KAILASH KATARIA, GURGAON V. ITO, WARD- 2(2), GURGAON

ITA 3090/DEL/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 2887 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 02-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S L ANURAGI
• Assessee Lawyers: RAHUL CHAURASIA
• Keywords: Gift; Question of law; Set aside
• Section: 271(1)(c)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES SMC: DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER ITA.NO.3090/DEL./2018 ASSESSMENT YEAR 2009-2010 MRS. KAILASH KATARIA, 344/1, MIANWALI COLONY, GURGAON 122 001 PAN ARGPK0420R VS., THE INCOME TAX OFFICER, WARD-2(2), GURGAON. (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI ASHWANI KUMAR, C.A. AND SHRI RAHUL CHAURASIA, C.A. FOR REVENUE : SHRI S.L. ANURAGI, SR. D.R. DATE OF HEARING : 27.08.2019 DATE OF PRONOUNCEMENT : 02.09.2019 ORDER THIS APPEAL BY ASSESSEE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-2, GURGAON, DAT ED 23.03.2018, FOR THE A.Y. 2009-2010, CHALLENGING THE LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE I.T. ACT, 19 61. 2. IN THIS CASE THE A.O. PASSED THE ASSESSMENT ORD ER DATED 31.12.2011. THE ASSESSEE CLAIMED GIFT OF RS.6 5 LAKHS. THE A.O. ULTIMATELY MADE ADDITION OF RS.30,90,000/- . THE 2 ITA.NO.3090/DEL./2018 MRS. KAILASH KATARIA, GURGAON. A.O. INITIATED PENALTY PROCEEDINGS FOR CONCEALMENT OF PARTICULARS OF INCOME. THE A.O. VIDE SEPARATE ORDER LEVIED PENALTY UNDER SECTION 271(1)(C) OF THE I.T. ACT, 19 61, WHICH IS CONFIRMED BY THE LD. CIT(A). 3. LEARNED COUNSEL FOR THE ASSESSEE AT THE OUTSET SUBMITTED THAT THE A.O. ISSUED NOTICE UNDER SECTION 271(1)(C) OF THE I.T. ACT DATED 31.12.2011 IN WHICH THE A.O. HAS MENTIONED AS FOLLOWS : HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR ................FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. 3.1. HE HAS, THEREFORE, SUBMITTED THAT THE ISSUE I S COVERED BY THE JUDGMENT OF THE HONBLE DELHI HIGH C OURT IN THE CASE OF PR. CIT VS. M/S. SAHARA INDIA LIFE INSU RANCE COMPANY LTD., 2019(8) TMI 409 (DEL.) VIDE JUDGMENT DATED 02.08.2019 IN PARAS 21 AND 22 HELD AS UNDER : 21. THE RESPONDENT HAD CHALLENGED THE UPHOLDING OF THE PENALTY IMPOSED UNDER SECTION 271(1) (C) OF THE ACT, WHICH WAS ACCEPTED BY THE ITAT. IT FOLLOWED THE DEC ISION 3 ITA.NO.3090/DEL./2018 MRS. KAILASH KATARIA, GURGAON. OF THE KARNATAKA HIGH COURT IN CIT V. MANJUNATHA CO TTON & GINNING FACTORY 359 ITR 565 (KAR) AND OBSERVED THAT THE NOTICE ISSUED BY THE AO WOULD BE BAD IN LAW IF IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1) (C) THE PE NALTY PROCEEDINGS HAD BEEN INITIATED UNDER I.E. WHETHER F OR CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISH ING OF INACCURATE PARTICULARS OF INCOME. THE KARNATAKA HIG H COURT HAD FOLLOWED THE ABOVE JUDGMENT IN THE SUBSEQ UENT ORDER IN COMMISSIONER OF INCOME TAX V. SSAS EMERAL D MEADOWS (2016) 73 TAXMAN.COM 241 (KAR), THE APPEAL AGAINST WHICH WAS DISMISSED BY THE SUPREME COURT OF INDIA IN SLP NO.11485 OF 2016 BY ORDER DATED 5TH AUGUST, 2016. 22. ON THIS ISSUE AGAIN THIS COURT IS UNABLE TO FIND ANY ERROR HAVING BEEN COMMITTED BY THE ITAT. NO SUBSTANTIAL QUESTION OF LAW ARISES. 3.1. HE HAS, THEREFORE, SUBMITTED THAT PENALTY IS NOT LEVIABLE IN THE MATTER. 4 ITA.NO.3090/DEL./2018 MRS. KAILASH KATARIA, GURGAON. 4. THE LD. D.R. ON THE OTHER HAND RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT APPEAL OF ASSESSEE HAS BEEN DISMISSED FOR DEFAULT ON QUANT UM VIDE SEPARATE ORDER DATED 25.10.2016. 5. AFTER CONSIDERING THE RIVAL SUBMISSIONS, I AM O F THE VIEW THAT PENALTY IS NOT LEVIABLE IN THE MATTER . IN THIS CASE, THE A.O. ISSUED SHOW CAUSE NOTICE FOR LEVY OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT WHICH IS BAD IN LAW AS IT DID NOT SPECIFY IN WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, THE PENALTY PROCEEDINGS HAD BEEN INITIATED I.E., WH ETHER FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. THE ENTIRE PENALT Y PROCEEDINGS ARE, THEREFORE, VITIATED AND NO PENALTY IS LEVIABLE. ON THIS SCORE ITSELF SIMILAR VIEW IS TAKE N BY HONBLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. M/S. SS AS EMERALD MEADOWS 73 TAXMANN.COM 241. THIS DECISION I S CONFIRMED BY THE HONBLE SUPREME COURT REPORTED IN 73 TAXMANN.COM 248. FURTHER, THE HONBLE DELHI HIGH CO URT RECENTLY VIDE ORDER DATED 02.08.2019 IN THE CASE OF PR. CIT VS. M/S. SAHARA INDIA LIFE INSURANCE COMPANY LTD., (SUPRA) 5 ITA.NO.3090/DEL./2018 MRS. KAILASH KATARIA, GURGAON. FOLLOWING THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF M/S. SSAS EMERALD MEADOWS (SUPRA) CONFIRMED CANCELLATION OF THE PENALTY. I, THEREFORE, FOLLOWIN G THE AFORECITED DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF PR. CIT VS. M/S. SAHARA INDIA LIFE INSURANC E COMPANY LTD., (SUPRA) SET ASIDE THE ORDERS OF THE AUTHORITIES BELOW AND CANCEL THE PENALTY. 6. IN THE RESULT, APPEAL OF ASSESSEE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- (BHAVNESH SAINI) JUDICIAL MEMBER DELHI, DATED 2 ND SEPTEMBER, 2019 VBP/- COPY TO 1. THE APPELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT SMC BENCH 6. GUARD FILE //BY ORDER// ASST. REGISTRAR : ITAT : DELHI BENCHES : DELHI. 6 ITA.NO.3090/DEL./2018 MRS. KAILASH KATARIA, GURGAON. DATE OF DICTATION 27.08.2019 DATE ON WHICH THE TYPED DRAFT ORDER IS PLACED BEFOR E THE DICTATION MEMBER 29.08.2019 DATE ON WHICH THE APPROVAL DRAFT COMES TO THE SR. P S 02.09.2019 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATION MEMBER FOR PRONOUNCEMENT 02.09.2019 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S. 02.09.2019 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 02.09.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 03. 09.2019 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER.