Appeal details
Counselvise Citation
[2016] 132 COUNSELVISE.COM (IT) 0663 (ITAT-AHMEDABAD)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
8 month(s) 15 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
01-09-2016
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
SMC
Next Hearing Date
10-06-2016
Assessment Year
2012-2013
Appeal Filed On
17-12-2015
Judgement Text
, , IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER ./ ITA.NO.3538/AHD/2015 / ASSTT. YEAR: 2012-2013 SHRI HASMUKH C. AMIN C/O. VINOD AMIN & CO. 210/SF, SPENTHA COMPLEX OPP: VANIJYA BHAVAN VADODARA 390 007. PAN : ASMPA 4293 P VS ASSTT.CIT (INTERNATIONAL TAXATION) VADODARA 390 007. ! / (APPELLANT) '# ! / (RESPONDENT) ASSESSEE BY : SHRI BHAVIN MARFATIA, AR REVENUE BY : SHRI SANJAY KUMAR, SR.DR / DATE OF HEARING : 10/06/2016 / DATE OF PRONOUNCEMENT: 01/09/2016 $%/ O R D E R ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL AGAINST T HE ORDER OF THE LD.CIT(A)-13, AHMEDABAD DATED 7.10.2015 PASSED FOR THE ASSTT.YEAR 20012- 13. 2. SOLITARY GRIEVANCE OF THE ASSESSEE IS THAT THE L D.CIT(A) HAS ERRED IN CONFIRMING PENALTY OF RS.2,50,000/- IMPOSED BY THE AO UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN INDIVIDUAL NRI RESIDING IN US. HE DID NOT FILE HIS RETURN OF INCO ME UNDER SECTION 139 OF THE INCOME TAX ACT, 1961. THE AO GOT INFORMATION FROM AIR WING EXHIBITING FACT THAT THE ASSESSEE HAS DEPOSITED A SUM OF RS.12 ,78,530/- IN HIS SAVING BANK ACCOUNT. ACCORDINGLY, HE ISSUED A NOTICE UNDER SEC TION 148 OF THE INCOME ITA NO.3538/AHD/2015 2 TAX ACT, ON 28.3.2014. IN RESPONSE TO THE NOTICE U NDER SECTION 148, THE ASSESSEE FILED HIS INCOME-TAX RETURN ON 17.6.2014 A ND DECLARED TOTAL INCOME AT RS.12,78,530/-. THIS RETURN INCLUDED A SUM OF RS.1 2,20,000/- DEPOSITED IN THE SAVING BANK ACCOUNT. THE LD.AO HAS PASSED AN ASSES SMENT ORDER ON 30.6.2014 AND DETERMINED THE TAXABLE INCOME OF THE ASSESSEE EQUIVALENT TO ONE DECLARED BY HIM. THE LD.AO INITIATED PENALTY P ROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT. HE IMPOSED PENALTY OF RS.2,5 0,000/-. THE STAND OF THE DEPARTMENT WAS THAT, HAD THE DEPARTMENT NOT INITIAT ED PROCEEDINGS UNDER SECTION 148, THE ASSESSEE WOULD NOT HAVE DISCLOSED THE INCOME ? AND THEREFORE, HE DESERVED TO BE VISITED WITH PENALTY F OR CONCEALMENT. APPEAL TO THE CIT(A) DID NOT BRING ANY RELIEF TO THE ASSESSEE . 