Sri Surya Constructions, Suryapet, Hyderabad V. ITO, Suryapet, Suryapet

ITA 503/HYD/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6275 (ITAT-HYDERABAD)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 11-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E SUNIL BABU
• Assessee Lawyers: S RAMA RAO
• Keywords: Reasonable cause; Non compliance

Judgement Text

ITA 503 OF 2016 SRI SURYA CONSTRUCTIONS HYDERABAD PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD BEFORE SMT. P.MADHAVI DEVI, JUDICIAL MEMBER & SHRI S.RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO.503/HYD/2016 (ASSESSMENT YEAR: 2009-10) SRI SURYA CONSTRUCTIONS SURYAPET PAN: ABKFS 1420 P VS. INCOME TAX OFFICER SURYAPET (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI S. RAMA RAO FOR REVENUE : SHRI K.E. SUNIL BABU, DR DATE OF HEARING : 26.07.2016 DATE OF PRONOUNCEMENT : 24 .08.2016 O R D E R PER SMT. P. MADHAVI DEVI, J.M. THIS IS ASSESSEES APPEAL FOR THE A.Y 2009-10 AGAIN ST THE ORDER OF THE CIT (A) CONFIRMING THE PENALTY LEVIED BY THE AO U/S 271(1)(B) OF THE ACT. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSMENT WAS COMPLETED ON 30.12.2011 DETERMINING THE TOTAL INCOM E OF THE FIRM AT RS.22,38,010. WHILE COMPLETING THE ASSESSME NT, THE PENALTY PROCEEDINGS U/S 271(1)(B) OF THE ACT WERE A LSO INITIATED FOR FAILURE TO COMPLY WITH THE NOTICES ISSUED U/S 1 42(1) AND 143(2) OF THE ACT. PENALTY NOTICES WERE ISSUED TO T HE ASSESSEE REQUESTING THE ASSESSEE TO SHOW CAUSE AS TO WHY PEN ALTY SHOULD NOT BE LEVIED. THE ASSESSEE, REPRESENTED BY HIS C.A . APPEARED AND SUBMITTED THE REASONS FOR NON COMPLIANCE OF EAC H OF THE ITA 503 OF 2016 SRI SURYA CONSTRUCTIONS HYDERABAD PAGE 2 OF 4 NOTICE. AO WAS NOT CONVINCED WITH THE REASONS MENTI ONED BY THE ASSESSEE AND HELD THAT THE FAILURE OF THE ASSESSEE FIRM TO COMPLY WITH THE NOTICES ATTRACTS PENALTY U/S 271(1)(B) OF THE ACT. HE ACCORDINGLY LEVIED PENALTY OF RS.50,000 FOR FAILURE ON A TOTAL OF FIVE OCCASSIONS. AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT (A) WHO CONFIRMED THE ORDER OF THE A O AND THE ASSESSEE IS IN SECOND APPEAL BEFORE US. 3. THE LEARNED COUNSEL FOR THE ASSESSEE, SHRI S. RA MA RAO, FURNISHED BEFORE US, THE COPY OF THE LETTER DATED 1 3.06.2012 WHICH WAS GIVEN TO THE AO EXPLAINING THE REASONS FO R NON APPEARANCE BEFORE THE AO. AS PER THIS LETTER, THE F OLLOWING ARE REASONS FOR NOT ATTENDING THE HEARINGS: (A) ON 2 ND AUGUST,2011, I WAS AT HYDERABAD AND TAKEN ORAL PERMISSION FROM THE AO. I WOULD LIKE TO BRING TO YOUR NOTICE THAT THE SUBSEQUENT NOTICE WAS ISSUE D AFTER 2 AND MONTHS. (B) WE APPEARED BEFORE YOUR HONOR ON 29 TH OCTOBER, 2010 FOR YOUR LETTER DATED 7 TH OCTOBER, 2010 AND REQUESTED FOR CONDONATION OF DELAY. THE DELAY IS MA INLY BECAUSE OF AUDITORS ILL HEALTH AND THE SAME WAS REPORTED TO YOU IN THE LETTER DATED 29 TH OCTOBER, 2010 AND FILED ON THE SAME DAY. (C) MY BROTHER-IN-LAW (SISTERS HUSBAND AND WIFE FA THER) FELL ILL. MY ATTENDANCE WAS REQUIRED AT MY BROTHER- IN- LAWS PRESENCE VERY MUCH ON THE DAY OF HEARING. (D) MY BROTHER-IN-LAW WAS DIED ON 25 TH AUGUST, 2011 AND BUSY WITH SUBSEQUENT ACTIVITIES. HENCE NOT RESPONDED ON THE DAY OF HEARING. ITA 503 OF 2016 SRI SURYA CONSTRUCTIONS HYDERABAD PAGE 3 OF 4 (E) OUR AUDITOR WAS PRESENTED BEFORE THE COMMISSION ER OF APPEALS-VI IN ANOTHER CASE. HENCE NOT PRESENTED BEFORE YOUR HONOR. (F) ADJOURNMENT LETTER FILED BEFORE YOU ON 11 TH NOVEMBER, 2011. (G) WE ATTENDED BEFORE YOU ON 21 ST NOVEMBER, 2011 AND FILED THE REQUIRED INFORMATION TO THE EARLIER HEARING. SUBSEQUENTLY, WE RECEIVED LETTER DATED 22.11.2011 ASKING TO APPEAR BEFORE YOU ON 25 TH NOVEMBER, 2011. THE ABOVE SAID NOTICE WAS SERVED ON MY AR ON THE SAME DAY ON WHICH THE CASE IS POSTED F OR HEARING. (H) THE NOTICE WAS SERVED ON OUR AR ON 30 TH NOVEMBER, 2011 AND ASKED US TO APPEAR ON THE NEXT DAY WITHOUT REASONABLE GAP. IT IS EVIDENT FROM THE ABOVE THAT THE NON COMPLIANC E FOR YOUR NOTICES ARE NOT INTENTIONAL AND THERE IS A REASONABLE CAUSE AS EXPLAINED ABOVE. HENCE WE REQUEST YOU TO KINDLY NOT TO INITIATE THE PENALTY PROCEEDINGS U/S 271(1)(B) OF INCOME TAX ACT, 1961. 4. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED T HAT FROM THE ABOVE LETTER, IT CAN BE SEEN THAT THE ASSESSEE WAS PREVENTED BY REASONABLE CAUSE FOR NOT APPEARING BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS. THE LEARNED DR, HOWEVER, SU PPORTED THE ORDERS OF THE AUTHORITIES BELOW. 5. HAVING REGARD TO THE RIVAL CONTENTIONS AND THE M ATERIAL ON RECORD, WE FIND THAT THE ASSESSEE HAS ALLEGEDLY NOT APPEARED ON FIVE OCCASSIONS AND EXCEPT FOR TWO OCCASSIONS, ON T HE OTHER DATES THE ASSESSEE WAS PREVENTED BY REASONABLE CAUSE SUCH AS THE ASSESSEES BROTHER-IN-LAW/FATHER-IN-LAW FALLING SIC K AND THEREFORE, PASSING AWAY. ON TWO OCCASSIONS, THE ASS ESSEE WAS PRESENT EITHER IN PERSON OR THROUGH HIS REPRESENTAT IVE. ITA 503 OF 2016 SRI SURYA CONSTRUCTIONS HYDERABAD PAGE 4 OF 4 THEREFORE, WE ARE SATISFIED THAT THE ASSESSEE WAS P REVENTED BY REASONABLE CAUSE IN NOT APPEARING BEFORE THE AO. TH EREFORE, WE DELETE THE PENALTY LEVIED U/S 271(1)(B) OF THE ACT. 6. IN THE RESULT ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 24 TH AUGUST, 2016. S D/ - S D/ - (S.RIFAUR RAHMAN) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED 24 TH AUGUST, 2016. VNODAN/SPS COPY TO: 1. SHRI S. RAMA RAO, ADVOCATE, FLAT NO.102, SHRIYAS E LEGANCE, 3-6-643 STREET NO.9 HIMAYATNAGAR, HYDERABAD 500029 2. INCOME TAX OFFICER SURYAPET, NALGONDA DISTT. TELANG ANA 3. CIT(A) -3 HYDERABAD 4. PR. CIT 3 HYDERABAD 5. THE DR, ITAT, HYDERABAD 6. GUARD FILE BY ORDER