Vikas Manilal Boyatkar, Pune V. Assistant Commissioner of Income tax,

ITA 2607/PUN/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5231 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 16-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K J KAWADE
• Section: 271(1)(c); 40(a)(ia)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , . , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI D. KARUNAKARA RAO , AM . / ITA NO. 2 60 7 /P U N/201 6 / ASSESSMENT YEAR : 20 1 2 - 1 3 VIKAS MANILAL BOYATKAR 101, FLORENCE BUILDING, DATTA MANDIR CHOWK, VIMAN NAGAR, PUNE 14 . / APPELLANT P AN: AHRPB5224F VS. THE ASST. COMMISSIONER OF INCOME TAX, AHMEDNAGAR CIRCLE, AHMEDNAGAR . / RESPONDENT / APPELLANT BY : NONE / RESPONDENT BY : SHRI K.J. KAWADE / DATE OF HEARING : 1 2 . 12 .201 8 / DATE OF PRONOUNCEMEN T: 06 . 0 2 .201 9 / ORDER PER SUSHMA CHOWLA, J M : THE APPEAL FILED BY ASSESSEE IS AGAINST ORDER OF CIT (A) - 2 , PUNE , DATED 20 . 0 7 .20 1 6 RELATING TO ASSESSMENT YEAR 20 1 2 - 1 3 AGAINST PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOME - TAX ACT , 1961 (IN SHORT THE ACT) . 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUND S OF APPEAL: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) PUNE E RRED IN CONFORMING THE PENALTY LEVIED BY THE ASSESSING O FFICER OF RS.25,07 , 000/ - U/S 271(1)( C) IN COMPLETE DISREGARD OF THE FACT THAT THERE IS NO ADDITION ITA NO. 260 7 /P U N/20 1 6 VIKAS MANILAL BOYATKAR 2 MADE U/S 40(A)(IA) FOR FAILURE TO DEDUCT TDS IN THE ASSESSMENT ORDER IN RELATION TO THE RETURN OF I NCOME ON THE BASIS OF WHICH ASSESSMENT IS MADE AND OVERLO OKING THE SETTLED LEGAL PROPOSITION THAT CONCEALMENT ORIGINATES FROM THE RETURN OF INCOME FILED BY THE ASSESSEE. 2. WITHOUT PREJUDICE TO GROUND NO.1 THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) PUNE E RRED IN CONFIRMING PENALTY ON A TECHNICAL GROUND OF TDS FAILURE U/S 40(A)(IA) WHERE ALLOWABILITY OF THE EXPENDITURE IS OTHERWISE UNDISPUTED AND ERRED IN DISAGREEING WITH DECISION OF HON'BLE BOMBAY ITAT IN THE CASE OF RUSHI BUILDERS WHICH DELETED THE PENALTY U/S 271( 1 )(C) ON THE SAME GROUND OF TDS FAILURE. 3. DESPITE SERVICE OF NOTICE, NONE APPEARED ON BEHALF OF ASSESSEE NOR ANY APPLICATION WAS FILED FOR ADJOURNMENT. HOWEVER, IN VIEW OF THE ISSUE INVOLVED, WE PROCEED TO DECIDE THE PRESENT APPEAL AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE. 4. THE ONLY ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT AT 25,07,000/ - . 5. BEFORE GOING INTO THE MERITS OF SAID LEVY OF PENALTY FOR CONCEALMENT, WE REFER TO THE SATISFACTION RECORDED BY THE ASSESSING OFFICER WHILE INITIATING PENALTY PROCEEDINGS. THE ASSESSING OFFICER VIDE PARA 6 HAD HELD THE ASSESSEE TO HAVE F URNISHED INACCURATE PARTICULARS OF INCOME AND HENCE, PENALTY UNDER SECTION 271(1)(C) R.W.S. EXPLANATION 1 OF THE ACT WAS INITIATED. IN OTHER WORDS, THE ASSESSING OFFICER HAD INITIATED PENALTY PROCEEDINGS FOR FURNISHING INACCURATE PARTICULARS OF INCOME AND ALSO UNDER EXPLANATION 1 WHICH DEALS WITH CONCEALMENT OF INCOME. WHILE LEVYING PENALTY FOR CONCEALMENT, THE ASSESSING OFFICER HAD HELD THE ASSESSEE TO HAVE CONCEALED PARTICULARS OF INCOME AND HELD IT TO BE FIT CASE FOR LEVY OF PENALTY FOR CONCEALMENT. I N VIEW OF NON RECORDING OF PROPER SATISFACTION BY THE ASSESSING OFFICER WHILE INITIATING PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT, WHEREIN PENALTY WAS INITIATED FOR BOTH THE LIMBS WITH SPECIFIC MENTION OF FURNISHING OF INACCURATE PARTICULARS OF INCOME AND READ WITH EXPLANATION 1 AND THEREAFTER, WHILE LEVYING PENALTY FOR CONCEALING THE PARTICULARS OF INCOME, WE FIND THAT IN THE ABSENCE OF PROPER SHOW CAUSE NOTICE ITA NO. 260 7 /P U N/20 1 6 VIKAS MANILAL BOYATKAR 3 BEING GIVEN TO THE ASSESSEE, THERE IS NO MERIT IN LEVY OF AFORESAID PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 6. 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 PR OCEEDINGS AND IN THE ABSENCE OF PROPER SHOW CAUSE NOTICE TO THE ASSESSEE, THERE IS NO MERIT IN LEVY OF PENALTY. ACCORDINGLY, WE DELETE THE PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE ACT. THE GROUNDS OF APPEAL RAISED BY ASSESSEE ARE THUS, ALLOWED. 7 . IN THE RESULT, THE APPEAL OF ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON THIS 6 TH DAY OF FEBRUARY , 201 9 . SD/ - SD/ - ( D.KARUNAKARA RAO ) (SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 6 TH FEBRUARY , 201 9 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT(A) - 2 , PUNE ; 4. THE PR. CI T - 1 , PUNE ; 5. 6. , , / DR A , ITAT, PUNE ; / GUARD FILE . / BY ORDER , // TR UE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE