M/s Cosmopolitan Solution Pvt. Ltd., Surat V. Income tax Officer, -1(1)(2), Surat

ITA 51/SRT/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1808 (ITAT-SURAT)
• Duration Of Justice: 1 year(s) 2 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-07-2022
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 02-06-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 04-05-2021
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 148; 144; 143(3); 142(1); 274

Judgement Text

आयकर अपीलȣय अͬधकरण, स ु रत Ûयायपीठ, स ु रत IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JUDICIAL MEMBER AND Dr ARJUN LAL SAINI, ACCOUNTANT MEMBER आ.अ.सं./ITA No.51/SRT/2021 (AY 2012-13) (Hearing in Physical Court) M/s Cosmopolitan Solution Pvt. Ltd., 1/1446 Hari Om Nivas, Babu Nivas Lane, Surat-395006 PAN : AADCC 8591 N Vs Income Tax Officer,Ward-1(1)(2), Surat अपीलाथȸ/Appellant Ĥ×यथȸ /Respondent Ǔनधा[ǐरती कȧ ओर से /Assessee by None (written submission) राजèव कȧ ओर से /Revenue by Shri Abhishek Gautam, Sr- DR सुनवाई की तारीख/Date of hearing 03.06.2022 उɮघोषणा कȧ तारȣख/Date of pronouncement 26.07.2022 Order under section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee is directed against the order of ld. National Faceless Appeal Centre (NFAC)/Ld. CIT(A) dated 13.04.2021 for assessment year (AY) 2012-13, which in turn arises out penalty levied under section 271(1)(b) of the Income Tax Act, 1961 (‘the Act’) vide order dated 26.06.2019. The assessee has raised the following grounds of appeal:- “1. The learned CIT(A) (NFAC) order is contradictory to law and facts of the case and therefore, the penalty u/s 271(1)(b) of the Act. ITA No.51/SRT/2021 (A.Y 12-13) M/s Cosmopolitan Solution Pvt. Ltd. 2 Imposed by the Assessing Officer as well confirmed by CIT(A) to the extent of Rs.10,000/- may please be deleted. 2. Assessment order passed u/s 143(3) r.w.s. 147 of the Act is completely invalid and bad in law because Assessing Officer has served the order through email to legal representative on 21/06/2019, against order passing dated 08/12/2018 i.e. almost after 6 & ½ months of order passed and last date of order to be served was 31 st December 2018, so the assessment order itself is invalid and hence accordingly Penalty order passed u/s 271(1)(b) of the Act is also invalid. 3. CIT(A) not considered that no notice u/s 271(1)(b) for penal action is received before 31 st December 2018 hence penalty order passed u/s 271(1)(b) is invalid. 4. Penalty u/s 271(1)(b) initiation notice must be issued before the completion of six assessment years, which was first time issued to the appellant co. after the expiry of six assessment years and hence notice for initiation of penal action u/s 271(1)(b) and order of the same is not valid order, which CIT(A) not considered while confirming the penalty. 5. CIT(A) grossly erred before confirming the penalty u/s 271(1)(b) that no show cause notice issued before order passed u/s 271(1)(b) of the Act and hence order passed is not valid order. 6. CIT(A) grossly erred for confirming penalty u/s 271(1)(b) that assessment order has been passed by Dy. Commissioner of Income- tax, Circle 1(1)(1), Surat and penalty imposed by I.T.O.Ward-1(1)(2), Surat which is completely wrong. 7. A.O as well as CIT (Appeals) did not consider the fact that once appellant came to know about the notice u/s 148 of the Act filed ITA No.51/SRT/2021 (A.Y 12-13) M/s Cosmopolitan Solution Pvt. Ltd. 3 return and details had been provided as and when asked for. So, penalty u/s 271(1)(b) cannot be levied when order passed u/s 143(3) and not u/s 144 of the Act. 2. Brief facts of the case as extracted from the order of lower authorities are that assessee is a private limited company engaged in business of computer software and call centre related services. The case of assessee was re-opened under section 147 and assessment was completed on 08.12.2018 by making various additions. The Assessing Officer after passing the assessment order issued show cause notice under section 