BRANCH MANAGER, CENTRAL BANK OF INDIA, Jaipur V. JDIT (I & CI), Jaipur

ITA 214/JPR/2017

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 2005 (ITAT-JAIPUR)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-07-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 11-07-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 14-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: POONAM ROY DCIT DHK
• Assessee Lawyers: S K GOGRA
• Keywords: Reasonable cause
• Section: 133(6)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR JH HKKXPAN] YS[KK LNL; ] DS LE{K BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER VK;DJ VIHY LA- @ ITA NOS. 214 TO 216/JP/2017 FINANCIAL YEAR : 2011-12 BRANCH MANAGER, CENTRAL BANK OF INDIA, BARAN (RAJ)-325205. CUKE VS. JOINT DIRECTOR OF INCOME TAX, (I&CI), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAACC 2498 P VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI S.K. GOGRA (CA). JKTLO DH VKSJ LS @ REVENUE BY : SMT. POONAM ROY (DCIT) LQUOKBZ DH RKJH[K @ DATE OF HEARING : 11/07/2017 MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 12/07/2017 VKNS'K@ ORDER PER: BHAGCHAND, A.M. THESE ARE THE APPEALS FILED BY THE ASSESSEE AGAINST THE COMMON ORDER DATED 06/01/2017 OF LD. CIT(A), ALWAR, PERTAINING TO THE FINANCIAL 2011-12 RELEVANT TO THE ASSESSMENT YEAR 2012-13. THERE IS CO MMON ISSUE INVOLVED IN ALL THESE APPEALS AND THE LD. CIT(A) HAS DECIDED THE SAME IN HIS COMBINED ORDER. THE ASSESSEE HAS TAKEN COMMON GROUNDS IN ALL THESE APPEALS, WHICH IS REPRODUCED HEREUNDER: ITA 214 TO 216/JP/2017_ BRANCH MANAGER, CBI VS. JDIT(I&CI) 2 1. THAT ORDER PASSED BY LD. A.O. BY CREATING DEMAN D AGAINST APPELLANT MAY PLEASE BE DECLARED AS ILLEGAL AND UNJ USTIFIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 2. THAT THE LD. JDIT HAS ERRED IN LEVY OF PENALTY D ESPITE OF FURNISHING OF REQUIRED INFORMATION BY BANK. AS THER E WAS DELAY IN FURNISHING OF SAME BY 456 DAYS AND REASON OF DEL AYS WERE ALSO EXPLAINED AS THE BANK OFFICIALS WAS NOT PROVID ED WITH ADEQUATE RIGHT TO HAVE ACCESS OR CONTROL OVER BANKI NG SOFTWARE SO THE REQUIRED INFORMATION WAS SUBMITTED BELATEDLY . THUS ACTION OF LD. JDIT MAY PLEASE BE DECLARED ILLEGAL A ND UNJUSTIFIED IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. THAT DELAY IS SUBMISSION OF INFORMATION IS UNINT ENTIONAL AND IS NOT DELIBERATELY OR WILLFULLY TAKEN. SUCH DELAY IS UNINTENTIONAL TOO AND ULTIMATELY THE REQUIRED INFORMATION IS PROV IDED AS AND WHEN THE REQUIRED SUPPORT RECEIVED FROM CONCERNING HIGHER AUTHORITIES. THUS APPELLANT WAS HAVING SUFFICIENT R EASONS DUE TO WHICH HE COULD NOT SUBMIT THE REQUIRED INFORMATI ON WITHIN STIPULATED TIME. THUS, ACTION OF LD. JDIT IN LEVYIN G OF PENALTY MAY PLEASE BE DECLARED AS ILLEGAL AND UNJUSTIFIED I N THE FACTS AND CIRCUMSTANCES OF THE CASE. 4. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ORDER OF LD. JDIT ON MECHANICAL SYSTEM BASIS AND SAME IS WITHOUT SUBSTAINTING ANY COGENT REASONS IN CONFIRMING PENAL TY. THUS THE SAME MAY PLEASE BE DECLARED AS ILLEGAL AND BE Q UASHED. 5. THE APPEAL FEES OF RS. 500/- HAS BEEN DEPOSITED ON 09/3/2017 AND COPY OF ACKNOWLEDGEMENT OF SUBMISSION IS ENCLOS ED HEREWITH. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, AMEND OR ALTER ANY OF THE GROUND TO THIS APPEAL WITH THE REQUEST TO ALLOW TO SUBMIT WRITTEN SUBMISSION AT THE TIME OF HEARING OF APPEAL . 7. THAT AUTHORITY LETTER IN FAVOUR OF COUNSEL ARE E NCLOSED HEREWITH. ITA 214 TO 216/JP/2017_ BRANCH MANAGER, CBI VS. JDIT(I&CI) 3 2. SINCE, COMMON ISSUES ARE INVOLVED IN ALL THE APP EALS, THEREFORE, ALL THE APPEALS ARE BEING HEARD TOGETHER AND FOR THE SAKE O F CONVENIENCE AND BREVITY, COMMON ORDER IS BEING PASSED. 3. IN ALL THESE APPEALS, THERE ARE ONLY ONE COMMON ISSUE, WHICH IS AGAINST CONFIRMATION OF PENALTY U/S 272A(2)(C) OF THE INCOM E TAX ACT, 1961 (IN SHORT THE ACT) FOR NON-SUBMISSION OF THE INFORMATION REQU IRED BY THE ITO (INTELLIGENCE) BY ISSUING NOTICE U/S 133(6) OF THE ACT. THE ITO (INTELLIGENCE) ASKED THE INFORMATION UNDER THE DIFFERENT CODES, WHI CH WERE SUPPLIED BY THE BRANCH, BUT THERE WAS A DELAY AND FOR THAT DELAY THE PENALTY HAS BEEN LEVIED. IT WAS PLEADED THAT THE INFORMATION SOUGHT BY THE NO TICE WAS NOT READILY AVAILABLE WITH THE BRANCH BUT TO GET THE INFORMATION FROM THE SYSTEM, THE BRANCH HAS TO GET SUPPORT AND PERMISSION OF THE HE AD OFFICE/REGIONAL OFFICE AND WHICH WAS FINALLY EXTRACTED/GENERATED IN THE MONT H OF SEPTEMBER, 2013, THEREAFTER, IT WAS IMMEDIATELY SUBMITTED. THUS, THERE WAS A REASONABLE CAUSE FOR DELAY ON THE PART OF THE BRANCH TO FURNISH THE REQUIRED INFORMATION IN RESPONSE TO NOTICE U/S 133(6) OF THE ACT. THERE WAS N O WILLFUL OR INTENTIONAL DELAY, THEREFORE, THE PENALTY LEVIED DESERVE TO BE DELETED. 4. ON THE OTHER HAND, THE LD DR HAS RELIED ON THE O RDERS OF THE AUTHORITIES BELOW. ITA 214 TO 216/JP/2017_ BRANCH MANAGER, CBI VS. JDIT(I&CI) 4 5. I HAVE HEARD BOTH THE SIDES ON THIS ISSUE. THIS I S A CASE OF A BRANCH OF CENTRAL BANK OF INDIA LOCATED IN THE REMOTE AREA OF BARAN. THE ITO (INTELLIGENCE) ASKED THE INFORMATION UNDER THE CODE 006, WHICH IS THE DETAILS OF PAYMENT IN CASH FOR PURCHASE OF BANK DRAFT/DD EX CEEDING RS. 1,00,000/-. THE OTHER INFORMATION REQUIRED BY THE NOTICE WAS UNDE R THE CODE 003, WHICH WAS REGARDING THE TIME DEPOSIT EXCEEDING RS. 2,00,00 0/- AND THE THIRD INFORMATION REQUIRED TO BE FURNISHED WAS WITH REGARD TO CODE NO. 007, WHICH WAS DEPOSIT IN CASH EXCEEDING RS. 2,00,000/-. ALL TH ESE THREE INFORMATION WERE REQUIRED TO BE FURNISHED IN COMPLIANCE TO THE N OTICE U/S 133(6) OF THE ACT. THE BRANCH MANAGER REQUESTED THE REGIONAL OFFIC E FOR WANT OF SUPPORT FOR OPERATION OF CENTRALIZED BANKING SYSTEM SOFTWARE (CB S) AND ALSO REQUESTED FOR REQUISITE PERMISSION FOR EXTRACTION OF SUCH INF ORMATION FROM THE REGIONAL OFFICE. FURTHER AS PLEADED, THERE WAS A SHORTAGE OF TECHNICAL STAFF AT A BRANCH LEVEL, WHO COULD GENERATE SUCH INFORMATION FROM THE CENTRALIZED BANKING SYSTEM SOFTWARE AT THE BRANCH LEVEL. IN VIEW OF THESE FACTS AND ALSO CONSIDERING THE FACT THAT THE COMPLIANCE HAS BEEN M ADE SUBSEQUENTLY. THE HON'BLE SUPREME COURT IN THE CASE OF HINDUSTAN STEE L LTD VS. STATE OF ORISSA (1972) 83 ITR 26 (SC) HAS HELD AS UNDER:- WHETHER PENALTY SHOULD BE IMPOSED FOR FAILURE TO P ERFORM A STATUTORY OBLIGATION IS A MATTER OF DISCRETION OF THE AUTHORI TY TO BE EXERCISED JUDICIALLY AND ON A CONSIDERATION OF ALL THE RELEVANT CIRCUMST ANCES. EVEN IF A MINIMUM PENALTY IS PRESCRIBED, THE AUTHORITY COMPETENT TO I MPOSE THE PENALTY WILL BE JUSTIFIED IN REFUSING TO IMPOSE PENALTY, WHEN THERE IS A TECHNICAL OR VENIAL ITA 214 TO 216/JP/2017_ BRANCH MANAGER, CBI VS. JDIT(I&CI) 5 BREACH OF THE PROVISIONS OF THE ACT OR WHERE THE BR EACH FLOWS FROM A BONA FIDE BELIEF THAT THE OFFENDER IS NOT LIABLE TO ACT IN TH E MANNER PRESCRIBED BY THE STATUTE. THE ITAT, HYDERABAD BENCH IN THE CASE OF SYNDICATE BA NK VS ACIT (2015) TAXPUB (DT) 3614 HAS HELD AS UNDER:- WHEREIN IT HAS BEEN HELD THAT AFTER CONSIDERING T HE RIVAL CONTENTIONS AND PERUSING THE CASE LAW RELIED UPON BY THE ID. COUNSE L OF THE ASSESSEE, I AM OF THE OPINION THAT THERE IS NO NEED FOR LEVY OF PENAL TY IN THE GIVEN CASE. FIRST OF ALL, THE NOTICE ISSUED U/S. 136 IS A GENERAL NOTICE ASKING FOR INFORMATION WHICH IS NOT IN THE DOMAIN OF THE ITO, CIB. THE CBDT ITSE LF HAS PRESCRIBED CERTAIN LIMITS FOR CALLING FOR INFORMATION AND INCOME TAX A CT ALSO PRESCRIBES VARIOUS LIMITS FOR FURNISHING INFORMATION ON A REGULAR BASI S FROM THE BANKS IN ANNUAL RETURNS. THE DETAILS ASKED IN VARIOUS CODES IS NEIT HER PRESCRIBED BY THE ACT NOR SUPPORTED BY THE BOARDS CIRCULAR. THIS INFORMATION IS SPECIFICALLY ASKED BY ITO, CIB IN A PARTICULAR FORMAT MAY BE ON THE STRENGTH O F INTERNAL INSTRUCTIONS. FOR EXAMPLE, THE TIME DEPOSITS EXCEEDING 2 LAKHS UNDER CODE NO. 003 IS NOT TO BE GENERALLY FURNISHED BY THE BANKS TO THE DEPARTMENT IN THE PRESCRIBED ANNUAL RETURN, LIKEWISE, OTHER CODES ALSO FOR WHICH DIFFER ENT AMOUNTS WERE PRESCRIBED BY THE ACT. THIS INDICATES THAT THIS INFORMATION WA S SPECIFICALLY ASKED FOR BY THE ITO, CIB. IN LIGHT OF THESE FACTUAL AND LEGAL POSITIONS AND L OOKING TO THE PECULIAR FACTS AND CIRCUMSTANCES, I DIRECT TO DELETE THE PENALTY L EVIED IN ALL THESE CASES. 6. IN THE RESULT, ALL THE THREE APPEALS OF THE ASSE SSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 12/07/2017. SD/- HKKXPAN (BHAGCHAND) YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ TK;IQJ TK;IQJ TK;IQJ@ @@ @ JAIPUR FNUKAD@ DATED:- 12 TH JULY, 2017 *RANJAN ITA 214 TO 216/JP/2017_ BRANCH MANAGER, CBI VS. JDIT(I&CI) 6 VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE BRANCH MANAGER, CENTRAL BANK OF IN DIA, BARAN. 2. IZR;FKHZ @ THE RESPONDENT- THE JDIT, (I&CI), JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO. 214 TO 216/JP/2017) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR