Asadullah Khan, Mysore V. Income Tax Officer, ward-1, Mandya

ITA 2077/BANG/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0642 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 18-12-2019
• Assessment Year: 2007-2008
• Appeal Filed On: 25-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KARUPPUSAMY
• Keywords: Period of limitation; Time period of passing order; Set aside
• Section: 246A; 246; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI B.R BASKARAN, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER ITA NOS.2077 & 2078/BANG/2018 ASSESSMENT YEAR : 2007-08 ITA NOS.2079 & 2080/BANG/2018 ASSESSMENT YEAR : 2008-09 ASADULLAH KHAN, NO.35/B, C/O RAM RATHANGE & CO, LEENA POINT, 2 ND FLOOR, OPP PUNJAB NATIONAL BANK, DD URS ROAD, MYSORE-570 001. PAN AINPA 6942 N VS. THE INCOME-TAX OFFICER, WARD-1, MANDYA. APPELLANT RESPONDENT ITA NOS.2081 & 2082/BANG/2018 ASSESSMENT YEAR : 2007-08 ITA NOS.2083 & 2084/BANG/2018 ASSESSMENT YEAR : 2008-09 ITA NO.2085/BANG/2018 ASSESSMENT YEAR : 2009-10 AYESHA NAJAM, NO.35/B, C/O RAM RATHANGE & CO, LEENA POINT, 2 ND FLOOR, OPP PUNJAB NATIONAL BANK, DD URS ROAD, MYSORE-570 001. PAN ADWPN 1511 E VS. THE INCOME-TAX OFFICER, WARD-1, MANDYA. APPELLANT RESPONDENT ITA NO.2077 - 2080 /BANG/2018 PAGE 2 OF 7 APPELLANT BY : SHRI NARENDRA SHARMA, ADVOCATE RESPONDENT BY : SHRI KARUPPUSAMY, ADDL. CIT (DR) DATE OF HEARING : 18.12.2019 DATE OF PRONOUNCEMENT : .12.2019 O R D E R PER BENCH:- ALL THE APPEALS FILED BY THE RESPECTIVE ASSESSEES ARE DIRECTED AGAINST THE ORDERS PASSED BY LD CIT(A)- MYSURU AND THEY RELATE TO THE ASSESSMENT YEARS MENTIONED IN THE CAPTION. COM MON ISSUE URGED IN ALL THESE APPEALS RELATE TO THE PENALTY LE VIED BY THE AO U/S 271(1)(B)/271F, AS THE CASE MAY BE, AND CONFIRMED B Y LD CIT(A). 2. ALL THE APPEALS WERE HEARD TOGETHER, SINCE T HE LEGAL ISSUE URGED BY THE ASSESSEE BY WAY OF ADDITIONAL GROUND IS IDEN TICAL IN NATURE IN ALL THE APPEALS. 3. IN THE ADDITIONAL GROUND URGED IN ALL THE A PPEALS, BOTH THE ASSESSEES ARE CONTENDING THAT THE PENALTY ORDERS PA SSED BY THE AO IN ALL THESE APPEALS ARE BARRED BY LIMITATION. 4. SINCE THE ADDITIONAL GROUND URGED BY BOTH TH E ASSESSEES IS LEGAL IN NATURE AND SINCE ALL THE MATERIALS RELATIN G THERETO ARE AVAILABLE ON RECORD, WE ADMIT THE ADDITIONAL GROUND IN ALL THE APPEALS. ITA NO.2077 - 2080 /BANG/2018 PAGE 3 OF 7 5. THE LD A.R SUBMITTED THAT THE ASSESSING OFFI CER HAS INITIATED PENALTY PROCEEDINGS U/S 271(1)(B)/271F OF THE ACT, AS THE CASE MAY BE, IN ALL THESE CASES BY ISSUING NOTICE DATED 26.0 3.2013, WHICH WAS SERVED UPON THE RESPECTIVE ASSESSEES ON 28-03-2 013. HOWEVER, THE ASSESSING OFFICER HAS PASSED ALL THE PENALTY OR DERS ONLY ON 26- 12-2016, I.E., AFTER EXPIRY OF ALMOST THREE AND HA LF YEARS. THE LD A.R SUBMITTED THAT THE LIMITATION PROVIDED IN THE P ROVISIONS OF SEC. 275(1)(C) SHALL APPLY IN RESPECT OF BOTH THE PENALT IES REFERRED ABOVE FOR COMPUTING THE LIMITATION PERIOD AVAILABLE WITH THE AO FOR IMPOSITION OF PENALTY. HE SUBMITTED THAT, AS PER C LAUSE (C) OF SUB- SECTION (1) OF SEC.275, THE PENALTY ORDERS SHOULD H AVE BEEN PASSED (A) BEFORE THE EXPIRY OF FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED (OR) (B) SIX MONTHS FROM THE END OF THE MONTH IN WHICH A CTION FOR IMPOSITION OF PENALTY IS INITIATED, WHICHEVER PERIOD EXPIRES LATER . HE SUBMITTED THAT THE AO HAS INITIATED PENALTY PROC EEDINGS ON 26.3.2013 DURING THE COURSE OF ASSESSMENT PROCEEDIN GS AND HENCE HE SHOULD HAVE COMPLETED THE PROCEEDINGS LATEST BY 30-09-2013. HE SUBMITTED THAT THE AO HAS, HOWEVER, PASSED THE I MPUGNED PENALTY ORDERS ONLY ON 26.12.2016 AND HENCE THE IMP UGNED PENALTY ORDERS ARE BARRED BY LIMITATION. ACCORDINGLY HE SU BMITTED THAT THE IMPUGNED PENALTY ORDERS ARE LIABLE TO BE QUASHED ON THIS LEGAL GROUND. 6. WE HEARD LD D.R, WHO DID NOT CONTROVERT THE F ACTUAL ASPECTS PRESENTED BY LD A.R. THE PROVISIONS OF SEC.275 OF THE ACT ITA NO.2077 - 2080 /BANG/2018 PAGE 4 OF 7 PRESCRIBES TIME LIMIT FOR IMPOSITION OF PENALTIES. THE SAID PROVISION READS AS UNDER:-. 275. (1) NO ORDER IMPOSING A PENALTY UNDER THIS CH APTER SHALL BE PASSED (A) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTHE R ORDER IS THE SUBJECT-MATTER OF AN APPEAL TO THE COMMISSIONER (AP PEALS) UNDER SECTION 246 OR SECTION 246A OR AN APPEAL TO THE APP ELLATE TRIBUNAL UNDER SECTION 253, AFTER THE EXPIRY OF THE FINANCIA L YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR SIX M ONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE COMMISSI ONER (APPEALS) OR, AS THE CASE MAY BE, THE APPELLATE TRIBUNAL IS R ECEIVED BY THE PRINCIPAL CHIEF COMMISSIONER OR CHIEF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIONER, WHICHEVER PERIOD EXPI RES LATER : PROVIDED THAT IN A CASE WHERE THE RELEVANT ASSESSME NT OR OTHER ORDER IS THE SUBJECT-MATTER OF AN APPEAL TO THE COM MISSIONER (APPEALS) UNDER SECTION 246 OR SECTION 246A, AND TH E COMMISSIONER (APPEALS) PASSES THE ORDER ON OR AFTER THE 1ST DAY OF JUNE, 2003 DISPOSING OF SUCH APPEAL, AN ORDER IMPOSING PENALTY SHALL BE PASSED BEFORE THE EXPIRY OF THE FINANCIAL YEAR IN WHICH TH E PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR IMPOSITION OF PENALT Y HAS BEEN INITIATED, ARE COMPLETED, OR WITHIN ONE YEAR FROM T HE END OF THE FINANCIAL YEAR IN WHICH THE ORDER OF THE COMMISSION ER (APPEALS) IS RECEIVED BY THE PRINCIPAL CHIEF COMMISSIONER OR CHI EF COMMISSIONER OR PRINCIPAL COMMISSIONER OR COMMISSIO NER, WHICHEVER IS LATER; (B) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTHE R ORDER IS THE SUBJECT-MATTER OF REVISION UNDER SECTION 263 OR SEC TION 264, AFTER THE ITA NO.2077 - 2080 /BANG/2018 PAGE 5 OF 7 EXPIRY OF SIX MONTHS FROM THE END OF THE MONTH IN W HICH SUCH ORDER OF REVISION IS PASSED; (C) IN ANY OTHER CASE, AFTER THE EXPIRY OF THE FIN ANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR SIX M ONTHS FROM THE END OF THE MONTH IN WHICH ACTION FOR IMPOSITION OF PENALTY IS INITIATED, WHICHEVER PERIOD EXPIRES LATER . 7. AS RIGHTLY POINTED OUT BY LD A.R, CLAUSE (C) O F SUB-SECTION (1) OF SEC.275 SHALL APPLY TO THE IMPUGNED PENALTIES. ACC ORDING TO CLAUSE (C), THE TIME LIMIT IS (A) EXPIRY OF FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED OR SIX MO NTHS FROM THE END OF THE MONTH IN WHICH ACTION FOR IMPOSITION OF PENALTY IS INITIATED, WHICHEVER PERIOD EXPIRES LATER. 8. IN THE INSTANT CASE, THE PENALTY PROCEEDINGS HAVE BEEN INITIATED IN MARCH, 2013, I.E., MAY BE DURING THE C OURSE OF ASSESSMENT PROCEEDINGS. HENCE THE FIRST TIME LIMIT PRESCRIBED IN CLAUSE (C) IS THE EXPIRY OF FINANCIAL YEAR IN WHICH THE ASSESSMENT PROCEEDINGS WAS COMPLETED, I.E., 31.3.2013. THE SE COND TIME LIMIT IS SIX MONTHS FROM THE END OF THE MONTH IN WHICH AC TION FOR IMPOSITION OF PENALTY IS INITIATED, I.E., 30-09-201 3. THUS THE LATER TIME LIMIT BEING 30-09-2013, THE AO SHOULD HAVE PAS SED THE PENALTY ORDERS LATEST BY 30-09-2013. HOWEVER THE I MPUGNED PENALTY ORDERS HAVE BEEN PASSED BY THE AO ONLY ON 2 6-12-2016. HENCE THEY ARE BARRED BY LIMITATION. ACCORDINGLY T HERE IS MERIT IN ITA NO.2077 - 2080 /BANG/2018 PAGE 6 OF 7 THE CONTENTIONS OF THE ASSESSEE THAT ALL THE PENALT Y ORDERS ARE LIABLE TO BE QUASHED AS THEY ARE BARRED BY LIMITATION. 9. ACCORDINGLY, WE SET ASIDE ALL THE IMPUGNED O RDERS PASSED BY LD CIT(A) AND QUASH THE PENALTY ORDERS PASSED BY TH E AO. 10. SINCE WE HAVE QUASHED THE PENALTY ORDERS ON THE POINT OF LIMITATION, THERE IS NO NECESSITY TO ADJUDICATE THE GROUNDS URGED ON MERITS. 11. IN THE RESULT, ALL THE APPEALS ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 19 TH DECEMBER, 2019. SD/ - (PAVAN KUMAR GADALE) JUDICIAL MEMBER SD/ - (B.R BASKARAN) ACCOUNTANT MEMBER BANGALORE, DATED, THE 19 TH DECEMBER , 2019. /VMS/ COPY TO: 1. APPELLANT (S) / CROSS OBJECTOR(S) 2. RESPONDENT(S) 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASST. REGISTRAR ITAT, BANGALORE ITA NO.2077 - 2080 /BANG/2018 PAGE 7 OF 7 1. DATE OF DICTATION 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO SR.P.S .. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER .. 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE S R. P.S. .. 6. DATE OF UPLOADING THE ORDER ON WEBSITE.. 7. IF NOT UPLOADED, FURNISH THE REASON FOR DOING SO .. 8. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 9. DICTATION NOTE ENCLOSED DATE ON WHICH ORDER GOES FOR XEROX & ENDORSEMENT 10. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 11. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER . 12. THE DATE ON WHICH THE FILE GOES TO DISPATCH SEC TION FOR DISPATCH OF THE TRIBUNAL ORDER . 13. DATE OF DESPATCH OF ORDER. . 14. DICTATION NOTE ENCLOSED