HEENA N KANAKIA, MUMBAI V. ACIT CC 32, MUMBAI

ITA 5299/MUM/2013

• Counselvise Citation: 529919914 RSA 2013
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-01-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2003-2004
• Appeal Filed On: 31-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JEETENDRA KUMAR
• Assessee Lawyers: GOVIND JAVERI
• Keywords: Reasonable cause
• Section: 273B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H, MUMBAI , ,, , BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI VIVEK VARMA, JUDICIAL MEMBER ITA NO. : 5299/MUM/2013 (ASSESSMENT YEAR: 2003-04) HEENA N KANAKIA, 701/702, QUARTER DECK, J P ROAD, VERSOVA, ANDHERI (WEST), MUMBAI -400 061 .: PAN: ANTPK 4556 B VS ACIT, CC-32, MUMBAI (APPELLANT) !' (RESPONDENT) # $ APPELLANT BY : SHRI GOVIND JAVERI !' # $ RESPONDENT BY : SHRI JEETENDRA KUMAR %& ' () /DATE OF HEARING : 06-01-2015 *+, ' () / DATE OF PRONOUNCEMENT : 23-01-2015 . / . / . / . / O R D E R PER VIVEK VARMA, JM: THE APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF CIT(A)-41, MUMBAI, DATED 03.05.2013, SUSTAINING THE PENALTY LEVIED AT RS 70,000/- U/S 271(1)(B) OF THE INCOME TAX ACT, 1961. 2. AT THE TIME OF HEARING, THE AR SUBMITTED THAT THE ASS ESSEE WAS UNABLE TO FURNISH COMPLETE DETAILS AS CALLED FOR BY THE AO BECAUSE 6. BEING AGGRIEVED BY THE PENALTY ORDER PASSED BY THE ASSESSING OFFICER THE APPELLANT HAS PREFERRED THE C URRENT APPEAL BEFORE YOUR HONOUR. 7. IT IS SUBMITTED THAT DURING THE COURSE OF THE AS SESSMENT PROCEEDINGS THE APPELLANT HAD MADE AWARE THE ASSESS ING OFFICER ABOUT HER INABILITY TO FURNISH THE DETAILS CALLED FOR DUE TO VARIOUS DIFFICULTIES FACED BY HER. THE SAID DOCUMEN TS HEENA N KANAKIA ITA 5299/M/2013 2 SUBSTANTIATING DIFFICULTIES HAD BEEN FILED BEFORE Y OUR HONOUR PREDECESSOR DURING THE APPELLATE PROCEEDING FOR AY 2008-09 WHILE MAKING SUBMISSIONS IN APPEAL FILED AGAINST TH E ASSESSMENT ORDER. 8. THE ASSESSING OFFICER WAS WELL INTIMATED DURING THE ASSESSMENT PROCEEDINGS ITSELF THAT THE DETAILS CALL ED FOR BY THE ASSESSING OFFICER WERE KEPT AT OFFICE SITUATED IN X -CUBE BUILDING WHICH WAS UNDER THE DISPUTE AND SEIZED BY CIVIL COU RT DINDOSHI (BORIVALI DIVISION). THEREFORE, THE APPELLANT COULD NOT PRODUCE OR FILE THE DETAILS BEFORE THE ASSESSING OFFICER. THE APPELLANT CRAVES LEAVE TO REFER TO AND RELY UPON THE SAID DOCUMENTS FILED DURING THE COT4RSE OF APPELLATE PROCEEDINGS FOR A. Y.2008- 09 AND NOT RE- SUBMITTING THE SAME NOW SO AS TO NOT TO BURDEN THE RECORD. HOWEVER, IF YOUR HONOUR SEEKS SUCH DETAILS, THE APP ELLANT MAY KINDLY BE ACCORDIN1 INTIMATED SO THAT THE SAME CAN BE FILED SEPARATELY. 9. IT IS SUBMITTED THAT THE APPELLANT H AD BEEN RELYING ON HER HUSBAND AND IN LAWS IN RESPECT OF COMPLIANCE S OF TAX MATTERS AND SHE IS NOT WELL AWARE ABOUT THE INTRICA CIES INVOLVED. IT IS SUBMITTED THAT HER HUSBAND AND IN LAWS HAD BE EN GETTING THROUGH VARIOUS DIFFICULTIES, PASSING THROUGH VERY DIFFICULT PHASE AND AS SUCH, COULD NOT ATTEND TO THE VARIOUS NOTICE S ISSUED BY THE ASSESSING OFFICER. IN SPITE OF ALL ODDS, THEY C OULD MANAGE TO MAKE PARTIAL COMPLIANCES TO THE BEST OF THEIR ABILI TY AS IT/S EVIDENT FROM THE DETAILS GIVEN BY THE ASSESSING OFF ICER IN THE PENALTY ORDER. (AS EXTRACTED FROM THE ORDER OF THE CIT(A)) 3. THE AR FURTHER SUBMITTED THAT ON THOSE FACTS ONLY, T HE ITAT IN ASSESSEES OWN CASES IN ASSESSMENT YEARS 2004 -05 TO 2007-08, IN ITAS NO. 5206 TO 5209/MUM/2013, HELD, THAT THE ASSESSEE IS UNABLE TO FURNISH DETAILS AS SUCH DETAILS WERE KEPT AT THE OFFICE SITUATED IN X-CUBE BUILDING , WHICH WAS UNDER DISPUTE AND SEIZED BY CIVIL COURT, DINDOSHI ( BORIVILI DIVN.). THEREFORE, THE ASSESSEE IS UNABLE TO PRODUC E THE DETAILS. EVEN BEFORE THE ID. COMMISSIONER OF INCOME TAX (APP EALS) INSPITE OF VARIOUS DIFFICULTIES, THE ASSESSEE FILED SUCH DE TAILS BUT THE SAME WERE DECLINED ON THE GROUND THAT THE ASSESSING OFFICER HAD ALREADY PROVIDED SUFFICIENT OPPORTUNITY TO FILE THESE DETAILS. WE ARE OF THE VIEW THAT ATLEAST THE ID. COMMISSIONE R OF INCOME TAX (APPEALS) WAS EXPECTED TO EXAMINE THESE DETAILS ALONG WITH C1ANED DIFFICULTIES FACED BY THE ASSESSEE AND THEN SHOULD HAVE REACHED TO A CONCLUSION. HOWEVER, THE LD. COMMISSIO NER OF INCOME TAX (APPEALS), ON THE BASIS OF OBSERVATION M ADE IN THE ASSESSMENT ORDER PROCEEDED TO DISPOSE OF THE APPEAL . THIS CLAIM OF THE ASSESSEE IS EVEN EVIDENT FROM PARA-7 (PAGE-3 ) OF THE WRITTEN SUBMISSION REPRODUCED IN THE IMPUGNED ORDER . THE DIFFICULTIES THE ASSESSEE WERE ANALYZED AND APPREC IATED BY THE TRIBUNAL AS HAS BEEN REPRODUCED (SUPRA), IN ITS ORDER DATED 18/10 20 WHEREIN, THE APPEAL WAS ALLOWED FOR STATIS TICAL PURPOSES DIRECTING THE ASSESSING OFFICER TO READJUD ICATE AFTER PROVIDING DUE OPPORTUNITY TO THE ASSESSEE. 5. THE WORD 'REASONABLE CAUSE' IN SECTION 273B MUST NECESSARILY HAVE A RELATION TO THE FAILURE ON THE PART OF THE A SSESSEE TO COMPLY WITH THE REQUIREMENT OF LAW WHICH HE/SHE HAD FAILED TO COMPLY WITH. IN CASE OF DELAY IN COMPLIANCE, THE CA USE SHOWN BY HEENA N KANAKIA ITA 5299/M/2013 3 THE ASSESSEE FOR SUCH DELAY HAS TO BE SEEN WHETHER THERE WAS A 'GOOD AND SUFFICIENT CAUSE' FOR SUCH NONCOMPLIANCE. IF THE CAUSE SHOWN IS SUCH AS TO EXPLAIN THE DELAY CONSTITUTE A GOOD REASON FOR NON-COMPLIANCE, NO PENALTY WOULD BE LEVIABLE. H OWEVER, IN CASES WHERE THE CAUSE SHOWN IS SUCH WHICH IS ONLY T O MITIGATE THE GRAVITY OF NON-COMPLIANCE SUCH A CAUSE CANNOT B E EXTRAPOLATED AND TREATED AS BEING A GOOD CAUSE. A C ONSTRUCTION WHICH WOULD PRESERVE THE EXERCISE OF THE POWER IN F AVOUR OF THE ASSESSEE, UNDER THE CIRCUMSTANCES, WHICH WARRANT IT IS TO BE PREFERRED TO A CONSTRUCTION WHICH WOULD RESULT IN T HE LIKELIHOOD OF DENIAL OF RELIEF. REASONABLE CAUSE IS NOT SUSCEP TIBLE OF A CLEAR AND PRECISE DEFINITION BUT AS APPLIED TO HUMAN ACTI ON WHICH WOULD CONSTRAIN A PERSON OF AVERAGE INTELLIGENCE AN D ORDINARY PRUDENCE ACTING UNDER NORMAL CIRCUMSTANCES. THE ASS ESSEE, BEING A LADY, WHO WAS FACING THE CLAIMED DIFFICULTI ES, THEREFORE, EVEN UNDER THE FACTS AVAILABLE ON RECORD THE ASSESS ING OFFICER WAS EXPECTED NOT TO BE SO TECHNICAL IN IMPOSING THE PENALTY, MORE SPECIFICALLY WHEN THE DOCUMENTS, AS CALLED FOR , WERE UNDER DISPUTE AND SEIZED BY THE DIRECTION OF THE COURT. T HEREFORE, THE ASSESSEE COULD NOT FILE THESE DETAILS. WE APPRECIAT E THAT THE ID. COMMISSIONER OF INCOME TAX (APPEALS), CONSIDERING T HE FACTS, ATLEAST GAVE PART RELIEF TO THE ASSESSEE. IN THE PR ESENT APPEALS THOUGH THERE IS A TECHNICAL BREACH ON THE PART OF T HE ASSESSEE, STILL, KEEPING IN VIEW THE TOTALITY OF THE FACTS AN D THE CIRCUMSTANCES, BY TAKING A LENIENT VIEW, THE PENALT Y IMPOSED/ SUSTAINED IN EACH CASE IS DELETED. WE ARE OBSERVING HERE THAT OUR CONCLUSION IS BASED UPON PECULIAR FACTS OF THE PRESENT APPEALS/ DIFFICULTIES FACED BY THE ASSESSEE, THEREF ORE, MAY NOT BE QUOTED AS A PRECEDENT. 4. SINCE THE PENALTY HAS BEEN DELETED BY THE ITAT ON S AME AND IDENTICAL FACTS, WE ARE OF THE OPINION THAT IN THE PRESE NT CASE AS WELL, PENALTY DESERVES TO BE DELETED. 5. WE, THEREFORE, SET ASIDE THE ORDER OF THE CIT(A) AND DIR ECT THE AO TO CANCEL THE PENALTY OF RS. 70,000/- LEVIED U/S 271(1)(B). 6. IN THE RESULT, THE APPEAL AS FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD JANUARY, 2015. SD/- SD/- ( ) ( ) . . . . . . . . (R C SHARMA) ( VIVEK VARMA ) ACCOUNTANT MEMBER J UDICIAL MEMBER MUMBAI, DATE: 23 RD JANUARY, 2015 HEENA N KANAKIA ITA 5299/M/2013 4 !(/ COPY TO:- 1) / THE APPELLANT. 2) !' / THE RESPONDENT. 3) THE CIT(A)-41, MUMBAI. 4) THE CIT CENTRAL -III, MUMBAI. 5) 2&34 !(% , , / THE D.R. H BENCH, MUMBAI. 6) 456 7 COPY TO GUARD FILE. ./% / BY ORDER / / TRUE COPY / / 8 / 9 : , DY. / ASSTT. REGISTRAR I.T.A.T., MUMBAI * *CHAVAN, SR.PS