SHAH PRATAP INDUSTRIES P. LTD, MUMBAI V. DCIT CC 44, MUMBAI

ITA 4643/MUM/2014

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 3762 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2005-2006
• Appeal Filed On: 07-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJEEV KASHYAPDR
• Assessee Lawyers: NIDHI PATEL
• Keywords: Search and seizure; Principle of natural justice; Reasonable cause; Non compliance
• Section: 143(3); 142(1); 132

Judgement Text

, INCOME-TAX APPELLATE TRIBUNAL -EBENCH MUMBAI , . . , BEFORE S/SHRI RAJENDRA,ACCOUNTANT MEMBER AND C. N. PRASAD,JUDICIAL MEMBER /.ITA.S./4643TO4649/MUM/2014 /ASSESSMENT YEARS: 2005-06 TO 2011-2012 M/S. SHAH PRATAP INDUSTRIES PVT. LTD. 16, GUNDECHA CHAMBERS, NM ROAD, FORT MUMBAI-400 023. PAN:AAACS5494D VS. DCIT, CC-44 ROOM NO.656, 6 TH FLOOR, AAYAKAR BHAVAN, MK ROAD MUMBAI-20. ( /APPELLANT ) ( / RESPONDENT) REVENUE BY: - SHRI SANJEEV KASHYAP-DR ASSESSEE BY: MS. NIDHI PATEL / DATE OF HEARING : 26.07.2016 / DATE OF PRONOUNCEMENT : 03.08.2016 , 1961 254 )1( ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA, AM - CHALLENGING THE ORDER,DTD.13.05.14,OF THE CIT(A)-38 ,MUMBAI, THE ASSESSEE HAS FILED APPEALS FOR THE ABOVE MENTIONED SEVEN AY.S.AS THE ISSUE INVOLVED IN ALL THE APPEALS ARE COMMON,SO WE ARE DISPOSING THEM OFF BY A CONSOLIDATED ORDER. EFFECTIVE GOA FOR ALL THE YEARS IS UPHOLDING THE LE VY OF PENALTY,IMPOSED BY THE AO,U/S.271(1)(B) OF THE ACT. ITA/4643/MUM/2014-AY.2005-06. BRIEF FACTS: 2. A SEARCH AND SEIZURE ACTION U/S. 132 (1) OF THE ACT WAS CARRIED OUT IN THE CASE OF M/S JIK INDUSTRIES LTD.(JIKIL)AND AT THE PREMISE S OF THE CMD OF THE COMPANY,NAMELY,R G PARIKH ON 4.2.2011. THE ASSESSEE -COMPANY IS A SUBSIDIARY AND GROUP COMPANY OF JIKIL.DURING THE CO URSE OF SEARCH AND SEIZURE PROCEEDINGS CERTAIN INCRIMINATING DOCUMENTS AND THE COMPUTER BACKUPS WERE SEIZED, THAT PERTAINED TO THE ASSESSEE-COMPANY AS W ELL.NOTICES U/S.143(2) AND 142(1) OF THE ACT WERE ISSUED TO THE ASSESSEE ON 10.8.12 FOR THE AY.S. 2005-06 TO 2011-12. AS PER THE AO IT DID NOT COMPLY WITH TH E NOTICES ISSUED. IN VIEW OF 4643-49/M/14-SHAH PRATAP 2 NON COMPLIANCE BY IT, ON TWO OCCASIONS,A NOTICE U/S .271(1)(B)WAS ISSUED AND SERVED ON THE ASSESSEE ON 26.3.13.HOWEVER,THERE WAS NO COMPLIANCE OF THE ABOVE SHOW-CAUSE NOTICE ALSO. SUBSEQUENTLY,A SHOW C AUSE NOTICE,DTD.08.07.13 WAS AGAIN ISSUED TO THE ASSESSEE TO EXPLAIN AS TO W HY PENALTY U/S. 271(1)(B) SHOULD NOT BE LEVIED. IN RESPONSE TO THE SAME,VIDE ITS LETTER DTD.,23.7.2013,THE ASSESSEE-COMPANY STATED THAT THERE WERE EIGHT ASSES SEES IN THE GROUP,THAT 55 SEARCH ASSESSMENTS WERE IN PROGRESS, THAT THERE WAS MINOR DELAY IN SUBMISSION OF THE DETAILS.IT RELIED UPON THE CASE OF HINDUSTAN STEEL LTD. (83ITR26).AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE,THE AO H ELD THAT TWO STATUTORY NOTICES WERE ISSUED,THAT IT FAILED TO COMPLY WITH T HE NOTICES, THAT THE CASE LAW RELIED UPON BY IT WAS DISTINGUISHABLE.HE REFERRED T O THE CASE OF DHARMENDRA PROCESSORS(306ITR277),HOLDING THAT LEVY OF PENALTY WAS CIVIL LIABILITY AND WILFUL CONCEALMENT WAS NOT ESSENTIAL FOR ATTRACTING A CIVIL LIABILITY, THAT IT HAD DEFAULTED IN COMPLYING WITH THE NOTICES ISSUED U/S. 143(2) AND 142(1) OF THE ACT.HE LEVIED A PENALTY OF RS.10,000/- FOR EACH DEF AULT (RS.20,000 IN TOTAL), INVOKING THE PROVISIONS OF SECTION 271(1)(B) OF THE ACT. 3. AGGRIEVED BY THE ORDER OF THE AO,THE ASSESSEE PREF ERRED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY(FAA).BEFORE HIM THE ASSES SEE CONTENDED THAT DUE TO HUGE VOLUME OF INFORMATION,INDISPOSITION OF THE CHA IRMAN AND THE COMPULSIONS OF FREQUENT CHANGE OF PROFESSIONAL ADVISORS RESULTE D IN UNINTENDED DELAYS IN RESPONDING TO NOTICES ISSUED BY THE AO,THAT IT HAD NEITHER NEGLECTED /DEFAULTED NOR WILFULLY DELAYED IN COMPLYING WITH THE REQUIREM ENTS OF THE NOTICES,THAT IT HAD ONLY SOUGHT FOR REASONABLE TIME TO FURNISH THE REQUIRED INFORMATION, IT HAD FILED NECESSARY DETAILS/CLARIFICATIONS/REPLY FROM T IME TO TIME. 4. AFTER CONSIDERING THE SUBMISSION OF THE ASSESSEE AN D THE PENALTY ORDER,THE FAA HELD THAT AO HAD ISSUED NOTICES U/S.143(2) AND 142(1) OF THE ACT 10.8.12, THAT IT WAS NOT DISPUTED BY THE ASSESSEE THAT IT HA D NOT COMPLIED WITH THE NOTICES, 4643-49/M/14-SHAH PRATAP 3 THAT IT MUST HAVE EITHER COMPLIED WITH THE NOTICES OR SHOULD HAVE SOUGHT AN ADJOURNMENT IN WRITING, THAT IT NEITHER COMPLIED NO T SOUGHT ADJOURNMENT,THAT THE AO HAD TAKEN FURTHER FOLLOW UP ACTION BY ISSUE OF A PENALTY NOTICE ON 26.03.2013 U/S. 271(1)(B) OF THE ACT,THAT EVEN IN R ESPECT OF PENALTY NOTICE IT DID NOT RESPOND BY EITHER APPEARING PERSONALLY OR THROU GH AN AUTHORISED REPRESENTATIVE OR BY SUBMITTING SOME EXPLANATION WI TH REGARD TO THE REASONABLE CAUSE, THAT THE ASSESSEE HAD TAKEN A STAND THAT THE AO HAD COMPLETED THE ASSESSMENT U/S.143(3) R.W.S.153C OF THE ACT AND NOT U/S. 144, THAT IT HAD COMPLIED WITH THE NOTICES ISSUED, THAT PENALTY U/S. 271(1)(B) OF THE ACT WERE NOT LEVIABLE.THE FAA REFERRED TO CASE OF REPAKA SITARAM ASWAMY(42ITR829) OF THE HONBLE ANDHRA PRADESH HIGH COURT.HE FURTHER REFERR ED TO THE CASE OF STANDARD MERCANTILE COMPANY(160ITR613) AND HELD THAT IT WAS THE DUTY OF THE ASSESSEE TO SHOW CAUSE FOR NOT COMPLYING FOR THE NOTICE ISSU ED,THAT PERSONAL APPEARANCE WAS NOT REQUIRED FOR PROVIDING THE INFORMATION SOUG HT,THAT IT COULD HAVE SUPPLIED THE REQUIRED INFORMATION THROUGH AN AR,THA T IF NOTICES ISSUED COULD NOT BE COMPLIED WITH FOR ANY MEDICAL REASONS THE ASSESS EE SHOULD HAVE INFORMED THE AO BY SEEKING ADJOURNMENT ON THAT GROUND, THAT SUCH GROUND WAS NOT TAKEN BY THE ASSESSEE DURING THE PENALTY PROCEEDINGS,THAT T HE DATES OF SICKNESS OF CMD AND DATES OF HEARING WERE DIFFERENT, THAT IT WAS DI FFICULT TO ACCEPT THE MEDICAL GROUND AS REASONABLE CAUSE,THAT IF INFORMATION CALL ED FOR WAS VOLUMINOUS, NOTHING COULD HAVE PREVENTED IT FROM SEEKING ADJOUR NMENT ON THAT GROUND,THAT IT COULD HAVE ASKED FOR ADJOURNMENT WHILE CHANGING HIS TAX ADVISORS,THAT THE PURPOSE OF SECTION 271(1)(B) OF THE ACT WAS TO ENSU RE THAT THE ASSESSEES COMPLIED WITH THE NOTICES WITHIN REASONABLE TIME,TH AT IT HAD FAILED TO ESTABLISHED ANY REASONABLE CASUE,THAT THE AO WAS JUSTIFIED IN L EVYING PENALTY U/S. 271(1)(B) OF THE ACT. 5. BEFORE US,THE AUTHORISED REPRESENTATIVE (AR) REFERR ED TO THE CASES OF RAJENDRA G PARIKH (ITA/6944-6950/ MUM/2014,DATED 20 .6.2016) AND ORDER OF 4643-49/M/14-SHAH PRATAP 4 JIKIL DTD.18.2.2016(4759/MUM/2014 ).THE DEPARTMENT REPRESENTATIVE (DR) SUPPORTED THE ORDER OF THE FAA. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD.WE FIND THAT WHILE DECIDING THE APPEALS OF T HE GROUP CASES I.E. RAJENDRA G. PARIKH AND JIKIL(SUPRA),THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THOSE ASSESSEES,THAT THE TRIBUNAL HAD DELETED THE PENALTY LEVIED BY THE AO AND CONFIRMED BY THE FAA. WE WOULD LIKE TO PRODUCE THE RELEVANT PORTION OF THE ABOVE ORDERS. (ITA NOS.6944 TO 6950-MR.RAJENDRA G. PARIKH, DT.20.6.2016) 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND P ERUSED THE MATERIAL AVAILABLE ON RECORD. BEFORE COMING TO ANY CONCLUSION, WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION FROM THE ORDER OF THE TRIBUNAL DATED 18/02/2016 FOR READY RE FERENCE AND ANALYSIS:- THESE APPEALS HAVE BEEN FILED BY THE ASSESSEE AGAI NST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-38, MUMBAI {(IN SHORT CIT(A) }, DATED 30.05.2014 FOR THE ASSESSMENT YEARS 2005- 06 TO 2011-12, PASSED AGAINST THE PENAL TY ORDER PASSED BY THE ASSESSING OFFICER (IN SHORT AO) U/S 271(1)(B) OF THE ACT, INVOLVING COMMON ISSUE OF LEVY OF PENALTY ON THE FOLLOWING GROUNDS: 1.ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE COMMISSIONER OF INCOME TAX,(APPEALS)-38, MUMBAI ERRED IN UPHOLDING THE ACT ION OF THE ASSESSING OFFICER, MUMBAI IN LEVYING THE PENALTY UNDER SECTION 271(1)(B) OF THE INCOME TAX ACT, 1961. 2. THE APPELLANT CARVES TO LEAVE TO ADD, TO ALTER, TO AMEND, TO MODIFY AND TO SUBSTITUTE THE GROUNDS OF APPEAL AT ANY TIME BEFORE OR AT ANY TIME OF HEARING OF THE APPEAL. 2. DURING THE COURSE OF HEARING, ARGUMENTS WERE MAD E BY MS. NIDHI PATEL, AUTHORISED REPRESENTATIVE (AR) ON BEHALF OFTHE ASSESSEE AND BY SHRI K MOHANDAS, SENIOR DEPARTMENTAL REPRESENTATIVE (DR) ON BEHALF OF THE REVENUE. 3. SINCE, COMMON ISSUE IS INVOLVED IN THESE APPEAL S, THEREFORE, THESE WERE HEARD TOGETHER AND ARE BEING DISPOSED TOGETHER BY THIS ORDER. 3.1. DURING THE COURSE OF HEARING DETAILED ARGUMEN TS HAVE BEEN MADE BY MS. NIDHI PATEL, LEARNED COUNSEL OF THE ASSESSEE, ASSAILING THE ORDE R OF THE AO IN LEVYING THE PENALTY U/S 271(1)(B) FOR ALLEGED NON-COMPLIANCE OF NOTICE U/S 142(1) DATED 04.09.2012, ISSUED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. IT HAS BEEN SUBMI TTED THAT ASSESSEE WAS SICK COMPANY AND APPROVED BY BIFR VIDE ORDER DATED 26.08.2008. THE A SSESSEE HAS TWO DIRECTORS AND BOTH ARE ABOVE THE AGE OF 60 YEARS. THE CHEMICAL RECYCLING U NIT OF THE ASSESSEE WAS BADLY AFFECTED DUE TO FIRE IN JULY, 2004 AND OPERATION HAD TO BE DISCO NTINUED. FURTHER, DUE TO NEGATIVE NET WORTH THE COMPANY HAD TO SURRENDER ITS LICENSE TO RESERVE BANK OF INDIA. IT WAS FURTHER SUBMITTED THAT INCOME TAX SEARCH HAD TAKEN PLACE IN THE CASE OF COMPANY AND IN PURSUANCE TO THE SAME ASSESSMENT PROCEEDINGS OF SEVEN YEARS HAD BEEN COMM ENCED BY THE INCOME TAX DEPARTMENT, AND THE ASSESSEE COMPANY HAD NO STAFF OR INFRASTRUC TURE TO TAKE CARE OF SUCH A VOLUMINOUS WORK OF COLLECTION OF HUGE DETAILS AND DOCUMENTS FO R SEVEN YEARS AND MAKING REPRESENTATION 4643-49/M/14-SHAH PRATAP 5 BEFORE THE AO. THE FINANCIAL CONDITION OF THE COMPA NY WAS ALSO VERY BAD. UNDER THESE CIRCUMSTANCES THE AO CLAIMED TO HAVE ISSUE NOTICE U /S 142(1) DATED 04.09.2012 FIXING THE DATE OF HEARING ON 10TH SEPTEMBER, 2012. SHE SUBMIT TED THAT IT HAS NOT BEEN STATED BY THE AO BEFORE LEVYING THE PENALTY THAT THE NOTICE WAS DULY SERVED UPON THE ASSESSEE. SHE FURTHER SUBMITTED THAT IN ANY CASE, THE TIME GIVEN WAS TOO SHORT, AND AFTER EXCLUDING SATURDAY AND SUNDAY AND TIME TAKEN FOR DISPATCH AND DELIVERY, TH ERE WERE HARDLY TWO OR THREE DAYS AVAILABLE WITH THE ASSESSEE TO RESPOND. UNDER SUCH CIRCUMSTANCES THE AO DID NOT GIVE PROPER OPPORTUNITY OF HEARING. FURTHER, IN ANY CASE, SUBSE QUENTLY, THE ASSESSEE HAD SINCERELY ATTENDED AND SUBMITTED WHATEVER DETAILS AND DOCUMENTS WERE A VAILABLE WITH THE ASSESSEE, WHICH IS EVIDENT FROM THIS FACT THAT ASSESSMENT ORDER WAS FR AMED U/S 143(3) AND NOT U/S 144, AND THEREFORE, IT WAS NOT A FIT CASE FOR LEVY OF PENALT Y U/S. 271(1)(B). IN SUPPORT OF HER ARGUMENTS, SHE RELIED UPON THE JUDGMENT OF HONBLE SUPREME COU RT IN THE CASE OF M/S. HINDUSTAN STEEL LTD. 83 ITR 26 AND JUDGMENT OF HONBLE DELHI BENCH ITAT IN THE CASE OF AKHIL BHARTIYA PRATHMIK SHIKSHAK SANGH BHAVAN TRUST VS. ADIT 115 T TJ 419 (DEL.) IN NUTSHELL SHE SUBMITTED THAT THE PENALTY ORDER PASSED BY THE AO W AS UNFAIR AND FACTUALLY INCORRECT, UNJUSTIFIED AND CONTRARY TO LAW AND FACTS, AND THER EFORE, PENALTY LEVIED BY THE AO SHOULD BE DELETED. 3.2. PER CONTRA LD. DR RELIED UPON THE ORDERS OF T HE LOWER AUTHORITIES AND SUBMITTED THAT SINCE THERE WAS NONCOMPLIANCE ON THE PART OF THE AS SESSEE, THEREFORE, PENALTY WAS RIGHTLY LEVIED BY THE AO AND CONFIRMED BY LD. CIT(A). 3.3. WE HAVE GONE THROUGH THE FACTS OF THE CASE BR OUGHT BEFORE US. IT IS NOTED THAT IN PURSUANCE TO THE SEARCH, THE ASSESSMENT PROCEEDINGS OF SEVEN YEARS WERE COMMENCED BY THE INCOME TAX DEPARTMENT. THE ADMITTED FACTS ON RECORD ARE THAT THE ASSESSEE COMPANY WAS A SICK COMPANY, AND WAS UNDER THE SCHEME OF BIFR. WE HAVE FURTHER NOTED THAT IT HAS BEEN STATED BY THE AO WHILE LEVYING THE PENALTY THAT HE HAD ISSUED NOTICE U/S 142(1) DATED 04.09.2012 FIXING THE HEARING FOR 10.09.2012, AND S INCE NONCOMPLIANCE WAS MADE BY THE ASSESSEE ON 10.09.2012, AND THEREFORE, IT WAS A FIT CASE FOR LEVY OF PENALTY, AND ACCORDINGLY, PENALTY WAS LEVIED. WE ARE SURPRISED TO NOTE THAT T HE AO HAS NO WHERE MENTIONED IN THE ASSESSMENT OR PENALTY ORDER THAT WHETHER THE IMPUGN ED NOTICE WAS SERVED AT ALL UPON THE ASSESSEE. IT IS FURTHER NOTED THAT IMPUGNED NOTICE CLAIM TO BE ISSUED ON 04.09.2012, FIXED THE DATE FOR HEARING ON 10.09.2012. IF, WE EXCLUDE SATU RDAY AND SUNDAY AND THE TIME TAKEN FOR DISPATCH AND DELIVERY OF THE NOTICE, THE ASSESSEE W AS LEFT WITH HARDLY TWO OR THREE DAY TIME, EVEN IF THE NOTICE WAS DULY AND EXPEDIENTLY SERVED UPON THE ASSESSEE. FURTHER THERE IS NO CASE MADE OUT BY THE AO OF ANY OTHER NON-COMPLIANCE ON T HE PART OF THE ASSESSEE. RATHER, IT IS NOTED THAT SUBSEQUENTLY DETAILS AND DOCUMENTS WERE FILED BY THE ASSESSEE TO THE AO ON THE BASIS OF WHICH ASSESSMENT PROCEEDINGS WERE COMPLETE D AND ASSESSMENT ORDER WAS PASSED U/S 143(3) AND NOT U/S 144. THUS, IT SHOWS THAT SUBSEQU ENTLY, COMPLIANCE HAS BEEN MADE BY THE ASSESSEE. UNDER SUCH CIRCUMSTANCES, IN OUR CONSIDER ED OPINION WITHOUT GIVING ADEQUATE TIME AND WITHOUT MAKING OUT A CASE OF SUBSTANTIVE NON-CO MPLIANCE BY THE ASSESSEE, IT WAS UNFAIR AND UNJUSTIFIED ON THE PART OF THE AO IN LEVYING TH E PENALTY U/S 271(1)(B). IN THE TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT L EVY OF PENALTY WAS NOT JUSTIFIED. THE ACTION OF THE AO IS UNSUSTAINABLE IN THE EYES OF LAW, AND THEREFORE, WE DIRECT THE AO TO DELETE THE PENALTY. 4. IN THE RESULT, ALL ABOVE SEVEN APPEALS FILED BY THE ASSESSEE ARE ALLOWED. 2.1. WE FIND THAT WHILE LEVYING THE PENALTY U/S 271 (1)(B) OF THE ACT (AS IS OOZING OUT FROM PARA-2 OF THE PENALTY ORDER), THE ASSESSEE WAS ISSU ED NOTICE U/S 142(1) OF THE ACT ON 04/09/2012, FIXING THE COMPLIANCE BY THE ASSESSEE O N 10/09/2012. IT HAS NOT BEEN MENTIONED AS TO WHEN THE NOTICE WAS SERVED UPON THE ASSESSEE. IT IS ALSO NOTED THAT DURING THAT PERIOD, AS 4643-49/M/14-SHAH PRATAP 6 EXPLAINED BEFORE US, THE ASSESSEE WAS SUFFERING FRO M AILMENT, MEANING THEREBY, SUFFICIENT TIME/OPPORTUNITY FOR COMPLIANCE WAS NOT PROVIDED TO THE ASSESSEE. THIS IS CLEARLY VIOLATION OF PRINCIPLE OF NATURAL JUSTICE ON THE PART OF THE REV ENUE. IT IS NOTED THAT THE TRIBUNAL IN THE AFORESAID ORDER DATED 18/02/2016 HAS MADE AN ELABOR ATE DISCUSSION ON IDENTICAL FACT INCLUDING THE DECISION FROM HONBLE APEX COURT IN M /S HINDUSTAN STEEL LTD. 83 ITR 26 AND THE CASE OF THE ASSESSEE DELHI BENCH OF THE TRIBUNA L IN AKHIL BHARTIYA PRATHMIK SHIKSHAK SANGH BHAWAN TRUST VS ADIT 115 TTJ 419 (DEL.). IF W E EXCLUDE THE SATURDAY AND SUNDAY, FALLING WITHIN THE GIVEN TIME IN THE NOTICE, TIME T AKEN FOR DISPATCH AND DELIVERY OF THE NOTICE HARDLY TWO OR THREE DAYS LEFT WITH THE ASSESSEE. IT IS NOTED THAT THE LD. ASSESSING OFFICER HAS NOT MADE A GOOD CASE FOR NON COMPLIANCE ON THE PART OF THE ASSESSEE. CONSIDERING THE TOTALITY OF FACTS AND THE CIRCUMSTANCES NARRATED BEFORE US, WE DIRECT THE LD. ASSESSING OFFICER TO DELETE THE PENALTY, IMPOSED UPON THE ASSESSEE. THUS, THE I MPUGNED APPEALS ARE ALLOWED. FINALLY, THE APPEALS OF THE ASSESSEE ARE ALLOWED. ITA NO.4759/MUM/2014-JIK INDUSTRIES LTD., DT.18.2. 2016 READS AS UNDER:- 3.3. WE HAVE GONE THROUGH THE FACTS OF THE CASE BR OUGHT BEFORE US. IT IS NOTED THAT IN PURSUANCE TO THE SEARCH, THE ASSESSMENT PROCEEDING S OF SEVEN YEARS WERE COMMENCED BY THE INCOME TAX DEPARTMENT. THE ADMITTED FACTS ON RECOR D ARE THAT THE ASSESSEE COMPANY WAS A SICK COMPANY, AND WAS UNDER THE SCHEME OF BIFR. WE HAVE FURTHER NOTED THAT IT HAS BEEN STATED BY THE AO WHILE LEVYING THE PENALTY THAT HE HAD ISSUED NOTICE U/S 142(1) DATED 04.09.2012 FIXING THE HEARING FOR 10.09.2012, AND SINCE NON-COMPLIANCE WAS MADE BY THE ASSESSEE ON 10.09.2012, AND THEREFORE, IT WAS A FIT CASE FOR LEVY OF PENALTY, AND ACCORDINGLY, PENALTY WAS LEVIED. WE ARE SURPRISED TO NOTE THAT THE AO HAS NO WHERE MENTIONED IN THE ASSESSMENT OR PENALTY ORDER THAT WHETHER THE IMPUGN ED NOTICE WAS SERVED AT ALL UPON THE ASSESSEE. IT IS FURTHER NOTED THAT IMPUGNED NOTICE CLAIM TO BE ISSUED ON 04.09.2012, FIXED THE DATE FOR HEARING ON 10.09.2012. IF, WE EXCLUDE SATU RDAY AND SUNDAY AND THE TIME TAKEN FOR DISPATCH AND DELIVERY OF THE NOTICE, THE ASSESSEE WAS LEFT WITH HARDLY TWO OR THREE DAY TIME, EVEN IF THE NOTICE WAS DULY AND EXPEDIENTLY SERVED UPON THE ASSESSEE. FURTHER THERE IS NO CASE MADE OUT BY THE AO OF ANY OTHER NON-COMPLIANCE ON THE PART OF THE ASSESSEE. RATHER, IT IS NOTED THAT SUBSEQUENTLY DETAILS AND DOCUMENTS WERE FILED BY THE ASSESSEE TO THE AO ON THE BASIS OF WHICH ASSESSMENT PROCEEDINGS WERE COMPLET ED AND ASSESSMENT ORDER WAS PASSED IS] S 143(3) AND NOT IS] S 144. THUS, IT SHOWS THAT SU BSEQUENTLY, COMPLIANCE HAS BEEN MADE BY THE ASSESSEE. UNDER SUCH CIRCUMSTANCES, IN OUR CON SIDERED OPINION WITHOUT GIVING ADEQUATE TIME AND WITHOUT MAKING OUT A CASE OF SUBSTANTIATE NON-COMPLIANCE BY THE ASSESSEE, IT WAS UNFAIR AND UNJUSTIFIED ON THE PART OF THE AO IN L EVYING THE PENAL 271(1)(B). IN THE TOTALITY OF THE FACTS AND CIRCUMSTANCES CASE, WE FIND THAT LEV Y OF PENALTY WAS NOT JUSTIFIED. THE ACTION OF THE AO IS UNSUSTAINABLE IN THE EYES OF LAW, AND TH EREFORE WE DIRECT THE AO TO DELETE THE PENALTY. 4. IN THE RESULT, ALL ABOVE SEVEN APPEALS FILED THE ASSESSEE ARE ALLOWED. 4643-49/M/14-SHAH PRATAP 7 AS THE FACTS AND CIRCUMSTANCES OF THE CASE UNDER CO NSIDERATION ARE IDENTICAL TO THE FACTS OF THE ABOVE-MENTIONED TWO CASES, THEREFO RE, FOLLOWING THOSE ORDERS WE DECIDE THE EFFECTIVE GROUND OF APPEAL IN FAVOUR OF THE ASSESSEE. ITA.S./4644,TO4649/MUM/2014,AYS-2006-07 TO 2011-201 2 6. FOLLOWING THE ORDER FOR THE AY. 2005-06,EFFECTIVE G ROUND OF APPEAL,FOR ALL THE ASSESSMENT YEARS, IS DECIDED IN FAVOUR OF THE ASSES SEE. AS A RESULT ALL THE APPEALS, FILED BY THE ASSESSEE, STAND ALLOWED. . ORDER PRONOUNCED IN THE OPEN COURT ON 3 RD AUGUST,2016. 3 , 2016 SD/- S D/- ( . . / C.N. PRASAD ) ( / RAJENDRA ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI; DATED : 03 .08.2016. JV.SR.PS. / COPY OF THE ORDER FORWARDED TO : 1. APPELLANT / 2. RESPONDENT / 3. THE CONCERNED CIT(A)/ , 4. THE CONCERNED CIT / 5. DR E BENCH, ITAT, MUMBAI / , , . . . 6. GUARD FILE/ //TRUE COPY// / BY ORDER, / DY./ASST. REGISTRAR , /ITAT, MUMBAI.