DCIT, Jaipur V. GRASS FIELD FARMS & RESORTS P. LTD., Jaipur

ITA 415/JPR/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 5218 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2007-2008
• Appeal Filed On: 29-04-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BK GUPTA
• Assessee Lawyers: P C PARWAL CA DHK
• Keywords: Opportunity of being heard; Period of limitation; Retrospective amendment; Initiation of penalty proceedings
• Section: 143(3); 133A

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, JAIPUR JH VH-VKJ-EHUK] YS[KK LNL; ,OA JH YFYR DQEKJ] U;KF; D LNL; DS LE{K BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR, JM VK;DJ VIHY LA -@ ITA NO. 415/JP/2015 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2007-08. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2, JAIPUR. CUKE VS. M/S GRASS FIELD FARMS & RESORTS P LTD., K-107, CLUB LANE, JANPATH, SHYAM NAGAR, JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO. AACCG 3874 D VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SHRI B.K. GUPTA FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (C.A.) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 10/05/2016. MN?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 06/06/2016. VKNS'K@ ORDER PER T.R. MEENA, A.M. THIS IS AN APPEAL FILED BY THE REVENUE AGAINST THE ORDER DATED 11/02/2015 OF THE LEARNED C.I.T.(A)-I JAIPUR, FOR A. Y. 2007-08. THE EFFECTIVE GROUNDS OF APPEAL ARE AS UNDER:- (1) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) HAS ERRED IN DELETING T HE PENALTY U/S 271(1)(C) AMOUNTING TO RS. 1,54,07,020/ -. 2 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. (2) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW THE LD CIT(A) HAS ERRED IN DETERMININ G THE LIMITATION FROM THE DATE OF ORDER OF CIT(A) WHEN THE ENTIRE ASSESSMENT ORDER WAS SUBSEQUENTLY SET ASIDE B Y HONBLE ITAT. 2. THE REVENUES APPEAL IS AGAINST DELETING THE PENA LTY IMPOSED U/S 271(1)(C) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) AT RS. 1,54,07,020/- AND DETERMINATION THE LIMITATION FROM THE DATE OF ORDER OF LD CIT(A). THE ASSESSEE FILED RETURN AT RS. 5,11,69,560 /- ON 31/12/2009 AS AGAINST RS. 14,73,790/- SHOWN IN THE RETURN OF INCOM E FILED OF 31/10/2007. THE CASE WAS SCRUTINIZED U/S 143(3) OF THE ACT ON 30/ 09/2009 BY THE ASSESSING OFFICER. THE ASSESSMENT WAS MADE AT RS. 5,1 1,69,560/- IN WHICH THE ADDITION ON ACCOUNT OF INVESTMENT IN PURCHASE O F AGRICULTURAL LAND U/S 69B OF THE ACT WAS MADE AT RS. 4,96,75,774/- PENALTY U/S 271(1)(C) WAS INITIATED FOR FURNISHING OF WRONG PARTICULARS AND CO NCEALMENT OF INCOME VIDE ORDER DATED 30/12/2009 BY THE LD ASSESSING OFFICER. THE ASSESSEE CHALLENGED THE ORDER OF THE ASSESSING OFFICER BEFOR E THE LD CIT(A), WHO VIDE ORDER DATED 08/2/2011 HAD DELETED THE ADDITION MADE BY THE ASSESSING OFFICER AT RS. 39,23,278/- U/S 69B OF THE ACT. REMAINING ADDITION WAS NOT CHALLENGED BY THE ASSESSEE BEFORE THE LD CIT( A). THE REVENUE IN APPEAL BEFORE THE HONBLE ITAT AGAINST THE CIT(A) ORD ER DATED 08/2/2011. 3 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. THE HONBLE ITAT VIDE ORDER DATED 14/12/2011 IN ITA N O. 406/JP/2011 A.Y. 2007-08 HAS SET ASIDE THIS ISSUE TO THE ASSESSING O FFICER. THEREAFTER, THE LD ASSESSING OFFICER COMPLETED THE SET ASIDE PROCEEDIN G VIDE ORDER DATED 18/3/2013 WHEREIN HE HAD NOT MADE ANY ADDITION SEPA RATELY BUT ACCEPTED THE ORIGINAL ASSESSED INCOME AND ISSUED NOTICE U/S 274 READ WITH SECTION 271(1)(C) OF THE ACT WITHOUT MENTIONING THE PENALTY PROCEEDING IS EITHER FOR CONCEALMENT OF INCOME OR FURNISHING INACCURATE PART ICULARS OF INCOME. THE LD ASSESSING OFFICER HAD SATISFIED WITH THE EXPLANAT ION MADE BY THE ASSESSEE BEFORE HIM AND NO ADDITION OF RS. 39,23,27 8/- WAS MADE IN SET ASIDE PROCEEDINGS. 2.1 BEFORE IMPOSING THE PENALTY, THE LD ASSESSING O FFICER GAVE REASONABLE OPPORTUNITY OF BEING HEARD. THE LD ASSESS ING OFFICER OBSERVED THAT THE ASSESSEE COMPANY HAS A PROJECT OF DEVELOPI NG FARM HOUSES SCHEME AT NH-8, NEAR VILLAGE MAHELA, DISTRICT- JAIP UR. SURVEY U/S 133A OF THE ACT WAS CARRIED OUT AT BUSINESS PREMISES OF THE ASSESSEE COMPANY ON 26/2/2008 TO 28/02/2008. DURING THE COURSE OF SURVE Y OPERATION, INCRIMINATING DOCUMENTS WERE FOUND AND IMPOUNDED U/S 133A OF THE ACT. AS A RESULT OF SURVEY, UNDISCLOSED INVESTMENT IN PU RCHASE OF AGRICULTURAL LAND AND OTHER DISCREPANCIES WERE DETECTED AND NOTIC ED, WHICH WAS 4 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. ADMITTED BY THE DIRECTOR OF THE COMPANY. IT IS FOUN D ON THE BASIS OF INCRIMINATING DOCUMENT THAT REGISTRY OF THE AGRICUL TURAL LAND WAS LESSER AMOUNT BUT ACTUALLY AMOUNT PAID BY THE ASSESSEE MUC H MORE. THEREFORE, ASSESSMENT FOR A.Y. 2006-07 WAS MADE AT RS. 5,57,72, 496/- AND ADDITION ON ACCOUNT OF UNDISCLOSED INVESTMENT U/S 69B OF THE ACT WERE MADE. THE ASSESSEE ALSO AVAILED REASONABLE OPPORTUNITY GIVEN BY THE LD ASSESSING OFFICER VIDE LETTER DATED 16/9/2013, WHICH HAS BEEN REPRODUCED BY THE ASSESSING OFFICER AT PAGE 2 TO 5 OF THE ASSESSMENT ORDER. AFTER CONSIDERING THE ASSESSEES REPLY, THE LD ASSESSING OFFICER HELD THAT PAPER MARKED AS ANNEXURE- A/1 AND A/2 WERE FOUND AND IMPOUNDED FROM THE SITE OFFICE OF THE ASSESSEE, WHICH WERE CONFRONTED WITH SHRI RAM KIS ORE JAT, MAIN PERSON OF THE ASSESSEE AND WITH THE DIRECTORS OF THE ASSESS EE COMPANY ALSO AND THE ADDITIONAL INCOME WAS SURRENDERED BY THE DIRECTO R, HENCE IT DID NOT MAKE ANY DIFFERENCE THAT PAPERS WERE NOT FOUND AT TH E REGISTERED OFFICE OR ADMINISTRATIVE OFFICE OF THE ASSESSEE COMPANY BUT F OUND AT THE SITE OFFICE. THE ARGUMENT TAKEN BY THE ASSESSEE THAT NO SPECIFIC PENALTY U/S 271(1)(C) HAS BEEN INITIATED IN SET ASIDE PROCEEDING WAS NOT F OUND CONVINCING TO THE ASSESSING OFFICER AS THE HONBLE ITAT HAS SET ASIDE SPECIFICALLY MENTIONED THE ASSESSMENT ORDER IS SET ASIDE, WHICH MEANS THE E NTIRE ORDER U/S 143(3) OF THE ASSESSING OFFICER HAD BEEN SET ASIDE TO ASSE SS THE INCOME OF THE 5 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. ASSESSEE AFRESH, AS SUCH THE ASSESSMENT AS WELL AS T HE CONSEQUENT PENALTY PROCEEDING HAD NO EXISTENCE UNTIL THE SET ASIDE ASS ESSMENT WAS COMPLETED AND INCOME WAS DETERMINED ACCORDINGLY. THEREFORE, THE LD ASSESSING OFFICER HAD DROPPED THE PENALTY PROCEEDINGS FOR A WHILE ON 2 7/3/2012. THIS WAS DONE WITHIN THE PRESCRIBED TIME LIMIT AS PER PROVISI ONS OF INCOME TAX ACT, 1961. THEREAFTER THE SET ASIDE ASSESSMENT HAD BEEN C OMPLETED VIDE ORDER DATED 18/3/2013 DETERMINING THE INCOME OF THE ASSES SEE AT RS. 4,72,86,290/- WHEREIN ADDITION OF RS. 4,57,72,496/- WAS MADE U/S 69B OF THE ACT AND PENALTY PROCEEDINGS U/S 271(1)(C) OF TH E ACT WERE INITIATED AND NOTICE IN THIS REGARD WAS ISSUED ALONGWITH ASSESSMENT ORDER DATED 18/3/2013. THUS, THERE IS NO MERIT IN THE ASSESSEE S SUBMISSIONS AT INSTANT PENALTY PROCEEDING IS BAD IN LAW. FURTHER HE DID NOT FIND ANY MERIT IN THE SUBMISSION THAT THE INCOME HAD BEEN ASSESSED AT THE FIGURE OFFERED FOR TAXATION BY THE ASSESSEE BECAUSE AS WAS THE MATTER O F FACT THE ASSESSEE HAD FILED ITS RETURN OF INCOME DECLARING INCOME OF RS. 14,73,790/- ON 31/10/2007 AND IT WAS THE SURVEY OPERATION CONDUCTED BY THE DEPARTMENT AT THE BUSINESS PREMISES OF THE ASSESSEE ON 26/2/20 08 TO 28/2/2008 WHEREIN THE UNDISCLOSED INVESTMENT AMOUNTING TO RS. 4,57,72,496/- WAS DETECTED, WHICH WAS ADMITTED BY THE DIRECTOR OF THE A SSESSEE COMPANY. WITH REGARDS TO NO SPECIFIC PENALTY HAS BEEN INITIA TED BY THE ASSESSING 6 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. OFFICER, HE HELD THAT AS PER SECTION 271(1)(B) INSE RTED BY THE FINANCE ACT, 2008 WITH RETROSPECTIVE EFFECT FROM 01/4/1989 DIRECT ION CONTAINED IN THE ASSESSMENT ORDER IS DEEMED AS SATISFACTION FOR INIT IATION OF THE PENALTY PROCEEDINGS AND IN THE CASE OF THE ASSESSEE THROUGH THE NOTICE ISSUED U/S 274 READ WITH SECTION 271(1)(C) ALONGWITH THE ASSESSM ENT ORDER. THE ASSESSEE HAS APPRISED THAT YOU HAD CONCEALED THE PA RTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. IN THIS CASE, THE ASSESSMENT WAS COMPLETED ON 31/12/2009 INITIATING THE PENALTY WH ICH WAS DECIDED BY THE LD CIT(A) ON 08/2/2011 AND BY THE HONBLE ITAT ON 14/10/2011 THUS, PERIOD OF DECIDING THE PENALTY WAS UP TO 31/4/2012. IT IS TO BE MENTIONED THAT THE PENALTY WAS DROPPED BY THE ASSESSING OFFICE R ON 27/3/2012 (D&CR NO. 87/135) I.E. WELL WITHIN THE TIME. THE PENALTY PRO CEEDINGS WERE DROPPED BY THE ASSESSING OFFICER BECAUSE OF THE FAC T THAT THE HONBLE ITAT VIDE THEIR ORDER DATED 14/10/2011 IN ITA NO. 406/JP /2011 HAD SET ASIDE THE ASSESSMENT AS HAD BEEN CONCLUDED BY THE HONBLE ITAT AT PARAGRAPH 8 OF THE ORDER I.E. THE ASSESSMENT ORDER IS SET ASIDE . THE PENALTY PROCEEDINGS INITIATED ALONGWITH SET ASIDE ASSESSMENT ARE ALTOGE THER DIFFERENT FROM THE EARLIER. THE ASSESSEES ARGUMENT WAS ALSO NOT FOUND C ONVINCING THAT THE ASSESSEE HAS DISCLOSED THE INCOME DURING THE ASSESS MENT PROCEEDINGS AT RS. 4,57,72,496/- AND THIS SURRENDER WAS MADE TO AVO ID THE LITIGATION AND 7 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. WAS CONTINUED TO BUY PEACE OF MIND AND AVOID PENALTY AND PROSECUTION. THIS ARGUMENT WAS NOT FOUND CONVINCING TO THE ASSESS ING OFFICER AND HELD THAT IF THE ASSESSEE DISCLOSED ON ACCOUNT OF INVEST MENT WILL AUTOMATICALLY WOULD BE REDUCED AT THE TIME OF SALE OF THE PROJECT AND ADJUSTED AGAINST THE COST OF THE LAND PURCHASED. AS PER EXPLATION-1 OF SECTION 271(1)(C), THE ASSESSEE HAD CLEARLY CONCEALED THE PARTICULARS OF I NCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME, THE ASSESSEE FAIL ED TO OFFER AN EXPLANATION AND HAS NOT SUBSTANTIATED THAT EXPLANATION FILED BY THE ASSESSEE IS BONAFIDE. HE FURTHER RELIED ON THE DECISION OF HON' BLE SUPREME COURT IN THE CASE OF DHARMENDRA TEXTILE PROCESSORS & ORS (2008) 3 06 ITR 277 (SC) WHEREIN IT HAS BEEN HELD THAT PENALTY PROCEEDINGS AR E NO LONGER QUASI CRIMINAL PROCEEDINGS AND, HENCE, THE PRESENCE OF ME NSREA IS NOT REQUIRED TO BE ESTABLISHED. THEREFORE, HE IMPOSED PENALTY U/S 271(1)(C) OF THE ACT ON CONCEALED INCOME AT RS. 1,54,07,020/-, WHICH IS 1 00% OF TAX SOUGHT TO BE EVADED ON INCOME. 3. BEING AGGRIEVED BY THE ORDER OF THE ASSESSING OF FICER, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD CIT(A), WHO HAD DELE TED THE PENALTY BY OBSERVING THAT THE ASSESSEE FILED REVISED COMPUTATI ON DISCLOSING ADDITIONAL INCOME OF RS. 4,57,72,496/- DURING THE ASSESSMENT P ROCEEDINGS. THE LD 8 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. ASSESSING OFFICER COMPLETED ASSESSMENT ON 30/12/200 9 U/S 143(3) MAKING ADDITION OF RS. 4,96,95,774/-, WHICH INCLUDES THE AD DITION OF RS. 39,23,273/- U/S 69B OF THE ACT ALSO. THE LD CIT(A) VI DE ORDER DATED 08/2/2011 IN ITA NO. 834/2009-10 DELETED THE ADDITI ON OF RS. 39,23,273/-. THE DEPARTMENT PREFERRED APPEAL BEFORE THE HONBLE I