Vijay Kumar, Gurgaon V. ITO, Ward- 4(5), Gurgaon

ITA 2650/DEL/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 2865 (ITAT-DELHI)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-08-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 16-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: DR RAKESH GUPTA
• Keywords: Revised return
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC, NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBER ITA NO.2650/DEL/2018 ASSESSMENT YEAR : 2014-15 VIJAY KUMAR, C/O. RRA TAXINDIA, D- 28, SOUTH EXTENSION, PART-1, NEW DELHI. VS. ITO, WARD- 4(5), GURGAON. PAN : AYOPK1044N (APPELLANT) (RESPONDENT) ASSESSEE BY : DR. RAKESH GUPTA, ADV. DEPARTMENT BY : SHRI ATIQ AHMED, SR. DR DATE OF HEARING : 02-08-2018 DATE OF PRONOUNCEMENT : 29-08-2018 O R D E R PER R. K. PANDA, AM : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER DATED 30.03.2018 OF CIT(A)- 1, GURGAON RELATING TO ASSESS MENT YEAR 2014-15. 2. LEVY OF PENALTY OF RS.6,84,440/- BY THE ASSESSIN G OFFICER U/S 271(1)(C) OF THE I.T. ACT, 1961 WHICH HAS BEEN SUSTAINED BY T HE LD. CIT(A) IS THE ONLY ISSUE RAISED BY THE ASSESSEE IN THE GROUNDS OF APPE AL. 3. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESS EE IS AN INDIVIDUAL AND FILED HIS RETURN OF INCOME ON 02.08.2014 DECLARING TOTAL INCOME OF RS.2,16,000/-. THE ASSESSEE HAS FILED THE REVISED RETURN OF INCOME ON 31.03.2016 DECLARING AN INCOME OF RS.20,21,650/-. THE ASSESSMENT WAS COMPL ETED U/S 143(3) ON 27.12.2016 DETERMINING THE TOTAL INCOME AT RS.27,81 ,682/- WHEREIN THE 2 ITA NO.2650/DEL/2018 ASSESSING OFFICER MADE CERTAIN ADDITIONS ON ACCOUNT OF COMMISSION INCOME RECEIVED FROM LANDMARK APARTMENTS PVT. LTD. OF RS.2 4,81,682/- AND RS.2,80,000/- TOWARDS RENTAL INCOME RECEIVED FROM H OUSE PROPERTY. THE ASSESSEE DID NOT FILE ANY APPEAL. SUBSEQUENTLY, TH E ASSESSING OFFICER LEVIED PENALTY OF RS.6,84,440/- U/S 271(1)(C) OF THE I.T. ACT, 1961. IN APPEAL, THE LD. CIT(A) UPHELD THE ACTION OF THE ASSESSING OFFICER. 4. AGGRIEVED WITH SUCH ORDER OF THE LD. CIT(A), THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. THE LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET, REFERRING TO THE NOTICE ISSUED U/S 274 R.W.S. 271 SUBMITTED THAT THE SHOW C AUSE NOTICE ISSUED U/S 274 R.W.S. 271 DOES NOT DEFINE THE NATURE OF DEFAULT I. E. WHETHER THE PENALTY IS LEVIED FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INAC CURATE PARTICULARS OF INCOME. HE SUBMITTED THAT THE ASSESSING OFFICER IMPOSED THE PENALTY U/S 271(1)(C) IN THIS CASE ON THE GROUND THAT THE ASSESSEE HAS CONCE ALED HIS INCOME AND FURNISHED INACCURATE PARTICULARS OF INCOME. REFERRING TO THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. M/S SSA S EMERALD MEADOWS VIDE ITA NO.380 OF 2015 ORDER DATED 23.11.2015, HE SUBMI TTED THAT THE HON'BLE HIGH COURT IN THE SAID DECISION, FOLLOWING THE DECISION IN THE CASE OF MANJUNATH COTTON AND GINNING FACTORY REPORTED IN 359 ITR 565, HAD UPHELD THE DECISION 3 ITA NO.2650/DEL/2018 OF THE TRIBUNAL CANCELLING THE PENALTY AND DISMISSE D THE APPEAL FILED BY THE REVENUE ON THE GROUND THAT THE NOTICE ISSUED BY THE ASSESSING OFFICER U/S 274 R.W.S. 271 IS BAD IN LAW SINCE IT DID NOT SPECIFY U NDER WHICH LIMB OF SECTION 271(1)(C) PENALTY PROCEEDINGS HAVE BEEN INITIATED. HE SUBMITTED THAT THE SLP FILED BY THE REVENUE HAS BEEN DISMISSED BY THE HON BLE SUPREME COURT. REFERRING TO VARIOUS DECISIONS FILED IN THE PAPER B OOK, HE SUBMITTED THAT UNDER IDENTICAL CIRCUMSTANCES VARIOUS BENCHES OF THE TRIB UNAL ARE CANCELLING THE PENALTY SO LEVIED WHERE THE INAPPROPRIATE WORDS ARE NOT STRUCK OFF FROM THE NOTICE ISSUED U/S 274 R.W.S. 271 OF THE ACT. HE AC CORDINGLY SUBMITTED THAT ON THIS PRELIMINARILY GROUND ITSELF THE ORDER OF THE L D. CIT(A) SUSTAINING THE PENALTY LEVIED BY THE ASSESSING OFFICER SHOULD BE SET-ASIDE AND THE PENALTY SHOULD BE CANCELLED. 