Satish Kumar Agarwal(HUF), Kolkata V. ACIT, Circle-45, Kolkata, Kolkata

ITA 2183/KOL/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 9188 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 10-11-2016
• Court: TRIBUNAL
• Department Lawyers: S ALLONG YADEN CIT LD
• Assessee Lawyers: S L KOCHAR LD
• Keywords: Application of stay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL : B BENCH KOLKAT A BEFORE : SHRI WASEEM AHMED, ACCOUNTANT M EMBER AND SHRI S.S.VISWANETHRA RAVI, J UDICIAL MEMBER S.A NO. 22/KOL/2017 [IN ITA NO. 2183/KOL/2 016 A.Y 2012-13] AND ITA NO. 2183/KOL/2016 A.Y 2012-13 SATISH KUMAR AGARWAL(HUF) VS. ASSISTANT COMMISSI ONER OF PAN: AAFHS 2532C INCOME TAX , CIR-45, KOLKATA [APPLICANT/ASSESSEE ] [RESPONDENT/ DEPARTMENT ] APPLICANT/APPELLANT BY : SHRI S.L. KOCHAR, A DVOCATE, LD.AR RESPONDENT/DEPARTMENT BY : SHRI SALLONG YADEN , ADDL.CIT, LD.DR DATE OF HEARING : 24-03-2017 DATE OF PRONOUNCEMENT : 24-03-2017 ORDER SHRI S.S.VISWANETHRA RAVI, JM: THIS STAY APPLICATION FILED BY THE ASSESSEE SEEK ING GRANT OF STAY OF OUTSTANDING DEMAND OF RS. 37,10,711/- RAISED ON ACC OUNT OF CONFIRMATION OF PENALTY BY THE CIT-A, LEVIED BY THE AO U/S. 271(1)( C) OF THE ACT IN SA 22/KOL/2017, WHICH IS ARISING OUT OF APPEAL IN ITA NO. 2183/KOL/2016 FOR THE A.Y 2012-13. THE ASSESSEE HAS ALSO FILED THIS APPEA L AGAINST THE ORDER OF THE CIT-A IN CONFIRMING THE IMPUGNED PENALTY. 2. SRI S.L. KOCHAR, ADVOCATE, LD. AR APPEARED ON BE HALF OF ASSESSEE AND SRI SALLONG YADEN, ADDL.CIT, LD. DEPARTMENTAL REPR ESENTATIVE APPEARED ON BEHALF OF REVENUE. 3. BRIEF FACTS OF THE ISSUE ARE THAT THE ASSESSEE I S AN HUF AND DERIVING HIS INCOME FROM HOUSE PROPERTY AND CAPITAL GAINS ETC. T HE ASSESSEE FILED HIS RETURN OF INCOME DECLARING TOTAL INCOME OF RS.52,03 ,244/-. THE AO S.A NO. 22/KOL/2017 & ITA N O.2183/KOL/2016 SATISH KUMAR AGARWAL(HUF) 2 DETERMINED THE TOTAL INCOME OF THE ASSESSEE AT RS. 2,32,16,400/- VIDE HIS ORDER DT. 23-02-2015. AGAINST WHICH THE ASSESSEE PR EFERRED AN APPEAL BEFORE THE CIT-A. THE CIT-A CONFIRMED THE ACTION OF THE AO. THEREAFTER, AO INITIATED PENALTY PROCEEDINGS BY ISSUING NOTICE U/S . 274 R.W.S 271 (1) ( C) OF THE ACT FOR CONCEALMENT OF INCOME. THE ASSESSEE CON TENDED IN THE PENALTY PROCEEDINGS BY FILING WRITTEN SUBMISSION ON 25-08-2 015. THE AO, HOWEVER, FOUND THAT THE SUBMISSIONS OF ASSESSEE ARE NOT ACCE PTABLE AND AS SUCH HE LEVIED THE PENALTY FOR CONCEALMENT OF INCOME U/S. 2 71(1) ( C) OF THE ACT OF RS.37,10,711/-. THE SAME WAS CHALLENGED BEFORE THE CIT-A. THE CIT-A ALSO CONFIRMED THE SAME IN IMPOSING THE IMPUGNED PENALTY . 4. THE LD.AR FURTHER SUBMITS THAT THE ASSESSEE FILE D APPEAL BEFORE THE TRIBUNAL ON 10-11-2016, WHICH IS PENDING FOR ADJUDI CATION. THE LD.AR FURTHER ARGUED THAT THE NOTICE DT. 23-02-2015 ISSUE D BY THE AO U/S. 274 R.W.S 271 IS DEFECTIVE WITHOUT SPECIFYING THE CHARG E OF OFFENCE. HE SUBMITS THAT THE ASSESSEE HAS FAIR CHANCE TO SUCCEED IN THE SAID APPEAL AS THE ISSUE IN HAND IS FULLY COVERED IN FAVOUR OF ASSESSEE BY T HE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS SSAS EM ERALD MEADOWS IN ITA NO. 380 OF 2015 DATED 23.11.2015 WHICH WAS LATER AP PROVED BY THE HONBLE SUPREME COURT BY DISMISSAL OF SPECIAL LEAVE PETITIO N (SLP) FILED BY THE REVENUE IN CC NO. 11485/2016 DATED 5.8.2016. 5. IN RESPONSE TO THIS, THE LD DR RAISED AN OBJECTI ON THAT THIS TRIBUNAL SHALL NOT HEAR THE MAIN APPEAL AS IT IS NOT FIXED F OR HEARING. HE RELIED ON THE ORDER OF THE LD AO. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE FIND THAT THE ASSESSEE RAISED THE GROUNDS OF APPEAL CHALLENGING THE NOTICE ISSUED BY THE AO U/SEC. 274 R.W.S 271(1)(C) OF THE ACT. WE FIND THAT THE ISSUE IN HAND IS SQUARELY COVERED BY THE DECISION OF THE HONBLE SUPREME COUR T IN THE CASE OF SUPRA. THEREFORE, WE FIND FORCE IN THE ARGUMENTS OF THE LD .AR AND PROCEED TO HEAR THE APPEAL. WE FIND THAT THE PENALTY NOTICE DT. 23- 02-2015 U/S 274 R.W.S S.A NO. 22/KOL/2017 & ITA N O.2183/KOL/2016 SATISH KUMAR AGARWAL(HUF) 3 271(1)(C) OF THE ACT DOES NOT SPECIFY THE CHARGE OF OFFENCE COMMITTED BY THE ASSESSEE VIZ WHETHER IT HAD CONCEALED THE PARTICULA RS OF INCOME OR IT HAD FURNISHED INACCURATE PARTICULARS OF INCOME. HENCE THE SAID NOTICE IS TO BE HELD AS DEFECTIVE. NOW THE SHORT QUESTION THAT ARI SES FOR CONSIDERATION IS AS TO WHETHER THE PENALTY COULD BE VALIDLY LEVIED BASE D ON THE DEFECTIVE SHOW CAUSE NOTICE. THIS ISSUE HAS BEEN ADDRESSED BY THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS SSAS EMERALD MEADOWS I N ITA NO. 380 OF 2015 DATED 23.11.2015 WHICH IN TURN PLACED RELIANCE ON ANOTHER JUDGMENT O F THE SAME COURT IN THE CASE OF CIT VS MANJUNATHA COTTON AND GINNING FACTORY REPORTED IN 359 ITR 565 (KAR). IN THE SAID DECISION, THEIR LORDSHIPS OF HONBLE KARNATAKA HIGH COURT HELD THAT :- 3. THE TRIBUNAL HAS ALLOWED THE APPEAL FILED BY THE ASSESSEE HOLDING THE NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SECTION 274 READ WIT H SECTION 271(1)(C ) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) TO BE BA D IN LAW AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C ) OF THE ACT, THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E , WHETHER FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE TRIBUNAL, WHILE ALLOWIN G THE APPEAL OF THE ASSESSEE, HAS RELIED ON THE DECISION OF THE DIVISION BENCH OF THI S COURT RENDERED IN THE CASE OF COMMISSIONER OF INCOME TAX VS MANJUNATHA COTTON AND GINNING FACTORY REPORTED IN (2013) 359 ITR 565. 4. IN OUR VIEW, SINCE THE MATTER IS COVERED BY JUDG EMENT OF THE DIVISION BENCH OF THIS COURT, WE ARE OF THE OPINION, NO SUBSTANTIAL QUESTI ON OF LAW ARISES IN THIS APPEAL FOR DETERMINATION BY THIS COURT. THE APPEAL IS ACCORDI NGLY DISMISSED. 7. WE FIND THAT THE REVENUE HAD PREFERRED A SLP BEF ORE THE HONBLE SUPREME COURT AGAINST THIS JUDGMENT WHICH WAS DISMI SSED IN CC NO. 11485/2016 DATED 5.8.2016 BY OBSERVING AS UNDER:- UPON HEARING THE COUNSEL, THE COURT MADE THE FOLLOW ING ORDER DELAY CONDONED. WE DO NOT FIND ANY MERIT IN THIS PETITION. THE SPE CIAL LEAVE PETITION IS , ACCORDINGLY DISMISSED. PENDING APPLICATION, IF ANY, STANDS DISPOSED OF. 8. RESPECTFULLY FOLLOWING THE AFORESAID JUDICIAL P RECEDENTS, WE CANCEL THE PENALTY LEVIED OF RS.37,30,711/- U/SEC. 271(1) (C) OF THE ACT AND CONFIRMED BY THE CIT-A. ACCORDINGLY THE GROUNDS RAISED BY TH E ASSESSEE ARE ALLOWED. 9. IN VIEW OF ABOVE, THE STAY APPLICATION FILED BY THE ASSESSEE IS LIABLE TO BE DISMISSED. S.A NO. 22/KOL/2017 & ITA N O.2183/KOL/2016 SATISH KUMAR AGARWAL(HUF) 4 10. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS AL LOWED AND STAY APPLICATION OF THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24-03-2017 SD/- SD/- WASEEM AHMED S.S. VISWANETHRA RAVI ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 24-03-2017 PP(SR.P.S.) COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT SHRI SATISH KUMAR AGARWAL (HUF) C/O S.L KOCHAR, ADVOCATE, 86 CANNING STREET, KOLKATA-1. 2 RESPONDENT THE ACIT, CIRCLE-45,KOLKATA 3 GOVT PLACE (WEST), KOLKATA-1. 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER SR.P.S, HEAD OF OFFICE ITAT KOLKATA