Mrs. Thankamani Varadarajulu, Kottayam V. The DCIT,Cen-circle-2, Trivandrum

ITA 374/COCH/2019

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 8963 (ITAT-COCHIN)
• Duration Of Justice: 4 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-09-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 25-09-2019
• Assessment Year: 2002-2003
• Appeal Filed On: 10-05-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A S BINDHU
• Assessee Lawyers: JACOB BABU
• Keywords: Opportunity of being heard; Reasonable cause; Corroborative evidences
• Section: 271(1)(c); 250; 274; 147; 148; 132

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFOR E S/ SHRI CHANDRA POOJARI , AM & GEORGE GEORGE K., J M I .T . A. NO S . 374 TO 380/ C OCH/2019 ASSESSMENT YEAR S : 2002 - 03 TO 2008 - 09 SMT. THANKAMANI VARADARAJULU, THRYAMBAKOM (H), PODUVAL LANE, PUTHANANGADI P.O., KOTTAYAM - 686 001. [PAN:ADYPV 4752B] VS. THE DEPUTY COMMISSIONER OF INCOME - TAX, CENTRAL CIRCLE - 2, TRIVANDRUM. (ASSESSEE - APPELLANT) (REVENUE - RESPONDENT) I .T.A. NOS.381 TO 384/COCH/2019 ASSESSMENT YEARS : 2002 - 03 TO 2005 - 06 SMT. ANITA NAGENDRAN, THRYAMBAKOM (H), PODUVAL LANE, PUTHANANGADI P.O., KOTTAYAM - 686 001. [PAN:A BFPV 7178J] VS. THE DEPUTY COMMISSIONER OF INCOME - TAX, CENTRAL CIRCLE - 2, TRIVANDRUM. (ASSESSEE - APPELLANT) (REVENUE - RESPONDENT) A SSESSEE BY SHRI JACOB BABU, CA REVENUE BY SMT. A.S. BINDHU, SR. DR D ATE OF HEARING 25/09 /2019 DATE OF PR ONOUNCEMENT 27 / 0 9 /201 9 O R D E R PER CHANDRA POOJARI, AM: TH ESE APPEAL S OF THE ASSESSEE S ARE DIRECTED AGAINST THE DIFFERENT ORDERS OF THE CIT(A) - III, KOCHI DATED 20 /02/2019 AND PERTAIN TO THE ASSESSMENT YEARS 2002 - 03 TO 2008 - 09. I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 2 2. THE GROUNDS OF APPEAL S IN THE CASE OF THE ASSESSEE SMT. THANKAMANI V ARADARAJULU WHICH ARE COMMON IN NATURE EXCEPT FOR CHANGE IN AMOUNT READ AS FOLLOWS: 1. THE LEARNED DEPUTY COMM ISSIONER OF INCOME TAX ERRED IN LEVYING A PENALTY OF RS 51.151/ - U/S 271(1) (C) OF THE INCOME TAX ACT 1961OVERLOOKING THE EXPLANATIONS OFFERED BY THE APPELLANT. 2. THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX OUGHT TO HAVE APPRECIATED THAT FAILURE TO DI SCLOSE PROPERTY INCOME WAS PURELY ACCIDENTAL. THE APPELLANT'S HUSBAND ALREADY HAVING CONCEDED TO THE DEPARTMENT THAT THE APPELLANT WAS IN POSSESSION OF TWO PROPERTIES THERE WAS NO QUESTION OF THE APPELLANT WILFULLY CONCEALING THE PARTICULARS OF INCOME IN R ESPECT OF THESE PROPERTIES. 3. THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX ERRED IN CONCLUDING THAT THE ADDITION MADE ON ACCOUNT OF UNEXPLAINED DEPOSITS IN S.B ACCOUNT WITH CANARA BANK, KOTTAYAM AMOUNTED TO CONCEALMENT, OVERLOOKING THE FACT THAT IT WA S APPELLANT'S LATE HUSBAND, WHO WAS HANDLING THE TAX AFFAIRS AND HAVING LOST HIM, THERE WAS NO WAY BY WHICH THE APPELLANT COULD PROPERLY EXPLAIN THE SOURCE OF DEPOSIT WITH EVIDENCE. 4. THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX OUGHT TO HAVE DISTINGU ISHED BETWEEN AN ACCIDENTAL OMISSION AND A WILFUL CONCEALMENT, AS ALSO A FAILURE TO EXPLAIN AN ITEM PROPERLY AND THE EXPLANATION HAVING BEEN MADE, THE DEPARTMENT NOT BEING SATISFIED WITH THE EXPLANATION OFFERED. 5. THE LEARNED DEPUTY COMMISSIONER OF INCO ME TAX OUGHT TO HAVE APPRECIATED THE CIRCUMSTANCES UNDER WHICH THE ADDITION WAS AGREED TO, MERELY BECAUSE THE APPELLANT HAD SURRENDERED OR AGREED TO AN ADDITION, IT WOULD NOT AUTOMATICALLY GO TO CONCLUDE THAT THE APPELLANT HAD IN FACT CONCEALED THE PARTICU LARS OF HER INCOME. 6. THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX OUGHT TO HAVE APPRECIATED THAT THE APPELLANT, BEING A WIDOW OF VARADARAJULU, WHO WAS THE MAIN PERSON IN CHARGE OF FAMILY AFFAIRS, FAILURE TO OFFER EXPLANATION, ON ACCOUNT OF THE DEATH OF THE SAID VARADARAJULU, WAS QUITE NATURAL AND TO EXPECT SOMETHING CONTRARY FROM THE APPELLANT IS TO EXPECT SOMETHING IMPOSSIBLE. 7. THE CIT (A) ERRED IN CONFIRMING THE PENALTY OF RS 51.151/ - U/S 271(1) (C) OF THE INCOME TAX ACT 1961 OVERLOOKING THE EX PLANATIONS OFFERED BY THE APPELLANT. 8. THE CIT (A) ALSO SHOULD HAVE APPRECIATED THE FACTUAL POSITION THAT THE MAJOR ADDITION IN INCOME WAS DUE TO THE APPELLANT'S INABILITY TO EXPLAIN THE DEPOSIT IN I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 3 BANK ACCOUNT IN THE ABSENCE OF HER LATE HUSBAND WHO WA S HANDLING HER TAX MATTERS. 9. SINCE THE BUSINESS OF M/S PARTHAS TEXTILES WAS A JOINT FAMILY BUSINESS, THE KEY MEMBER OF THE FAMILY HANDLED THE BUSINESS AND THE OTHER MEMBERS OF THE FAMILY ASSISTED HIM. THE KEY MEMBER WAS RESPONSIBLE FOR MANAGING THE T RANSACTIONS OF THE BUSINESS AND THE INCOME TAX MATTERS OF OTHER MEMBERS OF THE FAMILY. THE SUDDEN DEMISE OF KEY MEMBER, S VARADARAJULU, MADE THE OTHER MEMBERS HANDICAPPED TO PROPERLY EXPLAIN THE TRANSACTIONS IN THEIR ACCOUNT. 