Sri. Najeeb C, Cochin V. The ITO, Cochin

ITA 239/COCH/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7716 (ITAT-COCHIN)
• Duration Of Justice: 1 year(s) 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 18-08-2016
• Assessment Year: 2002-2003
• Appeal Filed On: 13-04-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: A DHANARAJ
• Assessee Lawyers: T M SREEDHARAN
• Keywords: Non compliance
• Section: 142(1); 27

Judgement Text

ITA NO 239/C/2015 1 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH KOCHI BEFORE S/ SHRI B P JAIN , AM & GEORGE GEORGE K, JM ITA NO 23 9 /COCH/2015 (A SST YEAR 2002 - 03 ) SHRI NAJEEB C M/S NAJEEB ASSOCIATES 4 TH FLOOR - CHICAGO PLAZA RAJAJI ROAD KOCHI 682 035 VS THE INCOME TA X OFFICER WARD 2(3), KOCHI ( APPELLANT) (RESPONDENT) PAN NO. AAOPN2180L ASSESSEE BY SH T M SREEDHARAN REVENUE BY SH A DHANARAJ, SR DR DATE OF HEARING 18 TH AUG 2016 DATE OF PRONOUNCEMENT 18 TH AUG 2016 ORDER PER GEORGE GEORGE K, JM; THIS APPEAL, AT THE INSTANCE OF THE ASSESSEE, IS DIRECTED AGAINST THE CIT(A)S ORDER DATED 30.6.2014. THE ORDER OF THE CIT(A) ARISES OUT OF THE ORDER PASSED U/S 27 1(1)(B) OF THE I T A CT. THE RELEVANT ASSESSMENT YEAR IS 2002 - 03. 2 THERE IS A DELAY 2 09 DAYS IN FILING THE APPEAL. THE ASSESSEE HAS FILED CONDONATION PETITION ALONG WITH AN AFFIDAVIT STATING THE REASONS FOR THE DELAY IN FILING THE APPEAL. ON PERUSAL OF THE AFFIDAVIT, WE FIND THERE IS SUFFICIENT CAUSE FOR THE DELAY IN FILING TH IS APPEAL AND HENCE, WE CONDONE THE DELAY A ND PROCEED TO DISPOSE OFF THE APPEAL ON MERIT. ITA NO 239/C/2015 2 3 . THE GROUNDS RAISED READ AS FOLLOWS: 1 THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) - II , KOCHI IN ITA 11/R - II/E/CIT(A) - 11/08 - 09 DATED 30.6.2014 DISMISSING THE APPEAL IS OPPOSED TO LAW , FACTS A ND CIRCUMSTANCES OF THE CASE. 2 THE CIT(A) WENT WRONG IN CONFIRMING THE LEVY OF PENALTY OF RS. 20,000/ - U/S 271(1)(B) OF THE INCOME TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2002 - 03. 3 IT IS RESPECTFULLY SUBMITTED THAT THE FINDING MADE BY THE OFFICER THAT THERE WAS FAILURE ON THE PART OF THE APPELLANT IN COMPLY ING WITH THE NOTICES WARRANTING PENALTY U/S 271(1)(B) IS NEITHER LEGAL NOR SUSTAINABLE. IT IS SUBMITTED THAT LEVY OF PENALTY IN THE FACTS AN D CIRCUMSTANCES OF THE C ASE IS UNJUST AND UNWARRANTED. 4 WITHOUT PREJUDICE, IT IS SUBMITTED THAT THE QUANTUM OF PENALTY IS EX CESSIVE. 5 THE APPELLANT HUMBLY PRAYS THAT THE GROUNDS OF APPEAL BEFORE THE CIT (A) MAY BE CONSIDERED AS PART OF THESE GROUNDS. FOR THESE AND OTHER REASONS THAT MAY BE URGED AT THE TIME OF HEARING , IT IS HUMBLY PRAYED THAT THE HON ' BLE INCOME TAX APPELLATE TRIBUNAL, COCHIN BENCH MAY KINDLY BE PLEASED TO VACATE THE LEVY OF PENALTY , ALLOW THE APPEAL AND RENDER J USTICE . 4 BRIEFLY STATED THE FACTS OF THE CASE ARE AS FOLLOWS: THE ASSESSEE IS AN ARCHITECT . HE ALSO UNDERTAKES CIVIL CONSTRUCTION AS A CONTRACTOR. THE ASSESSEE WAS REQU IRED TO FILE RETURN OF INCOME FOR THE AY 2002 - 03 ON OR BEFORE 31. 10. 2003 AS PER THE PROVISIONS OF SECTION 139(1) OF THE ACT. SINCE NO RETURN OF INCOME WAS FILED BY THE ASSESSEE, NOTICE U/S 142(1) WAS ISSUED ON 27 TH DEC 2002 BY THE ACIT, CENTRAL CIRCLE. THE ASSESSEE DID NOT RESPOND TO THIS NOTICE. SUBSEQUENTLY, ANOTHER NOTICE U/S 142(1) WAS ISSUED ON 2.12.2004 , REQUIRING THE ASSESSEE TO PRODUCE ON 10.12.2004 THE RETURN OF INCOME, COPY OF BOOKS OF ACCOUNTS, COPIES OF FINAL ACCOUNTS FOR THE YEAR ENDED ON ITA NO 239/C/2015 3 31. 