M/s Keti Infrastructure Pvt. Ltd., Indore V. Deputy Commissioner of Income Tax (Central), Indore, Indore

ITA 539/Ind/2017

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 4144 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 2 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 26-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K MITRA
• Assessee Lawyers: SHRI
• Keywords: Depreciation; Search and seizure
• Section: 143(3); 153A; 132

Judgement Text

KETI INFRASTRUCTURE PVT. LTD ITA NO.539/IND/2017 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO.539/IND/2017 ASSESSMENT YEAR: 2010-11 REVENUE BY S HRI P.K. MITRA, SR.DR ASSESSEE BY SHRI PANKAJ SHAH,C.A DATE OF HEARING 09.10 . 2018 DATE OF PRONOUNCEMENT 11 .10 .2018 O R D E R PER MANISH BORAD, AM. THIS APPEAL OF ASSESSEE PERTAINING TO A.Y. 2010-11 IS DIRECTED AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-III, INDORE (IN SHORT CIT(A)), DATED 05.05.2017 WHICH IS ARISING OUT OF THE ORDER U/S 271(1)(C ) OF THE INCOME TAX ACT 1961 (HEREINAFTER CALLED AS THE ACT) FRAMED ON 25.09.2014 BY DCIT ( CENTRAL), INDORE. M/S. KET I INFRASTRUCTURE PVT. LTD, 31/6 VATSALYA CHAMBERS, SNEH NAGAR MAIN ROAD, INDORE VS. DCIT (CENTRAL) INDORE ( APPELLANT ) (RESPONDENT ) PAN NO. A ADCK0722H KETI INFRASTRUCTURE PVT. LTD ITA NO.539/IND/2017 2 2. THE SOLE GRIEVANCE OF THE ASSESSEE IS AGAINST T HE ORDER OF LD.CIT(A) CONFIRMING THE PENALTY OF RS.71,500/- LEV IED BY THE LD. ASSESSING OFFICER U/S 271(1)(C ) OF THE ACT. 3. BRIEFLY STATED THE FACTS AS CULLED OUT FROM THE RECORDS ARE THAT A SEARCH AND SEIZURE OPERATIONS WERE CARRIED OUT U/ S 132 OF THE ACT IN THE CASE OF KETI/KALYAN GROUP AND OTHER ASSOCIAT ED BUSINESS CONCERNS ON 05.05.2011. IN THE CASE OF ASSESSEE AS SESSMENT U/S 153A R.W.S. 143(3) OF THE ACT WAS FRAMED ON 05.03. 2014 FOR ASSESSMENT YEAR 2010-11 AFTER MAKING DISALLOWANCE F OR DEPRECIATION AT RS.2,38,204/- WHICH WAS FOLLOWED BY PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. SUBSEQUENTLY PENALTY OF RS.71,500/- WAS LEVIED ON THE ALLEGED DISALLOWANCE OF DEPRECIATION. APPEAL FILED BY THE ASSESSEE BEFORE LD.CIT(A) BUT D ID NOT FIND ANY FAVOUR. 4. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNA L. 5. AT THE OUTSET LD. COUNSEL FOR THE ASSESSEE SUBMI TTED THAT THE ALLEGED NOTICE U/S 274 R.W.S. 271(1)(C ) OF THE ACT IS ERRONEOUS AS IT WAS ISSUED WITHOUT STRIKING EITHER OF THE TWO CHARG ES I.E. WHETHER THE ASSESSEE HAVE CONCEALED THE PARTICULARS OF THE INCOME OR KETI INFRASTRUCTURE PVT. LTD ITA NO.539/IND/2017 3 FURNISHED INACCURATE PARTICULARS OF INCOME. HE FUR THER REFERRING TO THE JUDGMENT OF THE CO-ORDINATE BENCH IN THE CASE O F KETI SANGAM INFRASTRUCTURE (I) LTD V/S DCIT (CENTRAL), INDORE I .T.A. NO.516/IND/2017 SUBMITTED THAT THE IDENTICAL FACTS WERE PLACED BEFORE THE CO-ORDINATE BENCH RELATING TO OTHER CONC ERNS OF THE SAME GROUP AND SIMILAR NOTICES WERE ISSUED HAVING SIMILA R DEFECTS AND THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. R ELIANCE WAS ALSO PLACED ON THE JUDGMENT OF JURISDICTIONAL HIGH COURT IN THE CASE OF PRINCIPAL COMMISSIONER OF INCOME TAX-I VS KULWANT S INGH BHATIA I.T.A NO.9/2018 ORDER DATED 9.5.2018 . 6. PER CONTRA LD. DEPARTMENTAL REPRESENTATIVE SUPPO RTED THE ORDER OF LOWER AUTHORITIES. 7. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS PLACED BEFORE US. THE SOLE ISSUE IN THE INSTANT AP PEAL RELATES TO VALIDITY OF PENALTY OF RS.71,500/- LEVIED U/S 271(1 )(C ) OF THE ACT. FROM THE PERUSAL OF THE NOTICE U/S 274 R.W.S. 271(1 )(C ) OF THE ACT DATED 5.3.2014 WE OBSERVE THAT BOTH THE CHARGES HAV E BEEN MENTIONED IN THE NOTICE I.E. THE ASSESSEE HAVE CON CEALED THE PARTICULARS OF INCOME OR FURNISHED INACCURATE PARTI CULARS OF SUCH KETI INFRASTRUCTURE PVT. LTD ITA NO.539/IND/2017 4 INCOME. LD. COUNSEL FOR THE ASSESSEE PLEADED THAT THE ALLEGED SHOW CAUSE NOTICE DO NOT SATISFY THE REQUIREMENT OF LAW AS THERE IS NO SPECIFIC CHARGE RAISED AGAINST THE ASSESSEE. 8. WE FIND THAT HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF PRINCIPAL COMMISSIONER OF INCOME TAX-I VS KULWANT S INGH BHATIA (SUPRA) ADJUDICATED THE VERY SAME ISSUE AND THE HON 'BLE HIGH COURT FOLLOWING THE DECISION TAKEN BY THE HON'BLE KARNATA KA HIGH COURT IN THE CASE OF CIT V MANJUNATHA COTTON AND GINNING FACTORY 359 ITR 565 (KAR) AS WELL AS THE JUDGMENT OF HON'BLE AP EX COURT IN THE CASE OF CIT V/S SSAS EMERALD MEADOWS (2016) 73 TAX MAN.COM 248 HELD THAT SHOW CAUSE NOTICE WOULD NOT SATISFY THE REQUIREMEN T OF LAW AS NOTICE WAS NOT SPECIFIC, WE ARE OF THE V IEW THAT THE LEARNED TRIBUNAL HAS RIGHTLY RELYING ON THE DECISION OF CIT V/S MANJUNATHA COTTON GINNING FACTORY (SUPRA) AND CIT V/S SSAS EM ERALD MEADOWS (SUPRA) RIGHTLY ALLOWED THE APPEAL OF THE ASSESSEE AND SET ASIDE THE ORDER OF THE PENALTY IMPOSED BY THE AUTHORITIES. SIMILAR VIEW WAS ALSO TAKEN BY THE COORDINATE BENCH IN THE CASE OF K ETI SANGAM INFRASTRUCTURE (I) LTD AND OTHERS V/S DCIT (SUPRA) ORDER DATED 27.6.2018 HOLDING THAT WHERE THE SPECIFIC CHARGE HA S NOT BEEN KETI INFRASTRUCTURE PVT. LTD ITA NO.539/IND/2017 5 MENTIONED IN THE NOTICE U/S 274 R.W.S. 271(1)(C ) O F THE ACT I.E. WHEN ONE OF THE CHARGE IS NOT STRIKED OFF THEN SUCH NOTICE DID NOT SATISFY THE REQUIREMENT OF LAW, THEREFORE THE PENAL TY PROCEEDINGS BECOMES VOID AB INITIO. WE THEREFORE, RESPECTFULLY FOLLOWING THE ABOVE JUDGMENTS AS WELL AS IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CASE, ARE OF THE VIEW THAT THE ORDER OF LD.CIT( A) DESERVES TO BE SET ASIDE AND THE IMPUGNED PENALTY OF RS.71,500/- NEEDS TO BE DELETED. WE ACCORDINGLY ORDER SO AND ALLOW THE APP EAL OF THE ASSESSEE. 9. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALLO WED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 11.10.201 8. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 11 OCTOBER, 2018 /DEV COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER ASSTT.REGISTRAR,I.T.A.T., INDORE