I.Ashok Kumar, Coimbatore V. ITO, Coimbatore

ITA 3371/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4439 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 16-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTHJCIT
• Assessee Lawyers: S SRIDHAR
• Keywords: Period of limitation

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . . . , .. ' #$, & '( BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NO.3371/MDS/2016 * +* / ASSESSMENT YEAR : 2013-14 SHRI I. ASHOK KUMAR, 658, P.N. PALAYAM ROAD, PULIYAKULAM, COIMBATORE 641 045. PAN : AHQPA 2689 G V. THE INCOME TAX OFFICER, CORPORATE WARD 4, COIMBATORE. (-./ APPELLANT) (/0-./ RESPONDENT) -. 1 2 / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE /0-. 1 2 / RESPONDENT BY : SHRI A.V. SREEKANTH, JCIT ' 1 3& / DATE OF HEARING : 06.03.2017 45+ 1 3& / DATE OF PRONOUNCEMENT : 31.05.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -1, COIMBA TORE, DATED 26.10.2016 AND PERTAINS TO ASSESSMENT YEAR 2013-14, CONFIRMING THE PENALTY LEVIED BY THE ASSESSING OFFICER UNDER S ECTION 271(1)(C) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT'). 2 I.T.A. NO.3371/MDS/16 2. SHRI S. SRIDHAR, THE LD.COUNSEL FOR THE ASSESSEE , SUBMITTED THAT FOR THE ASSESSMENT YEAR UNDER CONSIDERATION, T HE ASSESSEE FILED APPEAL BEFORE THIS TRIBUNAL AGAINST THE QUANT UM ORDER PASSED BY THE CIT(APPEALS), IN I.T.A. NO.366/MDS/2015. HO WEVER, AT THE TIME OF HEARING OF THE APPEAL, THE ASSESSEE WITHDRE W THE SAME, THEREFORE, THE TRIBUNAL DISMISSED THE APPEAL AS WIT HDRAWN. 3. REFERRING TO SECTION 275(1)(A) OF THE ACT, THE L D.COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSING OFFICER I S EXPECTED TO PASS A PENALTY ORDER WITHIN SIX MONTHS FROM THE END OF THE MONTH IN WHICH THE ORDER OF THE APPELLATE TRIBUNAL WAS RECEI VED BY THE COMMISSIONER OR PRINCIPAL COMMISSIONER, AS THE CASE MAY BE. IN THIS CASE, ACCORDING TO THE LD. COUNSEL, THE ORDER OF THIS TRIBUNAL WAS DATED 30.04.2015. THE ASSESSING OFFICER PASSED THE CONSEQUENTIAL ORDER GIVING EFFECT TO THE ORDER OF T HIS TRIBUNAL ON 07.07.2015. THEREFORE, ACCORDING TO THE LD. COUNSE L, THE SIX MONTHS PERIOD HAS TO BE COMPUTED EITHER ON THE DATE ON WHICH THE COMMISSIONER RECEIVED THE ORDER OR THE DATE ON WHIC H THE ASSESSING OFFICER PASSED THE CONSEQUENTIAL ORDER ON 07.07.2015. HOWEVER, THE ASSESSING OFFICER PASSED THE PENALTY O RDER ONLY ON 22.03.2016 WHICH IS BEYOND THE PERIOD OF LIMITATION . HENCE, 3 I.T.A. NO.3371/MDS/16 ACCORDING TO THE LD. COUNSEL, THE ORDER PASSED BY T HE ASSESSING OFFICER LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT CANNOT STAND IN THE EYE OF LAW. 4. REFERRING TO PROVISO TO SECTION 275(1)(A) OF THE ACT, THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT WHEN AN APPEAL WAS PENDING BEFORE THE TRIBUNAL, PROVISO TO SECTION 275 (1)(A) OF THE ACT IS NOT APPLICABLE AT ALL. IN THIS CASE, THE CIT(AP PEALS) AS WELL AS THE ASSESSING OFFICER HAVE MISCONSTRUED THE PROVISO TO SECTION 275(1)(A) OF THE ACT AND CONFIRMED THE PENALTY. RE FERRING TO THE WRITTEN SUBMISSION FILED BY THE ASSESSEE BEFORE THE CIT(APPEALS), THE LD.COUNSEL SUBMITTED THAT THE INVESTMENTS MADE IN THE LANDED PROPERTY WERE VERY MUCH AVAILABLE BEFORE THE ASSESS ING OFFICER, THEREFORE, IT CANNOT BE SAID THAT THE ASSESSEE HAS CONCEALED ANY PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTI CULARS. 5. THE LD.COUNSEL FOR THE ASSESSEE FURTHER SUBMITTE D THAT THE SHOW CAUSE NOTICE ISSUED BY THE ASSESSING OFFICER D OES NOT SPECIFICALLY MENTIONED WHETHER THE PENALTY WAS LEVI ED FOR CONCEALMENT OF PARTICULARS OF INCOME OR FOR FURNISH ING INACCURATE PARTICULARS OF INCOME. SINCE THE ASSESSING OFFICER HAS NOT APPLIED HIS MIND TO THE FACTS OF THE CASE AND FAILED TO IND ICATE WHETHER HE 4 I.T.A. NO.3371/MDS/16 LEVIED PENALTY FOR CONCEALMENT OF INCOME OR FOR FUR NISHING INACCURATE PARTICULARS, ACCORDING TO THE LD. COUNSE L, THE ORDER PASSED BY THE ASSESSING OFFICER CANNOT STAND IN THE EYE OF LAW. 6. ON THE CONTRARY, SHRI A.V. SREEKANTH, THE LD. DE PARTMENTAL REPRESENTATIVE, SUBMITTED THAT ADMITTEDLY THE ASSES SEE FILED APPEAL FOR THE YEAR UNDER CONSIDERATION BEFORE THIS TRIBUN AL AND THE SAME WAS WITHDRAWN. SINCE THE ASSESSEE HAS WITHDRAWN TH E APPEAL FILED BEFORE THIS TRIBUNAL, PROVISO TO SECTION 275(1)(A) OF THE ACT IS NOT APPLICABLE AT ALL. ACCORDING TO THE LD. D.R., THE ASSESSEES CASE SQUARELY FALLS UNDER PROVISO TO SECTION 275(1)(A) O F THE ACT. THEREFORE, THE ORDER PASSED BY THE ASSESSING OFFICE R LEVYING PENALTY UNDER SECTION 271(1)(C) OF THE ACT IS WITHI N A PERIOD OF LIMITATION. REFERRING TO THE SHOW CAUSE NOTICE ISS UED BY THE ASSESSING OFFICER, THE LD. D.R. SUBMITTED THAT NO D OUBT, THE ASSESSING OFFICER HAS NOT SPECIFIED IN THE SHOW CAU SE NOTICE WHETHER HE HAS PROPOSED TO LEVY PENALTY FOR CONCEAL MENT OF INCOME OR FURNISHING INACCURATE PARTICULARS OF INCOME. HO WEVER, ACCORDING TO THE LD. D.R., THAT DOES NOT INVALIDATE THE PENAL TY PROCEEDING. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN THE SHOW 5 I.T.A. NO.3371/MDS/16 CAUSE NOTICE ISSUED TO THE ASSESSEE, THE ASSESSING OFFICER HAS NOT SPECIFIED WHETHER HE HAS PROPOSED TO LEVY PENALTY F OR FURNISHING INACCURATE PARTICULARS OR FOR CONCEALING ANY PART O F INCOME. THE VERY OBJECT OF ISSUING SHOW CAUSE NOTICE IS TO GIVE AN OPPORTUNITY TO THE ASSESSEE TO EXPLAIN WHY PENALTY SHOULD NOT BE L EVIED ON THE ASSESSEE UNDER SECTION 271(1)(C) OF THE ACT. SINCE THE ASSESSING OFFICER HAS NOT SPECIFIED THE REASONS FOR LEVYING P ENALTY UNDER SECTION 271(1)(C) OF THE ACT, I.E. WHETHER FOR FURN ISHING INACCURATE PARTICULARS OR FOR CONCEALING PARTICULARS OF INCOME , THE ASSESSEE MAY NOT HAVE AN EFFECTIVE OPPORTUNITY TO REPRESENT THE MATTER BEFORE THE ASSESSING OFFICER. 8. SINCE THE PROCEEDING BEFORE THE ASSESSING OFFICE R IS A JUDICIAL PROCEEDING, THIS TRIBUNAL IS OF THE CONSID ERED OPINION THAT EFFECTIVE OPPORTUNITY SHOULD BE GIVEN TO THE ASSESS EE FOR REPRESENTING THE MATTER BEFORE THE ASSESSING OFFICE R BY SPECIFYING THE REASONS FOR WHICH THE ASSESSING OFFICER IS PROP OSING TO LEVY PENALTY. SINCE SUCH AN OPPORTUNITY WAS NOT GIVEN, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE JUDGMENT OF KARNATA KA HIGH COURT IN CIT V. MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565 IS SQUARELY APPLICABLE TO THE FACTS OF THE CASE. T HE ASSESSEE HAS 6 I.T.A. NO.3371/MDS/16 FILED A COPY OF SUPREME COURT ORDER WHEREIN THE SLP WAS DISMISSED BY THE APEX COURT AGAINST THE JUDGMENT OF THE KARNATAKA HIGH COURT. 9. IN VIEW OF THE ABOVE JUDGMENT OF KARNATAKA HIGH COURT IN MANJUNATHA COTTON AND GINNING FACTORY (SUPRA) AND J UDGMENT OF APEX COURT IN CIT V. SSAS EMERALD MEADOWS, SPECIAL LEAVE PETITION NO.11485/2016, A COPY OF WHICH IS FILED BY THE ASSESSEE, THIS TRIBUNAL IS UNABLE TO UPHOLD THE ORDER OF THE CIT(APPEALS). ACCORDINGLY, ORDERS OF BOTH THE AUTHORITIES BELOW A RE SET ASIDE AND THE PENALTY LEVIED BY THE ASSESSING OFFICER IS DELE TED. 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON 31 ST MAY, 2017 AT CHENNAI. SD/- SD/- ( . . ' #$ ) ( . . . ) (D.S. SUNDER SINGH) (N.R.S. GANESAN) & / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 7 /DATED, THE 31 ST MAY, 2017. KRI. 1 /3#8 98+3 /COPY TO: 1. -. /APPELLANT 2. /0-. /RESPONDENT 3. ' :3 () /CIT(A)-1, COIMBATORE 4. PRINCIPAL CIT-1, COIMBATORE 5. 8; /3 /DR 6. * < /GF.