A.C.I.T, CIRCLE-1, JAMMU V. M/S J.K GRAMIN BANK, JAMMU

ITA 386/ASR/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5731 (ITAT-AMRITSAR)
• Duration Of Justice: 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 19-02-2018
• Assessment Year: 2012-2013
• Appeal Filed On: 09-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S NEGI
• Keywords: Reasonable cause; Ignorance of law
• Section: 273B; 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SH. R.S.SYAL, VICE PRESIDENT AND SH. N.K.CHOUDHRY, JUDICIAL MEMBER ITA NO.386(ASR)/2017 ASSESSMENT YEAR:201 2-13 ASST. CIT, CIRCLE-1, JAMMU VS. M/S JK GRAMEEN BANK, HEAD OFFICE NARWAL, JAMMU PAN:AAAAJ7859H (APPELLANT) (RESPONDENT) APPELLANT BY: SH. S.S. NEGI (DR) RESPONDENT BY: NONE DATE OF HEARING: 19.02.2018 DATE OF PRONOUNCEMENT: 21.02.2018 ORDER PER N.K.CHOUDHRY, JM: THE INSTANT APPEAL HAS BEEN PREFERRED BY THE REVENUE DEPARTMENT, ON FEELING AGGRIEVED AGAINST THE ORDER DATED 24.02.201 7 PASSED BY THE LD. CIT(A), J&K, JAMMU, IN APPEAL NO.13/15-16, BY RAISIN G THE FOLLOWING GROUNDS OF APPEAL. WHETHER THE LD. CIT(A) WAS RIGHT IN LAW AND FACT I N ALLOWING THE APPEAL OF THE ASSESSEE ON THE DECISION OF HONBLE ITAT AMRITSAR O RDERS IN ITA NO.73,74,75 OF 2014 DATED 17.12.2015 AND ITA NO.75(ASR)/2015 DA TED 17.06.2015 IN CASE OF M/S J&K BANK LTD. ON THE SAME ISSUE OF DELE TING THE PENALTY U/S 27IE THOUGH THE DEPARTMENT HAS PREFERRED AN APPEAL BEFORE THE HONBLE HIGH COURT OF J&K IN CASE OF M/S J&K BANK LTD. ON THE SA ME ISSUE. WHETHER THE LD. CIT(A) WAS RIGHT IN LAW AND FACT IN ALLOWING THE APPEAL OF THE ASSESSEE WHILE COVERING IT UNDER THE EXCEPTION OF S ECTION 273B OF THE ACT. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE RETURN DECLARI NG INCOME NIL WAS FILED BY THE ASSESSEE ON 29 TH SEP. 2012. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY UNDER CASS AND STATUTORY NOTICES U/S 142(1) AND 143(2) OF THE I.T. ACT WERE ISSUED, ON WHICH VARIOUS DET AILS/DOCUMENTS HAVE ITA NO.386 /ASR/2017 (A.Y.2012-13) ACIT VS. M/S JK GRAMEEN BANK, JAMMU 2 BEEN FURNISHED BY THE ASSESSEE WHICH WERE SUBJECTED TO VERI FICATION. THE ASSESSING OFFICER CAME TO THE CONCLUSION THAT FROM THE PERUSA L OF THE AUDIT REPORT FILED ALONG WITH RETURN OF INCOME REVEALS THAT THE ASSESSEE HAS REPAID THE DEPOSITS OTHER THAN ACCOUNT PAYEE CHEQUES TO FOLLOWIN G PERSONS IN CONTRAVENTION TO SEC.269T OF THE I.T. ACT, 1961 AND FU RTHER IN PENALTY PROCEEDINGS, IMPOSED THE PENALTY, WHICH WAS CHALLENGED B Y THE ASSESSEE/APPELLANT BEFORE THE LD. CIT(A) MAINLY ON THE GROUND THAT THERE IS NO DISPUTE ON THE FACT THAT J&K GRAMEEN BANK HAVE MAD E THE RE-PAYMENT OF DEPOSITS EXCEEDING 20,000/- IN CONTRAVENTION OF PROVISIO NS OF SEC. 269T OF THE INCOME TAX ACT. DURING THE ASSESSMENT PROCEEDINGS, T HE ASSESSEE HAS ALREADY ADMITTED TO HAVE COMMITTED THE MISTAKE BUT PL EADED THAT IT WAS DUE TO IGNORANCE OF LAW. IT WAS FURTHER PLEADED THAT TRAN SACTIONS WERE GENUINE AND BONAFIDE AND WERE UNDERTAKEN DURING THE REGULAR COURSE OF BUSINESS, THUS, THE CASE OF ASSESSEE IS WELL COVERED UNDER THE EXCEPTI ON OF SEC.273B OF THE I.T. ACT AND THEREFORE, PENALTY SHOULD NOT BE IMPOSED BECAUSE THERE IS A REASONABLE CAUSE. THE ASSESSEE ALSO RELIED UPON THE ORDER PASSED BY THE ITAT, AMRITSAR BENCH, IN ITA NOS.73,74,75/ASR/2014 DATE D 17.12.2015 FOR ASST. YEARS: 2005-06, 2007-08 AND 2008-09 AND ITA NO. 75(ASR)/2015 DATED 17.06.2016 IN THE APPELLANTS OWN CASE OF J&K BANK LT D., WHEREIN THE HONBLE ITAT BENCH HAS DELETED THE PENALTY IMPOSED U/S 271E OF THE I.T. ACT. 3. THE LD. CIT(A) QUASHED THE PENALTY ORDER AND FEELING AGGRIEVED AGAINST THE SAME, THE REVENUE AUTHORITY PREFERRED TH E INSTANT APPEAL WHICH IS UNDER CONSIDERATION. 4. WE HAVE GIVEN OUR THOUGHTFUL CONSIDERATION TO THE OR DER PASSED BY THE CIT(A) AND REALIZED THAT WHILE DEALING WITH THE PEN ALTY ORDER, THE LD. CIT(A) HAS CONSIDERED THE FACTS THAT THE ASSESSEE HAS ALREADY ADMIT TED TO HAVE COMMITTED THE MISTAKE BUT PLEADED THAT IT WAS DUE TO IGNORANCE OF LAW AND ITA NO.386 /ASR/2017 (A.Y.2012-13) ACIT VS. M/S JK GRAMEEN BANK, JAMMU 3 WHILE DECIDING THE APPEAL OF THE ASSESSEE RESPECTFULLY FO LLOWED THE DECISIONS RENDERED BY THE CO-ORDINATION BENCH OF ITAT, AMRITSAR IN THE AFORESAID APPEALS STATED ABOVE. THE CONCLUDING PART OF THE ORDER PASSED BY THE CO- ORDINATION BENCH OF ITAT IS AS UNDER: 'IN THE PRESENT CASES, THE DEPARTMENT HAS NOT DOUBT ED THE GENUINENESS OF THE TRANSACTIONS AND HAS IMPOSED & UPHELD THE PE NALTY HOLDING THAT THE REASONS FOR REPAYMENT SUBMITTED BY ASSESSEE DID NOT CONSTITUTE REASONABLE CAUSE. WE FURTHER FIND THAT IN DIFFERENT YEARS THE VIOLATIONS HAS BEEN MADE BY DIFFERENT BRANCHES OF THE BANK AND THE VIOLATION HAS NOT BEEN REPEATED. IN ASSTT. YEAR 2008-09, THE VIO LATION WAS BY BULBUL NOWGAM, L.D. HOSPITAL & ISLAMIA COLLEGE BRANCHES & IN ASSTT. YEAR 2007-08, THE VIOLATION WAS BY LAI MANDI BRANCH WHER EAS IN ASSESSMENT YEAR 2005- 06, THE VIOLATION WAS BY LAI BAZAR BRANC H. WE FURTHER FIND THAT THE LEARNED CIT (A) HIMSELF IN ASSTT. YEAR 200 6-07 HAS DELETED THE PENALTY IMPOSED UNDER SIMILAR FACTS AND CIRCUMSTANC ES. WE FURTHER FIND THAT NO MENS REA IS INVOLVED AS THE VIOLATION IS NO T INTENTIONAL. THEREFORE, IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES AND IN VIEW OF LEGISLATURE INTENTION OF INTRODUCING THESE PENAL PROVISIONS AND IN VIEW OF THE PRECEDENTS RELIED UPON BY THE LEARNED AR, WE HOLD T HAT PENALTIES ARE NOT IMPOSABLE IN THESE CASES. ALTHOUGH, IT WAS ARGUED BY THE LD. DR THAT HE IS RELY ING UPON THE ORDER PASSED BY THE ASSESSING OFFICER AND FROM THE GROUND NO.1 RAISED IN THE APPEAL, IT REFLECTS THAT THE DEPARTMENT HAS PREFERRED THE INSTANT APPEAL IN THE HONBLE HIGH COURT OF JAMMU & KASHMIR IN THE CASE OF M/S J&K BANK LTD. ON THE SAME ISSUE, HOWEVER, NEITHER BROUGHT ON RECORD ANY MATERIAL QUA INTERIM OR FINAL OUT COME OF THE AFORESAID APPEAL AS R EFERRED IN THE GROUND NO.1 NOR SHOWN ANY IMPEDIMENT IN THE ADJUDICATION OF THE INSTANT APPEAL. HENCE, WE ARE OF THE CONSIDERED VIEW THAT THE LD. CIT(A ) WHILE PASSING THE IMPUGNED ORDER HEREIN CONSIDERED THE DECISION RENDE RED BY JURISDICTIONAL HIGH COURT IN THE APPELLANTS OWN CASE AND NON DOUBTIN G THE GENUINENESS OF THE TRANSACTIONS BY THE A.O., RIGHTLY DELETED THE PEN ALTY IMPOSED U/S 271E ITA NO.386 /ASR/2017 (A.Y.2012-13) ACIT VS. M/S JK GRAMEEN BANK, JAMMU 4 OF THE ACT. WE FOUND NO INFIRMITY, IMPROPRIETY AND I LLEGALITY IN THE ORDER UNDER CHALLENGE AND THE APPEAL OF THE REVENUE IS LIAB LE TO BE DISMISSED. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE DEPA RTMENT STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 .02.2018. SD/- SD/- (R.S.SYAL) (N.K.CHOUDHRY) VICE PRESIDENT JUDICIAL MEMBER DATED:21.02.2018 /PK/ PS. COPY OF THE ORDER FORWARDED TO: (1) M/S JK GRAMEEN BANK, HEAD OFFICE NARWAL, JAMMU (2) THE ACIT, CIRCLE-1, JAMMU (3) THE CIT(A). J&K, JAMMU (4) THE CIT CONCERNED. (5) THE SR DR, I.T.A.T., AMRITSAR TRUE COPY BY ORDER