Kasturilal Sardarilal Luthra, Nashik V. Assistant Commissioner of Income tax,

ITA 2561/PUN/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 6319 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 25-04-2019
• Assessment Year: 2004-2005
• Appeal Filed On: 10-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHABHANA PARVEEN
• Keywords: Reasonable cause; Condonation of delay
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO S . 2561 & 2562 /P U N/201 6 / ASSESSMENT YEAR S : 20 0 4 - 0 5 & 200 5 - 06 SHRI KASTURILAL SARDARILAL LUTHRA, URMIL, SHRIN MEADOWS, GANGAPUR ROAD, NASHIK 422011 . / APPELLANT P AN: A A FPL4629P VS. THE ASST . COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE 1, NASHIK . / RESPONDENT / APPELLANT BY : SHRI M.K. KULKARNI / RESPONDENT BY : MS. SHABHANA PARVEEN / DATE OF HEARING : 25 . 0 4 .201 9 / DATE OF PRONOUNCEMENT: 03 . 0 5 .201 9 / ORDER PER SUSHMA CHOWLA, J M : BOTH THE APPEAL S FILED BY ASSESSEE ARE AGAINST CONSOLIDATED ORDER OF CIT (A) - 1 2 , PUNE , DATED 04 . 07 .20 1 6 RELATING TO ASSESSMENT YEAR S 200 4 - 0 5 AND 200 5 - 06 AGAINST PENALTY LEVI ED UNDER SECTION 271(1)(C) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2. BOTH THE APPEALS OF ASSESSEE ON SIMILAR ISSUE WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. ITA NO S . 2561 & 2562 /P U N/20 1 6 KASTURILAL SARDARILAL LUTHRA 2 3. BOTH THE APPEALS HAVE BEEN FILED AFTER DELAY OF 26 DAYS. SINCE THE ISSUE INVOLVED IS SQUARELY COVERED AND THE DELAY IS MEAGER, HENCE WE PROCEED TO DECIDE THE PRESENT APPEALS BY CONDONING THE DELAY. 4 . THE ASSESSEE IN ITA NO.2561/PUN/2016, RELATING TO ASSESSMENT YEAR 2004 - 05 HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) - 12, PUNE WAS NOT JUSTIFIED IN CONFIRMING THE PENALTY LEVIED BY THE A. O. UNDER S. 271( 1 )(C) BY DISMISSING THE APPEAL OF THE ASSESSEE MEANING THEREBY THE PENALTY IMPOSED WAS ON DEEMED CONCEALMENT WHICH IS NOT ACCORDING TO LAW. THE PENALTY LEVIED BE QUASHED. 2) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW CL. (A) OF EXPLANATION 1 TO S. 271( 1 )(C) WAS NOT ATTRACTED AS EXPLANATION WAS SUB MITTED IN RESPONSE TO SHOW - CAUSE NOTICE U/S 274 OF THE ACT. THE CL. (B) TO THAT EXPLANATION WAS ALSO NOT ATTRACTED SINCE ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF HIS TOTAL INCOME WERE ALREADY DISCLOSED WHICH IS CLEAR FROM THE A SSESSMENT ORDER. THE ASSESSEE WAS NOT ABLE TO SUBSTANTIATE SINCE THE ORIGINAL LENDER OF MONEY OF RS.4,21,000/ - HAD ALREADY EXPIRED AFTER THE TRANSACTION. IN SUCH CIRCUMSTANCES THE PENALTY WAS NOT LEVIABLE. THE PENALTY BE QUASHED. 3) ON THE FACTS AND CIRCU MSTANCES OF THE CASE AND IN LAW THE PENALTY PROCEEDINGS WERE INITIATED WITHOUT ANY SPECIFIC CHARGE AGAINST THE ASSESSEE. THAT IS PERTAINING TO ANY SPECIFIC LIMB OF S.271( 1 )(C) OF THE ACT. THE HON'BLE SUPREME COURT WHILE DISMISSING THE SLP OF THE DEPARTMENT WHERE HIGH COURT HELD THAT NOTICE WITHOUT MENTIONING WHETHER FOR CONCEALMENT OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME WAS NOT SUSTAINED [386 ITR (ST) 13]. BY THIS THE HIGH COURTS ORDER ATTAINED FINALITY AND BECAME BINDING PRECEDENT UNDER ART 141 OF THE CONSTITUTION OF INDIA. IN THE CIRCUMSTANCES THE LD. C I T(A) WAS NOT JUSTIFIED IN CONFIRMING THE PENALTY. THE PENALTY LEVIED BE QUASHED. 4) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD.CIT(A) WAS NOT JUSTIFIED IN CONFIRMING THE PENAL TY ORDER IN SPITE OF THE ARGUMENT THAT THE SAME WAS BARRED BY LIMITATION. THE LD.C I T(A) REJECTED THE CONTENTION OF THE APPELLANT 'WITHOUT A SPEAKING ORDER'. THE PENALTY ORDER BE QUASHED AS BARRED BY LIMITATION. 5) ON THE FACTS AND CIRCUMSTANCES OF THE CAS E AND IN LAW THE DELAY HAS OCCURRED IN FILING OF THIS APPEAL BY 20 DAYS. THE REASONS ARE NOT 'WITHOUT REASONABLE CAUSE'. THE DETAILED SWORN AFFIDAVIT EXPLAINING THE REASONS FOR CONDONATION OF DELAY WILL BE FILED SEPARATELY. IN VIEW OF THIS THE DELAY BE CON DONED AND APPEAL BE ADMITTED FOR ADJUDICATION IN ACCORDANCE WITH THE PROVISIONS OF LAW. ITA NO S . 2561 & 2562 /P U N/20 1 6 KASTURILAL SARDARILAL LUTHRA 3 5 . THE ONLY ISSUE RAISED IN BOTH THE APPEAL S IS AGAINST LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT . 6 . BEFORE GOING INTO THE MERITS OF SAID LEVY OF PENALTY UN DER SECTION 271(1)(C) OF THE ACT , WE REFER TO THE SATISFACTION RECORDED BY THE ASSESSING OFFICER WHILE INITIATING PENALTY PROCEEDINGS. THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS RELATING TO ASSESSMENT YEAR 2004 - 05 AT THE END OF PARA 9 OF HIS ORDER HAD HELD THAT THE ASSESSEE IS DEEMED TO HAVE CONCEALED THE PARTICULARS OF SUCH INCOME, THEREFORE, PENALTY PROCEEDINGS U/S. 271(1)(C) IS SEPARATELY INITIATED . WHILE LEVYING PENALTY, THE ASSESSING OFFICER AT PAGE 3 OF PENALTY ORDER HAD HELD THAT THE ASSESSEE HAS CONCEALED PARTICULARS OF ITS INCOME BY FURNISHING OF INACCURATE PARTICULARS OF THE SAME. FURTHER, THE ASSESSING OFFICER DURING THE COURSE OF ASSESSMENT PROCEEDINGS RELATING TO ASSESSMENT YEAR 2005 - 06 AT LAST PAGE OF HIS ORDER HAD HEL D THAT FOR FILING INACCURATE PARTICULARS OF INCOME AS DISCUSSED ABOVE, PENALTY PROCEEDINGS U/S. 271(1)(C) IS SEPARATELY INITIATED. WHILE LEVYING PENALTY, THE ASSESSING OFFICER HAS HELD THAT THE ASSESSEE HAS CONCEALED PARTICULARS OF ITS INCOME BY FURNISHIN G OF INACCURATE PARTICULARS OF THE SAME. IN VIEW THERE OF , WHERE THE ASSESSING OFFICER HAD INITIATED PENALTY PROCEEDINGS FOR ONE LIMB AND LEVIES PENALTY FOR BOTH LIMBS ; WE FIND NO MERIT IN LEVY OF AFORESAID PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 7 . WE FIND SUPPORT FROM THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. SHRI SAMSON PERINCHERY (2017) 392 ITR 4 (BOM), WHEREIN IT WAS HELD THAT WHERE THERE IS NO PROPER SATISFACTION FOR INITIATING PENALTY PROCEEDINGS AND IN THE ABSENCE OF PRO PER SHOW CAUSE NOTICE TO THE ASSESSEE, THERE IS NO MERIT IN LEVY OF PENALTY. ACCORDINGLY, WE DELETE THE PENALTY LEVIED ITA NO S . 2561 & 2562 /P U N/20 1 6 KASTURILAL SARDARILAL LUTHRA 4 UNDER SECTION 271(1)(C) OF THE ACT IN BOTH THE APPEALS . THE GROUND S OF APPEAL RAISED BY ASSESSEE IN BOTH THE APPEALS ARE THUS, ALLOWED. 8 . IN THE RESULT, BOTH THE APPEAL S OF ASSESSEE ARE ALLOWED. ORDER PRONOUNCED ON THIS 3 RD DAY OF MAY , 201 9 . SD/ - SD/ - (ANIL CHATURVEDI) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 3 RD MAY , 201 9 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / TH E APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 1 2 , PUNE ; 4. THE PR. CI T CENTRAL, NAGPUR ; 5. 6. , , / DR A , ITAT, PUNE ; / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE