SHRI IQBAL SINGH , BATHINDA V. INCOME TAX OFFICER,WARD 1(3), BATHINDA

ITA 395/ASR/2018

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 6449 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-02-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 25-06-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bonafide belief; Reasonable cause
• Section: 273B; 139(1)

Judgement Text

P A G E | 1 ITA NO. 395/ASR./2018 A.Y. 2009-10 IQBAL SINGH V S. ITO IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH, AMRITSAR BEFORE SHRI L. P. SAHU, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER ITA NO. 395/ASR./2018 (ASSESSMENT YEAR: 2009-10) SHRI IQBAL SINGH S/O SH. JANG SINGH (TARA INFOTECH COMPUTERS), BHAGTA BHAI KA, R/O NEAR GOVT. SCHOOL, VILL. KOTHA GURU RAMPURAPHUL VS. INCOME TAX OFFICER , WARD 1(3), BATHINDA PAN BOMPS 0967K (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI ASHWANI KALIA, C.A. RESPONDENT BY: SHRI CHARAN DASS, D.R. DATE OF HEARING: 03.02.2020 DATE OF PRONOUNCEMENT: 04.02.2020 O R D E R PER RAVISH SOOD, JM THE PRESENT APPEAL FILED BY THE ASSESSEE IS DIRECTE D AGAINST THE ORDER PASSED BY THE CIT(A), BATHINDA, DATED 27. 04.2018, WHICH IN TURN ARISES FROM THE ORDER PASSED BY THE ASSESSING OFFICER U/S 271F OF THE INCOME TAX ACT, 1961 (FOR SHORT IT ACT), DATE D 23.08.2016 FOR A.Y. 2009-10. 2. THE ASSESSEE HAS ASSAILED THE IMPUGNED ORDER ON THE FOLLOWING EFFECTIVE GROUND OF APPEAL BEFORE US: P A G E | 2 ITA NO. 395/ASR./2018 A.Y. 2009-10 IQBAL SINGH V S. ITO 1. THAT THE LD. CIT(A), BATHINDA HAS ERRED IN CONF IRMING THE PENALTY OF RS.5000 U/S 271F LEVIED BY THE AO FOR NON FILING OF RETURN IGNORING THE FACT THAT THE ASSESSEE HAS SUFFERED A NET LOSS DUE TO WHICH THE R ETURN WAS NOT FILED. 3. BRIEFLY STATED, THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION DERIVED INCOME FROM RUNNING A COMPUTER CENTRE AND I MPARTING COURSES AFFILIATED TO PUNJAB TECHNICAL UNIVERSITY ( PTU). IT WAS NOTICED BY THE A.O THAT THE ASSESSEE DURING THE YEAR UNDER CONSIDERATION HAD NOT FILED HIS RETURN OF INCOME U/S 139(1) OF THE AC T. IN THE BACKDROP OF THE AFORESAID FACT, THE A.O CALLED UPON THE ASSESSE E TO SHOW CAUSE AS TO WHY PENALTY U/S 271F MAY NOT BE IMPOSED ON HIM. AS THE REPLY FILED BY THE ASSESSEE DID NOT FIND FAVOUR WITH THE A.O, THEREFORE, HE VISITED HIM WITH A PENALTY OF RS.5,000 U/S 271F OF THE ACT. 4. AGGRIEVED, THE ASSESSEE ASSAILED THE PENALTY IMP OSED U/S 271F BEFORE THE CIT(A). OBSERVING, THAT THE ASSESSEE HAD FAILED TO FILE THE RETURN OF INCOME WITHIN THE PRESCRIBED TIME PERIOD ENVISAGED IN SECTION 139(1) OF THE ACT, THE CIT(A) WAS OF THE VI EW THAT NO INFIRMITY DID EMERGE FROM THE ORDER OF THE A.O IMPOSING PENAL TY U/S 271F OF THE ACT. ACCORDINGLY, THE CIT(A) VIDE HIS ORDER DATED 2 7.04.2018 DISMISSED THE APPEAL. 