TAT, THE HONBLE ITAT HAD SET ASIDE THIS ISSUE TO THE ASSESSING OFFIC ER. THE LD ASSESSING OFFICER AFTER ITAT ORDER, HAD DROPPED THE PENALTY PR OCEEDINGS VIDE D&CR NO. 87/135 DATED 27/03/2012. THE LD ASSESSING OFFICE R FINALIZED THE SET ASIDE PROCEEDING OF ASSESSMENT ON 18/3/2013 AND ACC EPTED THE ASSESSEES CONTENTION AND NO ADDITION WAS MADE OF RS. 39,23,278 /-. WHILE PASSING THE SET ASIDE ORDER, THE LD ASSESSING OFFICER HAD ALSO INITIATED THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. THE MOOT QUES TION OF LIMITATION DATE WAS DECIDED BY THE LD CIT(A) AFTER CONSIDERING SECTIO N 275 OF THE ACT. THE LD CIT(A) IN FIRST ROUND HAD DECIDED THE APPEAL ON 0 8/2/2011, THEREFORE, AS PER CIT(A) IT HAS TO BE DECIDED ON OR BEFORE 31/3/20 12. HOWEVER, THE LD ASSESSING OFFICER HAS PASSED ORDER U/S 271(1)(C) ON 27/09/2013. IT IS ALSO A FACT THAT THE ASSESSING OFFICER HAD INITIALLY DRO PPED THE PENALTY PROCEEDINGS. FURTHER THE ADDITION OF RS. 4,57,72,49 6/- WAS NOT A SUBJECT MATTER IN THE SET ASIDE ASSESSMENT ORDER AND THEREF ORE, PERIOD OF LIMITATION CANNOT BE ACCOUNTED FROM THE DATE OF SET ASIDE ASSE SSMENT ORDER. VARIOUS 9 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. CASES RELIED BY THE ASSESSEE ALSO SUPPORTED ITS CON TENTION. THEREAFTER, IT HAS BEEN HELD AS UNDER:- THUS, AS PER SECTION 275(1 )(A) PROVISO, IN ORDER TO BE WITHIN LIMITATION, A PENALTY ORDER NEEDS MUST BE PASSED, I N THE FACTS OF THE PRESENT CASE, WITHIN ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH THE ORDER OF THE COMMISSION ER(A) IS RECEIVED BY THE CHIEF COMMISSIONER OR COMMISSIONER, WHICHEVER IS LATER. THUS, AS PER THE PROVISO TO SECTI ON 275 (1)(A) OF THE ACT, THE PENALTY ORDER OUGHT TO HAVE BEEN PASSED ON OR BEFORE 31.3.2012, I.E., WITHIN ONE YEAR FROM THE END OF FINANCIAL YEAR IN WHICH THE ID. CIT(A)S ORD ER WAS RECEIVED BACK BY THE DEPARTMENT. THE PENALTY ORDER, HOWEVER, GOT TO BE PASSED ONLY ON 27/9/2013. THAT BEI NG SO, THE CONTENTION OF THE ASSESSEE IS CORRECT. THE PENAL TY ORDER IS CLEARLY BARRED BY LIMITATION PROVIDED BY THE PROVIS O TO SECTION 275(1)(A) OF THE ACT. IN VIEW OF THE ABOVE, THE PENA LTY ORDER IS HIT BY THE PROVISO TO SECTION 275(1 )(A) OF THE ACT. GOING BY THE PARA-METERS LAID DOWN THEREIN IN THE SAID SECTIO N, THE PENALTY ORDER IS CLEARLY BEYOND THE LIMITATION PROV IDED THEREIN. ACCORDINGLY, THE PENALTY ORDER IS CANCELLED, BEING BARRED BY LIMITATION, AS ABOVE. SINCE THE PENALTY ORDER STANDS CANCELLED AS BARRED BY LIMITATION, NOTHING ELSE SURVIVES. AS SUCH, THE ORIGINAL GROUNDS RAISED BY THE ASSESSEE, ON MERITS, ARE NOT REQUIRED TO BE GONE INTO AND I AM NOT DOING SO. IN THE RESULT, THE APPEAL IS ALLOWED. 10 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. 4. NOW THE REVENUE IS IN APPEAL BEFORE US. THE LD DR HAS VEHEMENTLY SUPPORTED THE ORDER OF THE ASSESSING OFFICER. AT TH E OUTSET, THE LD AR OF THE ASSESSEE HAS REITERATED THE FACTS MENTIONED IN THE PENALTY ORDER BEFORE THE LD CIT(A). IN SET ASIDE PROCEEDINGS, THE LD ASSESSIN G OFFICER ACCEPTED THE INCOME OFFERED BY THE ASSESSEE AS SUCH AT RS. 4,57, 72,496/- BY FILING THE REVISED COMPUTATION AND ALSO ADDED BY THE ASSESSING OFFICER IN THE ORIGINAL ASSESSMENT PROCEEDINGS REMAINED TO THE INCOME ORIGI NALLY RETURNED BY THE ASSESSEE. IN SET ASIDE ASSESSMENT PROCEEDINGS, THE LD ASSESSING OFFICER HAD NOT SPECIFIED THE ADDITION FOR WHICH NOTICE U/S 271( 1)(C) OF THE ACT WAS ISSUED NOR IT WAS SPECIFIED WHETHER IT IS FOR CONCEAL MENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME. IN NOTICE ISSUED ON 18/3/2013, THE LD ASSESSING OFFICER HAD ALSO NOT SP ECIFIED THE INITIATION OF PENALTY WHETHER IT IS FOR CONCEALED THE PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTICULARS OF SUCH INCOME. THE ORDER CH ALLENGED THE LEGALITY OF PENALTY PROCEEDINGS INITIATED IN THE ASSESSMENT ORD ER PASSED U/S 143(3)/SET ASIDE EVEN THEN THE LD ASSESSING OFFICER IMPOSED THE PENALTY ON RS. 4,57,72,496/- ON ASSESSED INCOME. THE LD CIT(A) H AS ALLOWED THE APPEAL IN FAVOUR OF THE ASSESSEE BY CONSIDERING SEC TION 275(1) AND HELD THAT PENALTY IS BARRED BY LIMITATION. THEREFORE, IT WAS ARGUED THAT PENALTY PROCEEDINGS INITIATED IN ASSESSMENT ORDER U/S 143(3 )/SET ASIDE DATED 11 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. 18/3/2013 IS BAD IN LAW AS THE LD ASSESSING OFFICER HAD DROPPED THE PENALTY PROCEEDINGS AFTER SET ASIDE THE ORDER BY THE HONBL E ITAT, THIS IS BECAUSE, IN THE ORDER, NO ADDITION IS MADE. THE ONLY ADDITION WHICH WAS MADE WHILE FRAMING THE ORIGINAL ASSESSMENT WAS CONSIDERED AS SU CH, WHEREAS THERE IS NO REASON TO CONSIDER THE ORIGINAL ADDITION OF RS. 4,57,72,496/- IN SET ASIDE ASSESSMENT AS THIS ADDITION WAS NEITHER CHALLENGED B Y THE ASSESSEE NOR SET ASIDE BY THE HONBLE ITAT. THE AMOUNT ONLY, IN ADDITI ON TO THIS AMOUNT OF RS. 39,23,278/- WAS CHALLENGED BY THE ASSESSEE AND S AME WAS SET ASIDE BY THE HONBLE ITAT, WHICH HAS BEEN ACCEPTED BY THE ASS ESSING OFFICER AND NO ADDITION IN SET ASIDE PROCEEDING HAS BEEN MADE BY H IM. THEREFORE, PENALTY PROCEEDINGS INITIATED AT THE TIME OF SET ASIDE ASSE SSMENT IS ILLEGAL AND BAD IN LAW. THE HONBLE ITAT HAS SET ASIDE THE ORDER VIDE ORDER DATED 14/10/2011. AS PER SECTION 275(1)(A), THE PENALTY O RDER IS TO BE PASSED ON OR BEFORE 31/3/2012. THE ASSESSEE ONLY REQUESTED TO KEEP THE PENALTY PROCEEDING PENDING ONLY ADDITION SET ASIDE BY THE H ONBLE ITAT FOR RS. 39,23,278/- AND LD ASSESSING OFFICER WAS FREE TO IM POSE THE PENALTY ON REMAINING ADDITION IF INTENT TO DO SO ON REMAINING ASSESSED INCOME, WHICH HAS NOT BEEN CHALLENGED BY THE ASSESSEE. THE LD ASSE SSING OFFICER CONSIDERING THIS REPLY, HAD DROPPED THE PENALTY PRO CEEDINGS, THUS THE LEVY OF PENALTY WITH REFERENCE TO AMOUNT OF RS. 4,57,72,4 96/- IMPOSED BY THE 12 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. ASSESSING OFFICER ON 27/9/2013 IS BARRED BY LIMITAT ION. IT IS SETTLED LAW THAT ONCE THE ASSESSMENT OF A PARTICULAR ITEM OF INCOME IS FINAL, THE LD ASSESSING OFFICER HAS TO IMPOSE PENALTY QUA THAT ITEM WITHIN T HE LIMITATION WHICH RESPECT TO THE ORDER WHICH CONFERS SUCH FINALITY. LA W IS NOT AVERSE TO PASSING MULTIPLE PENALTY ORDERS FOR SAME ASSESSMENT YEAR, FOR WHICH HE RELIED ON THE FOLLOWING CASE LAWS:- (I) UP STATE BRIDGE CORPORATION LTD. VS DCIT 17 DTR 2 97 (LUCK-B BENCH). (II) PRAMOD KUMAWAT IN ITSSA NO. 178/JP/2005 DATED 2 2/2/2008. (III) CIT VS MORADABAD GENERAL ART METAL MILLS 282 ITR 510 (ALL). EVEN SET ASIDE ASSESSMENT ORDER DATED 18/3/2013, TH E LD ASSESSING OFFICER SIMPLY ISSUED NOTICE U/S 274 READ WITH SECTION 271(1 )(C) OF THE ACT. THUS, IT IS NOT STATED AS TO WHETHER THE PROCEEDINGS ARE I NITIATED FOR CONCEALMENT OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULA RS OF INCOME WITHOUT SPECIFYING ANY CHARGE AND INITIATION OF PENALTY PRO CEEDINGS IS VAGUE, NO PENALTY CAN BE LEVIED. HE RELIED ON THE DECISION IN THE CASE OF CIT VS MANJUNATHA COTTON & GINNING FACTORY & ORS. 359 ITR 565 (KAR.) WHEREIN NOTICE U/S 274 OF THE ACT SHOULD SPECIALLY STAYED T HE GROUNDS MENTIONED IN SECTION 271(1)(C) I.E. WHETHER IT IS FOR CONCEALMENT OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME, SENDIN G PRINTED FORM WHERE ALL 13 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. THE GROUNDS MENTIONED IN SECTION 271 OR MENTIONED WO ULD NOT SPECIFIED REQUIREMENT OF LAW. THE ASSESSEE SHOULD KNOW THE GROUN D WHICH HE HAS TO MEET SPECIFICALLY, OTHERWISE PRINCIPLES OF NATURAL J USTICE IS OFFENDED, ON THE BASIS OF SUCH PROCEEDINGS, NO PENALTY COULD BE IMPO SED TO THE ASSESSEE. TAKING UP OF PENALTY PROCEEDINGS ON ONE LIMB AND FIN DING THE ASSESSEE GUILTY OF ANOTHER LIMB IS BAD IN LAW. HE FURTHER REL IED ON THE FOLLOWING CASE LAWS:- (I) CIT VS MANU ENGINEERING WORKS 122 ITR 306 (GUJ)( HC) (II) CIT VS VIRGO MARKETING PVT. LTD. 171 TAXMAN 156 (DEL)(HC). (III) RADHA MOHAN MAHESHWARI VS. DCIT ORDER DATED 18 /3/2016 IN ITA NO. 773/JP/2013. THEREFORE, HE PRAYED TO DISMISS THE REVENUES APPEAL . 5. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. THE ASSESSEE ORIGINALLY FILED RETURN ON 31/10/2007 AT RS. 14,73,790/-. A SURVEY U/S 133A WAS CONDUCTED ON 26/2/2008 TO 28/2/2008. DURING THE COURSE OF SURVEY PROCEEDINGS, THE ASSESSEE ADMITTED ADDITIONAL INCOME FOR THE YEAR UN DER CONSIDERATION AT RS. 4,57,72,496/- ON ACCOUNT OF UNDISCLOSED EXPENDITURE /INVESTMENT TOWARDS PURCHASE OF LAND. HOWEVER, THE ADDITION WAS MADE BY T HE ASSESSING OFFICER AT RS. 4,96,95,774/-. THE ANOTHER ADDITION OF RS. 39 ,23,278/- WAS MADE BY 14 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. THE ASSESSING OFFICER, WHICH HAS BEEN DELETED BY THE LD CIT(A) VIDE ORDER DATED 08/2/2011. THE SAME WAS CHALLENGED BEFORE THE ITAT, THE ITAT HAD SET ASIDE THE PROCEEDING TO THE ASSESSING OFFICER. THEREAFTER, THE LD ASSESSING OFFICER HAS NOT MADE ANY ADDITION IN THE SET ASIDE ASSESSMENT ORDER. THE LD ASSESSING OFFICER IMPOSED PENALTY ON A DDITIONAL INCOME DISCLOSED BY THE ASSESSEE AT RS. 4,57,72,496/-, WHI CH HAS NOT BEEN CHALLENGED BEFORE THE LD CIT(A). THEREFORE, AFTER TH E ORIGINAL ASSESSMENT, THIS QUANTUM WAS FINAL. AS PER SECTION 275(1)(A) OF THE ACT, THE PENALTY ORDER OUGHT TO HAVE BEEN PASSED ON OR BEFORE 31/3/2 012 I.E. WITHIN ONE YEAR FROM THE END OF THE FINANCIAL YEAR IN WHICH THE LD CIT(A)S ORDER WAS RECEIVED BY THE DEPARTMENT. HOWEVER, PENALTY ORDER P ASSED ON 27/09/2013 BY THE LD ASSESSING OFFICER, THEREFORE, PENALTY ORD ER PASSED IS BARRED BY LIMITATION. 5.1 WE FURTHER FIND THAT THE PENALTY PROCEEDINGS IN ITIATED IN ORIGINAL ASSESSMENT HAS BEEN DROPPED BY THE LD ASSESSING OFF ICER VIDE D&CR NO. 87/135 DATED 27/3/2012. WHEN THERE IS NO ADDITION M ADE IN SET ASIDE PROCEEDINGS, NO PENALTY CAN BE IMPOSED ON RS. 4,57, 72,496/-. IN SET ASIDE ASSESSMENT ORDER, THE LD ASSESSING OFFICER HAS NOT SPECIFIED AT THE TIME OF INITIATION OF PENALTY PROCEEDINGS WHETHER PENALTY I S INITIATED FOR THE INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME. THE CASE LAWS 15 ITA NO. 415/JP/2015 DCIT VS M/S GRASS FIELD FARMS & RESORTS P. LTD. RELIED BY THE LD AR I.E. CIT VS MANJUNATHA COTTON & GINNING FACTORY & ORS. (SUPRA) IS SQUARELY APPLICABLE. THE COORDINATE BENCH ALSO CONSIDERED THIS ISSUE IN DETAIL IN THE CASE OF RADHA MOHAN MAHESHWAR I VS. DCIT (SUPRA) ON THE FACTS AND CIRCUMSTANCES OF CASE. ACCORDINGLY, WE UPHOLD THE ORDER OF THE LD CIT(A). 6. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 06/06/2016. SD/- SD/- YFYR DQEKJ VH-VKJ-EHUK (LALIET KUMAR) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 06 TH JUNE,2016 RANJAN* VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- THE DCIT, CIRCLE-2, JAIPUR. 2. IZR;FKHZ @ THE RESPONDENT- M/S GRASS FIELD FARMS & RESORTS P LT D., JAIPUR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO.415/JP/2015) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR