Sh. Ram Kripal Singh, New Delhi V. ACIT, New Delhi

ITA 5238/DEL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6600 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 5 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 17-02-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 18-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR BALWAN CHAUHAN
• Assessee Lawyers: SB GUPTA
• Keywords: Search and seizure; Initiation of penalty proceedings; Reasonable cause
• Section: 273B; 142(1); 27

Judgement Text

1 ITA NOS. 5236,37,38,39 &40/DEL/2013 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SH. N. K. SAINI, AM AND MS. SUCHITRA KAMBLE, JM ITA NO. 5236/DEL/2013 : ASSTT. YEAR : 2007-08 ITA NO. 5237/DEL/2011 : ASSTT. YEAR : 2008-09 ITA NO. 5238/DEL/2013 : ASSTT. YEAR : 2009-10 ITA NO. 5239/DEL/2013 : ASSTT. YEAR : 2010-11 ITA NO. 5240DEL/2013 : ASSTT. YEAR : 2011-12 RAM KIRPAL SINGH, A-41, MEERA BAGH, NEAR PACSHIM VIHAR NEW DELHI AATPS7073A VS ACIT CENT. CIRCLE 5 NEW DELHI (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. S. B. GUPTA, FCA REVENUE BY : DR. BALWAN CHAUHA N, CIT (DR) DATE OF HEARING : 18.02.2016 DATE OF PRONOUNCEMENT : 01 .03.2016 ORDER PER BENCH: THESE FIVE APPEALS BY THE ASSESSEE ARE DIRECTED AGA INST THE COMMON ORDER DATED 7/6/2013 OF THE LD. CIT (A), XXXI, NEW DELHI. COMMON GROUND IS RAISED IN ALL THESE APPEALS WHICH WER E HEARD 2 ITA NOS. 5236,37,38,39 &40/DEL/2013 TOGETHER, SO, THESE ARE BEING DISPOSED OF BY THESE CON SOLIDATED ORDERS FOR THE SAKE OF CONVENIENCE AND BREVITY. 2. FIRST, WE DEAL WITH APPEAL IN ITA NO. 5236/DEL/20 13 FOR THE ASSESSMENT YEAR 2007-08, THE ONLY EFFECTIVE GROUND RA ISED IN THIS APPEAL READS AS UNDER:- 1. THAT, ON THE FACTS AND CIRCUMSTANCES OF THE CASE , INITIATION OF PENALTY PROCEEDINGS AGAINST THE ASSESSEE UNDER SECT ION 274 READ WITH SECTION 271(1)(B) AND IMPOSITION OF PENALTY OF RS.1,00,00/- UPON THE ASSESSEE U/S 271(1)(B) IS ILLEGAL AND UNJU STIFIED AND, THEREFORE, PENALTY IMPOSED SHOULD BE DELETED. 3. FACTS OF THE CASE IN BRIEF ARE THAT A SEARCH AND SEIZURE OPERATION U/S 132(1) OF THE INCOME-TAX ACT 1961 (HEREINAFTER R EFERRED TO AS THE ACT IN SHORT) WAS CARRIED OUT IN THE CASE OF M/S SHI V NARESH SPORTS PVT. LTD. AT THE BUSINESS PREMISES OF THE COMPANY AND ALSO AT THE RESIDENTIAL PREMISES OF THE DIRECTORS OF THE SAID COMP ANY ON 28/10/2011, THEREAFTER A NOTICE U/S 142(1) OF THE ACT WAS ISSUED TO THE ASSESSEE ON 2/2/2012 ASKING HIM TO MAKE COMPLIANCE ON 20/2/2012, ANOTHER NOTICE WAS ISSUED ON 25/4/2012. ACCORDING TO TH E A.O, THESE NOTICES ISSUED U/S 142(1) OF THE ACT REMAINED UNCOMPLI ED WITH. THE A.O ALSO NOTED THAT A NOTICE U/S 142(1) OF THE ACT WAS AGAIN ISSUED ALONG WITH A QUESTIONNAIRE DATED 23/11/2012 CALLING F OR CERTAIN INFORMATION AND THE HEARING WAS FIXED ON 31/11/2012 ON THE SAID DATE 3 ITA NOS. 5236,37,38,39 &40/DEL/2013 NOBODY ATTENDED, THEREAFTER THE A.O ISSUED TO THE ASSE SSEE A NOTICE U/S 271(1)(B) OF THE ACT TO SHOW CAUSE THE REASONS FOR NON-C OMPLIANCE AND THE HEARING WAS FIXED FOR 13/12/2012. ON THE SAID D ATE ALSO NEITHER THE ASSESSEE ATTENDED NOR ANY SUBMISSION WAS FURNISHED, F OR NON- COMPLIANCE, THE A.O LEVIED THE PENALTY OF RS.10, 000/ - U/S 271(1)(B) OF THE ACT. THE RELIANCE WAS PLACED ON THE JUDGMENT OF THE HONBLE PATNA HIGH COURT IN THE CASE OF CIT VS. STANDARD MERCANTILE COMPANY REPORTED AT 160 ITR 613. BEING AGGRIEVED, THE ASSE SSEE CARRIED THE MATTER TO THE LD. CIT (A) AND SUBMITTED AS UNDER:- WITH REFERENCE TO THE ABOVE CAPTIONED SUBJECT, IT IS SUBMITTED THAT PENALTY U/S 271(1)(B) OF THE IT ACT 1961, WAS LEVIED UPON ME FOR NON-COMPLIANCE OF THE NOTICE FOR HEARINGS FIXED ON 30/11/2012 AND 13/12/2012. IN THIS REGARD, IT IS HEREBY SUBMIT TED THAT, I AM 70 YEARS OLD AND WAS SUFFERING FROM LOW BACK PAIN TO FALLING FROM STAIRS. I WAS ADVISED FOR COMPLETE BED REST SINCE 29/11/2012 TO 14/12/2012. THAT IS WHY I COULD NOT APPEAR BEFORE THE ASSESSING OFFICER FOR THE ABOVE MENTIONED REASONS. SECTION 273B PROVIDES THAT NO PENALTY SHALL BE IMPO SED UNDER VARIOUS PROVISIONS OF SECTIONS 271 AND 272 OF THE INCOME TAX ACT, 1961, IF THE ASSESSEE PROVES THAT THERE WA S REASONABLE CAUSE FOR NON APPEARANCE. HENCE, IN VIEW OF ABOVE FACTS AND CIRCUMSTANCES, THE PENALTY IMPOSED MAY KINDLY BE DELE TED. 4. THE LD. CIT (A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE OBSERVED THAT NON-COMPLIANCE OF THE NOTICES WAS NOT DISPU TED. 4 ITA NOS. 5236,37,38,39 &40/DEL/2013 HOWEVER, HE SUSTAINED THE PENALTY ONLY FOR 5 OUT OF 7 Y EARS I.E THE ASSESSMENT YEARS 2007-08 TO 2011-12 AND DELETED THE PENALTY FOR TWO ASSESSMENT YEARS I.E ASSESSMENT YEAR 2005-06 & 2006 -07 BY OBSERVING THAT THE LEVYING OF PENALTY FOR ALL THE SEVEN YEARS MAY BE A BIT TOO HARSH. 5. NOW, THE ASSESSEE IS IN APPEAL. THE LD. COUNSEL F OR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LD. CIT (A ) AND FURTHER SUBMITTED THAT THERE WAS A REASONABLE CAUSE FOR NON-A PPEARANCE ON 30/11/2012 & 13/12/2012 BECAUSE THE ASSESSEE WAS AD VISED FOR COMPLETE BED REST FROM 29/11/2012 TO 14/12/2012 DUE TO A FALL FROM THE STAIRS AND WAS SUFFERING FROM LOW BACK PAIN. T HEREFORE, THE LD. CIT (A) OUGHT TO HAVE DELETED THE PENALTY FOR ALL THE YEAR S INSTEAD OF ONLY 2 YEARS IN VIEW OF THE PROVISIONS CONTAINED IN SECTION 27 3 B OF THE ACT. 6. IN HIS RIVAL SUBMISSIONS, THE LD. DR SUBMITTED TH AT THE ASSESSEE WAS A WILLFUL DEFAULTER AND NEVER CO-OPERATED, THERE FORE, THE PENALTY WAS RIGHTLY LEVIED BY THE A.O U/S 271(1) (B) OF THE ACT AND THE LD. CIT (A) WAS FULLY JUSTIFIED IN SUSTAINING THE PENALTY. 7. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTI ES AND CAREFULLY GONE THROUGH THE MATERIAL AVAILABLE ON THE R ECORD. IN THE PRESENT CASE IT IS NOTICED THAT THE A.O LEVIED THE P ENALTY FOR NON- 5 ITA NOS. 5236,37,38,39 &40/DEL/2013 COMPLIANCE OF THE NOTICE U/S 142 ON 30/11/2012. THE E XPLANATION OF THE ASSESSEE FOR NON-APPEARANCE WAS THAT HE HAD A FAL L FROM THE STAIRS ON 29/11/2012 AND WAS ADVISED FOR BED REST. IT IS AL SO NOTICED THAT THE ASSESSEE IS AN OLD PERSON OF ABOUT 70 YEARS, SO THERE W AS A REASONABLE CAUSE FOR NON-APPEARANCE BEFORE THE A.O. IN OUR OPINI ON, THE PENALTY LEVIED BY THE A.O U/S 271(1)(B) AND SUSTAINED BY TH E LD. CIT(A) WAS NOT JUSTIFIED PARTICULARLY WHEN THE LD. CIT(A) CONSIDERE D THE EXPLANATION OF THE ASSESSEE FOR THE TWO ASSESSMENT YEARS IE. ASSESS MENT YEARS 2005- 06 AND 2006-07 AS PLAUSIBLE BECAUSE FOR THOSE TWO YEAR S, THE PENALTY LEVIED BY THE A.O WAS DELETED. WE, THEREFORE, BY CON SIDERING THE TOTALITY OF THE FACTS AS DISCUSSED HEREINABOVE ARE OF T HE VIEW THAT THERE WAS A REASONABLE CAUSE FOR NON-APPEARANCE OF THE ASSES SEE ON 30/11/2012 & 13/12/2012 BECAUSE THE ASSESSEE WAS AD VISED FOR COMPLETE BED REST FROM 29/11/2012 TO 14/12/2012 FOR TH E REASON THAT HE WAS SUFFERING FROM LOW BACK PAIN CAUSED BY FALL FR OM THE STAIRS. ACCORDINGLY PENALTY LEVIED BY THE A.O AND SUSTAINED BY THE LD. CIT (A) IS DELETED. THE FACTS FOR THE ASSESSMENT YEARS 2008-09 TO 2011-12 ARE IDENTICAL TO THE FACTS INVOLVED FOR THE ASSESSMENT YE AR 2007-08. THEREFORE, OUR FINDINGS GIVEN IN THE FORMER PART OF T HIS ORDER IN RESPECT OF ASSESSMENT YEARS 2007-08 SHALL APPLY MUTATIS MUTA NDI. 6 ITA NOS. 5236,37,38,39 &40/DEL/2013 8. IN THE RESULT, APPEALS OF THE ASSESSEE ARE ALLOWED . (ORDER PRONOUNCED IN THE COURT ON 01/03/2016) SD/- SD/- (SUCHITRA KAMBLE) (N. K. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMB ER DATED: 01/03/2016 *R.NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR 7 ITA NOS. 5236,37,38,39 &40/DEL/2013 DATE INITIAL 1. DRAFT DICTATED ON 17.02.2016 PS 2. DRAFT PLACED BEFORE AUTHOR 18.02.2016 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 01.03.2016 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK 01.03.2016 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 8 ITA NOS. 5236,37,38,39 &40/DEL/2013