U.P Cooperative Federation Ltd., Lucknow V. Income Tax Officer-2(3), Lucknow

ITA 302/LKW/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 4032 (ITAT-LUCKNOW)
• Duration Of Justice: 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 11-08-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 26-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SURENDRA KOHLI SHRI AMIT NI
• Keywords: Reasonable cause
• Section: 273B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH A , LUCKNOW BEFORE SHRI. P . K. BANSAL , ACCOUNTANT MEMBER AND SHRI ABY T VARKEY , JUDICIAL MEMBER ITA NO. 302/LKW/2016 ASSESSMENT YEAR: 2003 - 04 U.P. COOPERATIVE FEDERATION LTD. 32, STATION ROAD LUC KNOW V. ITO RANGE II(3) LUCKNOW T AN /PAN : AAAAU0373P (APP ELL ANT) (RESPONDENT) APPELLANT BY: SHRI SURENDRA KOHLI, ADVOCATE RESPONDENT BY: SHRI AMIT NIGAM, D.R. DATE OF HEARING: 11 08 2016 DATE OF PRONOUNCEMENT: 30 08 2016 PER ABY T VARK EY, J.M : O R D E R THIS IS AN APPEAL PREFERRED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) - 1, LUCKNOW DATED 29.1.2016 FOR THE ASSESSMENT YEAR 2003 - 04. 2 . THE ONLY GRIEVANCE RAISED BY THE ASSESSEE IS THAT THE PENALTY LEVIED UNDER SECTION 271(1)(B) OF THE INCOME - TAX ACT, 1961 (HEREINAFTER REFERRED IN SHORT 'THE ACT') WHEREIN THE LD. CIT(A) HAS RESTRICTED THE PENALTY TO RS.10,000/ - FROM RS.20,000/ - AS LEVIED BY THE ASSESSING OFFICER , NEEDS TO BE DELETED. 3 . THE BRIEF FACTS OF THE CASE ARE THAT DURING THE ORIGINAL ASS ESSMENT PROCEEDINGS, THE ASSESSING OFFICER DIRECTED THE ASSESSEE FOR SPECIAL AUDIT UNDER SECTION 142(2A) OF THE ACT ON 8.3.2006 WHICH , ACCORDING TO THE ASSESSING OFFICER , WAS NOT COMPLIED BY THE ASSESSEE. [ ITA NO.302/LKW/2016, A.Y 2003 - 04 ] 2 THE ASSESSING OFFICER, THEREFORE, IMPOSED A PENALT Y OF RS.20,000/ - UNDER SECTION 271(1)(B) OF THE ACT. 4 . BEING AGGRIEVED BY THE PENALTY ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) , WHO WAS PLEASED TO RESTRICT THE PENALTY FROM RS.20,000/ - TO RS.10,000/ - . AGGRIEVED BY THE SAID ORDER OF THE LD. CIT(A), THE ASSESSEE IS BEFORE US. 5 . WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECORD. WE TAKE NOTE THAT THE MAIN PLEA OF THE ASSESSEE IS THAT NOTICE UNDER SECTION 142(2A) OF THE ACT WAS SERVED ON THE ASSESSEE ON 8.3.2006 AND THE ASSESSEE PREFERRED A WRIT PETITION BEFORE THE HON'BLE HIGH COURT ON 27.3.2006 . THE SAID WRIT PETITION WAS DISMISSED BY THE HON'BLE HIGH COURT ON 30.3.2006 AND THEREAFTER THE ASSESSEE PURSUED THE LEGAL COURSE FOR FILING AN SLP AGAINST THE ORDER OF THE HON'BLE HIGH C OURT. I T HAS BEEN PLEA D ED BY THE LD. A.R. OF THE ASSESSEE THAT THE ASSESSEE DID NOT GET THE ACCOUNTS AUDITED BASED ON THE ADVICE GIVEN BY THE LAWYERS ENGAGED BY THE ASSESSEE IN THE HON'BLE HIGH COURT/SUPREME COURT. SO THE PLEA OF THE ASSESSEE IS THAT IN ACTION OF THE ASSESSEE TO GET ITS ACCOUNTS AUDITED WAS NOT INTENTIONAL, SINCE THE ASSESSEE WAS P URSUING THE LEGAL ACTION CHALLENGING THE VERY ORDER OF THE ASSESSING OFFICER TO GET THE SPECIAL AUDIT DONE. WE FIND FORCE IN THE SAID CONTENTION OF THE LD. A.R. OF THE ASSESSEE AND WE TAKE NOTE THAT IN A SIMILAR CIRCUMSTANCES IN THE ASSESSEES OWN CASE THE TRIBUNAL IN ITA NO. 134/LUC/2008 FOR ASSESSMENT YEAR 2003 - 04 , ORDER DATED 29.2.2008 DELETED THE PENALTY LEVIED BY THE ASSESSING OFFICER BY HOLDING AS UNDER: - 8 . AS FA R AS THE LD. D.R.S ARGUMENT BASED ON PROVISIONS OF SECTION 275 RELATING TO LIMITATION ARE CONCERNED, WE MAY ONLY OBSERVE THAT NOTHING PREVENTS THE ASSESSING OFFICER TO TAKE ACTION IN ACCORDANCE WITH LAW. HOWEVER, AT PRESENT, WE MAY ONLY OBSERVE THAT SINC E ASSESSEE WAS PURSUING LEGAL ACTION, THEREFORE, [ ITA NO.302/LKW/2016, A.Y 2003 - 04 ] 3 THERE WAS REASONABLE CAUSE FOR NOT GETTING THE ACCOUNTS AUDITED AND THEREFORE, ASSESSEE COULD NOT BE SADDLED WITH PENALTY. 6 . RESPECTFULLY FOLLOWING THE ORDER OF THE C O - ORDINATE BENCH OF THE TRIBUNAL, WE ARE I NCLINED TO DELETE THE PENALTY SUSTAINED BY THE LD. CIT(A). 7 . FURTHER, IT IS TO BE NOTED THAT THE PENALTY UNDER SECTION 271(1) ( B) OF THE ACT CANNOT BE LEVIED , IF REASONABLE CA U SE IS RAISED AND IS PRESENT AS PRESCRIBED UNDER SE CTION 273B OF THE ACT . WE FIND T HAT THERE WAS A REASONABLE CASE FOR NON - ADHER ING TO THE ORDER OF THE ASSESSING OFFICER. ON THIS COUNT ALSO PENALTY UNDER SECTION 271(1)(B) OF THE ACT IS NOT LEVIABLE AND THEREFORE IT IS DIRECTED TO BE DELETED. 8 . IN THE RESULT, APPEAL FILED BY THE ASSESSEE I S ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 30.8.2016. SD/ - SD/ - [P. K. BANSAL ] [ ABY T VARKEY ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 30 TH 1 . APPELLANT AUGUST , 2016 JJ: 1708 COPY FORWARDED TO: 2 . RESPONDENT 3 . CIT(A) 4 . CIT 5 . DR ASSISTANT REGISTRAR