SARDAR SINGH RATHORE, JAIPUR V. INCOME TAX OFFICER, WARD 4(5), JAIPUR

ITA 47/JPR/2023

AI Insights

This case involves an appeal by Sardar Singh Rathore against the order of the National Faceless Appeal Centre (NFAC/CIT(A)), which confirmed a penalty of Rs. 6,63,370 imposed by the Income Tax Officer (ITO) under section 271(1)(c) of the Income Tax Act, 1961. The penalty was based on the assessee's failure to explain the source of a cash deposit of Rs. 26,33,500 in his bank accounts during the financial year 2010-11. The CIT(A) dismissed the appeal due to a delay in filing, which the assessee attributed to a misunderstanding of the procedural requirements, believing the penalty appeal could be postponed until the resolution of the quantum appeal. The Tribunal noted the procedural lapses but emphasized the need for justice and equity, given the interconnection between the quantum and penalty appeals.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 132393 (ITAT-JAIPUR)
• Duration Of Justice: 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 13-03-2023
• Assessment Year: 2011-2012
• Appeal Filed On: 26-01-2023
• Other Referred Cases: Shri Dharamraj Singh vs. ITO
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Bonafide belief; Reasonable cause
• Section: 68; 148; 271(1)(c); 144; 274; 48

Judgement Text

vk;dj vihyh; vf/kdj.k] t;iqj U;k;ihB] t;iqj IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”SMC” JAIPUR MkWa- ,l-lhrky{eh] U;kf;d lnL; ,oa Jh jkBksM deys'k t;UrHkkbZ] ys[kk lnL; ds le{k BEFORE: DR. S. SEETHALAKSHMI, JM & SHRI RATHOD KAMLESH JAYANTBHAI, AM vk;dj vihy la-@ITA. No. 47/JPR/2023 fu/kZkj.k o"kZ@Assessment Years : 2011-12 Sardar Singh Rathore 304, Subhash Colony, Shastri Nagar, Jaipur. cuke Vs. ITO, Ward- 4(5), Jaipur. LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AEDPR 5993 L vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@ Assessee by : Shri Rohan Sogani (C.A.) jktLo dh vksj ls@ Revenue by : Ms Monisha Choudhary (Addl. CIT) lquokbZ dh rkjh[k@ Date of Hearing 14/03/2023 mn?kks"k.kk dh rkjh[k@Date of Pronouncement : 20/03/2023 vkns'k@ ORDER PER: DR. S. SEETHALAKSHMI, J.M. This is an appeal filed by the assessee against the order of the National Faceless Appeal Centre, Delhi [hereinafter referred to as “NFAC/CIT(A)”], dated 30.11.2022 for the assessment year 2011-12, which in turn arises from the order passed u/s 271(1)(c) of the Income Tax Act, 1961 ( in short ‘ the Act’) by the Income Tax Officer, ward-4(5), Jaipur dated 25.04.2019. ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 2 2. The assessee has raised the following grounds:- “1. In the facts and circumstances of the case and in law, the ld. CIT(A) has erred on confirming the imposition of penalty amounting to Rs. 6,63,370/-. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by deleting the penalty imposed of Rs. 6,63,370/-. 2. In the facts and circumstances of the case and in law, the ld. CIT(A) has erred in not condoning the delay in filing the appeal and dismissing the appeal of the assessee at the threshold. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Appropriate relief may please be granted. 3. In the facts and circumstances of the case and in law, the ld. CIT(A) has erred in passing the ex-parte order without deciding the case on merits. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by quashing such order. 4. The assessee craves his rights to add, amend or alter any of the grounds on or before the hearing.” 3. The brief facts of the case are that as per AIR information generated through AST system the assessee had deposited cash of Rs. maintained in SBBJ, Gopalbari, Jaipur Rs. 26,33,500/- in his savings bank account and ICICI Bank during the Financial year 2010-11 relevant to A.Y.2011-12. Though, in the absence of full and true particulars reliance is placed on AIR information available on record. In respect of ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 3 the aforementioned cash deposit/credit transactions of Rs. 26,33,500/- no compliance was made by the assessee during the course of the whole proceedings and no return of income was filed in response to the notice issued u/s 148 of the IT Act, 1961. Therefore, the assessee failed to furnish any satisfactory explanation /justification with regard to the source of the cash deposit/credit transactions made during the year. Therefore, cash deposit/credit transactions made to the tune of Rs. 26,33,500/- is treated as unexplained credit within the meaning of provisions of section 68 of the IT Act, 1961. Accordingly an addition of Rs. 26,33,500/- is made to the total income of the assesses. 4. The ld. AO observed that the assessee has furnished inaccurate particulars of income and thereby concealed the income to the tune of Rs. 26,33,500 as per the assessment order u/s 144 r.w.s. 147 dated 08.10.2018. Therefore, he is liable for imposition of penalty u/s 274 r.w.s. 271(1)(c) of the Act on the concealed income. Accordingly, penalty of Rs. 6,63,370/- u/s 271(1)(c) which is 100% of tax sought to be evaded is hereby imposed, calculated as under:- 1. Tax on total income including conceal income Rs. 6,63,370/- ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 4 2. Tax on income excluding concealed income Rs. 0/- 3. Tax sorted to be evaded (1-2) Rs. 6,63,370/- 4. 100% of tax sought to be evaded Rs. 6,63,370/- 5. 300% of tax sought to be evaded Rs. 19,90,110/- Penalty u/s 271(1)(c) is imposed for Rs. 6,63,370/- being 100% of tax sought to be evaded. 5. The assessee has filed the appeal before the ld. CIT(A) who after hearing the contention of the assessee dismissed the appeal of the assessee by giving his following relevant findings on the issues:- “ The appellant has filed the appeal on 02.10.2020 against the order received by it on 27.08.2020, which is belated as per Section 249(2) of the I.T. Act, 1961. The appellant has claimed to have received the certified true copy of the order under consideration on 27.08.2020. However, from the perusal of the attached copy of the assessment order, it is clear that the appellant had received the order on time as no certification by the Assessing Officer is apparent on the face of the assessment order with regard to the certified copy being given to the appellant after such a long delay of six months, which is the mandatory procedure adopted by AO while handing over the copy of assessment order on request. Moreover, even if the claim of the appellant regarding the late service of the order is considered, the appeal has been filed after a period of 36 days after the receipt of order, as claimed by the appellant, thereby resulting into a overall delay in filing of appeal. Therefore, considering the above facts, it is ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 5 clear that there is no reasonable cause of delay in filing the appeal. Hence, the appeal of the appellant is not admitted and condonation of delay is not granted. 5. As a result, the appeal is dismissed.” 6. The ld. AR for the assessee appearing before us submitted that the assessee was under the bonafide belief that the since his quantum appeal is pending, the penalty appeal may not persuaded and therefore, under that bonafide believe he remained non-compliant before the ld. CIT(A). The ld. AR for the assessee has submitted that an affidavit stating that the quantum appeal is pending for disposal that he sought adjournment in quantum appeal on 07.11.2022, notice for enablement was issued in quantum appeal. The said quantum appeal is pending for disposal under Appeal No. NFAC/2010-11/10009042. The screenshot of the Income Tax Portal evidencing the said appeal is placed on record. That on 07.11.2022 notice for enablement was also issued in penalty appeal. That the ld. CIT(A) vide order dated 30.11.2022 decided the penalty appeal before the quantum appeal. 7. On the other hand, ld. Sr. DR supported the order of the ld. CIT(A) and submitted that the assessee remained non-compliant to the three notices issued and has not submitted any justifiable reason so as to ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 6 remain non attentive to the notices so issued. At the same time looking to the arguments of the ld. AR, she has fairly admitted that in the interest of justice let this the issue be restored to the file of the ld. CIT(A) as the quantum appeal of the assessee is pending before ld. CIT(A). 