5. THE ASSESSEE BEING AGGRIEVED WITH THE ORDER OF T HE CIT(A) HAS CARRIED THE MATTER IN APPEAL BEFORE US. THE LD. AUT HORIZED REPRESENTATIVE (FOR SHORT A.R) FOR THE ASSESSEE A T THE VERY OUTSET OF THE HEARING OF THE APPEAL TOOK US THROUGH THE FACTS OF THE CASE. IT WAS AVERRED BY THE LD. A.R THAT AS THE INCOME OF THE AS SESSEE FOR THE YEAR UNDER CONSIDERATION WAS BELOW THE BASIC EXEMPTION L IMIT, THEREFORE, HE HAD REMAINED UNDER BONAFIDE BELIEF THAT NO STATUTOR Y OBLIGATION WAS CAST UPON HIM TO FILE THE RETURN OF INCOME. IN SUM AND SUBSTANCE, IT WAS THE CLAIM OF THE LD. A.R THAT THE FAILURE ON TH E PART OF THE P A G E | 3 ITA NO. 395/ASR./2018 A.Y. 2009-10 IQBAL SINGH V S. ITO ASSESSEE TO FILE THE RETURN OF INCOME U/S 139(1) OF THE ACT WAS BACKED BY A BONAFIDE BELIEF ON HIS PART. IN ORDER TO DRIVE HOME HIS AFORESAID CLAIM THE LD. A.R TOOK US THROUGH THE ASSESSMENT OR DER WHICH THEREIN FORTIFIED THE SAME. 6. PER CONTRA, THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R) RELIED ON THE ORDERS OF THE LOWER AUTHORITIES. IT W AS SUBMITTED BY THE LD. D.R THAT AS THE ASSESSEE HAD FAILED TO FILE HIS RETURN OF INCOME WITHIN THE STATUTORY TIME LIMIT CONTEMPLATED IN SEC . 139(1) OF THE ACT, THEREFORE, HE WAS RIGHTLY VISITED WITH PENALTY U/S 271F OF THE ACT. 7. WE HAVE HEARD THE AUTHORIZED REPRESENTATIVES FOR BOTH THE PARTIES, PERUSED THE ORDERS OF THE LOWER AUTHORITIE S AND THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY, THERE IS NO DENYIN G OF THE FACT THAT THE ASSESSEE HAD FAILED TO FILE HIS RETURN OF INCOME WI THIN THE STIPULATED TIME PERIOD CONTEMPLATED U/S 139(1) OF THE ACT. AT THE SAME TIME, WE CANNOT ALSO REMAIN OBLIVIOUS OF THE FACT THAT AS TH E RETURNED INCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION WAS B ELOW THE BASIC EXEMPTION LIMIT, THEREFORE, HE HAD REMAINED UNDER A BONAFIDE BELIEF THAT NO OBLIGATION WAS CAST UPON HIM TO FILE HIS RE TURN OF INCOME. AS SUCH, THERE IS SUBSTANTIAL FORCE IN THE EXPLANATION OF THE LD. A.R AS REGARDS THE FAILURE ON THE PART OF THE ASSESSEE TO FILE HIS RETURN OF INCOME UNDER SEC. 139(1) OF THE ACT. ALTHOUGH, THE ASSESSEE OUGHT TO HAVE BEEN VIGILANT AND CAUTIOUS AS REGARDS THE STAT UTORY OBLIGATION CAST UPON HIM, BUT THEN, IN THE TOTALITY OF THE FAC TS OF THE CASE THE EXISTENCE OF A BONAFIDE REASON LEADING TO THE FAIL URE ON HIS PART IN FILING HIS RETURN WITHIN THE STIPULATED TIME PERIOD CANNOT BE SUMMARILY RULED OUT. AS SUCH, WE ARE OF STRONG CONVICTION THA T THE CASE OF THE ASSESSEE CLEARLY FALLS WITHIN THE SWEEP OF SECTION 273B OF THE ACT. ACCORDINGLY, AS THERE IS A REASONABLE CAUSE FOR THE FAILURE ON THE PART OF THE ASSESSEE IN FILING HIS RETURN OF INCOME UNDE R SEC. 139(1) OF THE P A G E | 4 ITA NO. 395/ASR./2018 A.Y. 2009-10 IQBAL SINGH V S. ITO ACT, THEREFORE, WE ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE IMPOSITION OF PENALTY U/S 271F ON HIM. ON THE BASIS OF OUR AFORESAID OBSERVATIONS WE VACATE THE PENALTY IMPOSED BY THE A O U/S 271F OF THE ACT. 8. RESULTANTLY, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 04/02/2020 SD/- SD/- ( L. P. SAHU) (RAVISH SOOD) ACCOUNTANT MEMBER JUDICIAL MEMBER PLACE : AMRITSAR; DATED 04.02.2020 GP/SR PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A)- 4. / CIT 5. DR, ITAT, AMRITSAR BENCH, AMRITSR 6. / GUARD FILE. //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) & ' /ITAT, AMRITSAR. BENCH, AMRITSAR