M/s. Jyoti Oversease Ltd., Indore V. The D.C.I.T., Indore

ITA 209/IND/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 47757 (ITAT-INDORE)
• Duration Of Justice: 11 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 06-04-2011
• Assessment Year: 1991-1992
• Appeal Filed On: 16-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MITRA
• Keywords: Opportunity of being heard; Period of limitation
• Section: 260A; 246; 263; 139

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NOS.209 AND 210/IND/2010 A.YS.1991-92 AND 1993-94 JYOTI OVERSEASE LIMITED INDORE PAN AAACJ-7198R APPELLANT VS DY. COMMISSIONER OF INCOME TAX 1(1), INDORE RESPONDENT APPELLANT BY : SHRI MANOJ GUPTA RESPONDENT BY : SHRI P.K. MITRA O R D E R PER JOGINDER SINGH, JUDICIAL MEMBER THESE ARE THE APPEALS BY THE ASSESSEE AGAINST THE O RDER OF THE LEARNED CIT(A) DATED 4.2.2010 ON THE FOLLOW ING COMMON GROUNDS :- 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN NOT QUASHING THE PENALTY 2 ORDER WHICH WAS VOID-AB-INITIO, BARRED BY LIMITAT ION AND WITHOUT JURISDICTION. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE PENALTY ORDER IS VOID-AB-INITIO, BARRED BY LIMITA TION AND WITHOUT JURISDICTION AND LIABLE TO BE QUASHED . 2. DURING HEARING, WE HAVE HEARD LEARNED REPRESENTA TIVES OF BOTH THE PARTIES. THE CRUX OF ARGUMENTS ON BEHALF OF THE ASSESSEE IS THAT THE PENALTY IS BARRED BY LIMITATIO N. THIS FACTUAL MATRIX WAS CONSENT TO BE CORRECT BY THE LEARNED SEN IOR DEPARTMENTAL REPRESENTATIVE. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. IN THE PRESENT APPEAL, THE INC OME TAX RETURN U/S 139 WAS FILED ON 18.5.1992 AND REVISED R ETURN, IN PURSUANCE OF NOTICE U/S 148, WAS FILED ON 13.5.1994 . THE ASSESSMENT ORDER U/S 143(3)/148 WAS PASSED ON 20.3. 1996 WHEREIN THE AMOUNT OF RS.10,42,129/- WAS ADDED ON A CCOUNT OF JOB CHARGES AND FURTHER ADDITION WAS MADE ON ACCOUN T OF ESIC, TELEPHONE EXPENSES AND LOWER DEDUCTION /S 80IE, ETC . THE ORDER OF THE LD. FIRST APPELLATE AUTHORITY WAS PASS ED ON 3 12.3.1999 WHEREIN ADDITION ON ACCOUNT OF JOB WORK C HARGES WAS UPHELD AND THE ADDITION ON ACCOUNT OF ESIC, TELEPHO NE EXPENSES WAS DELETED AND THE DEDUCTION CLAIMED U/S 80I WAS ALLOWED. THE ASSESSEE FILED APPEAL BEFORE THE TRIBU NAL ON THE SUSTENANCE OF ADDITION ON ACCOUNT OF JOB WORK CHARG ES AND THE DEPARTMENT FILED APPEAL FOR THE ADDITION, DEDUCTION S AND EXPENSES. THE TRIBUNAL VIDE ORDER IN ITA NO. 491/IN D/99 DISMISSED THE APPEAL OF THE ASSESSEE AND THE APPEAL OF THE DEPARTMENT WAS REJECTED VIDE ORDER DATED 31.8.2005 (ITA NO.445/IND/99) WHEREIN THE MATTER OF DISALLOWANCE O F CAR AND TELEPHONE EXPENSES WAS REMANDED TO THE ASSESSING OF FICER FOR THE PURPOSE OF VERIFICATION. PURSUANT TO THE ORDER OF THE TRIBUNAL, THE ASSESSMENT WAS FRAMED ON 20.11.2006 W HEREIN THE LEARNED ASSESSING OFFICER CONFIRMED THE DISALLO WANCE OUT OF TELEPHONE AND VEHICLE EXPENSES. THE PENALTY ORDER W AS PASSED BY THE ASSESSING OFFICER ON 31.5.2007 LEVYIN G PENALTY OF RS.10,42,129/- ON DISALLOWANCE OF JOB CHARGES WH ICH WAS CONFIRMED BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ON 4.2.2010. THE ORDER OF THE TRIBUNAL WA S PASSED IN 4 AUGUST, 2005 AND THE PENALTY ORDER WAS PASSED ON 31 .5.2007 WHICH IS DEFINITELY BEYOND 6 MONTHS PERIOD PRESCRIB ED U/S 275(1)(A) OF THE ACT. SECTION 275 IS REPRODUCED HER EUNDER :- 275. 95 [(1)] NO ORDER IMPOSING A PENALTY UNDER THIS CHAPTE R SHALL BE PASSED 96 [( A ) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTHER ORDER IS THE SUBJECT- MATTER OF AN APPEAL TO THE 97 [***] COMMISSIONER (APPEALS) UNDER SECTION 246 98 [OR SECTION 246A ] OR AN APPEAL TO THE APPELLATE TRIBUNAL UNDER SECTION 253 , AFTER THE EXPIRY OF THE FINANCIAL YEAR IN WHICH T HE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED 99 , OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE 1 [***] COMMISSIONER (APPEALS) OR, AS THE CASE MAY BE, THE APPELLATE TRIBUNAL IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER PERIOD EXPIRES LATER : 2 [ PROVIDED THAT IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTH ER ORDER IS THE SUBJECT-MATTER OF AN APPEAL TO THE COMMISSIONER (APPEALS) UNDER SECTION 246 OR SECTION 246A , AND THE COMMISSIONER (APPEALS) PASSES THE ORDER ON OR AFTER THE 1ST DAY OF JUNE, 2003 DISPOSI NG OF SUCH APPEAL, AN ORDER IMPOSING PENALTY SHALL BE PASSED BEFORE THE E XPIRY OF THE FINANCIAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHI CH ACTION FOR IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPL ETED, OR WITHIN ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORD ER OF THE COMMISSIONER (APPEALS) IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER IS LATER;] ( B ) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OTHER ORDER IS THE SUBJECT-MATTER OF REVISION UNDER SECTION 263 2 [OR SECTION 264 ], AFTER THE EXPIRY OF SIX MONTHS FROM THE END OF THE MONTH IN WHICH SUCH ORDE R OF REVISION IS PASSED; ( C ) IN ANY OTHER CASE, AFTER THE EXPIRY OF THE FINANC IAL YEAR IN WHICH THE PROCEEDINGS, IN THE COURSE OF WHICH ACTION FOR THE IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPLETED, OR SIX MONTHS FR OM THE END OF THE MONTH IN WHICH ACTION FOR IMPOSITION OF PENALTY IS INITIA TED, WHICHEVER PERIOD EXPIRES LATER.] 3 [(1A) IN A CASE WHERE THE RELEVANT ASSESSMENT OR OT HER ORDER IS THE SUBJECT-MATTER OF AN APPEAL TO THE COMMISSIONER (AP PEALS) UNDER SECTION 246 OR SECTION 246A OR AN APPEAL TO THE APPELLATE TRIBUNAL UNDER SECTION 253 OR AN APPEAL TO THE HIGH COURT UNDER SECTION 260A OR AN APPEAL TO THE SUPREME COURT UNDER SECTION 261 OR REVISION UNDER SECTION 263 OR SECTION 264 AND AN ORDER IMPOSING OR ENHANCING OR REDUCING OR CANCELLING PENALTY OR DROPPING THE PROCEEDINGS FOR THE IMPOSITION OF P ENALTY IS PASSED BEFORE THE ORDER OF THE COMMISSIONER (APPEALS) OR THE APPE LLATE TRIBUNAL OR THE HIGH COURT OR THE SUPREME COURT IS RECEIVED BY THE CHIEF COMMISSIONER OR THE COMMISSIONER OR THE ORDER OF REVISION UNDER SECTION 263 OR SECTION 264 IS PASSED, AN ORDER IMPOSING OR ENHANCING OR REDUC ING OR CANCELLING 5 PENALTY OR DROPPING THE PROCEEDINGS FOR THE IMPOSIT ION OF PENALTY MAY BE PASSED ON THE BASIS OF ASSESSMENT AS REVISED BY GIV ING EFFECT TO SUCH ORDER OF THE COMMISSIONER (APPEALS) OR, THE APPELLATE TRI BUNAL OR THE HIGH COURT, OR THE SUPREME COURT OR ORDER OF REVISION UN DER SECTION 263 OR SECTION 264 : PROVIDED THAT NO ORDER OF IMPOSING OR ENHANCING OR REDUCING OR CANCELLING PENALTY OR DROPPING THE PROCEEDINGS FOR THE IMPOSITION OF PENALTY SHALL BE PASSED ( A ) UNLESS THE ASSESSEE HAS BEEN HEARD, OR HAS BEEN G IVEN A REASONABLE OPPORTUNITY OF BEING HEARD; ( B ) AFTER THE EXPIRY OF SIX MONTHS FROM THE END OF TH E MONTH IN WHICH THE ORDER OF THE COMMISSIONER (APPEALS) OR THE APPELLAT E TRIBUNAL OR THE HIGH COURT OR THE SUPREME COURT IS RECEIVED BY THE CHIEF COMMISSIONER OR THE COMMISSIONER OR THE ORDER OF REVISION UNDER SECTION 263 OR SECTION 264 IS PASSED: PROVIDED FURTHER THAT THE PROVISIONS OF SUB-SECTION (2) OF SECTION 274 SHALL APPLY IN RESPECT OF THE ORDER IMPOSING OR ENH ANCING OR REDUCING PENALTY UNDER THIS SUB-SECTION.] 4 [(2) THE PROVISIONS OF THIS SECTION AS THEY STOOD I MMEDIATELY BEFORE THEIR AMENDMENT BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1 987 (4 OF 1988), SHALL APPLY TO AND IN RELATION TO ANY ACTION INITIA TED FOR THE IMPOSITION OF PENALTY ON OR BEFORE THE 31ST DAY OF MARCH, 1989.] 5 [ EXPLANATION. IN COMPUTING THE PERIOD OF LIMITATION FOR THE PURP OSES OF THIS SECTION, ( I ) THE TIME TAKEN IN GIVING AN OPPORTUNITY TO THE AS SESSEE TO BE REHEARD UNDER THE PROVISO TO SECTION 129 ; ( II ) ANY PERIOD DURING WHICH THE IMMUNITY GRANTED UND ER SECTION 245H REMAINED IN FORCE; AND ( III ) ANY PERIOD DURING WHICH A PROCEEDING UNDER THIS C HAPTER FOR THE LEVY OF PENALTY IS STAYED BY AN ORDER OR INJUNCTION OF ANY COURT, SHALL BE EXCLUDED.]] IF THE AFORESAID PROVISION IS ANALYSED, THE MAIN PR OVISION PRESCRIBES ABOUT BAR OF LIMITATION FOR IMPOSING PEN ALTIES IN A CASE WHERE THE ASSESSMENT ORDER OR OTHER ORDER IS S UBJECT OF AN APPEAL BEFORE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) U/S 246 (OR SECTION 246A) OR AN APPEAL TO THE APPELLATE TRIBUNAL U/S 253, AFTER THE EXPIRY OF FIN ANCIAL YEAR IN 6 WHICH THE PROCEEDINGS IN THE COURSE OF WHICH ACTION FOR IMPOSITION OF PENALTY HAS BEEN INITIATED, ARE COMPL ETED OR SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) OR AS THE CASE MAY BE, THE APPELLATE TRIBUNAL, IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER WHICHEVER PERIOD EXPIR ES LATER, THEREFORE, BOTH THESE APPEALS OF THE ASSESSEE ARE A LLOWED. ORDER PRONOUNCED IN OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CO NCLUSION OF HEARING ON 6 TH APRIL, 2011. (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 6 TH APRIL, 2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-