SHRI CHOUTH MAL SHARMA, GRAM NINDAR, TEHSIL AMER, JAIPUR V. INCOME TAX OFFICER , WARD-7(4), JAIPUR

ITA 311/JPR/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 6376 (ITAT-JAIPUR)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-07-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 05-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: POONAM RAI DCIT DHK
• Keywords: Non compliance
• Section: 142(1); 147; 148; 144

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,OA JH FOE FLAG ;K NO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA NO. 311/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2009-10. SHRI CHOUTH MAL SHARMA, KOTOTYA KI DHANI, GRAM-NINDAR, TEHSIL- AMER, JAIPUR. CUKE VS. THE INCOME TAX OFFICER, WARD 7(4), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. CLCPS 3408 R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SMT. POONAM RAI (DCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 02.07.2018. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 05/07/2018. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 24 TH JANUARY, 2018 OF LD. CIT (A)-3, JAIPUR ARISING FROM PENALTY ORDER PASSED UNDER SECTION 271(1)(B) OF THE I.T. ACT FOR THE ASSESSMENT YEAR 2 009-10. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. THE LD. CIT (A) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE LEVY OF PENALTY OF RS. 20,000/- U/S 271(1)(B) OF TH E IT ACT, 1961. 2. THE ASSESSEE CRAVES TO AMEND, ALTER AND MODIFY A NY OF THE GROUNDS OF APPEAL. 3. THE APPROPRIATE COST BE AWARDED TO THE ASSESSEE . 2 ITA NO. 311/JP/2018 SHRI CHOUTH MAL SHARMA, JAIPUR. 2. THE ASSESSEE IS AN AGRICULTURIST AND SOLD AGRICU LTURAL LAND AT VILLAGE NINDAR, TEHSIL AMER. THE AO ISSUED NOTICE UNDER SECTION 14 8 ON 31 ST MAY, 2013 ON THE BASIS OF INFORMATION RECEIVED FROM SUB REGISTRAR ABOUT TH E SALE OF AGRICULTURAL LAND. THE NOTICE ISSUED UNDER SECTION 148 WAS SERVED THROUGH AFFIXTURE. THEREAFTER, NOTICE UNDER SECTION 142(1) WAS ISSUED ON 30 TH APRIL, 2014. SINCE THERE WAS NO RESPONSE AND COMPLIANCE ON BEHALF OF THE ASSESSEE TO THE NOT ICES ISSUED BY THE AO, ACCORDINGLY THE AO FRAMED THE ASSESSMENT UNDER SECT ION 147 READ WITH SECTION 144 OF THE IT ACT ON 23 RD JANUARY, 2015 AND INITIATED PENALTY PROCEEDINGS UN DER SECTION 271(1)(B) BY ISSUING A NOTICE ON 15.07.2015. THE A O LEVIED PENALTY OF RS. 10,000/- EACH FOR FAILURE ON NOTICES ISSUED UNDER SECTION 14 8 AND 142(1) OF THE ACT TOTAL AMOUNTING TO RS. 20,000/- VIDE ORDER DATED 31 ST JULY, 2015. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A) BUT COULD NOT SUCCEED. 3. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT PENALTY UNDER SECTION 271(1)(B) CAN BE IMPOSED BY THE AO IF HE IS SATISFIED THAT ANY PERSON FAILED TO COMPLY WITH THE NOTICE UNDER SECTION 142(1) OR U NDER SECTION 143(2) OR DIRECTIONS ISSUED UNDER SECTION 142(2A) OF THE ACT. THEREFORE , NO PENALTY CAN BE LEVIED UNDER SECTION 271(1)(B) FOR NON COMPLIANCE OF NOTICE ISSU ED UNDER SECTION 148. HENCE, THE LD. A/R HAS SUBMITTED THAT THE PENALTY LEVIED BY TH E AO OF RS. 10,000/- FOR NON COMPLIANCE OF NOTICE UNDER SECTION 148 IS NOT VALID AS THE PROVISIONS OF SECTION 271(1)(B) CANNOT BE INVOKED. HE HAS REFERRED TO TH E PROVISIONS OF