6. THE LD. DR ON THE OTHER HAND HEAVILY RELIED ON T HE ORDER OF THE LD. CIT(A). HE SUBMITTED THAT MERE NON-STRIKING OF THE INAPPROPRIATE WORDS WILL NOT INVALIDATE THE INITIATION OF PENALTY PROCEEDING S AND THE PROVISIONS OF SECTION 292B/292BB WILL COME TO RESCUE OF THE DEPARTMENT. 7. I HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BO TH THE SIDES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE NOTICE ISSUED U/S 274 R.W.S. 271 SHOWS THAT THE INAPPROPRIATE WORDS IN THE SAID NOTICE HAS NOT BEEN STRUCK OFF 4 ITA NO.2650/DEL/2018 I.E. THE NOTICE DOES NOT SPECIFY UNDER WHICH LIMB O F SECTION 271(1)(C) THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E. WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCO ME. I FIND THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF M/S SSAS EMERA LD MEADOWS (SUPRA) HAS OBSERVED AS UNDER :- 3. THE TRIBUNAL HAS ALLOWED THE APPEAL FILED BY TH E ASSESSEE HOLDING THE NOTICE ISSUED BY THE ASSESSING OFFICER UNDER SECTION 274 R EAD WITH SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) TO BE BA D IN LAW AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, THE PENALTY P ROCEEDINGS HAD BEEN INITIATED I.E., WHETHER FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THE TRIBUNAL, WHILE ALLOWING THE APPEAL OF THE ASSESSEE, HAS RELIED ON THE DECISION OF THE DIVISION BENCH OF THI S COURT RENDERED IN THE CASE OF COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON A ND GINNING FACTORY (2013) 359 ITR 565. 4. IN OUR VIEW, SINCE THE MATTER IS COVERED BY JUDG MENT OF THE DIVISION BENCH OF THIS COURT, WE ARE OF THE OPINION, NO SUBSTANTIAL Q UESTION OF LAW ARISES IN THIS APPEAL FOR DETERMINATION BY THIS COURT. THE APPEAL IS ACCO RDINGLY DISMISSED. 8. I FIND THE SLP FILED BY THE REVENUE HAS BEEN DIS MISSED BY THE HONBLE APEX COURT. FURTHER, THE VARIOUS BENCHES OF THE TR IBUNAL FOLLOWING THE ABOVE DECISIONS ARE CANCELLING THE PENALTY SO LEVIED BY T HE ASSESSING OFFICER AND CONFIRMED BY THE LD. CIT(A) ON ACCOUNT OF NON-STRIK ING OF THE INAPPROPRIATE WORDS FROM THE NOTICE ISSUED U/S 274 R.W.S. 271 OF THE ACT. SINCE IN THE INSTANT CASE, THE ASSESSING OFFICER HAS NOT STRUCK OFF THE INAPPROPRIATE WORDS IN THE NOTICES ISSUED U/S 274 R.W.S. 271, THEREFORE, THE N OTICE DOES NOT SPECIFY UNDER WHICH LIMB OF SECTION 271(1)(C) THE PENALTY PROCEED INGS HAS BEEN INITIATED I.E. 5 ITA NO.2650/DEL/2018 WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THEREFORE, THE PENALTY PROCEEDINGS BECOME BAD IN LAW. I, THEREFORE, SET-ASIDE THE ORDER OF THE LD. CIT(A) AND DIRECT TH E ASSESSING OFFICER TO CANCEL THE PENALTY SO LEVIED. THE APPEAL FILED BY THE ASS ESSEE IS ACCORDINGLY ALLOWED. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 29 TH AUGUST, 2018. SD/- (R. K. PANDA) ACCOUNTANT MEMBER DATED: 29-08-2018. SUJEET COPY OF ORDER TO: - 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT 4) THE CIT(A) 5) THE DR, I.T.A.T., NEW DELHI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, NEW DELHI