10. THE CIT (A) ALSO SHOULD HAVE APPRECIATED THE FACT THAT THE RETURN OF INCOME OF THE APPELLANT FOR THE ASSESSMENT YEAR 2002 - 2003 WAS FILED ON 20/11/2009. THE APPELLANT'S HUSBAND, WHO WAS HANDLING THE ACCOUNTS AND TAX AFFAIRS OF THE APPELLANT, WAS DIED ON 05/09/2009. BEFORE THE DE ATH THE APPELLANT'S HUSBAND UNDERGONE FOR CONTINUOUS TREATMENTS IN RELATION TO HIS ILLNESS. AT THAT TIME THE APPELLANT HAD TO DEVOTE HER FULL ATTENTION AND CARE TO HER HUSBAND. HER BELOVED HUSBAND'S HEALTH CONDITION WORRIED HER A LOT AND SHE GAVE MORE IMPO RTANCE FOR THE SURVIVAL OF HER HUSBAND RATHER THAN INCOME TAX MATTERS. SOON AFTER HER HUSBAND PASSED AWAY AND THE SUDDEN DEMISE OF THE LEADER OF THE FAMILY MADE THEM MENTALLY WEAK. IN SUCH A SITUATION THE DEPARTMENT ASKED THE APPELLANT TO FILE THE RETURN A ND PRODUCE THE SUPPORTING EVIDENCE. HENCE THE APPELLANT FILED A RETURN BASED ON HER LIMITED KNOWLEDGE AND PRODUCED THE SUPPORTING EVIDENCES TO THE BEST OF HIS KNOWLEDGE. SINCE THE RETURN WAS FILED AT A TIME WHEN THE APPELLANT WAS A SHAKEN PERSON, FOLLOWING THE DEATH OF HER HUSBAND AND DIFFERENCES IN THE FAMILY, SHE COULDN'T PROVIDE MORE ATTENTION TO THE TAX MATTERS. CIT (A) SHOULD HAVE CONSIDER THE HUMAN EMOTIONS BEHIND THE SITUATION AND TREAT THE OMISSIONS AS UNINTENTIONAL NOT AS CONCEALMENT. 11. THEREFOR E THE SURRENDER OF THE AMOUNTS WAS NOT BECAUSE THEY WERE INCOME, BUT DUE TO IMPOSSIBILITY OF PROVING THE CREDITS IN VIEW OF THE DEATH OF THE APPELLANT'S HUSBAND. THIS ADMISSION CAN'T BE CONSTRUED AS CONCEALMENT BY ANY STRETCH OF IMAGINATION 12. MORE OVER IN THE CASE OF LATE S VARADARAJULU THE COCHIN BENCH OF ITAT COCHIN VIDE ORDER DATED 07.09.2012 HELD THAT : 'IT IS WELL SETTLED PRINCIPLE OF LAW THAT ALL ADDITIONS MADE IN THE ASSESSMENT PROCEEDINGS DO NOT AUTOMATICALLY RESULT IN LEVY OF PENALTY, THE ASSESS ING, AUTHORITY IS EXPECTED TO REAPPRECIATE THE EVIDENCE AVAILABLE ON RECORD INDEPENDENTLY IN THE PENALTY PROCEEDINGS AND THEREAFTER IF HE COMES TO THE CONCLUSION THAT THERE WAS CONCEALMENT OF PARTICULARS OF INCOME OR THE TAX PAYER HAS FURNISHED INACCURATE PARTICULARS WITH REGARD TO THAT INCOME PENALTY MAY BE LEVIED. IN THIS CASE, ADMITTEDLY, THE TAX PAYER EXPIRED IN THE MONTH OF SEPTEMBER 2009. IT IS ALSO NOT IN DISPUTE THAT THE TAX PAYER WAS EXPELLED FROM THE PARTNERSHIP FIRM ON THE ALLEGATION OF MISAPPROP RIATION OF FIRM'S FUND. THE FACTUAL SITUATION COULD HAVE BEEN WELL EXPLAINED BEFORE THE ASSESSING AUTHORITY BY THE TAX I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 4 PAYER HIMSELF. UNFORTUNATELY THE TAX PAYER IS NO MORE. THEREFORE THE LEGAL REPRESENTATIVES OF THE TAX PAYER WERE PRACTICALLY HANDICAPPED IN EXPLAINING THE REAL SITUATION WHICH RESULTED IN CREDIT OF THE AMOUNT IN THE BANK ACCOUNT. IN SUCH A CIRCUMSTANCE, WE MAY NOT BE ABLE TO BLAME THE LEGAL HEIRS IN NOT FURNISHING A SATISFACTORY EXPLANATION. BY TAKING INTO CONSIDERATION THE DEATH OF THE TAX PAYER AND THE PRACTICAL DIFFICULTY FACED BY THE LEGAL HEIRS IN FURNISHING THE REASONS FOR NOT OFFERING THE AMOUNT FOUND IN THE BANK ACCOUNT, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THIS IS NOT A FIT CASE FOR LEVY OF PENALTY. THEREFORE THE COMMISSI ONER OF INCOME TAX (A) HAS RIGHTLY DELETED THE PENALTY. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY THE SAME IS CONFIRMED'. 13 . THE CIT (A) ALSO SHOULD HAVE APPRECIATED THE FACT THAT THE APPELLANT IS A HOUSEWIFE SUPPORTIN G HER HUSBAND IN THE BUSINESS NEEDS WITHOUT HAVING ANY KNOWLEDGE IN TAX AND ACCOUNTING MATTERS. THE SUDDEN DEMISE OF HER HUSBAND MADE HER SHAKEN AND AT THAT TIME FILING OF RETURN BECOMES NECESSARY AND SHE HAD FILED THE RETURN BASED ON AVAILABLE DOCUMENTS W ITH HER. THE ACTUAL INTENTION WAS TO FILE THE RETURN AND NOT CONCEAL ANY INCOME. HER INABILITY TO EXPLAIN THINGS IN THE ABSENCE OF HER HUSBAND LEAD TO THE SITUATION OF DIFFERENCES IN INCOME. 14 . THE CIT (A) ALSO SHOULD HAVE APPRECIATED THE FACT THAT THE A PPELLANT LOST HER HUSBAND. EMOTIONS CAN AFFECT THE MIND OF A PERSON FOR A LONG PERIOD. IT WILL TAKE A LOT OF TIME TO RECOVER FROM THE MENTAL ILLNESS CAUSED BY SUCH EMOTIONS. IN THIS CASE THE APPELLANT'S HUSBAND DIED IN THE YEAR 2009. SINCE THE APPELLANT WA S VERY MUCH CLOSER TO HER HUSBAND IT TOOK A LOT OF TIME TO THE APPELLANT TO RECOVER FROM THAT ACTUALLY THE A PPEAL WAS CONSIDERED BY THE CIT( A ) IN THE YEAR 2019. A LOOK BACK INTO SUCH A SITUATION AFTER A LONG PERIOD OF 10 YEARS MADE AN IMPRESSION THAT THE A PPELLANT GOT ABOUT 3 MONTHS TO FILE THE RETURN AFTER THE DEATH OF HER HUSBAND AND GOT ENOUGH TIME TO PRODUCE EVIDENCES BECAUSE SHE IS AN ADULT PERSON. HOWEVER THE SUDDEN DEMISE OF HER HUSBAND, THE EXPULSION FROM T HE FAMILY AND FAMILY BUSINESS E TC DESTROYED HER FINANCIAL AND MENTAL STRENGTH. IN SUCH A SITUATION, EVEN IF SHE IS AN ADULT PERSON, SHE WAS NOT ABLE TO RECOLLECT THE FINANCIAL TRANSACTIONS IN HER BANK ACCOUNT WITHOUT THE PRESENCE OF HER HUSBAND. THE APPELLANT TOOK A LOT OF TIME TO RECOVER FROM THAT . IF THE CIT (A ) HAD CONSIDERED THE SITUATION FROM THAT POINT OF VIEW THEY DID NOT CONCLUDE LIKE THAT. 15. THESE AND OTHER