Mangal Tech Park Private Limited, CHENNAI V. DCIT, CHENNAI

ITA 2084/CHNY/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9077 (ITAT-CHENNAI)
• Duration Of Justice: 7 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 04-05-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 28-10-2015
• Court: TRIBUNAL
• Assessee Lawyers: DR ANITA SUMANTH
• Keywords: Charitable institution; Period of limitation; Reasonable cause; Time period of passing order

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NOS.1439/MDS/2014 & 2084/MDS/2015 / ASSESSMENT YEAR : 2008-09 M/S MANGAL TECH PARK PVT. LTD SPENCER PLAZA NO.769, ANNA SALAI CHENNAI 600 002 VS. THE DY. COMMISSIONER OF INCOME-TAX COMPANY CIRCLE IV(1) CHENNAI [PAN AAECM 6101 F ] ( &' / APPELLANT) ( ()&' /RESPONDENT) / APPELLANT BY : DR. ANITA SUMANTH, ADVOCATE /RESPONDENT BY : SHRI B. KOTESWARA RAO, CIT / DATE OF HEARING : 04 - 05 - 2016 ! / DATE OF PRONOUNCEMENT : 17 - 0 6 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THE ASSESSEE FILED BOTH THE APPEALS AGAINST THE RESPECTIVE ORDERS OF THE COMMISSIONER OF INCOME-TAX (APPEALS) FOR ASSESSMENT YEAR 2008-09. I.T.A.NO.1439/MDS/2014 IS DIRECTED A GAINST THE ORDER OF THE CIT(A) CONFIRMING THE ASSESSMENT ORDER. I.T .A.NO.2084/ MDS/2015 IS DIRECTED AGAINST THE ORDER OF THE CIT(A ) CONFIRMING THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THEREF ORE, WE HEARD BOTH THE APPEALS TOGETHER AND DISPOSING OF THE SAME BY T HIS COMMON ORDER. ITA NO. 1439/14 2084/15 :- 2 -: 2. DR. ANITA SUMANTH, LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE ASSESSEE DONATED AN AMOUNT OF ` 2,25,00,000/- TO THREE CHARITABLE INSTITUTIONS AND CLAIMED EXEMPTION U/S 35AC OF THE ACT. THE DONATIONS WERE MADE THROUGH BANKING CHANNELS BY WAY OF DEMAND DRAFTS, ACCOUNT PAYEE CHEQUES AND TRANSACTIO N THROUGH RTGS. THE AMOUNTS WERE IN FACT CREDITED TO THE BANK ACCOU NT OF THE TRUSTS TO WHOM THE MONEY WAS DONATED. ALL THE THREE TRUSTS W ERE APPROVED U/S 35AC OF THE ACT. THE ASSESSING OFFICER MADE EN QUIRY BEHIND THE BACK OF THE ASSESSEE AND CAME TO THE CONCLUSION TH AT THE TRUSTS HAD NOT RECEIVED THE MONEY DONATED BY THE ASSESSEE. T HE ASSESSING OFFICER OBSERVED IN THE ASSESSMENT ORDER THAT THE S ECRETARY OF THE TRUST WAS EXAMINED. ACCORDING TO THE LD. COUNSEL, THE ERSTWHILE SECRETARY WAS EXAMINED BY THE ASSESSING OFFICER AND NOT THE PRESENT SECRETARY. MOREOVER, NO OPPORTUNITY WAS GIVEN TO T HE ASSESSEE FOR CROSS-EXAMINATION. THE ASSESSING OFFICER DISALLOWE D THE CLAIM OF THE ASSESSEE BY HOLDING THAT THE DONATIONS MADE BY THE ASSESSEE TO THREE DIFFERENT TRUSTS ARE NOT GENUINE. THE MATTER WAS CARRIED BY WAY OF APPEAL BEFORE THE CIT(A). DURING THE PENDENCY OF A PPEAL BEFORE THE CIT(A), THE ASSESSEE-COMPANY WAS IN THE PROCESS OF WINDING UP, THEREFORE, THE COMPANY WANTED TO SETTLE THE ISSUE P EACEFULLY WITH THE DEPARTMENT. ACCORDINGLY, THE DONATIONS MADE TO THE EXTENT OF ` ITA NO. 1439/14 2084/15 :- 3 -: 2,25,00,000/- WAS NOT PRESSED BEFORE THE CIT(A). T HE CIT(A) DISMISSED THE ISSUE AS NOT PRESSED. 3. SUBSEQUENTLY, THE ASSESSING OFFICER JUST 11 DAYS BE FORE THE EXPIRY OF LIMITATION FOR INITIATING PROCEEDINGS U/ S 271(1)(C) OF THE ACT ISSUED SHOW CAUSE NOTICE FOR INITIATING PENALTY PR OCEEDINGS AGAINST THE ASSESSEE. THE ASSESSEE EXPLAINED BEFORE THE ASSES SING OFFICER THAT THE ANTECEDENTS OF THE RECIPIENT DONEES WERE VERIFI ED THROUGH THE WEBSITE AND IT WAS ALSO DISCLOSED IN THE WEBSITE TH E APPROVAL OF THE NATIONAL COMMITTEE. THE LD. COUNSEL FURTHER SUBMIT TED THAT ALL THE THREE TRUSTS ARE GENUINE TRUSTS AND IN FACT, APPROV ED BY THE NATIONAL COMMITTEE U/S 35AC OF THE ACT. REFERRING TO THE P ENALTY ORDER, THE LD. COUNSEL SUBMITTED THAT THE ASSESSING OFFICER HA S NOT REAPPRECIATED THE MATERIAL AVAILABLE ON RECORD IN THE PENALTY PRO CEEDINGS. THE ASSESSING OFFICER HAS SIMPLY REFERRED TO THE FACT O F DISMISSAL OF THE APPEAL AS NOT PRESSED BY THE CIT(A) AND FOUND THAT THE ASSESSEE CONCEALED THE PARTICULARS OF ITS INCOME AND FURNISH ED INACCURATE PARTICULARS. ACCORDING TO THE LD. COUNSEL, MERELY BECAUSE THE ASSESSEE HAS NOT PRESSED THE ISSUE WITH REGARD TO D ONATION OF ` 2,25,00,000/- BEFORE THE CIT(A), THAT WOULD NOT AUT OMATICALLY RESULT IN LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THERE MAY BE VARIOUS REASONS FOR NOT ARGUING THE CASE ON MERIT BEFORE TH E CIT(A). THE LD. COUNSEL FURTHER SUBMITTED THAT THE PENALTY PROCEEDI NG IS SEPARATE AND ITA NO. 1439/14 2084/15 :- 4 -: DISTINCT THAN THE ASSESSMENT PROCEEDINGS. THEREFORE , EVEN IF THE ASSESSEE AGREED FOR ADDITION IN THE ASSESSMENT PRO CEEDINGS, THAT CANNOT BE A REASON FOR LEVY OF PENALTY U/S 271(1)( C) OF THE ACT. THE ASSESSING OFFICER HAS TO INDEPENDENTLY EXAMINE THE FACTS ON RECORD BEFORE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. IN THE PRESENT CASE, ACCORDING TO THE LD. COUNSEL, IT IS NOT IN DISPUTE THAT ALL THE THREE TRUSTS TO WHOM THE ASSESSEE DONATED FUNDS ARE APPR OVED BY THE NATIONAL COMMITTEE U/S 35AC. THE IDENTITY OF THE TRUSTS TO WHOM THE MONEY WAS DONATED IS NOT IN DISPUTE. THE FUNDS WER E, IN FACT, TRANSFERRED THROUGH BANKING CHANNELS AND THE FUNDS WERE CREDITED IN THE ACCOUNTS OF THE RESPECTIVE TRUSTS MAINTAINED WI TH AXIS BANK. THEREFORE, IT CANNOT BE SAID THAT THE ASSESSEE HAS FURNISHED INACCURATE PARTICULARS OF ITS INCOME AND HENCE, THE CIT(A) IS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIED BY THE A SSESSING OFFICER U/S 271(1)(C) OF THE ACT. 4. REFERRING TO THE DELAY OF 683 DAYS IN FILING THE AP PEAL IN I.T.A.NO.1439/MDS/2014 BEFORE THIS TRIBUNAL, THE LD . COUNSEL SUBMITTED THAT SINCE THE ASSESSEE HAS NOT PRESSED THE ISSUE OF DONATION OF ` 2,25,00,000/- BEFORE THE CIT(A), INITIALLY, THE ASSESSEE COULD NOT FILE THE APPEAL. SINCE PENALTY PROCEEDI NG WAS INITIATED JUST BEFORE EXPIRY OF THE LIMITATION PERIOD, THE ASSESS EE WAS COMPELLED TO FILE THE APPEAL AGAINST THE QUANTUM ADDITION CONFIR MED BY THE CIT(A) ITA NO. 1439/14 2084/15 :- 5 -: ALSO. THEREFORE, THE LD. COUNSEL SUBMITTED THAT TH E DELAY OF 683 DAYS IN FILING THE APPEAL BEFORE THIS TRIBUNAL MAY BE CO NDONED AND THE APPEAL OF THE ASSESSEE MAY BE ADJUDICATED ON MERIT . 5. NOW, COMING TO THE MERIT OF THE ADDITION, THE LD. C OUNSEL SUBMITTED THAT THE ASSESSING OFFICER MADE ENQUIRY B EHIND THE BACK OF THE ASSESSEE WITHOUT GIVING ANY OPPORTUNITY FOR CR OSS EXAMINATION. THEREFORE, THE LD. COUNSEL SUBMITTED THAT AN OPPORT UNITY MAY BE PROVIDED TO THE ASSESSEE FOR CROSS EXAMINATION OF THE SO CALLED SECRETARY WHO WAS EXAMINED BY THE ASSESSING OFFICER . 6. ON THE CONTRARY, SHRI B. KOTESWARA RAO, LD. DEPARTM ENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSING OFFICER MADE A THOROUGH INVESTIGATION WITH REGARD TO THE TRANSACTION OF THE SO CALLED DONATIONS SAID TO BE GIVEN BY THE ASSESSEE. THE ASSESSING O FFICER CONDUCTED ENQUIRY WITH AADIVASI MAHILA VIKAS SAMIDHI, ONE OF THE TRUST TO WHICH THE ASSESSEE CLAIMED TO HAVE DONATED A SUM OF ` 1 CRORE ON THREE OCCASIONS. THE SECRETARY OF AADIVASI MAHILA VIKAS SAMIDHI WAS EXAMINED. SHE CLARIFIED THAT SHE WAS WORKING AS SE CRETARY SINCE 1993 TO JULY 2010. THE SECRETARY CLARIFIED THAT THE TRU ST HAD NOT RECEIVED ANY BIG AMOUNT AT ANY TIME IN THE PAST. REFERRING TO THE SIGNATURE CONTAINED IN FORM 58A, THE SECRETARY OF THE TRUST C LARIFIED THAT THE SIGNATURE APPEARING IN FORM 58A IS NOT OF HER. THE TREASURER OF THE ITA NO. 1439/14 2084/15 :- 6 -: TRUST WAS ALSO EXAMINED. HE COULD NOT CONFIRM THE RECEIPT OF DONATION BY THE TRUST. THE OTHER PERSON WHO WAS HANDLING TH E AFFAIRS OF THE TRUST ALSO COULD NOT CONFIRM THE RECEIPT OF DONATIO N. IN FACT, THE OUTCOME OF THE ENQUIRY WAS PUT BEFORE SHRI BALASUBR AMANIAN, ONE OF THE DIRECTOR OF THE ASSESSEE-COMPANY. HE CLARIFIE D THAT APPROPRIATE ACTION MAY BE TAKEN. THEREFORE, IT IS NOT CORRECT TO SAY THAT THE ENQUIRY WAS MADE BEHIND THE BACK OF THE ASSESSEE. THE ENQUIRY CONDUCTED BY THE ASSESSING OFFICER WAS BROUGHT TO T HE NOTICE OF ONE OF THE DIRECTOR, SHRI BALASUBRAMANIAN. 7. REFERRING TO THE OTHER TRUSTS, VIZ. NANDHIGRAM SAMA J KALYAN PARISHAD AND AKSHYA NAGAR PALLISIRI SANGHA, THE LD. DR CLARIFIED THAT DONATIONS WERE GIVEN BETWEEN 26.3.2008 TO 31.3.2008 . REFERRING TO THE MODUS OPERANDI, THE LD. DR CLARIFIED THAT FICTI TIOUS BANK ACCOUNT WAS OPENED AT KOLKATA IN AXIS BANK. IN THE NAME OF THE APPROVED TRUST, SOME OTHER PERSONS OPENED THE ACCOUNT WITHOU T FILING KYC (KNOW YOUR CUSTOMER) DOCUMENTS. SOME OF THE OFFICI ALS OF THE AXIS BANK, KOLKATA, JOINED WITH SOME OF THE PERSONS FRA UDULENTLY OPENED THE FICTITIOUS ACCOUNT FOR RECEIVING THIS KIND OF M ONEY IN THE NAME OF DONATION. THE MATTER WAS REPORTED TO THE KOLKATA P OLICE AND IT IS PENDING INVESTIGATION BY THE CBCID WING OF THE KOLK ATA POLICE. ON A QUERY FROM THE BENCH WHETHER ANY ACTION WAS TAKEN A GAINST THE AXIS BANK FOR BEING A PARTY TO THIS KIND OF TRANSACTION IN THE COUNTRY, THE LD. ITA NO. 1439/14 2084/15 :- 7 -: DR COULD NOT CLARIFY WHETHER ANY ACTION WAS TAKEN A GAINST THE AXIS BANK. THE LD. DR FURTHER CLARIFIED THAT ACTION WAS TAKEN AGAINST SOME OF THE PERSONS AND STILL THE ENQUIRY/INVESTIGATION IS PENDING AT VARIOUS STAGES. SINCE THE ASSESSEE BY MISUSING THE BANKIN G CHANNEL CLAIMS THAT A SUM OF ` 2,25,00,000/- WAS DONATED TO THREE TRUSTS, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS FURN ISHED INACCURATE PARTICULARS. REFERRING TO THE DETAILS SAID TO BE F OUND IN THE WEBSITE, THE LD. DR SUBMITTED THAT THE DETAILS AVAILABLE IN THE WEBSITE ARE NOT AUTHENTICATED ONE. IT IS FOR THE ASSESSEE TO FURT HER CONFIRM WHETHER THE TRUSTS WHO CLAIMS TO HAVE OBTAINED THE APPROVAL FROM THE NATIONAL COMMITTEE U/S 35A ARE GENUINE OR NOT. IN THIS CA SE, EVEN THOUGH ALL THE THREE TRUSTS WERE APPROVED U/S 35AC OF THE ACT , THE SO CALLED BANK ACCOUNT TO WHICH THE MONEY WAS TRANSFERRED DOE S NOT BELONG TO THE ABOVE THREE TRUSTS. IN THE NAME OF THE THREE T RUSTS, A BANK ACCOUNT WAS OPENED FRAUDULENTLY BY SOME OTHER PERSO NS WITH THE KNOWLEDGE OF THE AXIS BANK, THEREFORE, THIS KIND OF TRANSACTIONS CANNOT BE ENTERTAINED BY THE INCOME TAX DEPARTMENT. THERE FORE, THE ASSESSING OFFICER HAS RIGHTLY LEVIED PENALTY U/S 271(1)(C) OF THE ACT WHICH WAS CONFIRMED BY THE CIT(A). 