274 rws 271(1)(b) of the Act dated 11.06.2018 for non- compliance of notice under section 142(1), dated 08.12.2018. The show cause notice was duly served vide reply dated 17.06.2019. In the reply, assessee stated that no notice as mentioned in show cause notice dated 11.06.2019 was served upon the assessee. Further, no such notice is reflected in the on-line portals. The copy of said photo of the portal was also placed with the record. The assessee further stated that even the assessment order, if any, completed under section 147 of the Act has not been served upon the assessee. ITA No.51/SRT/2021 (A.Y 12-13) M/s Cosmopolitan Solution Pvt. Ltd. 4 3. The reply of assessee was not accepted by the Assessing Officer. The Assessing Officer held that assessment order was passed on 08.12.2018 and it was served by Postal Authorities on 13.12.2018. The Assessing Officer levied the penalty of Rs.10,000/- for non-compliance of notice. On appeal before Ld. NFAC/CIT(A) the assessee made similar submission as made in response to the show cause notice to the assessee. The Ld. NFAC/CIT(A) after considering the statement of fact and order of Assessing Officer upheld the addition made by taking view that the assessee during the assessment failed to comply with the notices of the assessing officer. Ld. CIT(A) also noted that even in the appellate proceedings the assessee failed to respond their notices and had not file any response. Further aggrieved the has filed present appeal before the Tribunal. 4. None has appeared on behalf of assessee, on perusal of record, we find that the assessee has already filed written submission with the record on 20.04.2022, therefore, we proceeded to decide the appeal on the basis oral submission of Ld. Senior Departmental Representative (Sr. DR) for the Revenue and the ITA No.51/SRT/2021 (A.Y 12-13) M/s Cosmopolitan Solution Pvt. Ltd. 5 materials available on record in the form of assessee’s written submission. The Ld. Sr DR for the revenue supported the order of lower authorities And would submit that the attitude of the assessee is always of non-cooperative and no proper compliance was made in response to the various notices issued by assessing officer under section 142(1) from time to time. And it is a fit case foe levying penalty under section 271(1)(b). 5. In the written submissions the assessee besides that other contentions, contended that the assessing officer levied penalty for violation of notice dated 8.12.2018, in fact no such notices was received by the assessee. Even no such notice is reflected in the assessment order dated 08.12.2018. 6. We have considered the submissions of Ld. Sr DR for the revenue and the written submissions filed by the assessee on record. We find that the assessing officer passed the assessment order on 08.12.2018. In the assessment order the assessing officer has nowhere mentioned/ initiated penalty under section 271(1)(b) for non-compliance of any such notice. The assessing officer for the first time in the show cause notice ITA No.51/SRT/2021 (A.Y 12-13) M/s Cosmopolitan Solution Pvt. Ltd. 6 under section 274 rws 271(1)(b) has made the reference of notice dated 08.12.2018. In fact no such notice dated 08.12.2018 was ever issued by the assessing officer. The assessing officer while issuing show cause notice as well as penalty passing penalty order has not verified the fact properly and levied the penalty in a mechanical way. Hence, the penalty levied by assessing officer of Rs. 10,000/- is deleted. In the result, the grounds of appeal raised by the assessee is allowed. 7. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 26/07/2022 and the result was also placed on the Notice Board. Sd/- Sd/- (Dr ARJUN LAL SAINI) (PAWAN SINGH) [लेखा सद᭭य/ACCOUNTANT MEMBER] [᭠याियक सद᭭य JUDICIAL MEMBER] Surat, Dated: 26/07/2022 Dkp. Out Sourcing Sr.P.S Copy to: 1. Appellant- 2. Respondent- 3. CIT(A)- 4. CIT 5. DR 6. Guard File True copy/ By order // True Copy // Sr.P.S./Assistant Registrar, ITAT, Surat