Shri Dwarkadas Daga, Faridabad V. ACIT, New Delhi

ITA 4815/DEL/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0207 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 11 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 14-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 12-08-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVI JAIN
• Keywords: Search and seizure; Non compliance
• Section: 143(3); 142(1); 153A; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH B , NEW DELHI) BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND SHRI J. S. REDDY, ACCOUNTANT MEMBER I.T.A. NO.4815, 4816, 4817 & 4818/DEL/2013 ASSESSMENT YEAR : 2007-08, 2008-09, 2009-10 & 2010- 11) SHRI DWARKADAS DAGA, VS. ACIT, CC-11, 704, ROYAL STREET, CHARMSWOOD NEW DELHI VILLAGE SURAJKUND, FARIDABAD GIR / PAN:ADIPD6424E (APPELLANT) (RESPONDENT) APPELLANT BY : NONE RESPONDENT BY : SHRI RAVI JAIN, CIT DR DATE OF HEARING : 14.07.2015 DATE OF PRONOUNCEMENT : 22.07.2015 ORDER PER J. S. REDDY, AM: THESE APPEALS BY THE ASSESSEE ARE DIRECTED AGAINST THE CONFIRMATION OF PENALTY BY LD. CIT(A) LEVIED U/S 271(1)(B) OF THE A CT BY THE A.O. AS THE ISSUE THAT ARISES IN ALL THESE APPEALS IS THE SAME, FOR THE SAKE OF CONVENIENCE, THEY ARE HEARD TOGETHER AND ARE BEING DISPOSED OF B Y WAY OF THIS COMMON ORDER. 2. NONE APPEARED ON BEHALF OF THE ASSESSEE. NOTICE S SENT TO THEM BY RPAD AT THE ADDRESS GIVEN AT COLUMN 10 OF FORM36 WE RE RETURNED BY THE POSTAL AUTHORITIES WITH THE REMARKS INCOMPLETE ADD RESS. UNDER THESE ITA NO.4815-18/DEL/2013 2 CIRCUMSTANCES, WE DISPOSE OF THESE APPEALS EX-PARTE , QUA THE ASSESSEE, AFTER HEARING LD.CIT D.R. SHRI RAVI JAIN. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE RE GULARLY FILED RETURN OF INCOME WAS FROM NAGPUR, MAHARASHTRA. A SEARCH AND SEIZURE OPERATION U/S 132 OF THE I. T. ACT, 1961 WAS CONDUCTED ON SHIV VA NI GROUP ON 06.01.2011. THEREAFTER, ALL THE GROUP CASES WERE C ENTRALIZED WITH CENTRAL CIRCLE, NEW DELHI. NOTICES PRIOR TO CENTRALIZATION WERE GIVEN TO THE ASSESSEE U/S 142(1) BY THE A.O. NAGPUR, MAHARASHTRA. IN RES PONSE, THE ASSESSEE FILED RETURN OF INCOME AFTER CENTRALIZATION OF GROUP CASE S. THE PENALTY U/S 271(1)(B) WAS LEVIED ON THE ASSESSEE FOR NON COMPLI ANCE TO THE NOTICES. FIRST APPELLATE AUTHORITY DELETED THE PENALTY FOR TWO YEA RS AND CONFIRMED PENALTY FOR FOUR YEARS THOUGH THE A.O. HAD LEVIED PENALTY F OR ALL THE SIX YEARS ON THE GROUND OF NON COMPLIANCE OF NOTICES. AGGRIEVED, TH E ASSESSEE IS IN APPEAL BEFORE US. 4. AFTER HEARING LD. D.R., WE HOLD AS FOLLOWS: THE LD. A.R. OF THE ASSESSEE AT NAGPUR AND HE WAS ATTENDING THE DEPARTM ENTAL HEARING AT DELHI. A PERUSAL OF THE ORDER PASSED U/S 153A READ WITH SE CTION 143(3) DEMONSTRATES THAT THE LD. A.R. ATTENDED THE ASSESSM ENT PROCEEDINGS IN COMPLIANCE WITH THE NOTICES AND CONSEQUENTLY ASSESS MENT ORDERS WERE FRAMED. UNDER THESE CIRCUMSTANCES, THE ISSUE IS, W HETHER THE PENALTY U/S 271(1)(B) CAN BE SUSTAINED. IN THE WRITTEN SUBMISS IONS, THE ASSESSEE RELIED ON THE DECISION OF ITAT G BENCH ORDER IN THE CASE OF AKHIL BHARTIYA PRATHMIK SHIKSHAK SANGH BHAWAN TRUST VS ACIT (2008) 115 TTJ 149 AS WELL AS A NUMBER OF OTHER DECISIONS IN THE ASSESSEE S GROUP CASES WHERE SIMILAR PENALTIES WERE DELETED. COPIES OF THESE DE CISIONS ARE ENCLOSED IN THE PAPER BOOK FILED BY THE ASSESSEE. AFTER PERUSING A LL THESE DECISIONS, WE FIND ITA NO.4815-18/DEL/2013 3 THAT DELHI E BENCH OF ITAT IN I.T.A.NO. 4834 TO 4 837/DEL/2013 IN THE CASE OF NATASHA GARG, ORDER DATED 07.02.2014 AT PAR A 5 & 6 HAS HELD AS UNDER: 5. AS PER THE PENALTY ORDER PARAGRAPH I, THE ASSES SING OFFICER HAS MENTIONED THAT THE PENALTY HAS BEEN LEVIED FOR THE ASSESSEE'S FAILURE TO COMPLY WITH THE NOTICES ISSUED UNDER SECTION 142(1) . HOWEVER, THE ASSESSMENT ORDER DATED 28TH MARCH, 2013 IS ON RECOR D AND PARAGRAPH 2 OF THE SAME READS AS UNDER:- '2. NOTICE UNDER SECTION 143(2) ISSUED ALONG WITH N OTICE UNDER SECTION 142(1) ON 18-01-2013. SH. KAILASH JOGANI CH ARTERED ACCOUNTANT & NITESH AGGARWAL, CHARTERED ACCOUNTANT, AUTHORIZED REPRESENTATIVES, ATTENDED THE ASSESSMENT PROCEEDINGS IN COMPLIANCE TO NOTICES UNDER SECTION 142(1) & 143(2) OF THE INCOME TAX ACT, 1961 AND FURNISHED IN FORMATION FROM TIME TO TIME. THE DETAILS/INFORMATION PRODUCED /FURNISH DURING THE COURSE OF ASSESSMENT PROCEEDINGS HAS BEE N EXAMINED AND PLACED ON RECORD. ' 6. FROM THE ABOVE, IT IS EVIDENT THAT THE ASSESSING OFFICER HIMSELF IN THE ASSESSMENT PROCEEDINGS HAS RECORDED THE FINDING THAT SHRI KAILASH JOGANI, CA AND SHRI NITESH AGGARWAL, CA, AUTHORIZED REPRESENTATIVES ATTENDED THE ASSESSMENT PROCEEDINGS IN COMPLIANCE T O NOTICE ISSUED UNDER SECTION 142(1) AND 143(2). HE COMPLETED THE A SSESSMENT AT THE INCOME RETURNED BY THE ASSESSEE I.E. ~1,80,290/-. I N VIEW OF THE ABOVE FACTUAL FINDING IN THE ASSESSMENT ORDER, WE ARE OF THE OPINION THAT THE ASSESSEE CANNOT BE SAID TO HAVE COMMITTED THE DEFAU LT OF NON- COMPLIANCE DURING ASSESSMENT PROCEEDINGS WHICH MAY SADDLE WITH THE LIABILITY OF PENALTY UNDER SECTION 27L(1)(B). ACCOR DINGLY, THE PENALTY LEVIED UNDER SECTION 27L(1)(B) FOR THE ALL THE YEAR S UNDER CONSIDERATION IS CANCELLED. 5. SIMILARLY, IN THE CASE OF PAIGAM IMPEX PRIVATE L IMITED VS ACIT IN I.T.A.NO. 4787 TO 4791/DEL/2013 ORDER DATED 06.02.2 014 TO WHICH ONE OF THE ASSESSEES IS A PARTY, AT PARA 5, HAS HELD AS FO LLOWS: ITA NO.4815-18/DEL/2013 4 5. HAVING HEARD THE LD. SF. DR AND PERUSED THE MAT ERIAL AVAILABLE ON RECORD IN THE ABOVE-MENTIONED FACTUAL MATRIX, WE ARE OF THE VIEW THAT IN THE FACTS OF THE PRESENT CASE THERE IS NOTH ING ON RECORD TO SHOW THAT PENAL ACTION WAS WARRANTED AS IN ALL THESE YEA RS ON THE SPECIFIC DATE VERY LITTLE TIME WAS GIVEN BY THE AO TO THE AS SESSEE TO OFFER EXPLANATION. MOREOVER, THE RETURNED INCOME WAS ACCE PTED VIDE ORDER U/S 153A R.W.S 143(3) FOR EACH OF THE YEARS EVIDENT FROM THE COPIES FILED. IN THESE FACTS IT CAN BE SAFELY CONCLUDED TH AT THE SUBSEQUENT COMPLIANCE IN ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD COMPLIANCE AND THE DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE AO WHICH ARE THE PRINCIPLES LAID DOWN BY THE DECISI ON BY THE CO- ORDINATE BENCH IN THE CASE OF AKHIL BHARTIYA PRATHR NIK SHIKSHAK SANGH BHAWAN TRUST VS ACIT (2008) 115 TTJ (DELHI) 4 19 RELIED UPON BY THE ASSESSEE IN ITS GROUND NO-4 AND WHICH HAS BE EN FOLLOWED IN VARIOUS ORDERS BY CO-ORDINATE BENCHES. REFERENCE MA Y BE MADE TO ORDER DATED 31.01.2014 IN THE CASE OF M/S MANJUSHA MADAN VS DCIT IN ITA NO-4698 TO 4703/DE1L2013. FOR READY-REFERENC E WE REPRODUCE FROM THE SAID ORDER AS UNDER:- '7. WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS AN D PERUSED THE RECORDS. WE FIND CONSIDERABLE COGENCY IN THE LD. CO UNSEL OF THE ASSESSEE'S SUBMISSION THAT THE SHOW CAUSE NOTICE DO ES NOT MENTION ABOUT THE NON-COMPLIANCE OF NOTICE ON WHICH PENALTY HAS BEEN LEVIED. HENCE, ASSUMPTION OF JURISDICTION IS NOT PROPER. WE FURTHER FIND THAT IN THESE CASES THE AO HAS ASKED EXPLANATION OF QUES TIONS AND ASSESSEE WAS GIVEN ONLY 7 DAYS TIME. IN THESE CIRCUMSTANCES, IN OUR CONSIDERED OPINION, THE ASSESSEE WAS NOT GIVEN PROPER OPPORTUN ITY AND IN THE SAME SITUATION THIS TRIBUNAL IN ITA NO. 42391DEL120 I3 IN THE CASE OF SHIVAANSB ADVERTISING AND PUBLICATIONS (P) LTD. VID E ITS ORDER DATED 3.1.2014 HAS DELETED THE SIMILAR PENALTY HOLDING AS UNDER:- 'WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATER IAL PLACED BEFORE US. THE PENALTY HAD BEEN LEVIED BY THE ASSES SING OFFICER FOR NON-COMPLIANCE OF THE NOTICE DATED B.II.2010. F ROM THE ASSESSMENT ORDER, IT IS EVIDENT THAT THE NOTICE UND ER SECTION 142(/)1143(2) DATED B.//.20/O ALONG WITH THE DETAIL ED QUESTIONNAIRE WAS ISSUED FIXING THE CASE FOR IB.II. 2010. THESE DETAILS HAVE BEEN MENTIONED BY THE ASSESSING OFFICE R IN PARAGRAPH 2 PAGE I OF THE ASSESSMENT ORDER. THUS, T OTAL TEN ITA NO.4815-18/DEL/2013 5 DAYS' TIME WAS ALLOWED FROM THE DATE OF ISSUE OF TH E NOTICE. IN THE ASSESSMENT ORDER, THE ASSESSING OFFICER HAS NOT MENTIONED THE DATE ON WHICH SUCH NOTICE WAS SERVED UPON THE A SSESSEE. THEREFORE, IN OUR OPINION, THE TIME OF LESS THAN TE N DAYS ALLOWED BY THE ASSESSING OFFICER FOR COMPLYING WITH THE DET AILED QUESTIONNAIRE CANNOT BE SAID TO BE A SUFFICIENT TIM E BEING ALLOWED TO THE ASSESSEE AND, THEREFORE, FAILURE OF THE ASSESSEE TO COMPLY WITH SUCH NOTICE CANNOT BE SAID TO BE A DEFA ULT WHICH MAY JUSTIFY THE LEVY OF PENALTY UNDER SECTION 271 ( I )((B) OF THE ACT. ACCORDINGLY, THE SAME IS CANCELLED. ' 8. FURTHERMORE, WE ALSO NOTE THAT ASSESSMENT IN THI S CASE WERE COMPLETED U/S. 143(3) OF THE I. T. ACT, IT DOES MEA N THE SUBSEQUENT COMPLIANCE IN THE ASSESSMENT PROCEEDINGS WAS CONSID ERED AS GOOD COMPLIANCE. THE DECISION RELIED UPON BY THE LD. COU NSEL OF THE ASSESSEE AS ABOVE ALSO COME TO THE RESCUE OF THE AS SESSEE. 6. CONSISTENT WITH THE VIEW TAKEN THEREIN, WE CANC EL ALL THE PENALTY LEVIED U/S 271(1)(B) TO THE EXTENT IT IS SUSTAINED BY THE FIRST APPELLATE AUTHORITY AS THE ASSESSEE HAS COOPERATED AND COMPLI ED WITH THE NOTICE U/S 142(1) AND 143(2) AND THE A.O. HAS PASSED ORDER U/S 143(3) OF THE ACT. MOREOVER, THE ASSESSEE HAS DEMONSTRATED THAT IT WAS PREVENTED BY SUFFICIENT CAUSE FOR ATTENDING PROCEEDINGS BEFORE THE FIRST AP PELLATE AUTHORITY AND TAKEN ADJOURNMENTS ON ALL THE EARLIER OCCASIONS FOR THE R EASON THAT THE COUNSELS WERE FROM NAGPUR. 7. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE A RE ALLOWED. 8. ORDER PRONOUNCED IN THE OPEN COURT ON 22 ND JULY 2015. SD./- SD./- ( DIVA SINGH) (J. S. REDDY) JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 22 ND JULY, 2015 SP ITA NO.4815-18/DEL/2013 6 COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DEL HI. TRUE COPY. BY ORDER (ITAT, NEW DELHI). S.NO. DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 20/7 SR. PS/PS 2 DRAFT PLACED BEFORE AUTHOR 21 SR. PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/AM 5 APPROVED DRAFT COMES TO THE SR. PS/PS 22/7/15 SR. PS/PS 6 KEPT FOR PRONOUNCEMENT 22/7 SR. PS/PS 7 FILE SENT TO BENCH CLERK 23/7 SR. PS/PS 8 DATE ON WHICH THE FILE GOES TO HEAD CLERK 9 DATE ON WHICH FILE GOES TO A.R. 10 DATE OF DISPATCH OF ORDER