8. We have heard both the parties, perused materials available on record. To support the contention the ld. AR for the assessee was directed to file proof of pendency of appeal and the affidavit by the bench. The ld. AR for the assessee submitted vide his letter dated 01.03.2023 filed the screen shot and affidavit of the assessee. From the screen shot submitted as extracted from the system it is clear that the quantum appeal of the assessee pending. This is fact is also declared by the assessee in his sworn affidavit filed by him. The content of the affidavit is reproduced here in below : “Affidavit I, Sardar Singh Rathore, Aged 48 years, resident of Plot No. 304 subhash Colony, Shastri Nagar, jaipur, do hereby declare on oath as under: 1. That I am regularly assessed to tax and my PAN is AEDPR 5993L. 2. That assessment u/s 147 for A.Y. 2011-12 was completed in my case vide order dated 08.10.2018. Addition of Rs. 26,33,500 was made. Aggrieved by the said order, I preferred appeal before CIT(A). ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 7 3. That resultant penalty u/s 271(1)(c) amount to Rs. 6,63,370/- was imposed vide order dated 24.04.2019. Aggrieved by the said order, I preferred appeal before ld. CIT(A). 4. That both quantum appeal and penalty appeal were fixed. 5. That I sought adjournment in quantum appeal on 07.11.2022 notice for enablement was issued in quantum appeal. The said quantum appeal is pending for disposal under Appeal No. NFAC/2010-11/10009042. The screenshot of the Income Tax Portal evidencing the said appeal is placed on record. 6. That on 07.11.2022 notice for enablement was also issued in penalty appeal. 7. That the ld. CIT(A) vide order dated 30.11.2022 decided the penalty appeal before the quantum appeal.” 8.1 Further, the ld. AR for the assessee has strongly supported his arguments with this Hon’ble Bench order in case of Shri Dharamraj Singh vs. ITO in ITA No. 438/JPR/2022 dated 20.02.2023 wherein held as under:- “7.1 The Bench also noted from the entire episode that the assessee is deprived off to get the justice from the judicial authorities below because of technical latches as quantum appeal of the assessee has direct bearing on the levy of penalty and the same is pending before ld. CIT(A) and the assessee merely on technical ground deprived off from the justice which should not be done. Hence, the Bench in the interest of equity and justice restores the appeal of the assessee to the file of the ld. CIT(A) for afresh adjudication taking into consideration the fact that the quantum appeal of the assessee is also pending before ld. CIT(A). The assessee is also directed not take adjournment on frivolous ground and cooperate the ld. CIT(A) for adjudication of the appeals filed by the assessee.” ITA No. 47/JPR/2023 Sardar Singh Rathore vs. ITO 8 Since the issue involved in the appeal of the assessee for the assessment year 2011-12 is similar to the appeal in the case of Shri Dharamraj Singh vs. ITO (supra) therefore, the decision taken by us in the case of Shri Dharamraj Singh vs. ITO (supra) shall apply mutatis mutandis, Thus, the appeal of the assessee is allowed for statistical purpose. In the result, the appeal of the assessee is allowed for statistical purposes. Order pronounced in the open Court on 20/03/2023. Sd/- Sd/- ¼ jkBksM deys'k t;UrHkkbZ ½ ¼ MkWa-,l-lhrky{eh½ (RATHOD KAMLESH JAYANTBHAI) (Dr. S. Seethalakshmi) ys[kk lnL; @Accountant Member U;kf;d lnL;@Judicial Member Tk;iqj@Jaipur fnukad@Dated:- 20/03/2023. *Santosh vkns'k dh izfrfyfi vxzsf’kr@Copy of the order forwarded to: 1. vihykFkhZ@The Appellant- Sardar Singh Rathore, Jaipur. 2. izR;FkhZ@ The Respondent- ITO, Ward-4(5), Jaipur. 3. vk;dj vk;qDr@ CIT 4. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur. 5. xkMZ QkbZy@ Guard File { ITA No. 47/JPR/2023} vkns'kkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar