Sri Mohan , Bangalore V. Income Tax Officer Ward-6(1) , Bangalore

ITA 2627/BANG/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 7623 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 06-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DHIVAHAR
• Assessee Lawyers: B S BALACHANDRAN
• Keywords: Initiation of penalty proceedings; Condonation of delay

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER ITA NO. 2627 / BANG/201 7 ASSESSMENT YEAR : 20 13 - 14 SHRI MOHAN, NO. 1, NISCHITHALAYA, 10 TH C CROSS, ANJANEYA TEMPLE STREET, BALAJI NAGAR, ITTAMADU, BANGALORE 560 085. PAN: AMBPM2130N VS. THE INCOME TAX OFFICER, WARD 6 (1), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI B.S. BALACHANDRAN, A DVOCATE RESPONDENT BY : SHRI P. DHIVAHAR, ADDL. CIT (DR) DATE OF HEARING : 09 .0 7 .2018 DATE OF PRONOUNCEMENT : 20 .0 7 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIREC TED AGAINST THE ORDER OF LD. CIT(A)-7, BANGALORE DATED 17.10.2017 FOR ASSESSMENT YEAR 2013-14. 2. THE GROUNDS RAISED BY THE ASSESSEEARE AS UNDER. 1. THE ORDER OF THE LEARNED CIT (A), IS BAD AND UNS USTAINABLE IN THE EYE OF LAW AS THE SAME IS PASSED WITHOUT APPLICATIO N OF MIND. 2. THE CIT(A) OUGHT TO HAVE APPRECIATED THAT THE PE NALTY ORDER WAS ILLEGAL AND OPPOSED TO THE SETTLED POSITION OF LAW WHEN THE AO WITHOUT ANY REASON LEVIES AN ARBITRARY PENALTY AT 200% WHEN , ON MERITS, THE CREDITOR'S CONFIRMATIONS WERE AVAILABLE. 3. CIT(A) OUGHT TO HAVE APPRECIATED THAT THE VERY N OTICE ISSUED UNDER S.274 R/W S.271 DATED 16.03.2016 ITSELF BEING DEFEC TIVE & CONTRARY TO THE REQUIREMENT OF LAW AS INTERPRETED BY THE JURISD ICTIONAL HIGH COURT IN THE CASE OF MANJUNATHA COTTON & GINNING FACTORY (359 ITR 565), THE PENALTY AS LEVIED WAS UNSUSTAINABLE. 4. WITHOUT PREJUDICE, THE APPELLANT HAD IN GOOD FAI TH SUBMITTED THE REASONS FOR DELAY IN FILING APPEAL WHICH, SHE AS A LAYMAN BELIEVED TO BE TRUE AND HENCE, THE CIT(A) OUGHT TO HAVE CONDONE D THE DELAY AND ITA NO.2627/BANG/2017 PAGE 2 OF 4 PASSED ORDER ON MERITS BASED AT LEAST ON THE LEGAL POSITION AND THE GROUNDS OF APPEAL URGED. 5. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE URG ED AT THE TIME OF HEARING, THE APPELLANT PRAYS THAT THE APPEAL MAY BE ALLOWED. 3. THE LD. AR OF ASSESSEE PLACED RELIANCE ON THE JU DGMENT OF HONBLE KARNATAKA HIGH COURT RENDERED IN THE CASE OF CIT VS. MANJUNAT HA COTTON AND GINNING FACTORY AS REPORTED IN (2013) 359 ITR 565. HE ALSO SUBMITTED A COPY OF NOTICE ISSUED BY THE AO U/S. 274 R.W.S. 271(1) (C) OF IT A CT, 1961 AND POINTED OUT THAT IN THIS NOTICE, THERE ARE VARIOUS CLAUSES BUT THE A O HAS NOT EVEN TICKED ANY OF THE CLAUSES. HE FURTHER SUBMITTED THAT AT THE BEST , IT MAY BE ASSUMED THAT THE AO WANTED TO TICK THE THIRD CLAUSE WHICH READS AS U NDER. HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR FU RNISHED INACCURATE PARTICULARS OF SUCH INCOME. HE SUBMITTED THAT EVEN IF THIS ASSUMPTION IS MADE T HEN ALSO, THIS NOTICE IS BAD IN LAW BECAUSE THE AO HAS NOT MADE CLEAR AS TO WHET HER THE ALLEGATION IS REGARDING CONCEALMENT OF INCOME OR FURNISHING OF IN ACCURATE PARTICULARS OF INCOME AND THEREFORE, THE PENALTY ORDER PASSED IN P URSUANCE TO THIS NOTICE IS BAD IN LAW AND HENCE, NOT SUSTAINABLE AS PER THIS J UDGMENT OF HONBLE KARNATAKA HIGH COURT. IN REPLY, IT WAS SUBMITTED B Y LD. DR OF REVENUE THAT AS PER THE ORDER OF CIT(A), IT IS SEEN THAT IT IS NOTE D BY CIT(A) THAT THE APPEAL WAS FILED BY THE ASSESSEE AFTER A DELAY OF 124 DAYS IN FILING THE APPEAL AND LD. CIT(A) HAS NOT CONDONED THE DELAY AND DISMISSED THE APPEAL AND THEREFORE, THERE IS NO DECISION OF CIT(A) ON MERIT. HE SUBMIT TED THAT FIRST THIS ASPECT SHOULD BE DECIDED AS TO WHETHER THE DELAY IN FILING THE APPEAL BEFORE CIT(A) SHOULD BE CONDONED AND THEN ONLY THE ISSUE ON MERIT CAN BE CONSIDERED, EXAMINED AND DECIDED. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. FIRST OF ALL, WE REPRODUCE PARA 4.7 OF THE ORDER OF CIT(A) WHICH READS AS UNDER. 4.7 IN THE INSTANT CASE NO REASON HAS BEEN ADVANCED BY THE APPELLANT FOR THE DELAY OF 124 DAYS IN FILING APPEAL. AS SUC H, I AM OF THE CONSIDERED OPINION THAT THE DELAY IN FILING THE APP EAL CANNOT BE CONDONED. CONSEQUENTLY, THE APPEAL OF THE APPELLAN T IS TREATED AS INVALID. ITA NO.2627/BANG/2017 PAGE 3 OF 4 5. FROM THE ABOVE PARA, IT COMES OUT THAT AS PER TH E IMPUGNED ORDER OF CIT(A), THE ISSUE IS NOT DECIDED ON MERIT AND IT WAS DECIDE D ON THIS BASIS ALONE THAT THE ASSESSEE COULD NOT ADVANCE ANY REASON FOR THE DELAY OF 124 DAYS IN FILING THE APPEAL AND THEREFORE, THE APPEAL WAS TREATED INVALI D. IN PARA 4.5 OF THE ORDER OF CIT(A), IT IS SEEN THAT IT IS NOTED BY CIT(A) THAT THE ASSESSEE HAS PLACED RELIANCE ON JUDGEMENT OF HONBLE APEX COURT RENDERE D IN THE CASE OF COLLECTOR, LAND ACQUISITION VS. MST. KATIJI AS REPORTED IN 198 7 SC 1353. BUT THIS JUDGEMENT WAS NOT FOLLOWED BY CIT(A) ON THIS BASIS THAT THE ABOVE DECISION ARE RELATED TO CONDONATION OF DELAY OF ONLY 7 AND 4 DAY S BUT IN THE PRESENT CASE, THERE IS AN EXTRAORDINARY DELAY OF 281 DAYS AND ASS ESSEE HAS NOT SHOWN ANY SUFFICIENT CAUSE AS REQUIRED BY PROVISO TO SECTION 249 OF IT ACT. THEREAFTER, THE CIT(A) HAS FOLLOWED THE TRIBUNAL ORDER RENDERED IN THE CASE OF SRF LTD. VS. ADDL. CIT IN I.T.A.NO.3555/DEL/2009 DATED 13.11.201 4 OF WHICH THE LD. CIT(A) HAS REPRODUCED THE RELEVANT PARA AND IT IS SEEN THA T IN THAT CASE, THERE WAS EXTRAORDINARY DELAY OF 1163 DAYS IN FILING THE APPE AL AS AGAINST DELAY OF 281 DAYS IN THE PRESENT CASE. CONSIDERING ALL THESE FA CTS AS DISCUSSED ABOVE, WE FEEL IT PROPER TO CONDONE THE DELAY OF 281 DAYS IN FILING THE APPEAL BEFORE CIT(A) BY FOLLOWING JUDGMENT OF HONBLE APEX COURT RENDERE D IN THE CASE OF COLLECTOR, LAND ACQUISITION VS. MST. KATIJI (SUPRA). IN PARTI CULAR IN VIEW OF THIS FACT THAT THE INITIATION OF PENALTY PROCEEDINGS ITSELF IS BAD IN LAW IN THE FACTS OF THE PRESENT CASE AND THEREFORE, A LIBERAL APPROACH SHOULD BE AD OPTED IN CONDONING THE DELAY. HENCE WE CONDONE THE DELAY. AFTER CONDONIN G THE DELAY, WE FEEL IT PROPER TO RESTORE THE MATTER BACK TO THE FILE OF CI T(A) FOR DECISION ON MERIT. WE ORDER ACCORDINGLY. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- SD/- (N.V. VASUDEVAN) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 20 TH JULY, 2018. /MS/ ITA NO.2627/BANG/2017 PAGE 4 OF 4 COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.