Parisons Exports Inc, Trivandrum V. ACIT, Calicut

ITA 408/COCH/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64771 (ITAT-COCHIN)
• Duration Of Justice: 2 year(s) 2 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 23-08-2012
• Assessment Year: 2000-2001
• Appeal Filed On: 18-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PRAVEEN
• Assessee Lawyers: A S NARAYANAMOORTHY
• Keywords: Period of limitation; Competent authority; Time period of passing order

Judgement Text

1 ITA NO. 408/COCH/2010 IN THE INCOME TAX APPELLATE TRIBUNAL COCHIN BENCH, COCHIN BEFORE SHRI N.R.S. GANESAN (JM) AND SHRI B.R. BASKARA N(AM) I.T.A NO. 408/COCH/2010 (ASSESSMENT YEAR 2000-01) PARISONS EXPORTS INC VS THE A.C.I.T., CENT.CIR. 2 6/1183, KUNHIPARI BLDG CALICUT CHEROOTTY ROAD CALICUT PAN : AAFFP6372B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI A.S. NARAYANAMOORTHY RESPONDENT BY : SHRI S PRAVEEN DATE OF HEARING : 23-08-2012 DATE OF PRONOUNCEMENT : 23-08-2012 O R D E R PER N.R.S. GANESAN (JM) THIS APPEAL OF THE TAXPAYER IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME-TAX(A) CONFIRMING THE PENALTY LEVIED U/S 2 71(1)(C) OF THE ACT FOR THE ASSESSMENT YEAR 2000-01. 2. SHRI A.S. NARAYANAMURTHY, THE LD.REPRESENTATIVE FOR THE TAXPAYER SUBMITTED THAT THE ADDITION WAS CONFIRMED IN QUANTU M APPEAL. ACCORDING TO THE LD.REPRESENTATIVE, THE CREDITORS COULD NOT FILE THE CERTIFICATES ISSUED BY THE COMPETENT AUTHORITY UNDER VDIS, 1997 BEFORE THE LO WER AUTHORITIES IN THE COURSE 2 ITA NO. 408/COCH/2010 OF ASSESSMENT PROCEEDINGS. THEREFORE, THE ADDITION WAS CONFIRMED. THE TAXPAYER COULD NOT PRODUCE THE SAID CERTIFICATES EV EN DURING THE PENALTY PROCEEDINGS BEFORE THE LOWER AUTHORITIES. ACCORDIN G TO THE LD.REPRESENTATIVE, HAD THE CERTIFICATES ISSUED UNDER THE VDIS, 1997 WE RE CONSIDERED, THE ADDITION WOULD NOT HAVE BEEN CONFIRMED OR ATLEAST, THERE WOU LD HAVE BEEN NO SCOPE FOR LEVY OF CONCEALMENT PENALTY AT ALL. THEREFORE, THE LD.REPRESENTATIVE SUBMITTED THAT THE CERTIFICATES ISSUED BY THE COMPETENT AUTHO RITY UNDER THE VDIS, 1997 HAVE TO BE CONSIDERED. THE LD.REPRESENTATIVE HAS F ILED COPIES OF THE CERTIFICATES ISSUED BY THE COMPETENT AUTHORITY UNDER THE VDIS, 1 997 BEFORE THIS TRIBUNAL. THE LD. REPRESENTATIVE FOR THE TAXPAYER FURTHER SUB MITTED THAT THE PENALTY HAS TO BE LEVIED WITHIN SIX MONTHS FROM THE DATE OF ORDER OF THE COMMISSIONER OF INCOME-TAX(A) IN RESPECT OF ORDERS PASSED ON OR BEFO RE 01-06-2003 WHICH WAS CLARIFIED BY THE CIRCULAR ISSUED BY THE CBDT DATED 24-07-2007. THE TAXPAYER HAS FILED THE EXTRACT OF THE CIRCULAR ISSUED BY THE CBD T BEFORE THIS TRIBUNAL. ACCORDING TO THE LD.REPRESENTATIVE, SINCE THE ORDER WAS PASSED BEYOND THE PERIOD OF SIX MONTHS FROM THE DATE OF ORDER OF COMMISSIONE R OF INCOME-TAX(A), THE PENALTY LEVIED BY THE ASSESSING OFFICER IS BARRED B Y LIMITATION. THE LD.REPRESENTATIVE FURTHER SUBMITTED THAT THE ORDER OF THIS TRIBUNAL HAS TO BE TAKEN INTO ACCOUNT ONLY IN RESPECT OF THE ORDERS PAS SED AFTER 01-06-2003. 3. ON THE OTHER HAND, THE LD.DR SUBMITTED THAT THE PERIOD OF LIMITATION HAS TO BE COMPUTED FROM THE DATE OF ORDER OF THIS TRIBUNAL WHICH FINALLY CONCLUDED THE MATTER. THEREFORE, THE ASSESSING OFFICER HAS LEVIE D THE PENALTY WITHIN THE PERIOD LIMITATION PERIOD OF SIX MONTHS FROM THE DATE OF OR DER OF THIS TRIBUNAL. REFERRING TO THE CERTIFICATES ISSUED BY THE COMPETENT AUTHORI TY UNDER THE VDIS 1997, THE LD.DR SUBMITTED THAT THE TAXPAYER HAS NOT PRODUCED THE SAME BEFORE THE LOWER AUTHORITIES, THEREFORE, THE SAME WERE NOT CONSIDERE D. 3 ITA NO. 408/COCH/2010 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND A LSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSESSMENT PROCEEDINGS AN D PENALTY PROCEEDINGS ARE SEPARATE AND DISTINCT. THOUGH THE ADDITION WAS CON FIRMED IN THE APPELLATE PROCEEDINGS, THE ASSESSING AUTHORITY IS BOUND TO RE -APPRECIATE THE MATERIAL AVAILABLE ON RECORD IN THE PENALTY PROCEEDINGS. TH E ASSESSEE HAS FILED CERTIFICATES ISSUED BY THE COMPETENT AUTHORITY UNDE R THE VDIS, 1997 TO SHOW THAT THAT THE CREDITORS HAVE SUFFICIENT BALANCES TO ADVA NCE FUNDS TO THE ASSESSEE. UNFORTUNATELY THESE CERTIFICATES WERE NOT PRODUCED BEFORE THE LOWER AUTHORITY. THIS TRIBUNAL IS THE FINAL FACT FINDING AUTHORITY. THEREFORE, THE FACTUAL ASPECTS HAVE TO BE SETTLED AT THIS LEVEL. THE AMOUNTS DISC LOSED BY THE CREDITORS UNDER THE VDIS HAVE TO BE TAKEN INTO ACCOUNT ON THE BASIS OF T HE CERTIFICATES ISSUED BY THE COMPETENT AUTHORITY. THE ASSESSING AUTHORITY HAS T O EXAMINE THE CERTIFICATE AND FIND OUT WHETHER THE AMOUNTS DISCLOSED UNDER THE VD IS, 1997 WERE AVAILABLE WITH THE CREDITORS TO ADVANCE THE MONEY TO THE TAXPAYER. IN THE ABSENCE OF THE CERTIFICATES ISSUED BY THE COMPETENT AUTHORITY UNDE R VDIS, 1997, THE LOWER AUTHORITIES HAD NO OCCASION TO CONSIDER THEM. THER EFORE, THIS TRIBUNAL IS OF THE OPINION THAT THE CERTIFICATES ISSUED BY THE COMPETE NT AUTHORITY UNDER VDIS, 1997 HAVE TO BE CONSIDERED BY THE ASSESSING AUTHORITY. SINCE THE ISSUE ON MERIT NEEDS TO BE CONSIDERED BY THE ASSESSING AUTHORITY SO AS T O CORRECTLY APPRECIATE THE CIRCUMSTANCES UNDER WHICH CONCEALMENT PENALTY COULD BE LEVIED, THIS TRIBUNAL IS OF THE OPINION THAT THE ISSUE RELATING TO LIMITATIO N PERIOD FOR PASSING THE PENALTY ORDER ALSO HAS TO BE RECONSIDERED BY THE ASSESSING AUTHORITY IN THE LIGHT OF CONTENTIONS RAISED BY LD.REPRESENTATIVE FOR THE TAX PAYER. ACCORDINGLY THE ORDERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ENTI RE ISSUE IS REMITTED BACK TO THE FILE OF THE ASSESSING AUTHORITY. THE ASSESSING AUT HORITY SHALL RECONSIDER THE ISSUE IN THE LIGHT OF OBSERVATIONS MADE BY THIS TRIBUNAL IN THIS ORDER AND DECIDE THE 4 ITA NO. 408/COCH/2010 ISSUE AFRESH IN ACCORDANCE WITH LAW AFTER PROVIDING OPPORTUNITY OF HEARING TO THE TAXPAYER. 5. IN THE RESULT, THE APPEAL OF THE TAXPAYER IS ALL OWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 23 RD AUGUST, 2012. SD/- SD/- (B.R. BASKARAN) (N.R.S. GANESAN) ACCOUNTANT MEMBER JUDICIAL MEMBER COCHIN, DT : 23 RD AUGUST, 2012 PK/- COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE COMMISSIONER OF INCOME-TAX 4. THE COMMISSIONER OF INCOME-TAX(A) 5. THE DR (TRUE COPY) BY ORDER ASSTT. REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL, COCHIN BENCH