Smt Rekha Sharma, Kanpur V. ITO-3(3), Kanpur

ITA 287/LKW/2011

• Counselvise Citation: 28723714 RSA 2011
• Duration Of Justice: 2 year(s) 8 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-01-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2001-2002
• Appeal Filed On: 12-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R K RAM
• Keywords: Opportunity of being heard; Principle of natural justice; Retrospective amendment; Revised return

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A, LUCKNOW BEFORE SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER ITA NO.287/LKW/2011 A.Y.:2001 - 2002 SMT. REKHA SHARMA, KANPUR. PAN:AOEPS4462C VS. INCOME TAX OFFICER - 3(3), KANPUR. (APPELLANT) (RESPONDENT) APPELLANT BY SHRI RAKESH GARG, ADVOCATE RESPONDENT BY SHRI R. K. RAM, D.R. DATE OF HEARING 07/01/2014 DATE OF PRONOUNCEMENT 3 0 /01/2014 O R D E R PER A. K. GARODIA, A.M. THIS IS ASSESSEES APPEAL DIRECTED AGAINST THE ORDER OF LEARNED CIT ( A) - II, KANPUR DATED 17/01/2011 FOR THE ASSESSMENT YEAR 2001 - 02. 2. THE GROUNDS RAISED BY THE ASSESSEE ARE AS UNDER: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW , THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) MUZAFFARNAGAR, HOLDING CONCURRENT CHARGE OF C.I.T.(A) - LL, KANPUR HAS ERRED IN UPHOLDING PENALTY OF RS.3,17,937/ - UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT 1961 LEVIED BY THE LEARNED ASSESSING OFFICER 3 (3) KANPUR, BECAUSE THE APPELLANT HAS NOT CONCEALED ANY INCOME AND HAS NOT FURNISHED INACCURATE PARTICULARS IN RESPECT THEREOF. 2. THAT LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN NOT ACCEPTING THAT THE LEVY OF THE PENALTY IS NOT LEGALLY VAL ID AS THE APPELLANT HAS NOT BEEN GIVEN REASONABLE OPPORTUNITY OF BEING HEARD AS REQUIRED U/S 274 OF THE INCOME TAX ACT. 2 3. THAT LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ON THE FACTS, IN THE CIRCUMSTANCES OF THE CASE AND IN LAW HAS ERRED IN UPHOLDING T HAT THE REVISED RETURN WERE NOT FILED DUE TO AN OMISSION WITH BONAFIDE INTENTION BUT A CONSCIOUS EFFORT TO CONCEAL INCOME. 4. THAT LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN NOT ACCEPTING THAT THERE WAS NO SATISFACTION RECORDED BY THE LEARN ED ASSESSING OFFICER DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS IN RESPECT TO THE CONCEALMENT OF THE INCOME AS CONTEMPLATED IN SECTION 271(1)(C) OF THE INCOME TAX ACT 1961, WHICH GOES TO THE ROOT OF THE PENALTY PROCEEDINGS AND VITIATES THE PENALTY PRO CEEDINGS, RESULTING IN MAKING OF THE ORDER UNDER SECTION 271(1)(C) BAD IN LAW AND ORDER UNDER SECTION 271(1)(C) IS LIABLE TO BE QUASHED. 5. THAT THE ORDER PASSED UNDER SECTION 271( 1 ) ( C) IS BAD IN LAW, ON FACTS AND IS AGAINST THE PRINCIPLES OF THE NATURAL JUSTICE. 6. THAT THE APPELLANT CRAVES LIBERTY TO ADD, ALTER OR VARY ANY GROUND OF APPEAL EITHER AT THE TIME OF HEARING OF THE APPEAL OR BEFORE THE DISPOSAL OF THE APPEAL. 