GROUNDS OF APPEAL THAT MAY BE RAISED DURING THE COURSE OF APPEAL PROCEEDINGS YOUR APPELLANT PRAYS THAT THE PENALTY OF RS 51 , 151/ - L EVIED U/S 271(1) ( C ) OF THE INCOME TAX ACT 1961 BE CANCELLED. I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 5 3 . THE FACTS OF THE CASE IN THE CASE OF SMT. THANKAMANI VARADARAJULU, EX PARTNER OF M/S. PARTHAS TEXTILES IS THE WIFE OF SRI. S VARADARAJULU, EX - PARTNER OF M/S PARTHAS TEXTILES, KOTTAYAM, A R ELATED CONCERN OF M/S PARTHAS TEXTILES, TRIVANDRUM, WHICH WAS SUBJECTED TO SEARCH U/S 132 OF THE INCOME TAX ACT 1961 ON 11.10.2007. IN RESPONSE TO NOTICE U/S 153C, THE APPELLANT FILED A RETURN ADMITTING AN INCOME OF RS 7,49,88/ - . THE ASSESSMENT WAS COMPLET ED ON A TOTAL INCOME OF RS 9 , 20 , 385/ - . PENALTY PROCEEDINGS U/S 271(1)( C ) OF THE INCOME TAX ACT 1961WAS INITIATED, IN COMPLETING THE ASSESSMENT. ACCORDING TO THE ASSESSING OFFICER, AS PER WRITTEN SUBMISSION FILED BY SRI. S VARADARAJULU, IT WAS MENTIONED TH AT TWO PROPERTIES WITH RESIDENTIAL BUILDING I.E., THRAYAMBAKOM AND GUNA N IVAS WERE PURCHASED IN THE NAME OF THE ASSESSEE . HOWEVER THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAD NOT RETURNED ANY RENTAL INCOME FROM THE SAME NOR ANY SATISFACTORY EXPLANA TION WAS OFFERED BY THE ASSESSEE FOR NOT INCLUDING RENTAL INCOME. THE ASSESSING OFFICER INCLUDED THE RENTAL INCOME OF RS 15,960/ - WHICH WAS AGREED TO BY THE ASSESSEE. THIS OMISSION ON THE PART OF THE ASSESSEE, TO RETURN THE RENTAL INCOME, WAS DELIBERATE A CCORDING TO THE ASSESSING OFFICER. CONSEQUENTLY SHE CONCLUDED THAT THERE WAS A WILFUL ATTEMPT ON PART OF THE ASSESSEE TO FURNISH INACCURATE PARTICULARS OF INCOME, BY CONCEALING THE RENTAL INCOME. A SUM OF RS 1,54,542/ - WAS ADDED IN THE ASSESSMENT IN RESPEC T OF ALLEGED UNACCOUNTED DEPOSIT IN THE ASSESSEES S.B ACCOUNT NO.7961 WITH CANARA BANK, KOTTAYAM. THIS AMOUNT WAS ADDED AS INCOME FROM OTHER SOURCES, ON ACCOUNT OF FAILURE ON THE PART OF THE ASSESSEE TO EXPLAIN THE SOURCES OF THE SAME. ACCORDING TO THE A SSESSING OFFICER, THIS ADDITION ATTRACTED THE PROVISIONS OF SECTION 271(1) ( C ) OF THE INCOME TAX ACT 1961. I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 6 3 .1 IT WAS THE CASE OF THE ASSESSEE THAT INCOME FROM HOUSE PROPERTIES WAS A PURE ACCIDENTAL OMISSION AND THE ASSESSEE WAS NOT IN RECEIPT OF ANY REN T FOR MOST PARTS OF THE YEAR AND AT THE TIME OF FILING THE RETURN, THIS FACT WAS COMPLETELY OVERLOOKED. AS A NEW TAX CONSULTANT WAS HANDLING THE AFFAIRS, ON ACCOUNT OF DISPUTE IN THE FAMILY, FAILURE TO RETURN THE INCOME WAS NOT INTENTIONAL. REGARDING DEPOS IT IN HER S.B ACCOUNT, THE ASSESSEE COULD NOT EXPLAIN THE SAME, SINCE IT WAS HER LATE HUSBAND VARADARAJULU, WHO WAS HANDLING HER ACCOUNTS AND TAX MATTERS AND IN VIEW OF THE FACT THAT HE HAD EXPIRED BEFORE THE ASSESSMENT WAS COMPLETED, THE ASSESSEE COULD N OT PROPERLY EXPLAIN THE SOURCE FOR THE DEPOSITS. THE ASSESSEE ALSO SUBMITTED THAT THE ADDITIONS WERE AGREED TO MERELY ON ACCOUNT OF HER INABILITY TO EXPLAIN THINGS PROPERLY TO THE DEPARTMENT, AS A RESULT OF THE DEATH OF HER HUSBAND AND WITH A VIEW TO PURC HASE PEACE AND TO BRING ABOUT A FINALITY TO THE ASSESSMENT PROCEEDINGS AND NOT ON ACCOUNT OF THE FACT THAT THESE REPRESENTED UNDISCLOSED INCOME. THEREFORE IT WAS THE CASE OF THE ASSESSEE THAT THE ADDITION DID NOT TANTAMOUNT TO CONCEALMENT, EVEN THOUGH THE Y WERE AGREED TO. THE ASSESSING OFFICER REJECTED THE EXPLANATION OFFERED AND WENT ON TO LEVY A PENALTY OF RS 51,151/ - U/S 271(1 ) (C ) OF THE INCOME TAX ACT 1961. 3. 2 ON APPEAL, THE CIT(A) REJECTED THE APPEAL OF THE ASSESSEE STATING THAT STATING THAT TH E ASSESSEES HUSBAND'S PRESENCE AND ABILITY TO EXPLAIN THESE ITEMS WOULD HAVE RESULTED IN NO ADDITION AT ALL, DOES NOT HOLD ANY GROUND IN THE CASES OF THE ASSESSEE AS SHE BEING AN INDEPENDENT ADULT IS RESPONSIBLE FOR HER OWN ACTION, PARTICULARLY SINCE SH E WAS AND IS THE DIRECT BENEFICIARY OF THE INVESTMENTS. I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 7 3. 3 . AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 4. THE G ROUNDS OF APPEALS RAISED IN THE CASE OF THE ASSESSEE SMT. ANITA NAGENDRAN WHICH ARE ALSO COMMON IN NATURE EXCEPT FOR CHANGE IN FIGURES READ AS FOLLOWS: 1 . THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX ERRED IN LEVYING A PE NALTY OF RS 60,558/ - U/S 271(1)(C) OF THE INCOME TAX ACT 1961 IN RESPECT OF CERTAIN DEPOSITS MADE IN THE BANK ACCOUNT OF THE APPELLANT, OVERLOOKING THE EXPLA NATIONS OFFERED BY THE APPELLANT. 2. THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX OVERLOOKED THE FACT THAT THESE DEPOSITS WERE IN THE FORM OF CLEARING CHEQUES AND THE FAILURE TO EXPLAIN THE SAME WITH PROPER EVIDENCE WAS ON ACCOUNT OF THE FACT THAT THE APPELLANT'S FATHER, WHO WAS HANDLING THE ACCOUNTS AND TAX AFFAIRS OF THE APPELLANT HAD EXPIRED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. 3. THE LEARNED DEPUTY COMMISSIONER OF INCOME TAX OUGHT TO HAVE APPRECIATED THAT IT IS ONE THING TO OFFER AN EXPLA NATION AND ANOTHER THING TO OFFER EXPLANATION, BUT NOT SUPPORTING SUCH EXPLANATION WITH ANY DOCUMENTARY EVIDENCE. MERE FAILURE TO DO SO CANNOT LEAD TO A CONCLUSION THAT THE EXPLANATION OFFERED IS FALSE OR UNTRUE. 4. THE LEARNED DEPUTY COMMISSIONER OF IN COME TAX OUGHT TO HAVE APPRECIATED THE FACT THAT MERE SURRENDERING OF AN AMOUNT AS INCOME WITH A VIEW TO PURCHASING PEACE WILL NOT TANTAMOUNT TO CONCEALMENT AS DEFINED IN THE ACT THE REASON FOR AGREEING FOR AN ADDITION MAY BE ON SEVERAL COUNTS THAT ALONE C ANNOT BE A GROUND FOR CONCEALMENT OF INCOME. 5. THE CIT (A) ERRED IN CONFIRMING THE PENALTY OF RS 60,558/ - U/S 271(1) (C) OF THE INCOME TAX ACT 1961 OVERLOOKING THE EXPLANATIONS OFFERED BY THE APPELLANT. 6. THE CIT ( A) ALSO SHOULD HAVE APPRECIATED TH E FACTUAL POSITION THAT THE MAJOR ADDITION IN INCOME WAS DUE TO THE APPELLANT'S INABILITY TO EXPLAIN THE DEPOSIT IN BANK ACCOUNT IN THE ABSENCE OF HER LATE FATHER WHO WAS HANDLING HER TAX MATTERS. I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 8 7. SINCE THE BUSINESS OF M/S PARTHAS TEXTILES WAS A JOIN T FAMILY BUSINESS, THE KEY MEMBER OF THE FAMILY HANDLED THE BUSINESS AND THE OTHER MEMBERS OF THE FAMILY ASSISTED HIM. THE KEY MEMBER WAS RESPONSIBLE FOR MANAGING THE TRANSACTIONS OF THE BUSINESS AND THE INCOME TAX MATTERS OF OTHER MEMBERS OF THE FAMILY. T HE SUDDEN DEMISE OF KEY MEMBER, S VARADARAJULU, MADE THE OTHER MEMBERS HANDICAPPED TO PROPERLY EXPLAIN THE TRANSACTIONS IN THEIR ACCOUNT 8. THE CIT (A ) ALSO SHOULD HAVE APPRECIATED THE FACT THAT THE RETURN OF INCOME OF THE APPELLA NT FOR THE ASSESSMENT Y EAR 2002 - 2003 WAS FILED ON 20/11/2009. THE APPELLANT'S FATHER, WHO WAS HANDLING THE ACCOUNTS AND TAX AFFAIRS OF THE APPELLANT, WAS DIED ON 05/09/2009. BEFORE THE DEATH THE APPELLANT'S FATHER UNDERGONE FOR CONTINUOUS TREATMENTS IN RELATION TO HIS ILLNESS. A T THAT TIME THE APPELLANT HAD TO DEVOTE HER FULL ATTENTION AND CARE TO HER FATHER. HER BELOVED FATHER'S HEALTH CONDITION WORRIED HER A LOT AND SHE GAVE MORE IMPORTANCE FOR THE SURVIVAL OF HER FATHER RATHER THAN INCOME TAX MATTERS. SOON AFTER HER FATHER PAS SED AWAY AND THE SUDDEN DEMISE OF THE LEADER OF THE FAMILY MADE THEM MENTALLY WEAK. IN SUCH A SITUATION THE DEPARTMENT ASKED THE APPELLANT TO FILE THE RETURN AND PRODUCE THE SUPPORTING EVIDENCE. HENCE THE APPELLANT FILED A RETURN BASED ON HER LIMITED KNOWL EDGE AND PRODUCED THE SUPPORTING EVIDENCES TO THE BEST OF HIS KNOWLEDGE. SINCE THE RETURN WAS FILED AT A TIME WHEN THE APPELLANT WAS A SHAKEN PERSON, FOLLOWING THE DEATH OF HER FATHER AND DIFFERENCES IN THE FAMILY, SHE COULDN'T PROVIDE MORE ATTENTION TO TH E TAX MATTERS. CIT (A) SHOULD HAVE CONSIDER THE HUMAN EMOTIONS BEHIND THE SITUATION AND TREAT THE OMISSIONS AS UNINTENTIONAL NOT AS CONCEALMENT. 9. THEREFORE THE SURRENDER OF THE AMOUNTS WAS NOT BECAUSE THEY WERE INCOME, BUT DUE TO IMPOSSIBILITY OF PRO VING THE CREDITS IN VIEW OF THE DEATH OF THE APPELLANT'S FATHER. THIS ADMISSION CAN'T BE CONSTRUED AS CONCEALMENT, BY ANY STRETCH OF IMAGINATION 10. MORE OVER IN THE CASE OF LATE S VARADARAJULU THE COCHIN BENCH OF ITAT COCHIN VIDE ORDER DATED 07.09.2012 HELD THAT: 'IT IS WELL SETTLED PRINCIPLE OF LAW THAT ALL ADDITIONS MADE IN THE ASSESSMENT PROCEEDINGS DO NOT AUTOMATICALLY RESULT IN LEVY OF PENALTY. THE ASSESSING AUTHORITY IS EXPECTED TO REAPPRECIATE THE EVIDENCE AVAILABLE ON RECORD INDEPENDENTLY IN THE PENALTY PROCEEDINGS AND THEREAFTER IF HE COMES TO THE CONCLUSION THAT THERE WAS CONCEALMENT OF PARTICULARS OF INCOME OR THE TAX PAYER HAS FURNISHED INACCURATE PARTICULARS WITH REGARD TO THAT INCOME PENALTY MAY BE LEVIED. IN THIS CASE, ADMITTEDLY, THE TAX PAYER EXPIRED IN THE MONTH OF SEPTEMBER 2009, IT IS ALSO NOT IN DISPUTE THAT THE TAX PAYER WAS EXPELLED FROM THE PARTNERSHIP FIRM ON THE ALLEGATION OF MISAPPROPRIATION OF FIRM'S FUND. THE FACTUAL SITUATION COULD HAVE BEEN WELL EXPLAINED BEFORE THE ASSESSIN G AUTHORITY BY THE TAX PAYER HIMSELF. UNFORTUNATELY THE TAX PAYER IS NO MORE. THEREFORE THE LEGAL REPRESENTATIVES OF THE TAX PAYER WERE PRACTICALLY HANDICAPPED IN EXPLAINING THE REAL SITUATION WHICH RESULTED IN CREDIT OF THE AMOUNT IN THE BANK ACCOUNT IN S UCH A CIRCUMSTANCE, WE MAY NOT BE I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 9 ABLE TO BLAME THE LEGAL HEIRS IN NOT FURNISHING A SATISFACTORY EXPLANATION. BY TAKING INTO CONSIDERATION THE DEATH OF THE TAX PAYER AND THE PRACTICAL DIFFICULTY FACED BY THE LEGAL HEIRS IN FURNISHING THE REASONS FOR NOT OF FERING THE AMOUNT FOUND IN THE BANK ACCOUNT, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THIS IS NOT A FIT CASE FOR LEVY OF PENALTY. THEREFORE THE COMMISSIONER OF INCOME TAX (A) HAS RIGHTLY DELETED THE PENALTY. WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY THE SAME IS CONFIRMED'. 11. THE CIT (A) ALSO SHOULD HAVE APPRECIATED THE FACT THAT THE APPELLANT IS A HOUSEWIFE SUPPORTING HER FATHER IN THE BUSINESS NEEDS WITHOUT HAVING ANY KNOWLEDGE IN TAX AND ACCOUNTING MATTERS. TH E SUDDEN DEMISE OF HER FATHER MADE HER SHAKEN AND AT THAT TIME FILING OF RETURN BECOMES NECESSARY AND SHE HAD FILED THE RETURN BASED ON AVAILABLE DOCUMENTS WITH HER. THE ACTUAL INTENTION WAS TO FILE THE RETURN AND NOT CONCEAL ANY INCOME. HER INABILITY TO E XPLAIN THINGS IN THE ABSENCE OF HER FATHER LEAD TO THE SITUATION OF DIFFERENCES IN INCOME. 12. THE CIT ( A ) ALSO SHOULD HAVE APPRECIATED THE FACT THAT THE APPELLANT LOST HER FATHER. EMOTIONS CAN AFFECT THE MIND OF A PERSON FOR A LONG PERIOD. IT WILL TAKE A LOT OF TIME TO RECOVER FROM THE MENTAL ILLNESS CAUSED BY SUCH EMOTIONS. IN THIS CASE THE APPELLANT'S FATHER DIED IN THE YEAR 2009. SINCE THE APPELLANT WAS VERY MUCH CLOSER TO HER FATHER IT TOOK A LOT OF TIME TO THE APPELLANT TO RECOVER FROM THAT. ACTUALLY THE APPEAL WAS CONSIDERED BY THE CIT ( A ) IN THE YEAR 2019. A LOOK BACK INTO SUCH A SITUATION AFTER A LONG PERIOD OF 10 YEARS MADE AN IMPRESSION THAT THE APPELLANT GOT ABOUT 3 MONTHS TO FILE THE RETURN AFTER THE DEATH OF HER FATHER AND GOT ENOUGH TIME TO P RODUCE EVIDENCES BECAUSE SHE IS AN ADULT PERSON. HOWEVER THE SUDDEN DEMISE OF HER FATHER, THE EXPULSION FROM THE FAMILY AND FAMILY BUSINESS E.TC DESTROYED HER FINANCIAL AND MENTAL STRENGTH. IN SUCH A SITUATION, EVEN IF SHE IS AN ADULT PERSON, SHE WAS NOT A BLE TO RECOLLECT THE FINANCIAL TRANSACTIONS IN HER BANK ACCOUNT WITHOUT THE PRESENCE OF HER FATHER. THE APPELLANT TOOK A LOT OF TIME TO RECOVER FROM THAT. IF THE C I T (A) HAD CONSIDERED THE SITUATION FROM THAT POINT OF VIEW THEY DID NOT CONCLUDE LIKE THAT. 13. THESE AND OTHER GROUNDS OF APPEAL THAT MAY BE RAISED DURING THE COURSE OF APPEAL PROCEEDINGS YOUR APPELLANT PRAYS THAT THE PENALTY OF RS 60,558/ - LEVIED U/S 271(1)(C) OF THE INCOME TAX ACT 1961 BE CANCELLED. 4.1 THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS THE DAUGHTER OF SRI. S VARADARAJULU, EX - PARTNER OF M/S PARTHAS TEXTILES, KOTTAYAM, A RELATED CONCERN OF M/S PARTHAS TEXTILES, TRIVANDRUM, WHICH WAS SUBJECTED TO SEARCH U/S 132 OF THE INCOME I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 10 TAX ACT 1961 ON 11.10.2007. IN RESPONSE TO NOTICE U/S 153C, THE ASSESSEE FILED A RETURN ADMITTING AN INCOME OF RS 1,80,366/ - . THE ASSESSMENT WAS COMPLETED ON A TOTAL INCOME OF RS 3,82,226/ - . PENALTY PROCEEDINGS U/S 271(1) (C) OF THE INCOME TAX ACT 1961WAS INITIATED, IN COMPLETING THE ASSESSMENT. THE ONLY ADDI TION MADE IN THE ASSESSMENT WAS A SUM OF RS 2,01 , 860/ - IN RESPECT OF CERTAIN DEPOSIT IN THE ASSESSEES ACCOUNT NO.12669 WITH CANARA B ANK, KOTTAYAM ON VARIOUS DATES IN JANUARY 2002. ON THE GROUND THAT THE ASSESSEE HAD NOT SATISFACTORILY EXPLAINED THE SOUR CE FOR THESE DEPOSITS AND THE FURTHER FACT THAT THE ASSESSEE HAD AGREED FOR THE ADDITION, THE ASSESSING OFFICER CAME TO THE CONCLUSION THAT THE ASSESSEE HAD CONCEALED HER INCOME. FURTHER, THE ASSESSING OFFICER WAS OF THE OPINION THAT THE SEARCH BROUGHT TO LIGHT INCRIMINATING MATERIALS THAT LED TO THE ADDITION, WHICH ALSO AMOUNTED TO CONCEALMENT . THE ASSESSING OFFICER REJECTED THE ASSESSEES CONTENTION THAT FAILURE TO EXPLAIN THE SOURCE WITH EVIDENCE WAS ON ACCOUNT OF THE FACT THAT THE DETAILS WERE KNOWN ONL Y TO THE ASSESSEES FATHER, LATE VARADARAJULU, WHO DIED DURING THE COURSE OF ASSESSMENT PROCEEDINGS, FURTHER, SHE ALSO DID NOT TAKE TO NOTICE OF FACT THAT THESE DEPOSITS WERE NOT CASH DEPOSITS, BUT CLEARING CHEQUES WHICH COULD HAVE BEEN EASILY ASCERTAINED FROM THE BANKS. THE ASSESSING OFFICER REJECTED THE EXPLANATION OFFERED AND WENT ON TO LEVY A PENALTY OF RS 60 , 558/ - U/S 271(1) (C) OF THE INCOME TAX ACT 1961. 4.2 ON APPEAL, THE CIT(A) REJECTED THE APPEAL OF THE ASSESSEE BY STATING THAT THE ASSESSEE S F ATHER'S PRESENCE AND ABILITY TO EXPLAIN THESE ITEMS WOULD HAVE RESULTED IN NO ADDITION AT ALL, DOES NOT HOLD ANY GROUND IN THE CASES OF THE ASSESSEE AS SHE I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 11 BEING AN INDEPENDENT ADULT (DATE OF BIRTH 26.10.1976 - SHE WAS OVER 24 YEARS OLD AT THE TIME OF THE R ELEVANT YEAR) IS RESPONSIBLE FOR HER OWN ACTION, PARTICULARLY SINCE SHE WAS AND IS THE DIRECT BENEFICIARY OF THE INVESTMENTS. 4.3 AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 5. THERE WAS A SHORT DELAY OF 5 DAYS IN FILING THE APPEALS BEFORE THE TRIBUNAL IN BOTH THE CASES. THE LD. AR HAS FILED CONDONATION PETITION S S ACCOMPANIED BY AN AFFIDAVIT IN THE CASE OF SMT. THANKAMANI VARADRAJULU WHICH READS AS FOLLOWS: I AM ANE ASSESSEE IN THE JURISDICTION OF THE ASSESSING OFFICER AT KOTTAYAM. I AM THE WI FE OF LATE S VARADA RAJULU, EX - PARTNER OF M/S PARTHAS TEXTILES, KOTTAYAM. FOLLOWING A SEARCH IN THE CASE OF PAR THAS TEXTILES, KOTTAYAM/ TRIVANDRUM, THE FILES OF THE PETITIONER WERE ALSO TRANSFERRED FROM THE ASSESSING OFFICER AT KOTTAYAM TO CENTRAL CIRCLE, TR IVANDRUM. APART FROM THE FACT THAT I AM ASSESSED TO INCOME TAX FOR THE LAST FEW YEARS, MY TAX AFFAIRS WERE COMPLETELY MANAGED BY MY HUSBAND, S VARADARAJULU. A SEARCH U/S 132 OF THE INCOME TAX ACT 1961 TOOK PLACE ON 11.10.2007. I LOST MY HUSBAND AFTER A PR OLONGED ILLNESS. THEREAFTER AN ASSESSMENT WAS COMPLETED ON ME AND PENALTY U/S 271(1) (C) OF THE INCOME TAX ACT 1961 WAS LEVIED ON ME. I CHALLENGED THE LEVY OF PENALTY BEFORE HON'BLE CIT (A) III, COCHIN AND THE HON'BLE CIT (A) III, COCHIN CONFIRMED THE PENAL TY VIDE ORDER U/S 250 DATED 20.02.2019. THE ORDER WAS COMMUNICATED TO ME ON 06.03.2019 AND THE APPEAL AGAINST THE ORDER WAS TO BE FILED WITHIN 60 DAYS (I.E. ON 05.05.2019). THERE IS A DELAY OF 5 DAYS IN FILING THE APPEAL. IT IS SUBMITTED THAT I WAS ABROAD AT THAT TIME AND CAME BACK TO INDIA AT THE END OF THE MARCH 2019. AFTER COMING BACK TO INDIA I HAD TO GIVE ATTENTION FOR FEW DAYS TO THE BUSINESS ACTIVITIES CARRIED OUT BY ME. AT THE SAME TIME I HAD TO APPEAR BEFORE THE ASSESSING OFFICER IN KOTTAYAM IN REL ATION TO A SUMMONS RECEIVED EARLIER. WITH RESPECT TO THAT I HAD TO SUBMIT DOCUMENTS ALSO. SINCE THE DOCUMENTS RELATED TO OLD YEARS I TOOK LOT OF TIME TO COLLECT THE SAME. TO MAKE THE MATTERS WORSE A NOTICE WAS RECEIVED U/S 148 OF THE INCOME TAX ACT 1961 FO R REASSESSMENT U/S 147 OF THE INCOME TAX ACT 1961 FOR THE AY 2012 - 13 FROM THE INCOME TAX AUTHORITIES IN KOTTAYAM REQUIRING SUBMISSION OF INCOME TAX RETURN OF THAT YEAR. IN RELATION TO THAT, I HAD TO COLLECT DOCUMENTS RELATING TO PAST YEARS (ESPECIALLY BANK STATEMENTS). OBTAINING BANK STATEMENTS FROM BANK AT A TIME WHEN THEY WERE I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 12 UNDER STATUTORY AUDIT WAS VERY DIFFICULT AND SOME OF THE STATEMENTS WERE NOT YET RECEIVED. IN ADDITION TO THAT I HAD TO FOLLOW UP WITH CCIT, TRIVANDRUM REGARDING THE STATUS OF 'INTE REST WAIVER PETITION' SUBMITTED EARLIER BY ME REL ATING TO AY 2002 - 03 TO AY 2008 - 09. SINCE THE 'INTEREST WAIVER PETITION' WAS ALSO SUBMITTED LONG YEARS AGO I HAD TO TAKE MORE EFFORTS TO IDENTIFY THE CURRENT POSITION, WHICH REQUIRED CONTINUOUS COMMUNICATION S WITH INCOME TAX AUTHORITIES IN KOTTAYAM, ERNAKULUM AND TRIVANDRUM. MOREOVER THERE WAS A LOT OF PRESSURE ON ME TO REMIT VARIOUS TAX DEMANDS PERTAI NING TO THE PERIOD FROM AY 2002 - 03 TO AY 2008 - 09. A L L THESE SITUATIONS LEAD TO A BUSY SCHEDULE FOR ME IN THE MONTH OF APRIL 2019. IN THE MONTH O F APRIL 2019 I WAS BUSY WITH THE AFORESAID MATTERS AND I WAS NOT ABLE TO PREPARE ALL THE APPEAL DOCUMENTS BEFORE THE ITAT. SINCE THE CASE RELATED TO EARLIER YEARS, OBTAINING THE DOCUMENTS RELATING TO THOSE YEARS WERE A HERCULEAN TASK. ONLY FEW DOCUMENTS WERE AVAILABLE WITH ME. THE ASSESSMENT ORDERS OF THOSE YEARS WERE NOT AVAILABLE WITH ME. THE CASE WERE EARLIER HANDLED BY ANOTHER FIRM OF CHARTERED ACCOUNTANTS WHO WERE ALSO IN POSSESSION WITH THE ASSESSMENT ORDERS. TH E CASE WAS HANDLED BY THE INCOME TAX AUTHORITIES IN TRIVANDRUM AND THEREAFTER FILES ARE TRANSFERRED TO ERNAKULUM AND PRESENTLY MY CASES ARE HANDLED BY INCOME TAX AUTHORITIES IN KOTTAYAM. HENCE FOR OBTAINING THE DOCUMENTS I HAD TO MAKE INQUIRIES IN EACH OF THE ABOVE JURISDICTIONS AND I GOT ONLY SCATTERED INFORMATIONS FROM EAC H JURISDICTION. FINALLY AFTER A LONG PERIOD OF INQUI RIES IN VARIOUS INCOME TAX JURISDICTIONS, I GOT THE COPY OF THE ASSESSMENT ORDERS IN THE BEGINNING OF MAY 2019. THEREAFTER THE APPEAL DOCUMENTS WERE PREPARED AND I HAD REMITTED THE FEE FOR APPEAL FILING ON 03. 05.2019. I INTENDED TO FIE THE SAME BY 04.05.2019. I WAS UNDER THE STRONG BELIEF THAT 'FORM 36 IS TO BE SUBMITTED ELECTRONICALLY. ONLY ON INQUIRY WITH YOUR OFFICE ON 03 . 05.2019 I CAME TO K NOW THAT THE SUBMISSION SHOULD BE FILED MANUALLY. SINCE THE INFORMATION WAS OBTAINED A FTERNOON IT WAS NOT POSSIBLE TO SUBMIT THE DOCUMENTS AT COCHIN ON THAT DATE. UNFORTUNATELY T HE COMING TWO DAYS I.E., SATURDAY AND SUNDAY THE OFFICE OF ITAT WAS N OT WORKING. DUE TO THE AFORE MENTIONED REASONS I COULD NOT SUBMIT THE APPEAL WITHIN DUE DATE. IT IS SUBMITTED THAT THE D ELAY IN FILING THE APPEAL S IS NOT DELIBERATE AND HAS HAPPENED DUE TO THE AFOREMENTIONED CIRCUMSTANCES. IN THESE CIRCUMSTANCES, I HUMBLY PRAY THAT THE HON'BLE ITAT MAY KINDLY CONDONE THE DELAY O F 5 DAYS IN FILING THE APPEAL. 5.1 THE LD. AR HAS FILED CONDONATION PETITION S ACCOMPANIED BY AN AFFIDAVIT IN THE CASE OF SMT. ANITA NAGENDRAN WHICH READS AS FOLLOWS: I AM AN ASSESSEE IN TH E JURISDICTION OF THE ASSESSING OFFICER AT KOTTAYAM . I AM THE DAUGHTER OF LATE S VARADARAJULU, EX - PARTNER OF M/S PARTHAS TEXTILES, I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 13 KOTTAYAM. FOLLOWING A SEARCH IN THE CASE OF M/S PARTHAS TEXTILES, KOTTAYAM/ TRIVANDRUM, THE FILES OF THE PETITIONER WERE ALSO TRANSFERRED FROM THE ASSESSING OFFICER AT KOTTAYAM TO CENTRAL CIRCLE, TRIVANDRUM. APART FROM THE FACT THAT I AM ASSESSED TO INCOME TAX FOR THE LAST FEW YEARS, MY TAX AFFAIRS WERE COMPLETELY MANAGED BY MY FATHER, S VARADARAJULU. A SEARCH U/S 132 OF THE IN COME TAX ACT 1961 TOOK PLACE ON 11.10.2007. 1 LOST MY FATHER AFTER A PROLONGED ILLNESS. THEREAFTER AN ASSESSMENT WAS COMPLETED ON ME AND PENALTY U/S 271(1) (C) OF THE INCOME TAX ACT 1961 WAS LEVIED ON ME. I CHALLENGED THE LEVY OF PENALTY BEFORE HON'BLE C I T (A) III, COCHIN AND THE HON'BLE CIT (A) III, COCHIN CONFIRMED THE PENALTY VIDE ORDER U/S 250 DATED 20.02.2019. THE ORDER WAS COMMUNICATED TO ME ON 06.03.2019 AND THE APPEAL AGAINST THE ORDER WAS TO BE FILED WITHIN 60 DAYS (I.E, ON 05.05.2019). THERE IS A D ELAY OF 5 DAYS IN FILING THE APPEAL. IT IS SUBMITTED THAT ACTUALLY THE PENALTY WAS RELATING TO MY ASSESSED INCOME OF AY 2002 - 03, 2003 - 04, 2004 - 05 AND 2005 - 06. SINCE THE ASSESSMENT WAS DONE BASED ON A SEARCH CONDUCTED IN THE FAMILY OF US, I WAS ALSO SERVED WITH A PENALTY ORDER . ALL THE DOCUMENTS AND COMMUNICATIONS RELATING TO THAT SEARCH ASSESSMENT WERE HANDLED AND KEPT BY MY MOTHER. ON RECEIPT OF THE ORDER U/S 250 AS MENTIONED ABOVE MY MOTHER WAS ABROAD AND SHE CAME BACK TO INDIA AT THE END OF MARCH 2019. SINCE THE FILING OF APPEAL BEFORE ITAT REQUIRED COPY OF THE ASSESSMENT ORDERS OF EARLIER YEARS I CONTACTED MY MOTHER AND SHE REPLIED THAT OLD DOCUMENTS MAY BE WITH HER. AFTER COMING BACK TO INDIA MY MOTHER WAS BUSY WITH VARIOUS INCOME TAX MATTERS AND ONLY ON A THOROUGH SEARCH IT WAS KNOWN THAT THE DOCUMENTS ARE NOT AVAILABLE. SINCE THE CASE RELATED TO EARLIER YEARS, OBTAINING THE DOCUMENTS RELATING TO THOSE YEARS WERE A HERCULEAN TASK. ONLY FEW DOCUMENTS WERE AVAILABLE WITH ME. THE ASSESSMENT ORDERS OF THOS E YEARS WERE NOT AVAILABLE WITH ME. SINCE THE CASE WERE EARLIER HANDLED BY ANOTHER FIRM OF CHARTERED ACCOUNTANT WHO WERE ALSO NOT IN POSSESSION WITH THE ASSESSMENT ORDERS. THE CASE WAS HANDLED BY THE INCOME TAX AUTHORITIES IN TRIVANDRUM AND THEREAFTER SOME FILES ARE TRANSFERRED TO ERNAKULUM AND PRESENTLY MY CASES ARE HANDLED BY INCOME TAX AUTHORITIES IN KOTTAYAM. HENCE FOR OBTAINING THE DOCUMENTS I HAD TO MAKE INQUIRIES IN EACH OF THE ABOVE JURISDICTIONS AND THE PETITIONER GOT ONLY SCATTERED INFORMATIONS FR OM EACH JURISDICTION. FINALLY A FTER A LONG PERIOD OF INQUIRIES IN VARIOUS INCOME TAX JURISDICTIONS , I GOT THE COPY OF THE ASSESSMENT ORDERS. THEREAFTER THE APPEAL DOCUMENTS WERE PREPARED AND I HAD REMITTED THE FEE FOR APPEAL FILING ON 03.05.2019. I INTENDE D TO FI L E THE SAME BY 04.05.2019. I WAS UNDER THE STRONG BELIEF THAT 'FORM 36' IS TO BE SUBMITTED ELECTRONICALLY. ONLY ON INQUIRY WITH YOUR OFFICE ON 03.05.2019 I CAME TO KNOW THAT THE SUBMISSION SHOULD BE FILED MANUALLY. SINCE THE INFORMATION WAS OBTAINED AFTERNOON IT WAS NOT POSSIBLE TO SUBMIT THE DOCUMENTS AT COCHIN ON THAT DATE. UNFORTUNATELY THE COMING TWO DAYS I.E., SATURDAY AND SUNDAY THE OFFICE OF ITAT WAS NOT WORKING. DUE TO THE AFOREMENTIONED REASONS I COULD NOT SUBMIT THE APPEAL WITHIN DUE DATE. THE I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 14 ASSESSMENT ORDERS WERE NOT YET RECEIVED AND THE TIME FOR FILING THE APPEAL ALSO LAPSED; NOW I AM FORCED TO FILE THE APPEAL WITHOUT SUBMITTING THE ASSESSMENT ORDERS. IT IS SUBMITTED THAT THE DELAY IN FILING THE APPEAL IS NOT DELIBERATE AND HAS HAPPENED DUE TO THE AFOREMENTIONED CIRCUMSTANCES. IN THESE CIRCUMSTANCES, I HUMBLY PRAY THAT THE HON'BLE ITAT MAY KINDLY CONDONE THE DELAY OF 5 DAYS IN FILING THE APPEAL. 5.2 WE HAVE GONE THROUGH BOTH THE CONDONATION PETITIONS. WE FIND THERE IS SUFFICIENT CAU SE FOR FILING THE APPEALS IN BOTH THE CASES BELATEDLY BEFORE THE TRIBUNAL. ACCORDINGLY, WE CONDONE THE SHORT DELAY OF 5 DAYS IN FILING THE APPEALS OF BOTH THE ASSESSEES AND ADMIT THE APPEALS FOR ADJUDICATION. 6. THE ASSESSEE S HAVE ALSO FILED PETITION S FOR ADMISSION OF THE ADDITIONAL GROUND OF APPEALS IN ALL CASES AS FOLLOWS: WHEN THE APPEAL CAME UP FOR HEARING , THE HON'BLE BENCH DIRECTED THE APPELLANT TO PRODUCE A COPY OF THE PENALTY NOTICE RECEIVED BY THE APPELLANT FOR THE ASST. YEAR S UNDER APPEAL. 6.1 WE FI ND BONA FIDE REASONS IN THE ACT OF THE ASSESSEE IN NOT RAISING THE ADDITIONAL GROUND ON AN EARLIER OCCASION BY PLACING RELIANCE ON THE JUDGMENT OF THE SUPREME COURT IN THE CASE OF N ATIONAL T HERMAL P OWER C ORPORATION LTD. VS. CIT (229 ITR 383 ) WHEREIN IT WAS HELD THAT TRIBUNAL HAS THE DISCRETION TO ALLOW OR NOT TO ALLOW ADDITIONAL GROUND TO BE RAISED FOR THE FIRST TIME BEFORE THE TRIBUNAL. ACCORDINGLY , WE ADMIT THE ADDITIONAL GROUND FOR ADJUDICATION. I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 15 6. 2 WE HAVE HEARD THE RIVAL SUBMISSION S AND PERUSED THE RECORD. WE FIND BONA FIDE REASONS IN THE ACT OF THE ASSESSEE IN NOT RAISING THE ADDITIONAL GROUND ON AN EARLIER OCCASION BY PLACING RELIANCE ON THE JUDGMENT OF THE SUPREME COURT IN THE CASE OF N ATIONAL T HERMAL P OWER C ORPORATION LTD. VS. CIT (229 ITR 383) WHEREIN IT WAS HELD THAT TRIBUNAL HAS THE DISCRETION TO ALLOW OR NOT TO ALLOW ADDITIONAL GROUND TO BE RAISED FOR THE FIRST TIME BEFORE THE TRIBUNAL. ACCORDINGLY , WE ADMIT THE ADDITIONAL GROUND FOR ADJUDICATION. 7 . COMING TO THE MERIT S OF THE ADDITIONAL GROUND, THE LD. AR DREW OUR ATTENTION TO ALL THE NOTICE ISSUED FOR IMPOSI NG PENALTY U/S. 274 OF THE ACT AND ONE SUCH NOTICE ISSUED FOR AY 2002 - 03 IN THE CASE OF SMT. ANITA NAGENDRAN DATED 31/12/12009 READS AS FOLLOWS: ENCLOSURE 1 - NO TICE UNDER SECTION 274 OF THE INCOME TAX ACT 1961 NOTICE UND E R SECTION 274 READ WITH SECTION 271 OF THE INCOME - TAX ACT, 1961 PAN: ABFPV7178.I OFFICE OF THE ASSISTANT COMMISSIONE OF O F INCOME - TAX, CENTRAL CIRCLE - 2, DEVIKRIPA'. PETTAH, PALLIMUKKU, TRIVANDRUM - 695 024. DATED: 31.12.2009 PR (56)/09 - 10 TO SMT. ANITA NNGENDRAN, 'SRI SA I LAM', UNION CLUB ROAD, KOTTAYAM - 686 001 WHEREAS IN THE COURSE OF PROCEEDINGS BEFORE ME FOR THE ASSESSMENT YEAR 2002 - 03 IT APPEARS TO ME THAT YOU: - * H A V E_WITHOUT REASONABLE CAUSE FAILED TO COMPLY WITH A NOTICE UNDER SECTION 142 ( 1 ) /143(2) OF THE INCOME - TAX ACT, 1961, I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 16 * HAVE CONCEALED TH E PARTICULARS OF YOUR INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME , YOU ARE HEREBY REQUESTED TO APPEAR BEFORE ME AT 03.30PM ON 2I. 0 L20 10 AND SHOW CAUSE WHY AN ORDER IMPOSING A PENALTY ON YOU SHOULD NOT BE MADE UNDER SE CTION 71 OF THE INCOME - TAX ACT, 1961. IF YOU DO NOT WISH TO AVAIL YOURSELF OF THIS OPPORTUNITY OF BEING HEARD IN PERSON OR THROUGH AUTHORIZED REPRESENTATIVE YOU MAY SHOW CAUSE IN WRITING ON OR BEFORE THE SAID DATE WHICH WILL BE CONSIDERED BEFORE A NY SUCH O RDER IS MADE UNDER SECTION 271. SEAL SD/ - (S. MOHD. MUSTAFA) ASSISTANT DIRECTOR OF INCOME - TAX(LNV.), TVM, HOLDIN G CONCURRENT JURISDICTION OVER CENTRAL CIRCLE - 2, TRIVANDRUM 7 .1 THE LD. AR SUBMITTED THAT THE PENALTY INITIATED U/S 271( 1 )(C) WAS INVALID FOR THE REASON THAT THE DEFAULT FOR WHICH THE PENAL ACTION WAS TAKEN HAS NOT BEEN SPECIFIED IN THE NOTICE ISSUED. THE NOTICE MENTIONED BOTH THE DEFAULTS VIZ. CONCEALMENT OF INCOME AND FURNISHING OF INACCURATE PARTICULARS OF INCOME. IT WAS SUBMITTED THAT THE ASSESSING OFFICER HAD NOT STRUCK OFF THE IRRELEVANT PORTION OF THE PENALTY NOTICE WHICH WAS NOT APPLICABLE TO THE ASSESSEE AND DOES NOT CLEARLY MENTION WHETHER HE PROPOSED TO L EVY PENALTY FOR CONCEALMENT OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. 7.2 THE LD. AR RELIED ON THE RECENT JUDGMENTS OF THE KARNATAKA HIGH COURT IN THE CASE OF MUNINAGA REDDY V S. ACIT RE PORTED IN 396 ITR 398 A ND IN THE CASE OF S. C HANDRASEKAR VS. ACIT REPORTED IN 396 ITR 538 AND ALSO THAT OF TELANGANA & I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 17 ANDHRA PRADESH HIGH COURT IN THE CASE OF PR.CIT VS. SMT. BAISETTY R EVATHI REPORTED IN 398 ITR 88 . H ENCE , IT WAS SUBMITTED THAT THE PENALTY LEVIED MAY BE CANCELLED. 8 . THE LD. DR SUBMITTED THAT IT WAS ONLY A TECHNICAL MISTAKE WHICH WAS NOT TO BE CONSIDERED AND THE APP EA L SHOULD BE DECIDED ON MERIT. 9 . WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. WE HAVE CAREFULLY GONE THROUGH THE NOTICE ISSUED U/S. 274 R .W.S. 271 OF THE ACT NARRATED IN PARA 4 OF THIS ORDER. AS SEEN FROM THE ABOVE NOTICE ISSUED U/S. 274 OF THE ACT, THE ASSESSING OFFICER HAS NOT STRUCK OUT THE IRRELEVANT PORTION OF THE NOTICE. IN OTHER WORDS HE HAS NOT SPECIFIED WHETHER HE IS LEVYING PENA LTY FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. AS HELD BY THE KARNATAKA HIGH COURT IN THE CASE OF CIT & ANR. VS. M/S. SSAS EMERALD MEADOWS (2015) (11) TMI 1620 THAT THE NOTICE ISSUED BY THE ASSESSING OFFI CER U/S. 274 R.W.S 271(1)(C) IS TO BE BAD IN LAW AS IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, THE PENALTY PROCEEDINGS HAD BEEN INITIATED, I.E., WHETHER FOR CONCEALMENT OF PARTICULARS OF INCOME OR FURNISHING OF INACCURATE PARTICULARS OF INCOME. THIS VIEW WAS CONFIRMED BY THE SUPREME COURT IN THE SAME CASE, I.E., CIT & ANR. VS. M/S. SSAS EMERALD MEADOWS REPORTED IN (2016) (8) TMI 1145. 9.1 IN VIEW OF THE ABOVE DISCUSSION, WE ARE INCLINED TO HOLD THAT THE PENALTY PROCEEDINGS INITIATE D BY THE AO IS VOID AB INITIO AND ALLOW THE APPEAL OF THE I.T.A. NO S . 374 - 380 / COCH/201 9 381 TO 384/COCH/2019 18 ASSESSEE. SINCE WE HAVE QUASHED THE PENALTY PROCEEDINGS ITSELF, WE REFRAIN FROM ADJUDICATING THE OTHER GROUNDS OF APPEAL S RAISED BY THE ASSESSEE. 8. IN THE RESULT, APPEAL S OF THE ASSESSES ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 27 TH SEPTEMBER, 2019. SD/ - SD/ - (GEORGE GEORGE K.) (CHANDRA POOJARI) JUDICI AL MEMBER ACCOUNTANT MEMBER PLACE: KOCHI DATED: 27 TH SEPTEMBER, 2 019 GJ COPY TO: 1 . SMT. THANKAMANI VARADARAJULU, THRYAMBAKOM (H), PODUVAL LANE, PUTHANANGADI P.O., KOTTAYAM - 686 001. 2. SMT. ANITA NAGENDRAN, THRYA MBAKOM (H), PODUVAL LANE, PUTHANANGADI P.O., KOTTAYAM - 686 001. 3. THE DEPUTY COMMISSIONER OF INCOME - TAX, CENTRAL CIRCLE - 2, TRIVANDRUM. 4 . THE COMMISSIONER OF INCOME - TAX (AP P EALS) - III, KOCHI. 5 . THE COMMISSIONER OF INCOME - TAX, CENTRAL, KOCHI. 6 . D. R., I.T.A .T., COCHIN BENCH, COCHIN. 7 . GUARD FILE. BY ORDER (ASSISTANT REGISTRAR) I.T.A.T., COCHIN