4. THE LD.COUNSEL FOR THE ASSESSEE, WHILE IMPUGNING THE ORDERS OF THE REVENUE AUTHORITIES RAISED TWO FOLD SUBMISSIONS. H E CONTENDED THAT AS FAR AS VISITING THE ASSESSEE WITH PENALTY WITH HELP OF EXPLANATION 1 TO SECTION 271(1)(C) IS CONCERNED, THAT WILL NOT BE APPLICABLE , BECAUSE, THE AO COULD NOT FIND ANY IRREGULARITIES OR ILLEGALITY IN THE FACTS DISCLOSED BY THE ASSESSEE. THE AO HAS ACCEPTED RETURN FILED BY THE ASSESSEE, AND H E DID NOT FIND ANY DEFICIENCIES IN FURNISHING OF SUCH FACTS. THE PENA LTY COULD BE IMPOSED WITH THE HELP OF EXPLANATION-3 TO SECTION 271(1)(C) OF THE ACT, BUT THAT EXPLANATI ON IS ALSO NOT ATTRACTED IN THE PRESENT CASE, BECAUSE NOTICE UNDER SECTION 148 WAS ISSUED WITHIN TIME PERIOD AVAILABLE FOR THE ASSESSM ENT OF THIS INCOME UNDER SECTION 153(1) OF THE ACT. ACCORDING TO THE LD.COU NSEL FOR THE ASSESSEE, THE ASSESSMENT OF THE INCOME FOR THE ASSTT.YEAR 2012-13 COULD BE COMPLETED UPTO 31.3.2015. NOTICE WAS ISSUED ON 28.3.2014 AND ASSE SSEE HAS FILED RETURN. THE SAME RETURN HAS BEEN ACCEPTED BY THE AO. IF THIS N OTICE UNDER SECTION 148 WAS ISSUED AFTER 31.3.2015, ONLY THEN THE PENALTY C OULD BE IMPOSED UPON THE ASSESSEE. FOR BUTTRESSING HIS CONTENTIONS HE RELIE D UPON THE JUDGMENT OF THE ITA NO.3538/AHD/2015 3 HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CH HAGANLAL SUTERIYA VS. ITO, 337 ITR 350 (GUJ). HE PLACED ON RECORD COPY OF THI S DECISION. ON THE OTHER HAND, THE LD.DR RELIED UPON THE ORDER OF THE AO. 5. WE HAVE CONSIDERED RIVAL CONTENTIONS AND GONE TH ROUGH THE RECORD CAREFULLY. SECTION 271(1)(C) OF THE ACT HAS A DIRE CT BEARING ON THE CONTROVERSY WHICH READS AS UNDER: '271. FAILURE TO FURNISH RETURNS, COMPLY WITH NOTIC ES, CONCEALMENT OF INCOME, ETC. (1) THE ASSESSING OFFICER OR THE C OMMISSIONER (APPEALS) OR THE CIT IN THE OF COURSE OF ANY PROCEE DINGS UNDER THIS ACT, IS SATISFIED THAT ANY PERSON (A) AND (B) ** ** ** (C) HAS CONCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. HE MAY DIRECT THAT SUCH PERSON SHALL PAY BY WAY OF PENALTY. (I)AND (INCOME-TAX OFFICER,)** ** ** (III) IN THE CASES REFERRED TO IN CLAUSE (C) OR CLA USE (D), IN ADDITION TO TAX, IF ANY, PAYABLE BY HIM, A SUM WHICH SHALL N OT BE LESS THAN, BUT WHICH SHALL NOT EXCEED THREE TIMES, THE AMOUNT OF TAX SOUGHT TO BE EVADED BY REASON OF THE CONCEALMENT OF PARTICULA RS OF HIS INCOME OR FRINGE BENEFIT THE FURNISHING OF INAC CURATE PARTICULARS OF SUCH INCOME OR FRINGE BENEFITS: EXPLANATION 1- WHERE IN RESPECT OF ANY FACTS MATERI AL TO THE COMPUTATION OF THE TOTAL INCOME OF ANY PERSON UNDER THIS ACT, (A) SUCH PERSON FAILS TO OFFER AN EXPLANATION OR OF FERS AN EXPLANATION WHICH IS FOUND BY THE ASSESSING OFFICER OR THE COMM ISSIONER (APPEALS) OR THE CIT TO BE FALSE, OR (B) SUCH PERSON OFFERS AN EXPLANATION WHICH HE IS N OT ABLE TO SUBSTANTIATE AND FAILS TO PROVE THAT SUCH EXPLANATI ON IS BONA FIDE AND THAT ALL THE FACTS RELATING TO THE SAME AND MAT ERIAL TO THE COMPUTATION OF HIS TOTAL INCOME HAVE BEEN DISCLOSED BY HIM, THEN, THE AMOUNT ADDED OR DISALLOWED IN COMPUTING THE TOT AL INCOME OR SUCH PERSON AS A RESULT THEREOF SHALL, FOR THE PURP OSES OF CLAUSE (C) OF THIS SUB-SECTION, BE DEEMED TO REPRESENT THE INC OME IN RESPECT OF WHICH PARTICULARS HAVE BEEN CONCEALED.' ITA NO.3538/AHD/2015 4 EXPLANATION 2.WHERE THE SOURCE OF ANY RECEIPT, DEP OSIT, OUTGOING OR INVESTMENT IN ANY ASSESSMENT YEAR IS CLAIMED BY ANY PERSON TO BE AN AMOUNT WHICH HAD BEEN ADDED IN COMPUTING THE INCOME OR DEDUCTED IN COMPUTING THE LOSS IN THE ASSESSMENT OF SUCH PERSON FOR ANY EARLIER ASSESSMENT YEAR OR YEARS BUT IN RESPECT OF WHICH NO PENALTY UNDER CLAUSE (III) OF THIS SUB-SECTION HAD BEEN LEVIED, THAT PART OF THE AMOUNT SO ADDED OR DEDUCTED IN SUCH EAR LIER ASSESSMENT YEAR IMMEDIATELY PRECEDING THE YEAR IN WHICH THE RE CEIPT, DEPOSIT, OUTGOING OR INVESTMENT APPEARS (SUCH EARLIER ASSESS MENT YEAR HEREAFTER IN THIS EXPLANATION REFERRED TO AS THE FI RST PRECEDING YEAR) WHICH IS SUFFICIENT TO COVER THE AMOUNT REPRESENTED BY SUCH RECEIPT, DEPOSIT OR OUTGOING OR VALUE OF SUCH INVESTMENT (SU CH AMOUNT OR VALUE HEREAFTER IN THIS EXPLANATION REFERRED TO AS THE UTILISED AMOUNT) SHALL BE TREATED AS THE INCOME OF THE ASSES SEE, PARTICULARS OF WHICH HAD BEEN CONCEALED OR INACCURATE PARTICULA RS OF WHICH HAD BEEN FURNISHED FOR THE FIRST PRECEDING YEAR; AND WH ERE THE AMOUNT SO ADDED OR DEDUCTED IN THE FIRST PRECEDING YEAR IS NOT SUFFICIENT TO COVER THE UTILISED AMOUNT, THAT PART OF THE AMOUNT SO ADDED OR DEDUCTED IN THE YEAR IMMEDIATELY PRECEDING THE FIRS T PRECEDING YEAR WHICH IS SUFFICIENT TO COVER SUCH PART OF THE UTILI SED AMOUNT AS IS NOT SO COVERED SHALL BE TREATED TO BE THE INCOME OF THE ASSESSEE, PARTICULARS OF WHICH HAD BEEN CONCEALED OR INACCURA TE PARTICULARS OF WHICH HAD BEEN FURNISHED FOR THE YEAR IMMEDIATELY P RECEDING THE FIRST PRECEDING YEAR AND SO ON, UNTIL THE ENTIRE UT ILISED AMOUNT IS COVERED BY THE AMOUNTS SO ADDED OR DEDUCTED IN SUCH EARLIER ASSESSMENT YEARS. [EXPLANATION 3.WHERE ANY PERSON [***] FAILS, WIT HOUT REASONABLE CAUSE, TO FURNISH WITHIN THE PERIOD SPECIFIED IN SU B-SECTION (1) OF SECTION 153 A RETURN OF HIS INCOME WHICH HE IS R EQUIRED TO FURNISH UNDER SECTION 139 IN RESPECT OF ANY ASSESSMENT YEAR COMMENCING ON OR AFTER THE 1ST DAY OF APRIL, 1989, AND UNTIL T HE EXPIRY OF THE PERIOD AFORESAID, NO NOTICE HAS BEEN ISSUED TO HIM UNDER CLAUSE (I) OF SUB-SECTION (1) OF SECTION 142 OR SECTION 148 AN D THE ASSESSING OFFICER OR THE [***] COMMISSIONER (APPEALS) IS SAT ISFIED THAT IN RESPECT OF SUCH ASSESSMENT YEAR SUCH PERSON HAS TAX ABLE INCOME, THEN, SUCH PERSON SHALL, FOR THE PURPOSES OF CLAUSE (C) OF THIS SUB- SECTION, BE DEEMED TO HAVE CONCEALED THE PARTICULAR S OF HIS INCOME IN RESPECT OF SUCH ASSESSMENT YEAR, NOTWITHSTANDING THAT SUCH PERSON FURNISHES A RETURN OF HIS INCOME AT ANY TIME AFTER THE EXPIRY OF THE PERIOD AFORESAID IN PURSUANCE OF A NOTICE UN DER SECTION 148.] ITA NO.3538/AHD/2015 5 6. A BARE PERUSAL OF THIS SECTION WOULD REVEAL THA T FOR VISITING ANY ASSESSEE WITH THE PENALTY, THE ASSESSING OFFICER OR THE LEARNED CIT(APPEALS) DURING THE COURSE OF ANY PROCEEDINGS BEFORE THEM SH OULD BE SATISFIED, THAT THE ASSESSEE HAS; (I) CONCEALED HIS INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. AS FAR AS THE QUANTIFICATION OF THE PENALTY IS CONCERNED, THE PENALTY IMPOSED UNDER THIS SECTION CAN RANGE IN BETWEEN 100 % TO 300% OF THE TAX SOUGHT TO BE EVADED BY THE ASSESSEE, AS A RESULT OF SUCH CONCEALMENT OF INCOME OR FURNISHING INACCURATE PARTICULARS. THE OT HER MOST IMPORTANT FEATURES OF THIS SECTION IS DEEMING PROVISIONS REGARDING CON CEALMENT OF INCOME. THE SECTION NOT ONLY COVERED THE SITUATION IN WHICH THE ASSESSEE HAS CONCEALED THE INCOME OR FURNISHED INACCURATE PARTICULARS, IN CERT AIN SITUATION, EVEN WITHOUT THERE BEING ANYTHING TO INDICATE SO, STATUTORY DEEM ING FICTION FOR CONCEALMENT OF INCOME COMES INTO PLAY. THIS DEEMING FICTION, BY WAY OF EXPLANATION-1 TO SECTION 271(1)(C) POSTULATES TWO SITUATIONS; (A) FI RST WHETHER IN RESPECT OF ANY FACTS MATERIAL TO THE COMPUTATION OF THE TOTAL INCO ME UNDER THE PROVISIONS OF THE ACT, THE ASSESSEE FAILS TO OFFER AN EXPLANATION OR THE EXPLANATION OFFERED BY THE ASSESSEE IS FOUND TO BE FALSE BY THE ASSESSING OFFICER OR LEARNED CIT(APPEAL); AND, (B) WHERE IN RESPECT OF ANY FACT, MATERIAL TO THE COMPUTATION OF TOTAL INCOME UNDER THE PROVISIONS OF THE ACT, THE ASSESSEE IS NOT ABLE TO SUBSTANTIATE THE EXPLANATION AND THE AS SESSEE FAILS, TO PROVE THAT SUCH EXPLANATION IS BONA FIDE AND THAT THE ASSESSEE HAD DISCLOSED ALL THE FACTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATIO N OF THE TOTAL INCOME. UNDER FIRST SITUATION, THE DEEMING FICTION WOULD CO ME TO PLAY IF THE ASSESSEE FAILED TO GIVE ANY EXPLANATION WITH RESPECT TO ANY FACT MATERIAL TO THE COMPUTATION OF TOTAL INCOME OR BY ACTION OF THE ASS ESSING OFFICER OR THE LEARNED CIT(APPEALS) BY GIVING A CATEGORICAL FINDIN G TO THE EFFECT THAT EXPLANATION GIVEN BY THE ASSESSEE IS FALSE. IN THE SECOND SITUATION, THE DEEMING FICTION WOULD COME TO PLAY BY THE FAILURE O F THE ASSESSEE TO ITA NO.3538/AHD/2015 6 SUBSTANTIATE HIS EXPLANATION IN RESPECT OF ANY FACT MATERIAL TO THE COMPUTATION OF TOTAL INCOME AND IN ADDITION TO THIS THE ASSESSE E IS NOT ABLE TO PROVE THAT SUCH EXPLANATION WAS GIVEN BONA FIDE AND ALL THE FA CTS RELATING TO THE SAME AND MATERIAL TO THE COMPUTATION OF THE TOTAL INCOME HAV E BEEN DISCLOSED BY THE ASSESSEE. THESE TWO SITUATIONS PROVIDED IN EXPLANATION 1 APPENDED TO SECTION 271(1)(C) MAKES IT CLEAR THAT THAT WHEN THIS DEEMIN G FICTION COMES INTO PLAY IN THE ABOVE TWO SITUATIONS THEN THE RELATED ADDITION OR DISALLOWANCE IN COMPUTING THE TOTAL INCOME OF THE ASSESSEE FOR THE PURPOSE OF SECTION 271(1)(C) WOULD BE DEEMED TO BE REPRESENTING THE I NCOME IN RESPECT OF WHICH INACCURATE PARTICULARS HAVE BEEN FURNISHED. 7. IN THE LIGHT OF THE ABOVE DISCUSSION, IF I EXAMI NE THE FACTS IN THE PRESENT CASE, THEN IT WOULD REVEAL THAT THE INCOME DISCLOSE D BY THE ASSESSEE HAS BEEN ACCEPTED. THEREFORE, THE ASSESSEE CANNOT BE VISITE D WITH PENALTY WITH THE HELP OF EXPLANATION-I OF SECTION 271(1)(C) OF THE ACT. THAT EXPLANATION IS NOT ATTRACTED IN THE PRESENT CASE. AS FAR AS SECOND ASPECT IS CO NCERNED, AN IDENTICAL ISSUE HAS BEEN CONSIDERED BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE JUDGMENT RELIED UPON THE LD.COUNSEL FOR THE ASSESSEE. THE RELEVANT DISCUSSION MADE IN THE DECISION IS AS UNDER: 11. THUS, THE LEGAL POSITION THAT EMERGES IS THAT M ERE FAILURE TO FURNISH A RETURN OF INCOME DOES NOT TANTAMOUNT TO C ONCEALMENT UNDER S. 271(1)(C) OF THE ACT. IN THE CIRCUMSTANCES, THE CON TENTION RAISED ON BEHALF OF THE REVENUE THAT NON-FILING OF THE RETURN OF INCOME PER SE AMOUNTS TO CONCEALMENT WITHIN THE MEANING OF S. 271 (1)(C) OF THE ACT, BEING CONTRARY TO THE SETTLED LEGAL POSITION, DOES NOT MERIT ACCEPTANCE. 12. BUT THE INTRODUCTION OF EXPLN. 3 TO S. 271(1) W .E.F. 1ST APRIL, 1976 HAS CHANGED THE LAW ON THE POINT IN CERTAIN CASES. EXPLANATION 3 PROVIDES THAT IF A PERSON, WHO HAS NOT HITHERTO BEE N ASSESSED TO TAX UNDER THE IT ACT, 1961 DOES NOT FILE A RETURN OF IN COME FOR AN ASSESSMENT YEAR VOLUNTARILY WITHIN THE NORMAL PERIO D OF LIMITATION AND NO NOTICE UNDER S. 142(1) OR 148 IS ISSUED TO HIM T ILL THE EXPIRY OF THE ITA NO.3538/AHD/2015 7 SAID PERIOD, HE WILL BE TREATED TO HAVE CONCEALED H IS INCOME AND PENALTY WILL BE LEVIABLE ON HIM ACCORDINGLY IF HE I S LATER FOUND TO HAVE HAD TAXABLE INCOME IN THAT YEAR. THUS, FOR THE PURP OSE OF FALLING WITHIN THE PURVIEW OF EXPLN. 3, FIRSTLY, A PERSON SHOULD N OT HAVE BEEN PREVIOUSLY ASSESSED (THAT IS, A NEW ASSESSEE); SECO NDLY, HE SHOULD HAVE FAILED WITHOUT REASONABLE CAUSE, TO FURNISH RETURN OF INCOME FOR ASST. YR. 1989-90 OR ANY YEAR SUBSEQUENT THERETO WITHIN T WO YEARS FROM THE END OF THE ASSESSMENT YEAR CONCERNED; THIRDLY, THAT NO NOTICE SHOULD HAVE BEEN ISSUED TO HIM UNDER S. 142(1) OR S. 148 O F THE ACT TILL THE EXPIRY OF THE TWO YEAR PERIOD; AND LASTLY, THE CONC ERNED OFFICER IS SATISFIED THAT IN RESPECT OF SUCH ASSESSMENT YEAR, SUCH PERSON HAD TAXABLE INCOME. IN SUCH CASES, EXPLN. 3 PROVIDES TH AT SUCH PERSON SHALL BE DEEMED TO HAVE CONCEALED THE PARTICULARS OF HIS INCOME WITHIN THE MEANING OF CL. (C) OF S. 271(1) OF THE ACT FOR SUCH ASSESSMENT YEAR. IN SUCH AN EVENTUALITY, EVEN IF THE PERSON CONCERNED F ILES A RETURN AFTER THE EXPIRY OF THE SAID PERIOD OF TWO YEARS IN PURSUANCE OF A NOTICE UNDER S. 148 OF THE ACT, THE DEEMING PROVISION OF EXPLN. 3 S HALL STILL HAVE APPLICATION. 13. THOUGH IT HAS BEEN CONTENDED ON BEHALF OF THE R ESPONDENTS THAT IN THE PRESENT CASE EXPLN. 3 HAS NOT BEEN APPLIED; AS NOTICED EARLIER MERE NON-FURNISHING OF A RETURN PER SE IS NOT TANTA MOUNT TO CONCEALMENT WITHIN THE MEANING OF S. 271(1)(C) OF T HE ACT. THE ONLY EVENTUALITY UNDER WHICH NON-FURNISHING OF RETURN OF INCOME AMOUNTS TO CONCEALMENT IS AS PROVIDED UNDER EXPLN. 3 TO SUB-S. (1) OF S. 271 OF THE ACT. HENCE, UNLESS EXPLN. 3 OF S. 271(1) OF THE ACT IS ATTRACTED, THERE CAN BE NO CONCEALMENT AS ENVISAGED UNDER S. 271(1)( C) OF THE ACT. IN THE CIRCUMSTANCES, IT IS REQUIRED TO BE EXAMINED AS TO WHETHER THE PROVISIONS OF EXPLN. 3 TO S. 271(1) COULD HAVE BEEN INVOKED IN THE PRESENT CASE. FOR THE PURPOSE OF INVOKING THE PROVI SIONS OF EXPLN. 3 TO S. 271(1) OF THE ACT, THE CONDITIONS ENUMERATED HER EINBEFORE ARE REQUIRED TO BE SATISFIED. IF ANY OF THE SAID CONDIT IONS IS NOT SATISFIED, THE PROVISIONS OF EXPLN. 3 TO S. 271(1) OF THE ACT WOUL D NOT BE APPLICABLE. 14. IN THE PRESENT CASE ADMITTEDLY THE PETITIONER H AD NOT BEEN PREVIOUSLY ASSESSED UNDER THE PROVISIONS OF THE ACT , HENCE, THE FIRST REQUIREMENT OF EXPLN. 3 IS DULY SATISFIED. THE PETI TIONER HAD NOT FILED HIS RETURN OF INCOME WITHIN THE PERIOD SPECIFIED UN DER SUB-S. (1) OF S. 153 OF THE ACT AND AS SUCH, THE SECOND CONDITION IS ALSO SATISFIED. HOWEVER, AS NOTED EARLIER, IN THE PRESENT CASE A NO TICE HAD BEEN ISSUED TO THE PETITIONER UNDER S. 148 OF THE ACT ON 10TH M ARCH, 1997 WHICH ITA NO.3538/AHD/2015 8 WAS WITHIN THE PERIOD SPECIFIED UNDER S. 153(1) OF THE ACT. IN THE CIRCUMSTANCES, THE THIRD CONDITION NAMELY, THAT NO NOTICE UNDER S. 142(1) OR S. 148 OF THE ACT SHOULD HAVE BEEN ISSUED WITHIN THE PERIOD SPECIFIED UNDER SUB-S. (1) OF S. 153 OF THE ACT IS CLEARLY NOT SATISFIED. AS DISCUSSED EARLIER, THE CONDITIONS FOR APPLICABILITY OF EXPLN. 3 TO S. 271(1) ARE CUMULATIVE AND EACH OF THE CONDITIONS HA S TO BE ESTABLISHED FOR THE PURPOSE OF INVOKING THE SAID PROVISION. IN THE PRESENT CASE, ALL THE CONDITIONS ARE NOT CUMULATIVELY SATISFIED. THE FAILURE ON THE PART OF THE PETITIONER TO FURNISH RETURN OF INCOME WITHIN T HE SPECIFIED PERIOD, THEREFORE, CANNOT BE DEEMED TO BE CONCEALMENT WITHI N THE MEANING OF THE EXPLN. 3 TO S. 271(1)(C) OF THE ACT. IN THE LIG HT OF THE AFORESAID, IT IS APPARENT THAT THE CASE OF THE PETITIONER DOES NOT F ALL WITHIN THE AMBIT OF EXPLN. 3 TO S. 271(1) OF THE ACT AND AS SUCH, NO PE NALTY COULD BE LEVIED ON THE PETITIONER UNDER S. 271(1)(C) OF THE ACT FOR CONCEALMENT OF PARTICULARS OF HIS INCOME ON THE GROUND THAT THE PE TITIONER HAD FAILED TO FURNISH RETURN OF INCOME FOR THE YEAR UNDER CONSIDE RATION. THE IMPUGNED ORDER, THEREFORE, BEING CONTRARY TO THE PR OVISIONS OF THE ACT, CANNOT BE SUSTAINED. INSOFAR AS THE ORDER PASSED BY THE REVISIONAL AUTHORITY IS CONCERNED, IN THE REVISION APPLICATION THE PETITIONER HAS STATED THAT THE REASON FOR NOT APPEARING IN RESPONS E TO THE NOTICES ISSUED UNDER SS. 148 AND 144 OF THE ACT, WAS THAT H E HAD HANDED OVER THE SAID NOTICES TO THE INCOME-TAX PRACTITIONER, SH RI K.J. JOSHI TO DO THE NEEDFUL IN THE MATTER. HOWEVER, FOR REASONS BEST KN OWN TO HIM HE NEVER ATTENDED AND AT THE SAME TIME ASSURED THE PETITIONE R THAT EVERYTHING HAD BEEN FOLLOWED UP AND CLEARED. THAT HE BEING HIS TAX CONSULTANT HE RELIED UPON HIS ASSURANCE WHILE IN FACT HE BETRAYED HIM. HOWEVER, THE REVISIONAL AUTHORITY HAS WITHOUT EVEN CONSIDERING T HE EXPLANATION PUT FORTH BY THE PETITIONER, DISMISSED THE REVISION PET ITION MERELY ON THE GROUND THAT THE PETITIONER HAD NOT RESPONDED TO THE NOTICES ISSUED BY THE AO. IN THE ORDER MADE BY THE REVISIONAL AUTHORI TY THERE IS NO DISCUSSION AS REGARDS THE MERITS OF THE CASE. HOWEV ER, SINCE THE SAID ORDER IN EFFECT AND SUBSTANCE CONFIRMS THE PENALTY ORDER MADE BY THE AO, FOR THE REASONS RECORDED HEREINABOVE THE ORDER PASSED BY THE REVISIONAL AUTHORITY ALSO CANNOT BE SUSTAINED. 8. AS OBSERVED EARLIER, IN THE PRESENT CASE ALSO TH REE CONDITIONS CONTEMPLATED IN EXPLANATION-3 ARE NOT AVAILABLE HERE. NOTICE UNDER SECTION 148 HAS BEEN ISSUED WITHIN TIME LIMIT AVAILABLE FOR ASSESSMENT OF THE INCOME FOR THIS YEAR UNDER SECTION 153(1) OF THE ACT. HAD THIS NOTICE BEEN NOT ISSUED, ITA NO.3538/AHD/2015 9 THEN, ASSESSEE COULD BE VISITED WITH PENALTY WITH T HE HELP OF EXPLANATION- 3. THEREFORE, IN VIEW OF THE ABOVE DISCUSSION, I ALLOW GROUND OF THE APPEAL AND DELETE THE IMPUGNED PENALTY. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE COURT ON 1 ST SEPTEMBER, 2016 AT AHMEDABAD. SD/- (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 01/09/2016
