Shri Nand Kishore Tikamdasji Bisani, Kolkata V. Addl. CIT, Range-44, Kolkata, Kolkata

ITA 2271/KOL/2014

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1639 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-06-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2009-2010
• Appeal Filed On: 29-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R CHOWDHURY JCITSRDR
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH C KOLKATA BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ITA NO. 2271 / KOL / 2014 ASSESSMENT YEAR :2009-10 NANDKISHORE TIKAMDASJI BISANT, C/O M.M. SAREE HOUSE, 7A, SIR HARIRAM GOENKA ST, 3 RD FLORE, KOLKATA-700 007 [ PAN NO. AECPB 7140 N ] V/S . CIT (APPEALS),-XXX, 3, GOVERNMENT PLACE (WEST), KOLKATA-700 001 /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI VIGYANESHWAR NATH DATTA, ADVOCATE /BY RESPONDENT SHRI R. CHOWDHURY, JCIT-SR-DR /DATE OF HEARING 08-05-2017 /DATE OF PRONOUNCEMENT 02-06-2017 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-XXX, KOLKATA D ATED 03.11.2014. ASSESSMENT WAS FRAMED BY ACIT, RANGE-44, KOLKATA U/ S 143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS T HE ACT) VIDE HIS ORDER DATED 16.12.2011 FOR ASSESSMENT YEAR 2009-10. SHRI VIJYANESHWAR NATH DATTA, LD. ADVOCATE APPEARED ON BEHALF OF ASSESSEE AND SHRI R.CHOWDHURY, LD. DEPARTMENTAL REPRESENTATI VE REPRESENTED ON BEHALF OF REVENUE. ITA NO.2271/KOL/2014 A.Y. 2009-10 NANDKISHORE T. BISANI VS. CIT(A)-XXX KOL. PAGE 2 2. IN THIS APPEAL THE ASSESSEE HAS CHALLENGED THE ORDER OF CIT(A) WHEREBY THE CIT(A) CONFIRMED THE ORDER OF ASSESSING OFFICER IMPOSING PENALTY ON THE ASSESSEE U/S 271(1)(C) OF THE ACT. 3. THE FACTS AND CIRCUMSTANCES UNDER WHICH PENALTY U/S 271(1)(C) OF THE ACT WAS LEVIED ON THE ASSESSEE BY THE AO ARE AS FOLLOWS :- THE ASSESSEE IS AN INDIVIDUAL. HE IS ENGAGED IN THE TRADING BUSINESS OF SAREE. THE ASSESSEE FILED RETURN OF INCOME FOR A.Y. 2008-09 DECLARING TOTAL INCOME OF RS.3,87,210/-. IN THE COURSE OF AS SESSMENT PROCEEDINGS U/S 143(3) OF THE ACT, THE AO NOTICED THAT THE ASSE SSEE HAD NOT TAKEN VALUE OF SAREE SENT FOR EMBROIDERY FOR RS.3 LAKH IN THE CLOSING STOCK AND THEREFORE THE SUM OF RS.3 LAKH WAS ADDED TO THE TOT AL INCOME OF THE ASSESSEE BY THE AO AS INCOME NOT DISCLOSED. IN RES PECT OF THE AFORESAID ADDITION MADE IN THE COURSE OF ASSESSMENT PROCEEDIN GS, THE AO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. THE A O IMPOSED PENALTY HOLDING THAT THE ASSESSEE HAS VIOLATED THE PROVISIO N OF LAW ENUMERATED IN SECTION 271(1)(C) OF THE ACT BY FURNISHING INACCURA TE PARTICULARS OF INCOME AND IMPOSED PENALTY U/S 271(1)(C) OF THE ACT. 4. BEING AGGRIEVED BY THIS ORDER OF LD. CIT(A) ASSE SSEE CAME IN APPEAL BEFORE THE TRIBUNAL. 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED BEF ORE US THAT THE SHOW CAUSE NOTICE ISSUED U/S 274 OF THE ACT BEFORE IMPOS ING PENALTY DOES NOT CONTAIN THE SPECIFIC CHARGE AGAINST THE ASSESSEE NA MELY AS TO WHETHER THE ASSESSEE WAS GUILTY OF HAVING CONCEALED PARTICULARS OF INCOME OR HAVING FURNISHED INACCURATE PARTICULARS OF INCOME. A COPY OF THE SHOW CAUSE NOTICE U/S 274 OF THE ACT WAS FILED BEFORE US WHICH IS PLA CED ON RECORD. PERUSAL OF THE SAME REVEALS THAT AO HAS NOT STRUCK OUT THE IRR ELEVANT PORTION IN THE SHOW CAUSE NOTICE AND THEREFORE THE SHOW CAUSE NOTICE DO ES NOT SPECIFY THE CHARGE AGAINST THE ASSESSEE AS TO WHETHER THE CHARG E IS OF CONCEALMENT