M/s. Improvement Trust, Bathinda V. The Asstt. Commissioner of Income-tax, Bathinda

ITA 411/ASR/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4424 (ITAT-AMRITSAR)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-10-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 20-08-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 17-06-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: K R JAIN
• Section: 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P. JAIN, ACCOUNTANT MEMBER I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 PAN: AAATE1563E IMPROVEMENT TRUST, VS. THE ACIT, CIRCLE-I, DR. MELA RAM ROAD, BATHINDA BATHINDA (APPELLANT) (RESPONDENT) APPELLANT BY: SH. K.R. JAIN, ADVOCATE RESPONDENT BY: SH. TARSEM LAL, DR DATE OF HEARING: 14.10.2013 DATE OF PRONOUNCEMENT: 15.10.2013 ORDER PER BENCH 1) THE ASSESSEE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ORDER DATED 19.03.2013 PASSED BY LEARNED CIT(A), BA THINDA, FOR THE ASSESSMENT YEAR 2007-08. 2) THE FACTS RELATING TO THE ISSUE IN DISPUTE ARE T HAT THE ASSESSEE HAS FILED ITS RETURN OF INCOME AT RS. NIL ON 31.10. 2007, WHICH WAS PROCESSED UNDER SECTION 143(1) OF THE INCOME TAX AC T, 1961 (IN SHORT THE THE ACT) ON 05.02.2008. THE ASSESSING OFFICER SEL ECTED THE CASE OF THE 2 I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 ASSESSEE FOR SCRUTINY BY ISSUING STATUTORY NOTICES UNDER SECTIONS 143(2) & 142(1) OF THE ACT. IN COMPLIANCE TO THE SAME, THE A UTHORIZED REPRESENTATIVE OF THE ASSESSEE APPEARED. 3) DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS GIVEN AN OPPORTUNITY, VIDE OFFICE LETTER DATED 23.1 1.2009, TO EXPLAIN AS TO WHY ITS ACCOUNTS MAY NOT BE GOT AUDITED AS PER PROV ISIONS OF SECTION 142(2A) OF THE ACT, IN RESPONSE TO WHICH IT WAS RES PONDED THAT THE ASSESSEE-TRUST HAS NO OBJECTION IN MAKING SPECIAL A UDIT UNDER SECTION 142(2A) OF THE ACT. 4) AFTER OBTAINING NECESSARY APPROVAL FROM THE COMM ISSIONER OF INCOME TAX, BATHINDA, COMMUNICATED VIDE OFFICE LETT ER NO. 2941 DATED 10.12.2009, THE ASSISTANT COMMISSIONER OF INCOME TA X, CIRCLE-I, BATHINDA, VIDE LETTER DATED 14.12.2009, REQUESTED T HE ASSESSEE TO GET ITS ACCOUNT AUDITED FROM M/S P.L. MITTAL & CO., CAS, 30 50-POWER HOUSE ROAD, BATHINDA, AND FURNISH AUDIT REPORT BY 15.03.2 010. BUT THE ASSESSEE FAILED TO SUBMIT THE REQUISITE AUDIT REPORT BY 15.0 3.2010. THE ASSESSING OFFICER ISSUED THE PENALTY NOTICE UNDER SECTION 274 READ WITH SECTION 271(1)(B) OF THE ACT ON 19.03.2010, REQUIRING THE A SSESSEE TO SHOW CAUSE WHY AN ORDER IMPOSING PENALTY UNDER SECTION 271(1) (B) OF THE ACT SHOULD NOT BE MADE AS THE ASSESSEE HAS FAILED TO CO MPLY WITH THE 3 I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 DIRECTION ISSUE UNDER SUB-SECTION (2A) OF SECTION 1 42 OF THE ACT. THE SHOW CAUSE NOTICE WAS SERVED UPON THE ASSESSEE ON 2 5.03.2010 AND DUE DATE OF COMPLIANCE WAS 05.04.2010, BUT NO COMPLIANC E WAS MADE BY THE ASSESSEE. THE CHARTERED ACCOUNTANTS, M/S P.L. MITTA L & CO., CAS, BATHINDA, NOMINATED FOR THE PURPOSE OF CONDUCTING A UDIT UNDER SECTION 142(2A) OF THE ACT, VIDE THEIR LETTER DATED 11.03.2 010, INFORMED TO THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-I, BAT HINDA, THAT THE PROGRESS OF THE AUDIT IS VERY SLOW DUE TO COMPLETEL Y INDIFFERENT ATTITUDE OF THE OFFICIALS OF THE TRUST AS THEY REFUSE TO ACKNOW LEDGE THEIR AUDIT MEMOS, REPLY THE QUERIES RAISED ETC. THE ASSESSEE W AS ALSO SENT A LETTER DATED 08.03.2010 BY THE CHARTERED ACCOUNTANTS TO AP PROACH THE OFFICE OF ASSESSING OFFICER FOR SEEKING EXTENSION OF TIME, IF THE ASSESSEE DOES NOT CONSIDER IT PROPER TO SUPPLY THE INFORMATION. BUT T HE ASSESSEE HAS NOT TAKEN ANY COGNIZANCE OF THIS LETTER. KEEPING IN VI EW THE AFORESAID ATTITUDE OF THE ASSESSEE, THE ASSESSING OFFICER I.E . ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-I, BATHINDA, IS OF THE VIEW THAT IT IS A FIT CASE FOR IMPOSING PENALTY AS PER THE PROVISIO NS OF SECTION 271(1)(B) OF THE ACT AND ACCORDINGLY SHE IMPOSED PENALTY OF R S. 10,000/- AS PER THE PROVISIONS OF SECTION 271(1)(B) OF THE ACT BY PASSI NG THE ORDER DATED 08.04.2010. 4 I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 5) AGGRIEVED BY THE ASSESSMENT ORDER DATED 08.04.2010, THE ASSESSEE FILED AN APPEAL BEFORE THE LEARNED FIRST APPELLATE TRIBUNAL, WHO VIDE IMPUGNED ORDER DATED 19.03.2013, DISMISSED THE APPEAL OF THE ASSESSEE AND UPHELD THE PENALTY OF RS. 10,000/- IMPOSED BY THE ASSESSING OF FICER. NOW, BEING AGGRIEVED WITH THE ORDER OF LEARNED FIRST APPELLATE AUTHORITY, THE ASSESSEE FILED THE PRESENT APPEAL. 6) IN COMPLIANCE OF THE ORDER DATED 19.09.2013 PASS ED BY HON'BLE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH, IN CIVIL WRIT PETITION NO. 1151 OF 2013(O&M), IMPROVEMENT TRUST VS. COMMISSIONER OF IN COME TAX, BATHINDA & OTHERS, THE PRESENT CASE CAME UP FOR HEARING BEFO RE THIS BENCH ON 14.10.2013 AND SH. K.R. JAIN, ADVOCATE, APPEARED FO R THE ASSESSEE AND STATED THAT HE HAS RECEIVED NOTICE OF HEARING FOR THE PRES ENT APPEAL ON 10 TH OCTOBER, 2013 AND NECESSARY COMMUNICATION TO THIS EFFECT HAS BEEN SENT TO THE ASSESSEE- TRUST ON 11 TH OCTOBER, 2013 BUT HE HAS NOT RECEIVED ANY INSTRUC TION FROM THE ASSESSEE SO FAR. THEREFORE, HE REQUESTED FOR ADJOUR NMENT. BUT KEEPING IN VIEW THE DIRECTION GIVEN BY THE HON'BLE HIGH COURT, WE A RE UNABLE TO ADJOURN THE MATTER BEING A TIME-BOUND MATTER. ACCORDINGLY, WE R EJECT THE REQUEST OF LEARNED COUNSEL FOR THE ASSESSEE FOR ADJOURNMENT AN D PROCEED TO DECIDE THE PRESENT APPEAL EX-PARTE AFTER HEARING LEARNED DR AND AS PER THE MATERIALS AVAILABLE ON RECORD. 7) LEARNED DR RELIED UPON THE ORDER PASSED BY L EARNED FIRST APPELLATE AUTHORITY. 5 I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 8) WE HAVE HEARD LEARNED DR AND PERUSED THE MATERIA LS AVAILABLE ON RECORD, ESPECIALLY THE IMPUGNED ORDER DATED 19.0 3.2013 PASSED BY LEARNED FIRST APPELLATE AUTHORITY. WE ARE OF THE CO NSIDERED VIEW THAT THE PROVISIONS OF SECTION 271(1)(B) OF THE ACT IS VERY CLEAR, WHICH EMPOWERS THE ASSESSING OFFICER TO IMPOSE PENALTY AT A SUM OF RS. 10,000/- FOR EACH FAILURE. IN THE PRESENT CASE, THE ASSESSEE FILED IT S RETURN OF INCOME RELATING TO THE ASSESSMENT YEAR 2007-08 ON 31.10.2007, DECLA RING NIL INCOME. DURING THE ASSESSMENT PROCEEDINGS, IT TRANSPIRED TH AT THE ASSESSEE HAD BEEN MAINTAINING ITS ACCOUNTS ON SINGLE ENTRY SYSTE M AND METHOD OF ACCOUNTING WAS CASH SYSTEM. IN SUCH CIRCUMSTANCES , TRUE STATE OF AFFAIRS OF THE ASSESSEE COULD NOT BE ASCERTAINED ON A PARTI CULAR DATE. KEEPING IN VIEW THE NATURE OF AND COMPLEXITY OF THE ACCOUNTS, THE ASSESSING OFFICER ISSUED A SHOW CAUSE NOTICE TO THE ASSESSEE AS TO WH Y ITS ACCOUNTS MAY NOT BE GOT AUDITED FROM A CHARTERED ACCOUNTANT IN VIEW OF THE PROVISIONS OF SECTION 142(2A) OF THE ACT. AFTER RECEIVING THE CO NSENT, THE CASE WAS REFERRED FOR SPECIAL AUDIT TO M/S P.L. MITTAL & CO. , CHARTERED ACCOUNTANTS, BATHINDA AND THE ASSESSEE WAS ALSO INT IMATED VIDE LETTER DATED 14.12.2009 TO GET ITS ACCOUNTS AUDITED BY 15. 03.2010. THAT M/S P.L. MITTAL & CO., CAS, BATHINDA NOMINATED FOR THE PURPOSE OF CONDUCTING AUDIT UNDER SECTION 142(2A) OF THE ACT V IDE THEIR LETTER DATED 6 I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 11.03.2010 INFORMED THE A.O. THAT THE OFFICIALS OF THE ASSESSEE-TRUST HAVE ADOPTED INDIFFERENT ATTITUDE AND EVEN REFUSED TO AC KNOWLEDGE THEIR AUDIT MEMOS AND ALSO DID NOT FURNISH REPLY OF THE QUERIES RAISED ETC. AND FOR THAT MATTER THE AUDIT COULD NOT BE COMPLETED WITHIN THE STIPULATED PERIOD. 9) IT IS ALSO PERTINENT TO MENTION HERE THAT THE AS SESSEE DID NOT BOTHER TO REPLY THE SHOW CAUSE NOTICE ISSUED BY THE ASSESSING OFFICER DATED 19.03.2010, REQUIRING THE ASSESSEE TO SHOW CA USE AS TO WHY AN ORDER IMPOSING PENALTY MAY NOT BE MADE AS IT HAS FA ILED TO COMPLY WITH THE DIRECTIONS ISSUED UNDER SECTION 142(2A) OF THE ACT BUT THE ASSESSEE DID NOT TENDER ANY EXPLANATION TO THE SAME. 10) KEEPING IN VIEW THE AFORESAID FACTS AND CIRCUMSTA NCES OF THE PRESENT CASE, WE ARE OF THE CONSIDERED OPINION THAT THE ASSESSEE DID NOT BOTHER TO COMPLY WITH THE NOTICE ISSUED BY THE ASSE SSING OFFICER TO GET ITS ACCOUNTS AUDITED FROM THE NOMINATED CHARTERED A CCOUNTANTS AND REMAIN UN-COOPERATIVE WITH THE NOMINATED CHARTERED ACCOUNTANTS AND HAS ALSO NOT FILED ANY EXPLANATION TO THE SHOW CAUS E ISSUED BY THE ASSESSING OFFICER. THIS SHOWS TOTALLY NON-COOPERATI VE NATURE OF THE ASSESSEE BEFORE THE ASSESSING OFFICER IN THE ASSESS MENT PROCEEDINGS. THEREFORE, THE PENALTY OF RS. 10,000/- IMPOSED UNDE R SECTION 271(1)(B) OF THE ACT HAS RIGHTLY BEEN IMPOSED BY THE ASSESSIN G OFFICER AND 7 I.T.A. NO. 411 (ASR)/2013 ASSESSMENT YEAR: 2007-08 CONFIRMED BY LEARNED FIRST APPELLATE AUTHORITY IN T HE IMPUGNED ORDER. THUS, NO INTERFERENCE IS CALLED FOR IN THE IMPUGNED ORDER. ACCORDINGLY, WE DISMISS THE PRESENT APPEAL FILED BY THE ASSESSEE AND UPHOLD THE IMPUGNED ORDER DATED 19.03.2013 PASSED BY LEARNED C IT(A), BATHINDA. 11) IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH OCTOBER, 2013 SD/./- SD/./- (B.P. JAIN) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 15 TH OCTOBER, 2013 /RK/ COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: IMPROVEMENT TRUST, DR. MELA RAM ROAD, BATHINDA 2. THE ACIT, CIRCLE-I, BATHINDA 3. THE CIT(A), BATHINDA 4. THE CIT, BATHINDA 5. THE SR DR, I.T.A.T., ASR TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR.