M/s. ANAND TRADERS, Ujjain V. THE ACIT 2(1), Ujjain

ITA 537/IND/2014

• Counselvise Citation: 53722714 RSA 2014
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 29-07-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 13-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: G S GAUTAM
• Assessee Lawyers: S S DESHPANDE
• Keywords: Loose papers; Reasonable cause
• Section: 153A; 6

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI D.T. GARASIA, J.M. AND SHRI B.C.MEENA, A.M. I.T.A.NO.535 & 537/IND/2014 A.YS. : 2003 & 2004 M/S.ANAND TRADERS, ACIT, 2(1), UJJAIN VS UJJAIN APPELLANT RESPONDENT P.A.N. NO A ACFA4861B APPELLANT BY SHRI S. S. DESHPANDE, CA RESPONDENT BY SHRI G. S. GAUTAM, DR DATE OF HEARING : 29.07.2015 DATE OF PRONOUNCEMENT : 01 .0 9 .2015 -: 2: - 2 O R D E R PER GARASIA, J.M. THESE APPEALS OF THE ASSESSEE ARE DIRECTED AGAINST THE SEPARATE ORDERS OF CIT(A), UJJAIN, BOTH DATED 25.06 .2014 FOR THE ASSESSMENT YEARS 2003-04 AND 2004-05. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE F IRM DEALS IN MILK & MILK PRODUCTS. THE SEARCH OPERATION WAS CARRIED OUT ON 25.09.2003. DURING THE COURSE OF SEA RCH, SOME LOOSE PAPERS AND DOCUMENTS WERE SEIZED FROM THE PRE MISES OF THE ASSESSEE. NOTICE U/S 153A WAS SERVED TO THE AS SESSEE AND THE AO HAS COMPLETED THE ASSESSMENT U/S 153A OF THE ACT ON 31.03.2006. WHILE PASSING THE ASSESSMENT ORDER, THE AO OBSERVED THAT THE TOTAL TURNOVER IS EXCEEDING RS. 4 0 LACS AND THE ASSESSEE FURNISHED THE TAX AUDIT REPORT ALONGWI TH THE RETURN LATE BY ONE YEAR. THEREFORE, THE PENALTY NOT ICE U/S 271B WAS ISSUED TO THE ASSESSEE AND IN REPLY TO SHOW CAU SE NOTICE, THE ASSESSEE CONTENDED THAT THERE WAS SURVEY OPERAT ION CARRIED OUT AT HIS SHOP AND RESIDENCE OF ALL THE DI RECTORS AND ALL THE DOCUMENTS WERE SEIZED BY THE DEPARTMENT AND -: 3: - 3 THEREAFTER THEY HAVE REQUESTED SEVERAL TIMES TO THE DEPARTMENT TO GIVE ACCOUNTS, SO THAT THEY MAY GET T HEM AUDITED, BUT AS THE COPIES WERE GIVEN LATE, THE STA TUTORY TIME LIMIT FOR GETTING THE ACCOUNTS AUDITED HAD ALREADY BEEN EXPIRED. THEREFORE, THEY COULD NOT GET THEM AUDITED AND UNABLE TO SUBMIT WITH THE RETURN. THE AO IS NOT SAT ISFIED WITH THE EXPLANATION OF THE ASSESSEE AND HE HAS IMPOSED THE PENALTY U/S 271B OF RS. 71,435/- AND RS. 67,676/- I N ASSESSMENT YEARS 2003-04 AND 2004-05 RESPECTIVELY. 3. THE MATTER CARRIED TO THE LD. CIT(A) AND THE LD. C IT(A) HAS CONFIRMED THE PENALTY. 4. THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED BEFORE US THAT THE ASSESSEE HAS FILED THE RETURN LATE. AS THE RE WAS SURVEY OPERATION CARRIED OUT AT THE ASSESSEES SHOP AND RE SIDENCE OF DIRECTORS, ALL THE BOOKS OF ACCOUNT AND VARIOUS PAP ERS WERE SEIZED BY THE DEPARTMENT AND THEY HAD NO INFORMATIO N ON HAND ON THE BASIS OF WHICH THE RETURN COULD BE FILE D AND ACCOUNTS COULD BE AUDITED. WHEN THE PHOTOCOPIES WER E GIVEN BY THE DEPARTMENT, THE TIME LIMIT FOR GETTING THE A CCOUNTS AUDITED HAD ALREADY BEEN EXPIRED. THEREFORE, THEY C OULD NOT -: 4: - 4 GET THEM AUDITED AND RETURNS WERE SUBMITTED LATE. T HE ASSESSEE HAD REASONABLE CAUSE FOR NOT FILING THE AU DIT REPORT IN TIME. 5. THE LD. AUTHORIZED REPRESENTATIVE ALSO RELIED UPON THE DECISION IN THE CASE OF AHMEDABAD CO-OPERATIVE DEPT . STORES (APNA BAZAAR) VS. ITO, (2001) 73 TTJ (AHD) 784 AND TRIBHOVANDAS TEJPAL & SONS, (2003) 126 TAXMAN 28 (R AJKOT). 6. THE LD. D.R. RELIED UPON THE ORDERS OF THE REVENUE AUTHORITIES. 7. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES. LOOKING TO THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT IN THIS CASE THERE WAS SEARCH OPERATIO N CARRIED OUT IN THE ASSESSEES PREMISES AND SOME DOCUMENTS W ERE FOUND RELATING TO ASSESSEE. THEREFORE, NOTICE U/S 1 53A WAS ISSUED TO THE ASSESSEE. AFTER ISSUING THE NOTICE, T HE ASSESSEE HAS FILED THE RETURN AND RETURN WAS PROCESSED U/S 1 53A OF THE INCOME-TAX ACT, 1961. THE ASSESSEE HAD REQUESTED TH E DEPARTMENT TO GIVE THE LOOSE PAPERS, SO THAT THE AS SESSEE CAN GET ITS ACCOUNTS AUDITED U/S 44AB OF THE ACT. THE A SSESSEE WAS GIVEN THE ACCOUNTS AND ALL THE PHOTOCOPIES OF T HE RECORDS, -: 5: - 5 BUT BY THAT TIME THE STATUTORY TIME LIMITED FOR GET TING THE ACCOUNTS AUDITED HAD ALREADY EXPIRED AND, THEREFORE , THE ASSESSEE WAS UNABLE TO GET ITS ACCOUNTS AUDITED AND SUBMIT THE REPORT ALONGWITH THE RETURN. THUS, WE ARE OF TH E VIEW THAT THE ASSESSEE HAS REASONABLE CAUSE FOR NOT FILING TH E AUDIT REPORT IN TIME. THEREFORE, THE PENALTY U/S 271B FOR THE YEARS UNDER CONSIDERATION CANNOT BE IMPOSED. WE FIND THAT IN THE CASE OF AHMEDABAD CO-OPERATIVE DEPT. STORES (APNA B AZAAR) VS. ITO, (2001) 73 TTJ (AHD) 784, WHEREIN THE TRIBU NAL HAS HELD THAT WHEN THERE IS DELAY ON THE PART OF STATUT ORY AUDITORS IN COMPLETING THE AUDIT OF THE ASSESSEE SOCIETY, PE NALTY CANNOT BE LEVIED ON THE ASSESSEE. WE FIND THAT THE SIMILAR ISSUE HAD COME UP BEFORE THE RAJKOT TRIBUNAL IN THE CASE OF TRIBHOVANDAS TEJPAL & SONS, (2003) 126 TAXMAN 28 (R AJKOT), WHEREIN IT IS HELD THAT WHEN THE BOOKS OF ACCOUNT W ERE SEIZED BY THE CUSTOM, THEN IT WAS HANDED OVER BY THE INCOM E TAX AUTHORITIES, THE AUDIT WAS COMPLETED LATE. THE ASSE SSEE HAD REASONABLE AND SUFFICIENT CAUSE FOR NOT GETTING THE ACCOUNTS AUDITED IN TIME AS PROVIDED IN THE ACT. WE, RESPECT FULLY FOLLOWING THE DECISION OF THE TRIBUNAL, ARE OF THE VIEW THAT THE -: 6: - 6 PENALTY U/S 271B CANNOT BE LEVIED, BECAUSE THE ASSE SSEE HAD REASONABLE CAUSE FOR NOT GETTING ITS ACCOUNTS AUDIT ED IN TIME. THEREFORE, WE DELETE THE PENALTY IN BOTH THE YEARS. 8. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE ALLOWED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 1 ST SEPTEMBER, 2015. SD/- (B. C. MEENA) ACCOUNTANT MEMBER SD/- ( D.T.GARASIA) JUDICIAL MEMBER DATED :1 ST SEPTEMBER, 2015. CPU* 2731