8. IN THE QUANTUM APPEAL IN I.T.A.NO.1439/MDS/2014, T HE ASSESSEE HAS NOT PRESSED THE ISSUE OF DONATION OF ` 2,25,00,000/-, THEREFORE, THE CIT(A) HAS NO OCCASION TO CONSIDER T HE SAME ON MERIT. ITA NO. 1439/14 2084/15 :- 8 -: THE CIT(A) HAS SIMPLY REJECTED THE APPEAL OF THE A SSESSEE ON THE GROUND THAT THE ISSUE WAS NOT PRESSED BEFORE HIM. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE SO CALLED DONA TION WAS ROUTED THROUGH FICTITIOUS BANK ACCOUNT, THE CIT(A) OUGHT T O HAVE EXAMINED THE ISSUE ON MERIT. THE ASSESSEE HAD NOT PRESSED THE APPEAL BEFORE THE CIT(A) WITH AN INTENTION TO AVOID FURTHER LEGAL PROCEEDINGS. THE POWER OF THE CIT(A) IS COTERMINOUS WITH THAT OF THE ASSESSING OFFICER. THEREFORE, IN ORDER TO FIND OUT THE REAL CULPRITS W HO OPENED THE BANK ACCOUNT IN THE NAME OF THE RECIPIENT TRUST, THE CIT (A) OUGHT TO HAVE EXAMINED THE MATTER ON MERIT AND DISPOSE OF THE SAM E ON MERIT. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE POWE R TO ENHANCE THE ASSESSMENT BY ASSESSING THE INCOME WHICH WAS OMITT ED BY THE ASSESSING OFFICER, CAN BE EFFECTIVELY EXERCISED, PR OVIDED THE CIT(A) DECIDES THE APPEAL ON MERIT. THEREFORE, THE CIT(A) MAY NOT HAVE THE POWER TO REJECT THE GROUND AS NOT PRESSED. IN THOS E CIRCUMSTANCES, THE THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THERE WAS A REASONABLE CAUSE IN NOT FILING THE APPEAL IN TIME. ACCORDINGLY, THE DELAY OF 683 DAYS IN FILING THE APPEAL IS CONDONED AND THE APPEAL IS ADMITTED. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSEE CLAIMS THAT A SUM OF ` 2,25,00,000/- WAS DONATED TO THREE TRUSTS. THE ITA NO. 1439/14 2084/15 :- 9 -: ASSESSEE HAS DONATED A SUM OF ` 1 CRORE TO AADIVASI MAHILA VIKAS SAMIDHI. THE ASSESSEE HAS ALSO DONATED TO NANDHIG RAM SAMAJ KALYAN PARISHAD A SUM OF ` 75 LAKHS AND ANOTHER SUM OF ` 50 LAKHS WAS DONATED TO AKSHYA NAGAR PALLISIRI SANGHA. THE ASSESSING OFFICER, ON EXAMINATION, FOUND THAT THOUGH THE ABOVE THREE T RUSTS ARE GENUINE, THE BANK ACCOUNT TO WHICH THE MONEY WAS TR ANSFERRED DOES NOT BELONG TO THE ABOVESAID TRUSTS. WE HAVE CAREFU LLY GONE THROUGH THE ENQUIRY REPORT FILED BY THE INSPECTOR OF INCOME TAX, JAMSHEDPUR, DATED 24.12.2010, THE COPY OF WHICH IS AVAILABLE AT PAGE 8 OF THE PAPER BOOK. FROM THE ENQUIRY REPORT, IT APPEARS TH AT THE RECEIPT SAID TO BE ISSUED BY THE SECRETARY OF AADIVASI MAHILA VI KAS SAMIDHI DOES NOT CONTAIN THE SIGNATURE OF THE SECRETARY. IN FAC T, THE SECRETARY DENIED HER SIGNATURE IN FORM 58A. THE SECRETARY HA S ALSO FURTHER CLAIMED THAT SHE NEITHER KNOWS THE ASSESSEE-COMPANY NOR RECEIVED ANY MONEY DURING THE YEAR UNDER CONSIDERATION. IN V IEW OF THIS SPECIFIC STATEMENT, IT APPEARS THAT THE MONEY HAS NOT REACHE D AADIVASI MAHILA VIKAS SAMIDHI. THIS COPY OF THE REPORT SUBMITTED BY THE INCOME TAX INSPECTOR WAS NOT FURNISHED TO THE ASSESSEE. THE ASSESSEE, HOWEVER, ENCLOSED A COPY OF THE COMMUNICATION SAID TO BE RECEIVED BY THE DY. COMMISSIONER OF INCOME TAX, CHENNAI FROM TH E DY. DIRECTOR OF INCOME TAX (INVESTIGATION), JAMSHEDPUR. THIS COMMU NICATION CLEARLY INDICATES THAT THE BANK ACCOUNT OF THE RECIPIENT TR UST DOES NOT SHOW ITA NO. 1439/14 2084/15 :- 10 -: THE RECEIPT OF DONATION. THE DY. DIRECTOR OF INCOM E TAX (INVESTIGATION), JAMSHEDPUR, HAS REPORTED TO THE DY . COMMISSIONER OF INCOME TAX, CHENNAI, AS FOLLOWS: 1. M/S ADIVASI MAHILA VIKAS SAMITI (PAN: AAAAA 2945B) PHULDUNGRI, GHATSILA, JHARKHAND IS A GENUINE CONCERN, WHICH HAS REGISTRATION U/S 12AA/AA OF IT ACT, 1961 AND FILES ITS RETURN OF INCOME WITH THE DY. CI T, CIRCLE -1, JAMSHEDPUR. 2. THE CHARITABLE ACTIVITIES UNDERTAKEN BY THIS SA MITI ARE ON VERY SMALL SCALE AND IN THE AREA OF FORMATIO N OF SELF HELP GROUPS, MANUFACTURING OF CANDLE, PREPARIN G TASHAR THREAD, ETC. 3. SUMMONS WERE ISSUED TO THE PRESIDENT OF THE SAM ITI, SHRI DIKU HANSDA TO PRODUCE THE BOOKS OF ACCOUNT AN D BANK STATEMENTS OF SAMITI FOR F.YS 07-08 & 08-09 AN D SMT. SUKUL HANSDA, THE THEN SECRETARY OF THE SAMITI AND HER STATEMENT WAS RECORDED. 4. VERIFICATION OF RECEIPT & PAYMENT ACCOUNT OF THE SAMITI FOR F.YR 07-08 SHOWS THAT IT HAS NOT RECEIVE D ANY DONATION FROM M/S MANGAL TECH PARK PVT. LTD. NEITHE R, THE BANK STATEMENTS OF THE SAMITI SHOWS TO HAVE RECEIVED SUCH HEAVY SMOUNTS FROM DONATION. 5. SMT. SUKUL HANSDA, THE THEN SECRETRAY OF M/S AD IVASI MAHILA VIKAS SAMITI DENIED TO HAVE RECEIVED ANY AMO UNT AS DONATION FROM M/S MANGAL TECH PARK PVT. LTD. SH E ALSO DENIED HER SIGNATURE ON THE RECEIPTS OF MONEY (FORM NO.58A) WHICH HAVE BEEN SENT TO THIS OFFICE BY YOU . 6. CONCLUSION: ADVASI MAHILA VIKAS SAMITI, PHULDUN GRI, P.O GHATSILA, DIST. SINGHBHUM, JHARKHAND HAS NOT RECEIV ED THE DONATIONS OF ` 1 CRORE ( ` 35,000 THROUGH RTGS, ` ITA NO. 1439/14 2084/15 :- 11 -: 30,000/- & ` 35,000 THROUGH DRAFTS) AS CLAIMED BY M/S MANGAL TECH PARK PVT. LTD. 10. FROM THE ABOVE, IT APPEARS THAT NO DONA TION WAS RECEIVED BY AADIVASI MAHILA VIKAS SAMIDHI FROM THE ASSESSEE- COMPANY. APPARENTLY, THESE COMMUNICATIONS WERE NOT BROUGHT T O THE NOTICE OF THE ASSESSEE. THE ASSESSING OFFICER HAS OBSERVED I N THE ASSESSMENT ORDER THAT THE OUTCOME OF THE ENQUIRY WAS PUT TO SH RI BALASUBRAMANIAN, ONE OF THE DIRECTOR OF THE ASSESSE E-COMPANY. HOWEVER, IT IS NOT KNOWN WHETHER THE SAID BALASUBRA MANIAN IS LOOKING AFTER THE AFFAIRS OF THE ASSESSEE-COMPANY OR NOT. FROM THE MATERIALS AVAILABLE ON RECORD, IT APPEARS THAT ONE SHRI VIJAY SADARANGANI, FILED THE APPEAL BEFORE THIS TRIBUNAL IN HIS CAPACITY AS DIRE CTOR. IF SHRI VIJAYSADARANGANI WAS LOOKING AFTER THE DAY TODAY AF FAIRS OF THE ASSESSEE-COMPANY, THIS TRIBUNAL IS OF THE CONSIDER ED OPINION THAT HE WOULD HAVE FILED THE RETURN BEFORE THE ASSESSING OF FICER IN THE REGULAR COURSE. THEREFORE, IT IS OBLIGATORY ON THE PART OF THE ASSESSING OFFICER TO BRING TO THE NOTICE OF THE DIRECTOR WHO IS IN-CH ARGE OF THE DAY TODAY ADMINISTRATION SO THAT HE MAY BE IN A BETTER POSITI ON TO REPLY OR ENLIGHTEN THE ASSESSING OFFICER WITH REGARD TO THE DONATION SAID TO BE GIVEN BY THE ASSESSEE-COMPANY. THEREFORE, THIS TR IBUNAL IS OF THE CONSIDERED OPINION THAT IT NEEDS TO BE CLARIFIED WH O IS LOOKING AFTER THE AFFAIRS OF THE ASSESSEE-COMPANY ON DAY TODAY BASIS AT THE RELEVANT ITA NO. 1439/14 2084/15 :- 12 -: POINT OF TIME. WHETHER SHRI BALASUBRAMANIAN OR SH RI VIJAYSADARANGANI WAS LOOKING AFTER THE AFFAIRS OF T HE ASSESSEE- COMPANY AT THE RELEVANT POINT OF TIME. IF SHRI BAL ASUBRAMANIAN WAS LOOKING AFTER THE AFFAIRS OF THE ASSESSEE-COMPANY, THEN IT HAS TO BE CLARIFIED WHETHER THE ENQUIRY REPORT FILED BY THE I NCOME TAX INSPECTOR AND THE COMMUNICATION SAID TO BE RECEIVED BY THE DY . COMMISSIONER OF INCOME TAX, CHENNAI FROM THE DY. DIRECTOR OF INC OME TAX(INVESTIGATION), JAMSHEDPUR, WAS COMMUNICATED TO THE ASSESSEE. THE ASSESSEE CLAIMS BEFORE THIS TRIBUNAL THAT NO O PPORTUNITY WAS GIVEN TO IT TO CROSS EXAMINE THE SECRETARY AND TREA SURER OF THE TRUST WHO DENIED THE RECEIPT OF MONEY. THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT WHEN THE ASSESSING OFFICER EXAMINED TH E SECRETARY AND TREASURER OF THE TRUST, AN OPPORTUNITY SHALL BE GIV EN TO THE ASSESSEE TO CROSS EXAMINE THEM TO FIND OUT WHETHER ACTUALLY THE TRUST RECEIVED THE MONEY OR NOT. IT IS ALSO NECESSARY TO FIND OUT WHO ACTUALLY OPENED THE BANK ACCOUNT IN AXIS BANK AT KOLKATA AND OPERAT ED THE SAME. IF THE TRUSTEES OF THE SO CALLED THREE TRUSTS OPENED T HE BANK ACCOUNT IN THE NAME OF SOME OTHER PERSONS WITH CONNIVANCE OF T HE OFFICIALS OF AXIS BANK, THE ASSESSING OFFICER HAS TO FIND OUT WH AT KIND OF ACTION WAS TAKEN AGAINST THE AXIS BANK OFFICIALS AND THE T RUSTEES WHO ARE RESPONSIBLE FOR OPENING THE BANK ACCOUNT. SINCE TH ESE DETAILS ARE NOT ITA NO. 1439/14 2084/15 :- 13 -: AVAILABLE ON RECORD, THIS TRIBUNAL IS OF THE CONSI DERED OPINION THAT THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OF FICER. 11. NOW COMING TO THE PENALTY LEVIED BY THE ASSESSING O FFICER U/S 271(1)(C) OF THE ACT, AS OBSERVED EARLIER, THE ASSESSEE WAS NOT GIVEN ANY OPPORTUNITY TO CROSS EXAMINE THE SECRETAR Y AND TREASURER OF THE TRUST. ADMITTEDLY, AS OBSERVED EARLIER, THE SE CRETARY AND THE TREASURER OF THE TRUST WERE EXAMINED AND THE COPIES OF THE STATEMENT WAS NOT FURNISHED TO THE ASSESSEE AND WHAT WAS AVA ILABLE ON RECORD IS ONLY ENQUIRY REPORT AND THE LETTER SAID TO BE RECEI VED BY THE DY. COMMISSIONER OF INCOME TAX, CHENNAI, FROM DY. DIREC TOR OF INCOME TAX (INVESTIGATION), JAMSHEDPUR. IN THOSE CIRCUMST ANCES, PENALTY BEING DIFFERENT AND DISTINCT FROM ASSESSMENT PROCEE DINGS, THE ASSESSING OFFICER OUGHT TO HAVE GIVEN AN OPPORTUNIT Y TO THE ASSESSEE TO CROSS EXAMINE THE SECRETARY AND TREASURER OF THE SO CALLED TRUST. SINCE SUCH AN OPPORTUNITY WAS NOT GIVEN, THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OFFICER BY GIVING AN OPPORTUNITY TO THE ASSESSEE FOR CROSS EXAMINATION. ACCORDINGLY, THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ISSUE OF LEVY OF PENALTY WITH REGARD TO DONATION OF ` 2,25,00,000/- ALONE IS REMITTED BACK TO THE FILE O F THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL REC ONSIDER THE ISSUE AFRESH AFTER FURNISHING THE COPIES OF STATEMENT SAI D TO BE RECORDED ITA NO. 1439/14 2084/15 :- 14 -: FROM THE SECRETARY AND THE TREASURER OF THE TRUST T O WHOM THE DONATION WAS SAID TO BE GIVEN, AND ALSO FURNISH COP IES ALL DOCUMENTS AND INVESTIGATION REPORT TO THE ASSESSEE AND THERE AFTER PROVIDE AN OPPORTUNITY TO CROSS EXAMINE THOSE PERSONS FROM WHO M THE STATEMENTS WERE RECORDED. THEREAFTER, THE ASSESSIN G OFFICER SHALL PASS AN ORDER AFRESH IN ACCORDANCE WITH LAW AFTER GIVING A REASONABLE OPPORTUNITY TO THE ASSESSEE. 12. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE AR E ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JUNE, 2016, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 17 TH JUNE, 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF