Smt. Rekha Anil Duggad, Ahmedabad V. The DCIT, Circle-6(1), Ahmedabad

ITA 359/AHD/2020

• Counselvise Citation: [2022] 105 COUNSELVISE.COM (IT) 2640 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 10 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 23-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.S. SHUKLA
• Keywords: Bogus purchase; Recovery proceedings; Reasonable cause; Set aside
• Section: 271(1)(c); 143(3)

Judgement Text

आयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरणआयकर अपीलीय अिधकरण आयकर अपीलीय अिधकरण, अहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठअहमदाबाद 瀈यायपीठ अहमदाबाद 瀈यायपीठ ‘A’ अहमदाबाद। अहमदाबाद।अहमदाबाद। अहमदाबाद। IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, AHMEDABAD ] ] BEFORE SHRI PRAMOD M JAGTAP, VICE PRESIDENT AND T.R. SENTHIL KUMAR, JUDICIAL MEMBER ITA Nos.358/Ahd/2020 Assessment Year : 2009-10 Anil Gaherilal Duggad B/2, Harivandan Co. OP. HSG. Society, Near Idli Char Rasta, Maninagar-East, Ahmedabad- 380008 PAN:AELPD5832J Vs DCIT Circle-6(1), Ahmedabad-380015 अपीलाथ / (Appellant) यथ / (Respondent) ITA Nos.359/Ahd/2020 Assessment Year : 2009-10 Rekha Anil Duggad B/2, Harivandan Co. OP. HSC. Society, Near Idli Char Rasta, Maninagar-East, Ahmedabad- 380008 PAN:AHSPD6134B Vs DCIT Circle-6(1), Ahmedabad-380015 अपीलाथ / (Appellant) यथ / (Respondent) Assessee by : Shri Suresh Gandhi, AR Revenue by : Shri S. S. Shukla, Sr. DR स ु नवाई क तार ख/Date of Hearing : 05/05/2022 घोषणा क तार ख /Date of Pronouncement: 11 /05/2022 आदेश/O R D E R PER T.R. SENTHIL KUMAR, JUDICIAL MEMBER: These are the appeals filed by the assessee who are husband and wife against the separate orders dated 24.01.2020 passed by the Commissioner of Income Tax (Appeals)-6, Ahmedabad (in short “CIT(A)”) relating to the A.Y. 2009-10 refusing to condone the delay of 1276 days in filing the appeals ITA Nos.358&359/Ahd/2020 2 against the penalty orders passed under Section 271(1)(c) of the Income Tax Act, 1961 (hereinafter called “the Act”). 2. The assessee before us are the husband and wife engaged in the business of trade in brass and Proprietors of two different firms wherein common disallowances were been made on account of bogus purchases by the respective firms. 3. The Registry has noted that this appeal is time barred by 80 days in filing this appeal before the Tribunal. The Hon’ble Supreme Court in suo motu Writ Petition (C) No. 3 of 2020 and in M.A. No. 29 of 2022 dated 10.01.2022 extend by the period of limitation from 15.03.2020 till 28.02.2022. This appeal is filed on 24.06.2020. Thus, there is no delay in filing the appeal before the Tribunal. 4. The original assessment under Section 143(3) was passed on 26.12.2011 treating the purchase of brass as bogus purchase and an addition of Rs. 38,00,000/- was being made and determined the taxable income as Rs. 19,61,059/-. Following this assessment order, penalty proceeding was initiated against the husband and levied a penalty of Rs. 13,00,000/- under Section 271(1)(c) of the Act. In the case of the wife Smt. Rekha Anil Duggad, by order dated 20.03.2015 levied a penalty of Rs.23,00,000/- under Section 271(1)(c) of the Act. 5. As against these penalty orders both the assessees filed appeals before the Ld. CIT(A) with a request to condone the delay of 1276 days in filing such appeals. The Ld. CIT(A) has dismissed the appeals by holding that the assessee has not submitted any evidence either alongwith the appeal or with the appellate ITA Nos.358&359/Ahd/2020 3 proceeding to establish the genuine hardship and there is no reasonable cause to condone the huge delay of 1276 days and thereby dismissed the appeal filed by the assessee vide order dated 24.01.2020. 6. Aggrieved against the same the assessees are before us raising the grounds of appeal as follows: Ground of ITA No. 358/A/2020:- “1. The learned CIT(A) has erred in law and on facts while not granting the condonation of delay in filing the appeal and thereby dismissing the appeal on this ground itself. In view of the facts of the case and elaborate submission filed requesting condonation of delay, the learned CIT(A) ought to have regularize the appeal condoning the delay in filing of appeal in the large interest of justice and equity. 2. The learned CIT(A) has erred in law and on facts while not deciding the appeal on the merits of the case and thereby confirming the levy of penalty of Rs. 13,00,000/-. In view of the facts and merits of the case, the appellant’s case does not fall within the scope of provisions of Section 271(1)(c) of the Act. Accordingly, the impugned penalty of Rs. 13,00,000/- required to be quashed / cancelled.” Ground of ITA No. 359/A/2020:- “1. The learned CIT(A) has erred in law and on facts while not granting the condonation of delay in filing the appeal and thereby dismissing the appeal on this ground itself. In view of the facts of the case and elaborate submission filed requesting condonation of delay, the learned CIT(A) ought to have regularize the appeal condoning the delay in filing of appeal in the large interest of justice and equity. 2. The learned CIT(A) has erred in law and on facts while not deciding the appeal on the merits of the case and thereby confirming the levy of penalty of Rs. 23,00,000/-. In view of the facts and merits of the case, the appellant’s case does not fall within the scope of provisions of Section 271(1)(c) of the Act. Accordingly, the impugned penalty of Rs. 23,00,000/- required to be quashed / cancelled.” 7. The ld.Authorised Representative, Mr. Suresh Gandhi submitted that original penalty order passed under section 271(1)(c) of the Act on 24.3.2015 might had served on one Shri Vikas Prajapati who has left job as an accountant in the assessee-firm, so it has not come to the knowledge of the ITA Nos.358&359/Ahd/2020 4 assessee. Only during the recovery proceedings in the month of September, 2018 the assessee came to the knowledge of the so- called penalty order. It is thereafter, assessee obtained copy of the impugned order, and then filed statutory appeal before the ld.CIT(A) thereby a delay of 1276 days in filing appeal caused. In the meanwhile, the assessee challenged quantum appeal, which travelled upto this Tribunal by way of appeals in ITA No.882/Ahd/2014 and 883/Ahd/2014 and vide common order dated 26.4.2017, the Tribunal directed the AO to restrict the impugned disallowance of bogus purchase of brass at 15% only, and not on the entire amount as claimed by the assessee. Thus, the assessee has got substantial relief in the quantum appeal. Consequently, the present penalty matter is required to be reconsidered especially quantification. The ld.AR further pleaded that this court can take into consideration further development in the case and condone the delay of 1276 days in filing appeal, and also set aside the matter back to the file of the AO even by passing any conditional order and also direct the AO to pass appropriate further orders in the penalty proceedings. 8. The Ld. DR appearing for the Department fairly accepted since the quantum appeal is being restricted the impugned disallowance to 15% by the Hon’ble Tribunal. He has no objection in remitting the matter back to the AO. Further a cost may be imposed for the huge delay of 1276 days in filing the appeal before the Commissioner (Appeals). 9. We have given our thoughtful considerations and further developments taken place in the quantum appeal and the orders passed by the Coordinate Bench of the Tribunal in assessee’s own ITA Nos.358&359/Ahd/2020 5 case (cited supra). We think it deemed fit to impose a cost of Rs. 10,000/- for each appeal to be deposited in the Prime Minister National Relief Fund within a period of 4 weeks from the receipt of the order copy to condone the huge delay of 1276 days in filing the appeal before the Ld. CIT(A). 10. On paying the cost within 4 weeks from the date of receipt of this order copy, and on such production of the proof of the payment, the Ld. AO shall pass a fresh order under Section 271(1)(c) of the Act in accordance with law. In terms of the above conditions the appeals are allowed for statistical purposes. 11. In the result, the appeals filed by the assessees are allowed for statistical purposes. Order pronounced in the Court on 11.05.2022 at Ahmedabad. Sd/- Sd/- (PRAMOD M JAGTAP) VICE PRESIDENT (T.R. SENTHIL KUMAR) JUDICIAL MEMBER Ahmedabad, dated 11/05/2022 Tanmay TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ! / The Appellant 2. "यथ! / The Respondent. 3. संबं&धत आयकर आय ु (त / Concerned CIT 4. आयकर आय ु (त)अपील (/ The CIT(A)- 5. वभागीय त न&ध ,आयकर अपील य अ&धकरण,राजोकट/DR,ITAT, Ahmedabad, 6. गाड1 फाईल /Guard file. आदेशान ु सार/ BY ORDER, सहायक पंजीकार (Asstt. Registrar) आयकर अपील य अ&धकरण, ITAT, Ahmedabad