SECTION 271(1)(B) AND SUBMITTED THAT IT STIPULATES THE LEVY OF PENALT Y ON ACCOUNT OF FAILURE OR NON COMPLIANCE OF ASSESSEE TO THE NOTICE UNDER SECTION 142(1) OR SECTION 143(2) OR SECTION 142(2A) OF THE ACT. AS REGARDS THE NON COM PLIANCE OF NOTICE ISSUED UNDER 3 ITA NO. 311/JP/2018 SHRI CHOUTH MAL SHARMA, JAIPUR. SECTION 142(1), THE LD. A/R OF THE ASSESSEE HAS SUB MITTED THAT SINCE THE ASSESSEE SHIFTED HIS RESIDENCE FROM THE PLACE AS GIVEN IN TH E SALE DEED, THEREFORE, THE NOTICES ISSUED BY THE AO COULD NOT BE SERVED ON THE ASSESSE E. THE ASSESSEE IN THE APPELLATE PROCEEDINGS FURNISHED THE RELEVANT DOCUME NTS TO SHOW THAT THE ASSESSEE SHIFTED HIS RESIDENCE AT JHOTWARA AND, THEREFORE, I N THE ABSENCE OF SERVICE OF NOTICE ISSUED BY THE AO, THE ASSESSEE COULD NOT COMPLY WIT H THE NOTICE UNDER SECTION 142(1). HE HAS ALSO REFERRED TO THE DECISION OF T HIS TRIBUNAL IN ASSESSEES OWN CASE DATED 20.11.2017 IN QUANTUM PROCEEDINGS AGAINST THE EX PARTE ASSESSMENT PASSED BY THE AO AND SUBMITTED THAT THE TRIBUNAL HAS SET A SIDE THE MATTER TO THE RECORD OF THE AO FOR DECIDING THE SAME DENOVO AS PER LAW. HE NCE, THE LD. A/R HAS PLEADED THAT THE PENALTY LEVIED BY THE AO UNDER SECTION 271 (1)(B) MAY BE DELETED/CANCELLED. 3.1. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED T HAT DESPITE REPEATED NOTICES THE ASSESSEE DID NOT RESPOND AND APPEAR IN THE ASSE SSMENT PROCEEDINGS. EVEN IN THE PENALTY PROCEEDINGS, NOBODY HAS APPEARED ON BEH ALF OF THE ASSESSEE AND THERE IS A REPORT OF THE INSPECTOR THAT THE ASSESSSEE REF USED TO RECEIVE THE NOTICE. SHE HAS FURTHER POINTED OUT THAT THE AO HAS LEVIED THE PENALTY FOR NON COMPLIANCE OF STATUTORY NOTICE UNDER SECTION 142(1) AS WELL AS OT HER SHOW CAUSE NOTICE ISSUED BY THE AO, THEREFORE, IT IS NOT THE CASE FOR LEVY OF P ENALTY FOR NON COMPLIANCE OF NOTICE UNDER SECTION 148 ONLY BUT SINCE THE ASSESSEE HAS N OT COMPLIED WITH THE NOTICE ISSUED UNDER SECTION 142(1) AND OTHER SHOW CAUSE NO TICES, THEREFORE, THE AO HAS IMPOSED THE PENALTY OF RS. 20,000/-. SHE HAS RELIE D UPON THE ORDERS OF THE AUTHORITIES BELOW. 4 ITA NO. 311/JP/2018 SHRI CHOUTH MAL SHARMA, JAIPUR. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE IS NOT REGULARLY ASSESSED TO TAX. SINCE THE ASSESSEE HAS SOLD THE ANCESTRAL AGRICULTURAL LAND DURING THE YEAR REL EVANT TO THE YEAR UNDER CONSIDERATION, THEREFORE, AS PER THE INFORMATION RE CEIVED FROM THE SUB REGISTRAR, THE AO ISSUED NOTICE UNDER SECTION 148 OF THE ACT. THE AO HAS RECORDED IN THE ORDER THAT THE NOTICE ISSUED UNDER SECTION 148 WAS SERVED THROUGH AFFIXTURE AS THE ASSESSEE WAS NOT AVAILABLE AT THE PLACE OF ADDRESS. FURTHER, THE NOTICE ISSUED UNDER SECTION 142(1) WAS ALSO NOT SERVED ON THE ASSESSEE AND, THEREFORE, THERE WAS NO COMPLIANCE BY THE ASSESSEE TO THE NOTICE ISSUED UND ER SECTION 142(1). THE ASSESSMENT WAS FRAMED UNDER SECTION 147 READ WITH S ECTION 144. EVEN DURING THE PENALTY PROCEEDINGS, NONE HAS APPEARED ON BEHALF OF THE ASSESSEE AND THE AO HAS STATED IN THE ORDER THAT THE NOTICE WAS REFUSED TO BE RECEIVED. EVEN THE INSPECTOR ALSO REPORTED THAT ASSESSEE HAS REFUSED TO TAKE NOT ICE THOUGH NONE OF THE REPORTS OF THE POSTAL AUTHORITIES OR THE INSPECTOR HAS STATED THAT THE ASSESSEE WAS AVAILABLE AT THE PLACE AND ASSESSEE REFUSED TO RECEIVE THE NOTIC E. THEREFORE, THE ASSESSEE HAS EXPLAINED THE FACT THAT HE HAS SHIFTED HIS PLACE OF RESIDENCE AND, THEREFORE, HE COULD NOT RECEIVE THE NOTICE ISSUED BY THE AO. THE ASSES SEE HAS GIVEN THE CURRENT ADDRESS AT 88, RAM NAGAR B, JHOTWARA, JAIPUR. WE FIND TH AT THE CURRENT ADDRESS OF THE ASSESSEE IS MENTIONED IN THE ORDER OF THE TRIBUNAL IN QUANTUM APPEAL NO. 530/JP/2017. AS REGARDS THE PENALTY LEVIED BY THE AO OF RS. 10,000/- FOR NON COMPLIANCE OF NOTICE UNDER SECTION 148, WE FIND THA T THE PROVISIONS OF SECTION 271(1)(B) CANNOT BE INVOKED FOR NON COMPLIANCE OF N OTICE UNDER SECTION 148. THE AO WHILE PASSING THE ORDER UNDER SECTION 271(1)(B) HAS OBSERVED AS UNDER :- 5 ITA NO. 311/JP/2018 SHRI CHOUTH MAL SHARMA, JAIPUR. IN SUCH FACTS AND CIRCUMSTANCES I AM SATISFIED TH AT THE ASSESSEE IS LIABLE TO BE PENALIZED U/S 271(1)(B) OF THE I.T. AC T, 1961 FOR NON COMPLIANCE OF STATUTORY NOTICE ISSUED U/S 148/142(1 ) AND SHOW CAUSE NOTICE ISSUED OF THE I.T. ACT, 1961 ISSUED BY THIS OFFICE ON 31.05.2013, 30.04.2014. THUS IT IS CLEAR THAT THE AO HAS LEVIED THE PENALTY @ RS. 10,000/- EACH FOR NON COMPLIANCE OF NOTICES UNDER SECTION 148/142(1) OF T HE ACT. AS IT IS CLEAR FROM THE PROVISIONS OF SECTION 271(1)(B) THAT THIS PROVISION CAN BE INVOKED ONLY FOR NON COMPLIANCE OF NOTICE UNDER SECTION 115WD(2) OR SECT ION 115WE(2) OR SECTION 142(1) OR 143(2) OR DIRECTIONS ISSUED UNDER SECTION 142(2A ) OF THE ACT, THEREFORE, OTHER THAN THE DEFAULT COMMITTED BY THE ASSESSEE SPECIFIE D IN THE CLAUSE (B) OF SECTION 271(1) THE NON COMPLIANCE TO THE OTHER NOTICES OR DIRECTIONS WOULD NOT ATTRACT THE PENALTY UNDER SECTION 271(1)(B) OF THE ACT. ACCORD INGLY, THE PENALTY LEVIED UNDER SECTION 271(1)(B) FOR NON COMPLIANCE OF NOTICE UNDE R SECTION 148 IS NOT VALID AND THE SAME IS DELETED. 5. AS REGARDS THE PENALTY LEVIED FOR NON COMPLIANCE OF NOTICE UNDER SECTION 142(1), WE FIND THAT THE ASSESSEE WAS NOT SERVED WI TH ANY OF THE NOTICES ISSUED BY THE AO DUE TO THE CHANGE OF ADDRESS AND SINCE THE A SSESSEE HAS NOT FILED ANY RETURN OF INCOME, THEREFORE, THE AO WAS NOT HAVING THE PRE SENT ADDRESS OF THE ASSESSEE. HENCE WHEN THE NOTICE ISSUED UNDER SECTION 142(1) W AS NOT SERVED UPON THE ASSESSEE, AND THE AO HAS NOT CONDUCTED FURTHER ENQU IRY REGARDING THE CURRENT ADDRESS OF THE ASSESSEE THEN IN THE FACTS AND CIRCU MSTANCES OF THE CASE THAT THE ASSESSEE HAD ALREADY FURNISHED THE CURRENT ADDRESS IN THE QUANTUM PROCEEDINGS, WE FIND THAT THE REASONS EXPLAINED BY THE ASSESSEE ARE BONAFIDE AND REASONABLE. 6 ITA NO. 311/JP/2018 SHRI CHOUTH MAL SHARMA, JAIPUR. ACCORDINGLY, IN THE FACTS AND CIRCUMSTANCES OF THE CASE, WE DELETE THE PENALTY IMPOSED UNDER SECTION 271(1)(B) OF THE ACT FOR NON COMPLIANCE OF SECTION 142(1). 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER IS PRONOUNCED IN THE OPEN COURT ON 05/07/201 8. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 05/07/2018. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SHRI CHOUTH MAL SHARMA, JAIPUR. 2. THE RESPONDENT THE ITO WARD 7(4), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO.311/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 7 ITA NO. 311/JP/2018 SHRI CHOUTH MAL SHARMA, JAIPUR.