OF ITA NO.2271/KOL/2014 A.Y. 2009-10 NANDKISHORE T. BISANI VS. CIT(A)-XXX KOL. PAGE 3 PARTICULARS OF INCOME OR FURNISHING OF INACCURATE P ARTICULARS OF INCOME. THE LD. COUNSEL FOR THE ASSESSEE DREW OUR ATTENTION TO THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. SSAS EMERALD MEADOWS IN ITA NO.380 OF 2015 DATED 23.11.2015 WHEREIN THE HONBLE KARNATAKA HIGH COURT FOLLOWING ITS OWN DECISION IN THE CASE OF CIT VS MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565 TOOK A VIEW THAT IMPOSING OF PE NALTY U/S 271(1)(C) OF THE ACT IS BAD IN LAW AND INVALID FOR THE REASON THAT THE SHOW CAUSE NOTICE U/S 274 OF THE ACT DOES NOT SPECIFY TH E CHARGE AGAINST THE ASSESSEE AS TO WHETHER IT IS FOR CONCEALMENT OF PAR TICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE LD. COUNSEL FURTHER BROUGHT TO OUR NOTICE THAT AS AGAINST THE DECISION OF THE H ONBLE KARNATAKA HIGH COURT THE REVENUE PREFERRED AN APPEAL IN SLP IN CC NO.11485 OF 2016 AND THE HONBLE SUPREME COURT BY ITS ORDER DATED 05.08.2016 DISMISSED THE SLP PREFERRED BY THE DEPARTMENT. THE LD. COUNSEL ALSO B ROUGHT TO OUR NOTICE THE DECISION OF THE HONBLE BOMBAY HIGH COURT IN THE CA SE OF CIT VS SHRI SAMSON PERINCHERY IN ITA NO.1154 OF 2014 DATED 05.01.2017 WHEREIN TH E HONBLE BOMBAY HIGH COURT FOLLOWING THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF MANJUNATHA COTTON AND GINNING FACTORY (SUPRA) CAME TO THE CONCLUSION THAT IMPOSITION OF PENALTY O N DEFECTIVE SHOW CAUSE NOTICE WITHOUT SPECIFYING THE CHARGE AGAINST THE AS SESSEE CANNOT BE SUSTAINED. OUR ATTENTION WAS ALSO DRAWN TO THE DECI SION OF ITAT IN THE CASE OF SUVAPRASANNA BHATTACHARYA VS ACIT IN ITA NO.1303/KOL/2010 DATED 06.11.2015 WHEREIN IDENTICAL PROPOSITION HAS BEEN F OLLOWED BY THE TRIBUNAL. ON THE OTHER HAND LD. DR HEAVILY RELIED ON THE ORDE R OF AUTHORITIES BELOW. 6. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED T HE MATERIALS AVAILABLE ON RECORD. AT THE OUTSET, WE OBSERVE THAT THE SHOW CAU SE NOTICE ISSUED IN THE PRESENT CASE U/S 274 OF THE ACT WHICH DOES NOT SPEC IFY THE CHARGE AGAINST THE ASSESSEE AS TO WHETHER IT IS FOR CONCEALING PARTICU LARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. THE SHOW CAUSE NO TICE U/S 274 OF THE ACT DOES NOT STRIKE OUT THE INAPPROPRIATE WORDS. IN T HESE CIRCUMSTANCES, WE ARE ITA NO.2271/KOL/2014 A.Y. 2009-10 NANDKISHORE T. BISANI VS. CIT(A)-XXX KOL. PAGE 4 OF THE VIEW THAT IMPOSITION OF PENALTY CANNOT BE SU STAINED. THE PLEA OF THE LD. COUNSEL FOR THE ASSESSEE WHICH IS BASED ON THE DECI SIONS REFERRED TO IN THE EARLIER PART OF THIS ORDER HAS TO BE ACCEPTED. WE, THEREFORE HOLD THAT THE IMPOSITION OF PENALTY IN THE PRESENT CASE CANNOT BE SUSTAINED AND THE SAME IS DIRECTED TO BE CANCELLED. AO IS DIRECTED ACCORDINGL Y. 7. IN THE RESULT, ASSESSEES APPEAL STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT 02/ 05/2017 SD/- SD/- ( !') (!') (N.V.VASUDEVAN) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP, SR.P.S $!% &- 02 / 06 /201 7 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-NANDKISHORE TIKAMDASJI BISANI, C/O M.M. SAREE HOUSE, 7A, SIR HARIRAM GOE NKA ST, 3 RD FLOOR, KOLKATA-7 2. /RESPONDENT-CIT(A)-XXX, 3 GOVERNMENT PLACE (WEST), KOLKATA-1 3.%.%/01 1 2 / CONCERNED CIT KOLKATA 4. 1 1 2- / CIT (A) KOLKATA 5.567 /0, 1 /0 , / DR, ITAT, KOLKATA 6.7:;<= / GUARD FILE. BY ORDER/ 1!, /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE,/D.D.O. 1 /0 ,