE JURISDICTION BY RECORDING THE FACT THAT NO APPEAL BEFORE THE TRIBUNAL IS PENDING. SO, WE ARE OF THE CONSIDE RED VIEW THAT WHEN NO ADDITION HAS BEEN MADE AND ASSESSMENT HAS B EEN FRAMED AT NIL INCOME FOR BOTH THE YEARS BY EXTENDING BEN EFIT OF SECTIONS 11 & 12 OF THE ACT, PENALTY LEVIED IN THIS CASE IS NOT SUSTAINABLE IN THE EYES OF LAW, HENCE ORDERED TO BE DELETED. CONS EQUENTLY, BOTH THE APPEALS FILED BY THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON THIS 2 ND DAY OF SEPTEMBER, 2021 AFTER THE CONCLUSION OF THE HEARING THROUGH VIDEO C ONFERENCE. SD/- SD/- (N.K. BILLAIYA) (KULDIP SIN GH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED THE 2 ND DAY OF SEPTEMBER, 2021 TS ITA NO.1997/DEL./2018 ITA NO.1999/DEL./2018 6 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-I, NOIDA. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.