3. IT WAS SUBMITTED BY LEARNED A.R. OF THE ASSESSEE THAT IN THE ASSESSMENT ORDER, NO POSITIVE FINDING IS GIVEN BY THE ASSESSING OFFICER REGARDING ANY CONCEALMENT OF INCOME. HE PLACED RELIANCE ON THE JUDGMENT OF HON'BLE DELHI HIGH COURT RENDERED IN THE CASE O F MADHUSHREE GUPTA & BRITISH AIRWAYS PLC VS UNION OF INDIA [2009] 317 ITR 107 (DEL) . HE SUBMITTED THAT IN THIS CASE, IT WAS HELD BY HON'BLE DELHI HIGH COURT THAT EVEN AFTER AMENDMENT OF SECTION 271 BY WAY OF INSERTION OF SUB SECTION (1B) BY FINANCE ACT, 2 008 WITH RETROSPECTIVE EFFECT FROM 01/04/89 , PRIMA FACIE SATISFACTION OF THE ASSESSING OFFICER REGARDING CONCEALMENT SHOULD BE DISCERNABLE CLEARLY FROM THE ORDER PASSED BY THE ASSESSING OFFICER. IN THIS REGARD, HE DREW OUR ATTENTION TO PARA 63 ON PAGE 1 4 6 OF 317 ITR. HE SUBMITTED THAT AS PER THIS JUDGMENT , IN THE PRESENT CASE ALSO , THE PENALTY IS WITHOUT JURISDICTION BECAUSE NO SATISFACTION OF THE ASSESSING OFFICER IS DISCERNABLE FROM THE ASSESSMENT ORDER. 3 4. AS AGAINST THIS, LEARNED D.R. OF THE REVENUE SUPPORTED THE PENALTY ORDER. HE PLACED RELIANCE ON THE JUDGMENT OF HON'BLE ALLAHABAD HIGH COURT RENDERED IN THE CASE OF COMMISSIONER OF INCOME - TAX VS RAKESH SURI [2011] 331 ITR 458 (ALL) . 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND THE JUDGMENT CITED BY BOTH THE SIDES. WE FIND FORCE IN THE SUBMISSIONS OF LEARNED A.R. OF THE ASSESSEE BECAUSE WE FIND THAT AS PER THE COPY OF THE ASSESSMENT ORDER AVAILABLE ON RECORD, E VEN A SINGLE WORD HAS NOT BEEN STATED BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER REGARDING HIS PRIMA FACIE SATISFACTION IN RESPECT OF CONCEALMENT OF INCOME. HE HAS SIMPLY ACCEPTED THE INCOME DISCLOSED BY THE ASSESSEE IN THE REVISED RETURN OF INCOME ALTHOUGH SUCH RETURN WAS FILED BY THE ASSESSEE BEYOND THE TIME ALLOWED FOR THE SAME. HENCE, AS PER THE JUDGMENT OF HON'BLE DELHI HIGH COURT CITED BY LEARNED A.R. OF THE ASESSEE , THE PENALTY ORDER PASSED BY THE ASSESSING OFFICER IS WITHOUT JURISDICTION BEC AUSE NO PRIMA FACIE SATISFACTION OF THE ASSESSING OFFICER IS DISCERNABLE FROM THE ASSESSMENT ORDER. WE, THEREFORE, DELETE THE PENALTY BY HOLDING THAT THE PENALTY ORDER PASSED BY THE A.O. IS WITHOUT JURISDICTION. 6. NOW WE CONSIDER THE APPLICABILITY OF JUD GMENT CITED BY LEARNED D.R. OF THE REVENUE RENDERED IN THE CASE OF COMMISSIONER OF INCOME - TAX VS RAKESH SURI (SUPRA). IN THIS CASE, IT WAS HELD THAT WHERE THE ASSES SEE DID NOT PROVIDE THE RELEVANT INFORMATION CALLED FOR BY THE ASSESSING OFFICER REGARDING THE GENUINENESS OF THE SALE OF SHARES , SURRENDER O F INCOME COULD NOT BE SAID TO BE VOLUNTARY AND THEREFORE, IT IS A CASE OF CONCEALMENT OF INCOME AND LEVY OF PENALTY U/S 271(1 ) ( C) IS JUSTIFIED. TH ERE IS NO QUARREL ON THIS PROPOSITION LAID DOWN BY HON'BLE ALLAHABAD HIGH COURT BUT IN THE PRESENT CASE , THE ARGUMENT OF LEARNED A .R. OF THE ASSESSEE IS DIFFERENT. HIS ARGUMENT IS THAT SINCE NO 4 PRIMA FACIE SATISFACTION OF THE ASSESSING OFFICER IS DISCERNABLE FROM THE ASSESSMENT ORDER, THE PENALTY ORDER PASSED BY THE ASSESSING OFFICER IS WITHOUT JURISDICTION. ON THIS ASPECT, THIS JUDGMENT OF HON'BLE ALLAHABAD HIGH COURT IS NOT RENDERING ANY HELP TO THE REVENUE. 7. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. (ORDER WAS PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED ON THE CAPTION PAGE) SD/. SD/. (SUNIL KUMAR YADAV) ( A. K. GARODIA ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 3 0 T H JANUARY, 2014. *C.L.SINGH COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. CONCERNED CIT 4. THE CIT(A) 5. D.R., I.T.A.T., LUCKNOW ASSTT. REGISTRAR