MESERS HPCL MITTAL ENERGY LIMITED , BATHINDA V. ASSIATANT COMMISSIONER OF INCOME TAX, CIRCLE (1), BATHINDA

ITA 267/ASR/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3278 (ITAT-AMRITSAR)
• Duration Of Justice: 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 12-02-2019
• Assessment Year: 2010-2011
• Appeal Filed On: 08-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PARWINDER KAUR
• Keywords: Difference of opinion
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLA TE TRIBUNAL AMRITSAR BENCH, A MRITSAR BEFORE SH. N.S.SAINI, ACCOUNTANT MEMBER AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER ITA NO.266(ASR)/2018 ASSESSMENT YEA R:2010-11 M/S. HPCL MITTAL PIPELINES LTD., VILLAGE:- PHULOKHARI, TALUKA TALWANDI SABOO, DIST- BATHINDA, PUNJAB-151301. [PAN:AABCH 9865Q] VS. ASST. CIT, CIRCLE (1), BHATINDA-151005. (APPELLANT) (RESPONDENT) & ITA NOS.267 & 269(ASR)/2018 ASSESSMENT YEARS:2010-11 & 2011-12 M/S. HPCL MITTAL ENERGY LTD., VILLAGE:- PHULOKHARI, TALUKA TALWANDI SABOO, DIST- BATHINDA, PUNJAB-151301. [PAN:AABCG 5231F] VS. ASST. CIT, CIRCLE (1), BHATINDA-151005. (APPELLANT) (RESPONDENT) APPELLANT BY: SH. GAURAV JAIN & DEEPESH JAIN (LD . CAS) RESPONDENT BY: SMT. PARWINDER KAUR (LD. CIT-DR) DATE OF HEARING: 12.02.2019 DATE OF PRONOUNCEMENT: 14 .02.20 19 ORDER PER N.K.CHOUDHRY, JM: THESE APPEALS HAVE BEEN PREFERRED BY THE ASSESSEE AGAINST THE COMMON ORDER DATED 26.2.2018 PASSED BY THE LD. CIT( A), BHATINDA U/S 250(6) OF THE I.T. ACT, 1961 (HEREINAFTER CALLED AS THE ACT). 2. AS THE ISSUES INVOLVED IN ALL THE THREE APPEALS ARE IDENTICAL AND SIMILAR THEREFORE, FOR THE SAKE OF CONVENIENCE AND BREVITY ARE TAKEN SIMULTANEOUSLY FOR ADJUDICATION BY THIS COMPOSITE O RDER. ITA NOS.266, 267 & 269 /ASR/2018 (A .YS.2010-11 & 2011-12) 2 3. THE ONLY ISSUE INVOLVED IN THE INSTANT APPEALS R ELATES TO IMPOSITION OF PENALTY WHICH HAS BEEN AFFIRMED BY THE LD. CIT(A ). AT THE OUTSET, IT WAS STATED BY LD. AR IN THE INSTANT CASES, THE AO W HILE INITIATING PENALTY PROCEEDINGS RECORDED A SATISFACTION QUA CONCEALMENT OF PARTICULARS OF ITS INCOME, HOWEVER, WHILE ISSUING A NOTICE U/S 274 OF THE ACT, MENTIONED BOTH LIMBS I.E. CONCEALMENT OF INCOME/FURNISHING OF INACCURATE PARTICULARS OF INCOME AND FINALLY WITHOUT SPECIFYING THE LIMB, IMPOSED THE PENALTY FOR CONCEALMENT/FURNISHING INACCURATE PARTICULARS OF IN COME, WHICH GOES TO SHOW THAT WHILE INITIATING THE PENALTY, ISSUING OF NOTICE U/S 274 OF THE ACT AND LEVYING THE PENALTY, THE AO WAS NOT SURE UNDER WHICH LIMB THE PENALTY WAS ATTRACTED AND IMPOSABLE. IN THE SIMILAR FACTS AND CIRCUMSTANCES, WHILE ANALYZING VARIOUS DECISIONS RE NDERED BY HON'BLE KARNATAKA HIGH COURT IN MANJUNATHA COTTON AND GINN ING FACTORY 359 ITR 565 (KAR), KARNATAKA, CIT VS MANU ENGINEERING WOR KS (1980) 122 ITR 306 (GUJ), AND PADMA RAM BHARALI VS CIT, CO-ORD INATE BENCH AT AMRITSAR IN THE ASSESSEE'S OWN CASES (THIRD MEMBER' S CASES) HPCL MITTAL ENERGY LTD VS ADDL CIT & HPCL MITTAL PIPELINE LT D., VS ADDL CIT ( ITA NOS. 554 & 555/ASR/2014 AND 510 & 556/ASR.2014 ASSE SSMENT YEARS 2008-09 & 2009-10, ORDER DATED 7.5.2018), ORDERED FOR DELETION OF THE PENALTY AND THE CONSEQUENTIAL EFFECT TO THE THIRD MEMBER DECISION WAS GIVEN BY THE CO-ORDINATE BENCH IN THE SAME ITA NOS. VIDE ORDER DATED 7.5.2018 AND THEREFORE THE INSTANT CASES ARE SQUARE LY COVERED BY THE DECISION OF THE TRIBUNAL (THIRD MEMBER'S CASES) . 4. ON THE CONTRARY, THE LD. CIT(DR) FAIRLY SUBMITTE D THAT ALTHOUGH THE FACTS OF THIRD MEMBER'S CASES ARE IDENTICAL AND SI MILAR, HOWEVER EVERY CASE IS DISTINCT ONE AND MUST BE DECIDED IN ACCORDA NCE WITH PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE AND THE AUTHORITIES B ELOW WERE RIGHT IN INITIATING PENALTY PROCEEDINGS AS WELL AS IMPOSING THE PENALTY AND THEREFORE, THE ORDERS UNDER CHALLENGE DOES NOT SUFF ER FROM ANY PERVERSITY, ILLEGALITY OR IMPROPRIETY. ITA NOS.266, 267 & 269 /ASR/2018 (A .YS.2010-11 & 2011-12) 3 5. HAVING HEARD THE PARTIES AT LENGTH AND PERUSED T HE ORDERS PASSED BY THE AUTHORITIES BELOW AND THE MATERIAL AVAILABLE ON RECORD. FOR DECIDING THE INSTANT ISSUE, RELEVANT PART OF THE DECISION OF THE TRIBUNAL IN THIRD MEMBER'S CASES(SUPRA) IS CRUCIAL AND THEREFORE RE PRODUCED HEREIN BELOW FOR THE SAKE OF BREVITY AND READY REFERENCE :- IN VIEW OF THE FOREGOING DISCUSSION, I AM SATISFIED THAT THE PENALTY WAS WRONGLY IMPOSED AND CONFIRMED IN ALL THE FOUR APPEALS UNDER CONSIDERATION. I AGREE WITH THE LD. JM IN STRIKING DOWN ALL THE PENALTY ORDERS. THE QUESTION POSED IS, THEREFORE, ANSWERED IN AFFIRMATIVE TO THE EFFEC T THAT WHERE THE SATISFACTION OF THE AO WHILE INITIATING PENALTY PROCEEDINGS U/S 271(1)(C) I.T. ACT, 1961 IS WITH REGARD TO THE ALLEGED CONCEALMENT OF INCOME BY THE ASSESSEE, WHEREAS THE IMPOSITION OF PENALTY IS FOR CONCEALMENT/ FURNISHING INACCURATE PARTICULARS OF INCOME, THE LEVY OF PENALTY IS NOT SUSTAINABLE. 5.1 THOUGH WE ARE IN AGREEMENT WITH THE LD. D R TH AT EVERY CASE IS DISTINCT ONE AND MUST BE DECIDED IN ACCORDANCE WITH PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE, HOWEVER IT IS WELL SETTL ED LAW THAT LITIGATION MUST COME TO AN END AND CONSISTENCY IS IMPERATIVE T O BE OBSERVED. QUESTION QUA TAKING A CONTRARY VIEW TO JUDGMENTS OF CO-ORDINATE BENCHES, THE LAW IS WELL SETTLED BY THE APEX COURT IN THE CA SE OF THE S.I. ROOPLAL AND ANR VS LT. GOVERNOR THROUGH CHIEF SECRETARY DEL HI & ORS. (APPEAL CIVIL) 5363-64 OF 1997 DATE OF JUDGMENT: 14/12/1999 {1999 SUPP (5) SCR 310}), RELEVANT PART OF WHICH IS REPRODUCED HER EIN BELOW: ' AT THE OUTSET, WE MUST EXPRESS OUR SERIOUS DISSATIS FACTION IN REGARD TO THE MANNER IN WHICH A COORDINATE BENCH OF THE TRIBU NAL HAS OVERRULED, IN EFFECT, AN EARLIER JUDGMENT OF ANOTHER COORDINATE B ENCH OF THE SAME TRIBUNAL. THIS IS OPPOSED TO ALL PRINCIPLES OF JUDI CIAL DISCIPLINE. IF AT ALL, THE SUBSEQUENT BENCH OF THE TRIBUNAL WAS OF THE OPI NION THAT THE EARLIER VIEW TAKEN BY THE COORDINATE BENCH OF THE SAME TRIB UNAL WAS INCORRECT, IT OUGHT TO HAVE REFERRED THE MATTER TO A LARGER BENCH SO THAT THE DIFFERENCE OF OPINION BETWEEN THE TWO COORDINATE BENCHES ON TH E SAME POINT COULD ITA NOS.266, 267 & 269 /ASR/2018 (A .YS.2010-11 & 2011-12) 4 HAVE BEEN AVOIDED. IT IS NOT AS IF THE LATTER BENCH WAS UNAWARE OF THE JUDGMENT OF THE EARLIER BENCH BUT KNOWINGLY IT PROC EEDED TO DISAGREE WITH THE SAID JUDGMENT AGAINST ALL KNOWN RULES OF P RECEDENTS. PRECEDENTS WHICH ENUNCIATE RULES OF LAW FROM THE FOUNDATION OF ADMINISTRATION OF JUSTICE UNDER OUR SYSTEM. THIS IS A FUNDAMENTAL PRI NCIPLE WHICH EVERY PRESIDING OFFICER OF A JUDICIAL FORUM OUGHT TO KNOW , FOR CONSISTENCY IN INTERPRETATION OF LAW ALONE CAN LEAD TO PUBLIC CONF IDENCE IN OUR JUDICIAL SYSTEM. THIS COURT HAS LAID DOWN TIME AND AGAIN PRE CEDENT LAW MUST BE FOLLOWED BY ALL CONCERNED; DEVIATION FROM THE SAME SHOULD BE ONLY ON A PROCEDURE KNOWN TO LAW. A SUBORDINATE COURT IS BOUN DED BY THE ENUNCIATION OF LAW MADE BY THE SUPERIOR COURTS. A C OORDINATE BENCH OF A COURT CANNOT PRONOUNCE JUDGMENT CONTRARY TO DECLARA TION OF LAW MADE BY ANOTHER BENCH. IT CAN ONLY REFER IT TO A LARGER BENCH IF IT DISAGREES WITH THE EARLIER PRONOUNCEMENT. THIS COURT IN THE CASE OF TRIBHUVANDAS PURSHOTTAMDAS THAKAR V. RATILAL MOTILAL PATEL , [1968] 1 SCR 455 WHILE DEALING WITH A CASE IN WHICH A JUDGE OF THE HIGH CO URT HAD FAILED TO FOLLOW THE EARLIER JUDGMENT OF A LARGER BENCH OF THE SAME COUR T OBSERVED THUS: 'THE JUDGMENT OF THE FULL BENCH OF THE GUJARAT HIGH COURT WAS BINDING UPON RAJU, J. IF THE LEARNED JUDGE WAS OF T HE VIEW THAT THE DECISION OF BHAGWATI, J., IN PINJARE KARIMBHAI'S CASE AND OF MA CLEOD, C.J., IN HARIDAS `S CASE DID NOT LAY DOWN THE CORRECT LAW OR RULE OF PR ACTICE, IT WAS OPEN TO HIM TO RECOMMEND TO THE CHIEF JUSTICE THAT THE QUESTION BE CONSIDERED BY A LARGER BENCH. JUDICIAL DECORUM, PROPRIETY AND DISCIPLINE R EQUIRED THAT HE SHOULD NOT IGNORE IT OUR SYSTEM OF ADMINISTRATION OF JUSTICE A IMS AT CERTAINTY IN THE LAW AND THAT CAN BE ACHIEVED ONLY IF JUDGES DO NOT IGNO RE DECISIONS BY COURTS OF COORDINATE AUTHORITY OR OF SUPERIOR AUTHORITY. GAJE NDRAGADKAR, C.J. OBSERVED IN LALA SHRI BHAGWAN AND ANR, V. SHRI RAM CHAND AND AN R . 'IT IS HARDLY NECESSARY TO EMPHASIS THAT CONSIDERAT IONS OF JUDICIAL PROPRIETY AND DECORUM REQUIRE THAT IF A LEARNED SIN GLE JUDGE HEARING A MATTER IS INCLINED TO TAKE THE VIEW THAT THE EARLIER DECISION S OF THE HIGH COURT, WHETHER OF A DIVISION BENCH OR OF A SINGLE JUDGE, NEED TO B E RE- CONSIDERED, LIE SHOULD NOT EMBARK UPON THAT ENQUIRY SITTING AS A SINGLE JU DGE, BUT SHOULD REFER THE MATTER TO A DIVISION BENCH, OR, IN A PROPER CASE, P LACE THE RELEVANT PAPERS BEFORE THE CHIEF JUSTICE TO ENABLE HIM TO CONSTITUT E A LARGER BENCH TO EXAMINE THE QUESTION. THAT IS THE PROPER AND TRADITIONAL WA Y TO DEAL WITH SUCH MATTERS AND IT IS FOUNDED ON HEALTHY PRINCIPLES OF JUDICIAL DECORUM AND PROPRIETY.' WE ARE INDEED SORRY TO NOTE THE ATTITUDE OF THE TRI BUNAL IN THIS CASE WHICH, AFTER NOTICING THE EARLIER JUDGMENT OF A COO RDINATE BENCH AND AFTER NOTICING THE JUDGMENT OF THIS COURT, HAS STILL THOU GHT IT FIT TO PROCEED TO TAKE A VIEW TOTALLY CONTRARY TO THE VIEW TAKEN IN THE EARL IER JUDGMENT THEREBY CREATING A JUDICIAL UNCERTAINTY IN REGARD TO THE DECLARATION OF LAW INVOLVED IN THIS CASE. BECAUSE OF THIS APPROACH OF THE LATTER BENCH OF THE TRIBUNAL IN THIS CASE, A LOT OF VALUABLE TIME OF THE COURT IS WASTED AND PARTIES TO THIS CASE HAVE BEEN PUT TO CONSIDERABLE HARDSHIP. ITA NOS.266, 267 & 269 /ASR/2018 (A .YS.2010-11 & 2011-12) 5 5.2 IN OUR CONSIDERED VIEW, THE TRIBUNAL IN THIRD M EMBER'S CASES DEALT WITH EXACTLY IDENTICAL AND SIMILAR ISSUE AS INVOLVE D IN THE INSTANT APPEALS AND EVEN OTHERWISE WE DID NOT FIND ANY MATERIAL CON TRARY OR ANY CIRCUMSTANCE WHICH DIFFERS THESE CASE FROM THE THIR D MEMBER'S CASES (SUPRA) DECIDED AT AMRITSAR BENCH, THEREFORE WE RES PECTFULLY FOLLOWING THE DICTUM OF APEX COURT LAID DOWN IN S.I. ROOPLAL AND ANR VS LT. GOVERNOR THROUGH CHIEF SECRETARY DELHI & ORS.(SUPRA) QUA FOL LOWING THE PRINCIPLES OF JUDICIAL DISCIPLINE, RULES OF PRECEDENTS AND TO MAINTAIN CONSISTENCY IN THE DECISIONS ARE INCLINED TO FOLLOW THE DECISION O F CO-ORDINATE BENCH RENDERED IN ASSESSEE'S OWN CASES AND THEREFORE DO N OT HAVE ANY HESITATION TO DELETE THE PENALTY IMPOSED IN THESE C ASES. CONSEQUENTLY ORDERS IMPUGNED HEREIN ARE SET ASIDE AND PENALTY DE LETED. 6. IN THE RESULT, ALL THE APPEALS STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 14.02.2019. SD/- SD/- (N.S.SAINI) (N.K.CHOUDHRY) ACCOUNTANT MEMBER JUDI CIAL MEMBER DATED: 14.02.2019 RKK COPY OF THE ORDER FORWARDED TO: (1) (A) M/S. HPCL MITTAL PIPELINES LTD (B) M/ S HPCL ENERGY LTD. VILLAGE:- PHULOKHARI, TALUKA TALWANDI SABOO, DIST- BATHINDA, PUNJAB-151301 (2) THE ASST. CIT, CIRCLE-(1), BATHINDA (3) THE CIT(A), BATHINDA (4) THE CIT CONCERNED (5) THE SR DR, I.T.A.T., AMRITSAR TRUE COPY BY ORDER FILENAME: HPCL MITTAL PIPELINES LTD. 266, 267 & 269 - 2018 DIRECTORY: G: TEMPLATE: C:\USERS\ETC PARMOD\APPDATA\ROAMING\MICROSOFT\TEMPLATES\NORMAL.D OT TITLE: IN THE INCOME TAX APPELLATE TRIBU NAL SUBJECT: AUTHOR: RAHUL PRABHAKAR KEYWORDS: COMMENTS: CREATION DATE: 2/13/2019 11:31:00 AM CHANGE NUMBER: 40 LAST SAVED ON: 2/26/2019 11:12:00 AM LAST SAVED BY: ETC PARMOD TOTAL EDITING TIME: 207 MINUTES LAST PRINTED ON: 2/26/2019 11:13:00 AM AS OF LAST COMPLETE PRINTING NUMBER OF PAGES: 6 NUMBER OF WORDS: 1,707 (APPROX.) 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