Navjivan Education Trust & Charitable Trust, JAMNAGAR V. The Income Tax Officer, Ward-2(2), JAMNAGAR

ITA 377/RJT/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6708 (ITAT-RAJKOT)
• Duration Of Justice: 3 year(s) 4 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 15-02-2017
• Assessment Year: 2006-2007
• Appeal Filed On: 11-10-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARVIND N SONTAKKE
• Assessee Lawyers: CHETAN H AGARWAL
• Keywords: Charitable institution

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [CONDUCTED THROUGH E-COURT AT AHMEDABAD] BEFORE, SHRI S. S. GODARA, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NOS. 3 73 & 374/RJT/2013 (ASSESSMENT YEARS: 2003-04 & 2004-05) LATE BHUPATRAI B. TRIVEDI L/H DEEPAK B. TRIVEDI, STREET NO.2, DIGVIJAY PLOT, OPP. KHAMBALIA GATE, JAMNAGAR APPELLANT VS. INCOME TAX OFFICER, WARD 2(2), JAMNAGAR RESPONDENT PAN: ABWPT8912F & ITA NOS. 3 75 & 376/RJT/2013 (ASSESSMENT YEARS: 2004-05 & 2005-06) SHRI DEEPAK BHUPATRAI TRIVEDI, STREET NO.2, DIGVIJAY PLOT, OPP. KHAMBALIA GATE, JAMNAGAR APPELLANT VS. INCOME TAX OFFICER, WARD 2(2), JAMNAGAR RESPONDENT PAN: AAFPT2306M & ITA NOS. 373 TO 377/RJT/2013 (LATE BHUPATRAI B. TRI VEDI & 2 ORS.) A.YS. 2003-04 TO 2006-07 - 2 - ITA NO. 377/RJT/2013 (ASSESSMENT YEAR: 2006-07) NAVJIVAN EDUCATION & CHARITABLE TRUST STREET NO.2, DIGVIJAY PLOT, OUTSIDE KHAMBALIA GATE, JAMNAGAR APPELLANT VS. INCOME TAX OFFICER, WARD 2(2), JAMNAGAR RESPONDENT PAN: AAATN6039Q /BY ASSESSEE : SHRI CHETAN H. AGARWAL, A.R. /BY REVENUE : SHRI ARVIND N. SONTAKKE, SR. D.R. /DATE OF HEARING : 15.02.2017 /DATE OF PRONOUNCEMENT : 16.02.2017 ORDER PER S. S. GODARA, JUDICIAL MEMBER THIS BATCH OF FIVE APPEALS PERTAINS TO THREE DIFFER ENT ASSESSEES. FIRST ASSESSEE LATE BHUPATRAI B. TRIVEDI HAS FILED ITA NO S.373 & 374/RJT/2013 FOR ASSESSMENT YEARS 2003-04 & 2004-05 ARISE AGAINST TH E CIT(A), JAMNAGARS COMMON ORDER DATED 04.09.2013 IN APPEAL NOS. CIT(A) /JAM/09&08/12- 13/399, CONFIRMING ASSESSING OFFICERS ACTION IMPOS ING PENALTY OF RS.1,39,660/- & RS.1,60,360/-; RESPECTIVELY. SECON D ASSESSEE SHRI DEEPAK BHUPATRAI TRIVEDI HAS INSTITUTED ITA NOS.375 & 376/ RJT/2013 FOR ASSESSMENT YEARS 2004-05 & 2005-06 AGAINST THE VERY CIT(A)S O RDER OF THE SAME DATE IN CASE NOS. CIT(A)/JAM/11&10/12-13/398, UPHOLDING ASS ESSING OFFICERS ACTION IMPOSING PENALTIES OF RS.4,350/- & 16,080/-; RESPECTIVELY. THIRD ASSESSEE M/S. NAVJIVAN EDUCATION & CHARITABLE TRUST HAS PREFERRED ITA ITA NOS. 373 TO 377/RJT/2013 (LATE BHUPATRAI B. TRI VEDI & 2 ORS.) A.YS. 2003-04 TO 2006-07 - 3 - NO.377/RHT/2013 FOR ASSESSMENT YEAR 2006-07 AGAINST THE SAID VERY CIT(A)S ORDER OF THE SAME DATE IN APPEAL NO. CIT(A)/JAM/12/ 12-13/397 CONFIRMING PENALTY OF RS.1,27,270/-. RELEVANT PROCEEDINGS IN ALL CASES ARE U/S.271(1)(C) OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT. 2. WE NOTICE AT THE OUTSET THAT THE ASSESSEE HAS FI LED AN IDENTICAL ADDITIONAL GROUND IN ALL THESE FIVE CASES PLEADING THEREIN THAT THE CIT(A) HAS ERRED IN CONFIRMING THE IMPUGNED PENALTIES WHOSE CO RRESPONDING PROCEEDINGS HAD BEEN INITIATED BY THE ASSESSING OFFICER WITHOUT SPECIFYING EXPLICIT CHARGE LEVELED THAT IS AS TO WHETHER THE SAME WAS FOR FURN ISHING OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME U/S. 271(1)(C) OF THE ACT. LEARNED DEPARTMENTAL REPRESENTATIVE STRONGLY ARGUES AGAINST ADMISSION OF THE SAID ADDITIONAL GROUND. WE HAVE GIVEN OUT THOU GHTFUL CONSIDERATION TO REVENUES ARGUMENT REGARDING ADMISSION OF THE INSTA NT ADDITIONAL GROUND. THERE CAN HARDLY BE ANY DISPUTE THAT HONBLE APEX C OURTS DECISION IN NATIONAL THERMAL POWER CO. LTD. VS. CIT (1998) 229 ITR 383 (SC) HOLDS THAT THIS TRIBUNAL DOES HAVE JURISDICTION TO ENTERT AIN ADDITIONAL QUESTIONS ARISING IN THE RELEVANT PROCEEDINGS AND NOT RAISED BEFORE THE LOWER AUTHORITIES. THEIR LORDSHIPS MADE IT CLEAR THAT THIS TRIBUNAL CA N VERY WELL EXAMINE SUCH AN ADDITIONAL QUESTION FOR THE FIRST TIME WHICH WAS NO T RAISED BEFORE THE LOWER AUTHORITIES WHICH HAS A BEARING ON AN ASSESSEES TA X LIABILITY. WE KEEP IN MIND THIS LEGAL PRINCIPLE TO OBSERVE THAT THE ASSES SEES SOLE PLEA HEREIN THAT THE ASSESSING OFFICERS PENALTY NOTICES FORMING PAR T OF THE PAPER BOOK AT PAGES 8 TO 12 DATED 28.12.2007 EXCEPT IN CASE OF TH E LAST ASSESSEE INVOLVING THE SAME TO BE 29.12.2008 CONTAIN STEREO TYPE PERFO RMA ONLY WHEREIN THE ABOVE AUTHORITY SIMPLY PUTS A MARK ON HAVE CONCEAL ED THE PARTICULARS OF YOUR INCOME OR -------- FURNISHED INACCURATE PARTIC ULARS OF SUCH INCOME. WE ARE THUS OF THE OPINION THAT THE CASE FILES DO CONT AIN THE RELEVANT MATERIAL AS ITA NOS. 373 TO 377/RJT/2013 (LATE BHUPATRAI B. TRI VEDI & 2 ORS.) A.YS. 2003-04 TO 2006-07 - 4 - WELL FOR THE PURPOSE OF ADJUDICATION OF ASSESSEES ABOVE STATED LEGAL GROUND. WE THEREFORE ADMIT THE SAME FOR ADJUDICATION IN ALL CASES. 3. RELEVANT FACTS INVOLVED IN THESE CASES ARE IN A NARROW COMPASS. THE ASSESSING OFFICER FRAMED ASSESSMENTS/RE-ASSESSMENTS IN ALL THESE FIVE CASES MAKING VARIOUS ADDITIONS U/S.68 OF THE ACT QUA DEPO SITS MADE IN ASSESSEES BANK ACCOUNTS AS WELL AS DIFFERENCE IN RECEIPTS AS PER P&L ACCOUNT AND RETURNED INCOME, ROYALTY INCOME AND DISALLOWANCE OF STANDARD DEDUCTION ON SALE DEED. LAST ASSESSEES CASE INVOLVES DISALLOWA NCE/ADDITION OF RS.5,89,088/- ON ACCOUNT OF ASSESSEES FAILURE TO P ROVE THE RELEVANT EXPENSES IN ABSENCE OF BOOKS OF ACCOUNTS, VOUCHERS AND OTHER EVIDENCES. THERE IS NO DISPUTE BETWEEN THE PARTIES THAT SOME OF THESE ADDI TIONS STOOD MODIFIED IN THE QUANTUM LOWER APPELLATE PROCEEDINGS WHICH ULTIMATEL Y ATTAINED FINALITY AS THESE ASSESSEES DID NOT FILE ANY APPEAL BEFORE THE TRIBUNAL. BOTH THE LEARNED COUNSEL MAKE THIS STATEMENT AT THE BAR THAT THESE A SSESSEES ACCEPTED THE SAID QUANTUM ADDITIONS AS FINAL. 4. WE NOW COME TO THE IMPUGNED PENALTY PROCEEDINGS. THE ASSESSING OFFICER PLACED HEAVY RELIANCE UPON THE QUANTUM DEVE LOPMENTS HEREINABOVE TO IMPOSE THE IMPUGNED PENALTIES AS CONFIRMED IN TH E LOWER APPELLATE PROCEEDINGS IN ALL CASES. BOTH THE LOWER AUTHORITI ES ARE OF THE VIEW THAT ALL THESE ASSESSEES ACTIONS AMOUNT TO AN INSTANCE OF F URNISHING OF INACCURATE PARTICULARS OF INCOME AS WELL AS CONCEALMENT OF INC OME. THIS LEAVES ALL THESE THREE ASSESSEE AGGRIEVED. 5. HEARD BOTH SIDES. CASE FILES PERUSED. SUFFICE TO SAY, IT HAS ALREADY COME ON RECORD THAT NEITHER OF THE ASSESSING OFFICE RS SHOW CAUSE NOTICES INITIATING THE IMPUGNED PENALTY PROCEEDINGS IN ALL CASES SPECIFIES EXPLICITLY AS TO WHETHER THE ASSESSEES HAVE CONCEALED TAXABLE INC OME OR FURNISHED INACCURATE PARTICULARS OF INCOME AS REPRODUCED HERE INABOVE IN PRECEDING ITA NOS. 373 TO 377/RJT/2013 (LATE BHUPATRAI B. TRI VEDI & 2 ORS.) A.YS. 2003-04 TO 2006-07 - 5 - PARAGRAPH. WE NOTICE IN THIS FACTUAL BACKDROP THA T HONBLE KARNATAKA HIGH COURTS JUDGMENT IN CIT VS. MANJUNATHA COTTON & GIN NING FACTORY & ORS. (2013) 350 ITR 565 CONCLUDES THAT SUCH A CASUAL COU RSE OF ACTION IN A PENALTY SHOW CAUSE NOTICE ISSUED U/S.274 OF THE ACT IS NOT SUSTAINABLE SINCE THE SAME DOES NOT CONFIRM TO REQUIREMENT OF THE RELEVANT LAW . THEIR LORDSHIPS REITERATE THE VERY VIEW IN ITA NO.240/2010 M/S. SAFINA HOTEL PVT. LTD. VS. CIT DECIDED ON 25.01.2016. THIS CASE FILE INDICATES TH AT VARIOUS BENCHES OF THIS TRIBUNAL HAVE ADOPTED THE SAME REASONING IN DELETIN G IDENTICAL PENALTIES BASED ON SUCH SHOW CAUSE NOTICES. LEARNED DEPARTMENTAL R EPRESENTATIVE FAILS TO DISPUTE ALL THESE LEGAL DEVELOPMENTS. WE ACCORDING LY CONCLUDE THAT THE ASSESSING OFFICERS ACTION ITSELF IN INITIATING THE IMPUGNED PENALTIES VIDE ABOVE STATED SHOW CAUSE NOTICES NOT SPECIFYING AS T O UNDER WHICH CATEGORY OF DEFAULT DID THE ASSESSEES CASE COME; IS NOT SUSTAI NABLE. WE ACCEPT ASSESSEES ADDITIONAL GROUND AS WELL AS THEIR RESPECTIVE APPEA LS TO DELETE THE IMPUGNED PENALTIES IN ALL FIVE CASES. 6. THESE FIVE APPEALS ARE ALLOWED. [PRONOUNCED IN THE OPEN COURT ON THIS THE 16 TH DAY OF FEBRUARY, 2017.] SD/- SD/- ( MANISH BORAD ) (S. S. GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: DATED 16/02/2017 TRUE COPY S.K.SINHA COPY OF THE ORDER FORWARDED TO:- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT, RAJKOT