3.2002 ETC. THERE WAS NO RESPONSE TO THIS NOTICE ALSO. AS THE ASSESSEE FAILED TO COMPLY WITH THE TWO NOTICES ISSUED U/S 142(1) OF THE ACT , A SHOW CAUSE NOTICE WAS ISSUED FOR INITIATING PENALTY PROCEEDINGS U/S 271(1)(B) OF THE A CT. IN RESPONSE TO THE SHO W CAUSE NOTICE ISSUED FOR INITIATING PENALTY, THE ASSESSEE DID NOT FURNISH ANY SPECIFIC REASON FOR NON COMPLIANCE OF NOTICES ISSUED U/S 142(1) OF THE A CT. HENCE, PENALTY U/S 271(1)(B) OF THE ACT WAS IMPOSED AMOUNTING TO RS. 20,000/ - . (RS. 10,000/ - FOR EACH OF THE DEFAULTS) 5 AGGRIEVED BY THE ORD ER OF THE AO, IMPOSING PENALTY U/S 271(1)(B) OF THE ACT, THE ASSESSEE PREFERRED APPEAL TO THE FIRST APPELLATE AUTHORITY. THE CIT(A) CONFIRMED THE PENALTY . THE RELEVANT FINDINGS OF THE CIT(A) READ AS FOLLOWS: 5. I HAVE GONE THROUGH THE REASONING OF THE AO AND THE EXPLANATION BY THE ASSESSEE IN THIS REGARD . THE EXPLANAT ION OF THE ASSESSEE HAS NO FORCE IN IT THAT IN SPITE OF SPECIFICALLY SERVED STATUTORY NOTICES ON THE ASSESSEE WHY COMPLIANCE COULD NOT BE MADE BEFORE THE AO. ACCORDINGLY, THE PENALTY IMPOSED OF RS . 20,000/ - IS HEREBY CONFIRMED. 6 ASSESSEE BEING A GGRIEVED, IS IN APPEAL B EFORE US. THE LD COUNSEL FOR THE ASSESSEE SUBMITTED THAT HE MAY NOT HAVE ANY SPECIFIC REASON FOR NON COMPLIANCE OF NOTICES ISSUED U/S 142(1) OF THE ACT. HOWEVER , IT WAS SUBMITTED THAT PENALTY U/S 271(1)(B) CAN BE IMPOSED ONLY ONCE FOR AN AMOUNT OF RS. 10 ,000/ - . IN OTHER WORDS, IT WAS SUBMITTED THAT THE AO HAS IMPOSED PENALTY OF RS. 10,000/ - EACH FOR NON COMPLIANCE OF NOTICES U/S 142(1) OF THE ACT ISSUED ON 2 . 12. 2002 AND 2.12.2004. THIS, ACCORDING TO THE LD COUNSEL, IS NOT JUSTIFIED AND THE PENALTY CAN BE LEVIED ONLY FOR NON COMPLIANCE OF NOTICE ONCE . THE LD DR PRESENT WAS DULY HEARD. ITA NO 239/C/2015 4 7 WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE PENALTY U/S 271(1)(B) WAS IMPOSED FOR NON COMPLIANCE OF NOTICES ISSUED ON 27 TH DEC 2002 AND 2 ND DEC 2004. HENCE, FOR EACH OF THE FAILURE TO ATTEND TO THE NOTICES, PENALTY AMOUNTING TO RS. 10,000/ - EACH WAS LEVIED. THE ASSESSEE HAS NOT GIVEN ANY SPECIFIC REASON FOR NON COMPLIANCE OF NOTICES ISSUED AND HENCE, WE ARE OF THE VIEW T HAT T HE PENALTY IMPOSED IS JUSTIFIED. NOW, AS REGARDS THE QUANTUM OF IMPOSITION OF PENALTY, WE FIND SECTION 271(1)( II ) CLEARLY STATES A SUM OF RS. 10,000/ - CAN BE IMPOSED FOR EACH OF SUCH FAILURE OF COMPLIANCE OF NOTICES. HENCE, IN THE INSTANT CASE, SINCE THER E WAS FAILURE TO COMPLY WITH TWO NOTICES ISSUED U/S 142(1) OF THE A C T, WE ARE OF THE VIE W THAT THE AO IS JUSTIFIED IN IMPOSING A PENALTY AMOUNTING TO RS. 20,000/ - , WHICH WAS RIGHTLY CONFIRMED BY THE CIT(A). IT IS ORDERED ACCORDINGLY. 8 IN THE RESULT, THE A PPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 18 TH DAY OF AUG 2016 . SD/ SD/ - ( B P JAIN ) ( GEORGE GEORGE K ) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN: DATED 18 TH AUG 2016 RAJ* COPY TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT(A) , KOCHI 4 . CIT, KOCHI 5 . DR 6 . GUARD FILE BY ORDER ITA NO 239/C/2015 5 ASSISTANT REGISTRAR ITAT, COCHIN