Mahesh Wood Products (P) Ltd., Delhi V. ACIT, New Delhi

ITA 4387/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 91386 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Next Hearing Date: 10-07-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 18-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Assessee Lawyers: SURESH K GUPTA
• Keywords: Search and seizure; Reasonable cause
• Section: 273B; 143(3); 142(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : E : NEW DELHI BEFORE SHRI R.S. SYAL, AM AND SHRI A.T. VARKEY, JM ITA NOS.4387 TO 4393/DEL/2013 ASSESSMENT YEARS : 2004-05 TO 2010-11 MAHESH WOOD PRODUCTS (P) LTD., 2042, KATRA TABACCO, KHARI BAOLI, DELHI. PAN: AAACM0118Q VS. ACIT, CENTRAL CIRCLE-3, NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SURESH K. GUPTA, CA DEPARTMENT BY : SHRI P. DAM KANUNJNA, SR. DR DATE OF HEARING : 10.07.2015 DATE OF PRONOUNCEMENT : 10.07.2015 ORDER PER R.S. SYAL, AM: THESE SEVEN APPEALS BY THE ASSESSEE RELATING TO AS SESSMENT YEARS 2004-05 TO 2010-11 ARE DIRECTED AGAINST THE CONFIRM ATION OF PENALTY AMOUNTING TO RS.10,000 U/S 271(1)(B) OF THE INCOME- TAX ACT, 1961 ITA NOS.4387 TO 4393/DEL/2013 2 (HEREINAFTER ALSO CALLED `THE ACT) FOR EACH OF THE YEARS UNDER CONSIDERATION. SINCE ALL THESE APPEALS ARE BASED ON IDENTICAL FACTS AND COMMON GROUNDS OF APPEAL, WE ARE, THEREFORE, PROCEE DING TO DISPOSE THEM OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. BRIEFLY STATED, THE FACTS OF THE ASSESSMENT YEAR 2004-05 ARE THAT A SEARCH AND SEIZURE OPERATION WAS CONDUCTED ON MAHES H MEHTA GROUP OF CASES ON 30.6.2009. THE ASSESSEE WAS ALSO COVERED UNDER THE SEARCH. NOTICE U/S 143(2) AND 142(1) FIXING THE DATE OF HEA RING ON 1.7.2011 WAS ISSUED. SOMEBODY APPEARED ON BEHALF OF THE ASSESSE E AND SOUGHT ADJOURNMENT. ACCORDINGLY, THE CASE WAS ADJOURNED T O 18.7.2011. ON THAT DATE, THE ASSESSEE DID NOT APPEAR. SHOW CAUSE NOTICE U/S 271(1)(B) WAS ISSUED AND, RESULTANTLY, PENALTY OF RS.10,000/- WAS IMPOSED FOR THE DEFAULT OF THE ASSESSEE IN NOT APPEARING ON 18.7.20 11. THE LD. CIT(A) UPHELD THE PENALTY. FACTS FOR THE OTHER YEARS ARE A DMITTEDLY SIMILAR TO THE A.Y. 2004-05. 3. AFTER CONSIDERING THE RIVAL SUBMISSIONS AND PERU SING THE RELEVANT MATERIAL ON RECORD, IT IS OBSERVED THAT THE ASSESSE E FURNISHED AFFIDAVIT ITA NOS.4387 TO 4393/DEL/2013 3 BEFORE THE AUTHORITIES BELOW GIVING REASONS FOR ITS INABILITY TO APPEAR BEFORE THE AO ON THE STIPULATED DATE. IT CAN BE OB SERVED THAT THIS IS THE FIRST AND ONLY INSTANCE WHEN THE ASSESSEE DID NOT A PPEAR AND IT HAS BEEN VISITED WITH THE PENALTY. APART FROM THAT, ON ALL OTHER OCCASIONS THE ASSESSEE PARTICIPATED IN THE ASSESSMENT PROCEEDINGS AND THE ASSESSMENTS HAVE BEEN EVENTUALLY FINALIZED U/S 143(3) OF THE AC T. 4. SECTION 271(1)(B) PROVIDES FOR IMPOSING PENA LTY ON THE FAILURE OF THE ASSESSEE TO COMPLY WITH NOTICE, INTER ALIA , U/S 143(2) OR 142(1) OF THE ACT. IN CASE OF SUCH FAILURE, A PENALTY EQUAL TO R S.10,000/- FOR EACH SUCH FAILURE IS IMPOSABLE. HOWEVER, IT IS RELEVANT TO N OTE THAT SECTION 273B WAVING CERTAIN PENALTIES ON THE ASSESSEE SHOWING RE ASONABLE CAUSE FOR THE DEFAULT, ALSO COVERS SECTION 271(1)(B) OF THE A CT. ON A CONJOINT READING OF SECTION 271(1)(B) AND SECTION 273B, IT B ECOMES APPARENT THAT IF THERE IS A REASONABLE CAUSE FOR THE FAILURE OF T HE ASSESSEE IN COMPLYING WITH THE REQUIREMENTS STIPULATED U/S 271(1)(B), TH EN SUCH PENALTY, THOUGH LEVIABLE FOR THE DEFAULT, SHALL NOT BE IMPO SED BY VIRTUE OF SECTION 273B OF THE ACT. TURNING TO THE FACTS AND CIRCUMST ANCES OF THE INSTANT ITA NOS.4387 TO 4393/DEL/2013 4 CASE, WE FIND THAT THE ASSESSEE WAS UNABLE TO APPEA R BEFORE THE AO ON THE STIPULATED DATE DUE TO THE REASONS BEYOND ITS C ONTROL AS HAS BEEN MENTIONED IN THE AFFIDAVIT. WE ARE SATISFIED WITH THE GENUINENESS OF SUCH REASONS. UNDER SUCH CIRCUMSTANCES, THE FAILUR E TO COMPLY WITH THE NOTICES CAN BE SAID TO HAVE BEEN OCCURRED DUE TO RE ASONABLE CAUSE, THEREBY, COVERING THE CASE WITHIN THE AMBIT OF SECT ION 273B OF THE ACT. WE, THEREFORE, DIRECT THE DELETION OF PENALTY CONFI RMED FOR ALL THE YEARS UNDER CONSIDERATION. SIMILAR VIEW HAS BEEN TAKEN B Y THE TRIBUNAL IN OTHER GROUP COMPANIES OF THE ASSESSEE. A COPY OF T HE TRIBUNAL ORDER DATED 17.1.2014 IN ITA NO.4378/DEL/2013, HAS BEEN P LACED ON RECORD. IN THIS CASE ALSO, THE TRIBUNAL WAS PLEASED TO DELE TE PENALTY UNDER IDENTICAL CIRCUMSTANCES. 5. IN THE RESULT, ALL THE APPEALS ARE ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 10.07.201 5. SD/- SD/- [A.T. VARKEY] [R.S. SYAL] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED, 10 TH JULY, 2015. ITA NOS.4387 TO 4393/DEL/2013 5 DK COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.