Sub Registrar, Bhiwani V. DIT (CIB), Chandigarh

ITA 5734/DEL/2012

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 8825 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-02-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 02-02-2015
• Assessment Year: misc
• Appeal Filed On: 09-11-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: B R R KUMAR
• Keywords: Bonafide belief; Reasonable cause; Non compliance; Ignorance of law
• Section: 273B; 28; 15

Judgement Text

ITA NO S . 5733 - 5737/ DEL/ 2012 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G , NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI J.S. REDDY, ACCOUNTANT MEMBER I.T.A. NO S . 5733, 5734, 5735, 5736 & 5737 /DEL/201 2 FINANCIAL YEARS : 200 4 - 0 5 , 2005 - 06, 2006 - 07, 2007 - 08 & 2008 - 0 - 9 SUB REGISTRAR, BHIWANI (T AN: RTKS13256F) VS. DIRECTOR OF INCOME TAX (CIB), SCO 98 - 100, 3 RD FLOOR, SECTOR - 17 - C, CHANDIGARH (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. NAVEEN KUMAR GOYAL, ADV. DEPARTMENT BY : SH. BRR KUMAR, SR. DR DATE OF HEARING : 02 - 02 - 201 5 DATE OF ORDER : 09 - 02 - 201 5 ORDER PER BENCH TH ESE APPEAL S BY THE ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS ) - ROHTAK DATED 22.8.2012 P ERTAINING TO FINANCIAL YEARS 2004 - 05 TO 2008 - 09. SINCE THE ISSUE INVOLVED IN THESE APPEALS IS COMMON, WE ARE THEREFORE, PROCEEDING TO DISPOSE THEM OFF BY THIS CONSOLIDATED ORDER . FOR THE SAKE OF CONVENIENCE, WE ARE REPRODUCING TH E GROUNDS OF APPEAL OF ITA NO. 5733/DEL/2012 FOR THE F .Y. 200 4 - 0 5 . ITA NO S . 5733 - 5737/ DEL/ 2012 2 1. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN UPHOLDING THE PENALTY OF RS. 152500/ - LEVIED BY THE DIRECTOR (CIB) CHANDIGARH ON ACCOUNT OF LATE FILING OF AIR RETURNS, DESPITE OF THE FACT THAT THE ASSESSEE HAD FILED AIR RETURN BEFORE THE RECEIPT OF THE SHOW C AUSE NOTICE FROM DIR. (CIB). 2. THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT CONSIDERING THE DECISION GIVEN BY THE HON BLE APEX COURT IN THE CASE OF HINDUSTAN STEEL LTD. VS. STATE OF ORISSA, (83 ITR 26), APPLICABLE TO THE CASE OF THE ASSESSEE. 3. TH E CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT FOLLOWING ACCURATELY THE DECISION GIVEN BY THE HON BLE GUJRAT HIGH COURT IN THE CASE OF PATAN NAGRIK SAHAKARI BANK LTD. VS. DIT(CIB) SPECIAL CIVIL APPLICATION NO. 14675 OF 2010. 4. THAT THE CIT(A) ERRED IN L AW AND ON FACTS IN UPHOLDING THE TIME BARRED CASE BY IGNORING THE PROVISIONS OF SECTION 275(1)(C) OF THE INCOME TAX ACT, 1961. IN THIS THE LD. ASSESSING AUTHORITY HAD PASSED THE ORDER ON 6.1.2011 WHICH WAS BEYOND THE SIX MONTH OF THE DATE FROM WHICH PENAL TY PROCEEDINGS INITIATED. AS PER ORDER IT IS CLEARED THAT NOTICE FOR DEFAULT WAS ISSUED BY THE LD. AO U/S. 285A(5) OF THE INCOME TAX ACT, 1961, ON 30.11.2006 ON BEING DEFAULT OF THE APPELLANT FOR NOT FILING THE AIR RETURN IN DUE DATE. ITA NO S . 5733 - 5737/ DEL/ 2012 3 5. THE APPELLANT CRA VES LEAVE TO ADD, AMEND OR ALTER ANY OF THE GROUNDS OF APPEAL AT THE TIME OF HEARING OF THE APPEAL, IF DEEMED NECESSARY, IN THE INTER E ST OF JUSTICE AND EQUITY. 2. THE FACTS RELATING TO THE ISSUE IN DISPUTE ARE THAT THE SUB - REGISTRAR, BHIWANI, DISTT. BH IWANI (HARYANA), WAS REQUIRED TO FILE ANNUAL INFORMATION RETURN(S) FOR THE FINANCIAL YEAR(S ) 2004 - 05,2005 - 06, 2006 - 07, 2007 - 08 &. 2008 - 09 . 2.1 ACCORDING TO SECTION 285B A OF THE INCOME TAX ACT, 1961 REQUIRES CERTAIN SPECIFIED PERSONS TO FILE AN ANNUAL I NFORMATION RETURN ( AIR) IN RESPECT OF SPECIFIED FINANCIAL TRANSACTIONS REGISTERED OR RECORDED BY THEM D URING THE FINANCIAL YEAR. THE NATURE OF THE TRANSACTIONS AND THE THRESHOLD VALUE FOR INFORMATION TO BE SUBMITTED IN THE AIR ARE PRESCRIBED IN THE TABLE (ITEM NO. 6 ) IN RULE 116E OF THE INCOME T AX RULES, 1962. THE FORM IN WHICH THE RETURN IS REQUIRED TO BE FILED IS FORM NO.61A. THE CENTRAL BOARD OF DIRECT TAXES, NEW DELHI HAS AUTHORISED M/S NATIONAL SECURITIES DEPOSITORIES (NSDL) AS THE AGENCY AUTHORISED T O RECEIVE ALRS ON THE BEHALF OF THE COMMISSIONER OF INCOME TAX (CENTRAL INFORMATION BRANCH). THE FILER CAN ALSO FURNISH THE AIR WITH THE FACILITATION CENTRES OF NSDL:LOCATED IN DIFFERENT PARTS OF THE COUNTR Y . ITEM NO. 6 OF THE TABLE IN RULE 114E SPECIFIES THAT THE REGISTRAR OR SUB - REGISTRAR APPOINTED U / S 6 OF THE REGISTRATION ACT, 1908 IS REQUIRED TO FILE AIR IN RESPECT OF TRANSACTIONS OF PURCHASE OR SALE BY ANY PERSON OF IMMOVABLE PROPERTY VALUED AT THIRTY IAKH RUPEES OR MORE. THE DUE DATE FOR FILING THE A I R IS THE 31 ST AUGUST IMMEDIATELY FOLLOWING THE FINANCIAL YEAR IN WHICH THE TRANSACTION IS REGISTERED OR RECORDED. IN THE EVENT OF FAILURE TO FURNISH THE AIR, PENALTY OF RS. 100/ - PER DAY FOR EVERY DAY IS LEVIABLE U / S 271FA . AS PER THE RECORD THE ASSESS EE HAS FILED THE ANNUAL INFORMATION RETURN (AIR) LATE, IN RESPECT OF THE PURCHASE AND ITA NO S . 5733 - 5737/ DEL/ 2012 4 SALE BY ANY PERSON OF IMMOVABLE PROPERTY VALUE AT RS. 30 LACS OR MORE. 2. 2 THE DIRECTOR OF INCOME TAX (CIB), CHANDIGARH ISSUED SHOW CAUSE NOTICE ON 6.9.2010 ASKING TH E ASSESSEE TO SHOW CAUSE AS TO WHY PENALTY NOTICE U/S. 271FA SHOULD NOT BE IMPOSED UPON THE ASSESSEE FOR FAILURE TO FURNISH THE AIR IN TIME AND REPLY WAS SOUGHT BY 27.9.2010. IN RESPONSE TO THE SAME NEITHER THE ASSESSEE NOR ANY AUTHORIZED REPRESENTATIVE O F THE ASSESSEE APPEARED BEFORE THE AUTHORITY AND NOR FILED ANY APPLICATION FOR ADJOURNMENT. ANOTHER SHOW CAUSE NOTICE WAS ISSUED VIDE LETTER DATED 14.10.2010 FIXING THE HEARING OF THE CASE BY 22.1 1 .2010. O N 22. 11 .2010 SH. RAVI, CLERK FROM THE OFFICE OF THE ASSESSEE ATTENDED AND REQUESTED FOR ADJOURNMENT ON THE GROUND THAT ASSESSEE WAS UNABLE TO ATTEND THE HEARING ON THE SAID DATE. HE WAS ASKED TO FILE THE NECESSARY COPY OF PRO VISIONAL RECEIPTS FOR THE F.YS 2007 - 0 8 & 2008 - 09 AS A PROOF OF HAVING FIL ED THE AIRS WITH NSDL. THE HEARING WAS ADJOURNED FOR 29.11.2010 AT THE REQUEST OF THE PERSON. ON 29.11.2010 , SHRI AMI CHAND, TEHSILDAR - CUM - SUB - REGISTRAR, BHIWANI (HARYANA), THE ASSESSEE , ATTENDED THE OFFICE AND FILED A COPY OF PROVISIONAL RECEIPT ISSUED B Y THE NSDL FOR THE FINANCIAL YEARS 200 7 - 08 ALONG WITH ITS WRITTEN REPLY , WHICH THE AO HAS REPRODUCED IN PARA NO. 5.3 AT PAGE. 3 AND 4 OF THE PENALTY ORDER. 2.3 THE DIRECTOR OF INCOME TAX (CIB), CHANDIGARH CONSIDERED THE DOCUMENTARY EVIDENCE FILED BY THE ASSESSEE ALONG WITH THE RETURN FILED BY THE ASSESSEE AND REJECTED THE EXPLANATION OF THE ASSESSEE AND HELD THAT THE ASSESSEE HAS FILED ITS AIR LATE FOR ALL THE FINANCIAL YEARS IN DISPUTE WHICH MAKE THE ASSESSEE A HABITUAL DEFAULTER WITHOUT ANY CONCERN/ RE SPECT FOR THE LAW OF THE LAND. IN THESE CIRCUMSTANCES, LD. DIT(CIB), CHANDIGARH OF THE I.T. ACT @100 PER ITA NO S . 5733 - 5737/ DEL/ 2012 5 DAY FOR DEFAULT FOR THE FINANCIAL YEARS UNDER CONSIDERATION AND COMPLETED THE ORDER ON 6.1.2010 U/S. 271FA OF THE I.T. ACT. 3. AGGRIEVED WITH THE P ENALTY ORDER DATED 6.1.2010, ASSESSED FILED AN APPEAL BEFORE THE LD. FIRST APPELLATE AUTHORITY WHO VIDE COMMON IMPUGNED ORDER DATED 22.8.2012 PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE. 4. NOW THE ASSESSEE HAS FILED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING SH. NAVEEN KUMAR GOYAL, ADVOCATE APPEARED AND STATED THAT THE ASSESSEE HAS ALREADY FILED A PAPER BOOK CONTAINING PAGES 1 TO 13 IN WHICH THE ASSESSEE HAS FILED THE COPY OF REPLY OF SHOW CAUSE NOTICE DATED 14.10.2010; WRITTEN SUBMISSION GIVEN TO CIT(A), ROHTAK DATED 21.8.2012; COPY OF LETTERS WRITTEN TO DIRECTOR OF INCOME TAX (CIB), CHANDIGARH; COPY OF RTI TO OFFICE OF THE DIRECTOR OF INCOME TAX (CIB), CHANDIGARH AND MANUAL SHOWING DUTIES OF TEHSILDAR. HE REQUESTED THAT IN VIEW OF THESE DOCUMENTARY EVIDENCES AS WELL AS THE ORDER DATED 15.2.2003 PASSED BY THE ITAT, DELHI H BENCH, NEW DELHI IN ITA NOS. 5701 TO 5704/DEL/2012 FINANCIAL YEARS 2005 - 06 TO 2008 - 09 VIDE ORD ER DATED 15.2.2013 IN THE CASE OF THE MAHENDERGARH CENTRAL CO - OP BANK LTD. VS. DIT(CIB), THE PENALTY IN DISPUTE MAY BE CANCELLED BY ACCEPTING THE APPEAL FILED BY THE ASSESSEE. 6. LD. DR RELIED UPON THE ORDER PASSED BY THE LD. CIT(A) AND THE PROVISIONS OF LAW APPLICABLE TO THE CASE OF THE ASSESSEE. HE FURTHER STATED THAT THE ASSESSEE REMAINED NON - COOPERATIVE BEFORE THE AO AS WELL AS BEFORE THE LD. CIT(A), THEREFORE, ASSESSEE IS NOT ENTITLED FOR ANY LENIENT VIEW FROM THIS BENCH. HE REQUESTED THAT ASSESS EE HAS NO REASONABLE CAUSE FOR DELETING THE PENALTY IN DISPUTE, THEREFORE, THE APPEAL FILED BY THE ASSESEE MAY BE DISMISSED. ITA NO S . 5733 - 5737/ DEL/ 2012 6 7. WE HAVE HEARD BOTH THE PARTIES AND HAVE GONE THROUGH THE RELEVANT RECORD AVAILABLE WITH THE SPECIAL ORDER PASSED BY THE RE VENUE AUTHORITIES ALONGWITH THE PAPER BOOK PAGES 1 TO 13 FILED BY THE ASSESSEE IN WHICH THE ASSESSEE HAS ATTACHED THE WRITTEN SUBMISSIONS AS WELL AS THE RELEVANT PROVISIONS OF LAW APPLICABLE TO THE PRESENT CASE AND THE DECISION CITED BY THE LD. COUNSEL OF THE ASSESSEE . WE ARE OF THE VIEW THAT THE PROVISIONS OF SECTION 285BA(1) OF THE I.T. ACT, 1961 H AS SPECIFIED SOME PERSONS TO FILE AIR IN RESPECT OF SPECIFIED FINANCIAL TRANSACTIONS REGISTERED OR RECORDED BY THEM DURING THE FINANCIAL YEAR. THE NATURE O F TRANSACTIONS AND THE THRESHOLD VALUE FOR INFORMATION TO BE SUBMITTED IN THE AIR ARE PRESCRIBED IN THE TABLE (ITEM NO. 6 ) IN RULE 116E OF THE INCOME T AX RULES, 1962. IN THE PRESENT CASES THE ASSESSEE SUB - REGISTRAR, BHIWANI, HARYANA, IS R EQUIRED TO FILE THE AIR IN RESPECT OF SPECIFIED FINANCIAL TRANSACTIONS REGISTERED OR RECORDED BY HIM DURING THE FINANCIAL YEARS UNDER CONSIDERATION. ACCORDING TO RECORD THE SUB - REGISTRAR, BHIWANI IS REQUIRED TO FILE THE AIR FOR THE FINANCIAL YEARS 2004 - 05 TO 2008 - 09 A S UNDER: - FINANCIAL YEAR DUE DATE FOR FILING OF AIR 2004 - 05 30.11.2005 2005 - 06 31.08.2006 2006 - 07 31.08.2007 2007 - 08 31.08.2008 2008 - 09 31.08.2009 7.1 AS PER THE RECORD, THE ASSESSEE HAS FILED THE ANNUAL INFORMATION RE TURN VERY LATE IN RESPECT OF PURCHASE AND SALE OF IMMOVABLE PROPERTY AND VALUED AT RS. 30 LACS OR MORE FOR THE FINANCIAL YEARS IN DISPUTE I.E. 2004 - 05 TO 2008 - 09, THE DETAILS OF THE SAME IS AS UNDER: - ITA NO S . 5733 - 5737/ DEL/ 2012 7 S.NO. FINANCIAL YEAR DUE DATE FOR FILING FILED ON DELAY (IN DAYS) 1 2004 - 05 30.11.2005 03.02.2010 1525 DAYS 2 2005 - 06 31.08.2006 03.02.2010 1251 DAYS 3 2006 - 07 31.08.2007 03.02.2010 886 DAYS 4 2007 - 08 31.08.2008 26.11.2010 817 DAYS 5 2008 - 09 31.08.2009 03.02.2010 156 DAYS 7.2 ACCORDING TO SECTION 271FA OF THE I.T. ACT, IF A PERSON WHO IS REQUIRED TO FURNISH THE AIR AS REQUIRED UNDER SUB - SECTION (1) OF SECTION 285BA, FAILS TO FURNISH SUCH RETURN WITHIN THE TIME PRESCRIBED UNDER THAT SUB - SECTION, THE INCOME TAX AUTHORITY PRESC RIBED UNDER THE SUB - SECTION MAY DIRECT THAT SUCH PERSON SHALL PAY, BY WAY OF PENALTY, A SUM OF ONE HUNDRED RUPEES FOR EVERY DAY DURING THE FAILURE CONTINUES. 7.3 IN VIEW THE REQUIREMENT OF LAW AS MENTIONED ABOVE AS WELL AS NON - FULFILLMENT OF THE SAME AN D IN VIEW OF THE DETAILS GIVEN ABOVE, ASSESSEE HAS FILED ITS RETURN FOR THE FINANCIAL YEAR 2004 - 05 I.E. DELAY 1525 DELAYS; FY 2005 - 06 I.E. DELAY 1251 DAYS; FY 2006 - 07 I.E. DELAY 886 DAYS; FY 2007 - 08 I.E. DELAY 817 DAYS AND FY 2008 - 09 I.E DELAY 156 DAYS. 7.4 KEEPING IN VIEW OF THE AFORESAID DELAY FOR FILING THE AIR, THE AO ISSUED SHOW CAUSE NOTICE TO THE ASSESSEE ON 6.9.2010 ASKING THE ASSESSEE TO SHOW CAUSE AS TO WHY THE PENALTY U/S. 271FA OF THE ACT SHOULD NOT BE IMPOSED UPON IT FOR FAILURE THE AIR IN TIME AND THE REPLY WAS SOUGHT BY 27.9.2010. IN RESPONSE TO THE SAME, NOBODY APPEARED NOR ANY ADJOURNMENT APPLICATION IS FILED. THE AUTHROITY AGAIN ISSUED NOTICE DATED 14.10.2010 AND ADJOURNED THE HEARING FOR 22.11.2010 FOR THE SAME PURPOSES. ON 22.11.2010 SH. RAVI, CLERK ITA NO S . 5733 - 5737/ DEL/ 2012 8 FROM THE OFFICE OF THE ASSESSEE I.E. SUB REGISTRAR FILED AN APPLICATION FOR ADJOURNMENT AND THE HEARING WAS ADJOURNED FOR 29.11.2010. ON 29.11.2010 SUB REGISTRAR, BHIWANI APPEARED AND AGAIN FILED THE REPLY DATED 14.10.2010 WHICH THE AO HA S REPRODUCED IN THE ASSESSMENT ORDER AT PAGES 3 - 4 VIDE PARA 5.3. FOR THE SAKE OF CONVENIENCE, THE REPLY OF THE ASSESSEE DATED 14.10.2010 IS REPRODUCED AS UNDER: - 'THAT YOUR PETITIONER IS AN OFFICIAL OF THE HARYANA GOVT. AND HAS BEEN POSTED AS TEHSILDAR A T BHIWANI W.E.I 16.8.2010 AND HAS ALSO BEEN ASSIGNED WITH THE WORK AS SUB - REGISTRAR'AT BHIWANI FROM THE SAID DATE. VARIOUS OFFICIALS HAD BEEN POSTED AS TEHSILDAR AT BHIWANI END AS MANY AS SEVEN PERSONS HAVE WORKED AS TEHSILDAR SINCE 01.04.2004 AND MOST OF HAD A SHORT DURATION OF POSTING AND WORKING AS SUB - REGISTRAR AT BHIWANI AND IN MOST OF THE CASES SUCH DURATION WAS LESS THAN A YEAR. THEREFORE, THE PETITIONER IS UNABLE TO EXPLAIN THE CAUSE OF DE/AY IN SUBMISSION OF THE AIR. IN FACT TEHSILDAR POSTED I N THE SUBDIVISION HAS VARIOUS REVENUE DUTIES TO BE PERFORMED. HE HAS A/SO TO WORK AS A REVENUE OFFICER UNDER THE LAND REVENUE ACT AND THE TENANCY ACT. HE HAS ALSO TO ATTEND THE MINISTER VISITING THE DISTRICT AND HAD ALSO TO SO THE VILLAGES. IN FACT TEHSILA DAR ALSO WORK AS A CV FIELD OFFICER AND AN EXECUTIVE MAGISTRATE. SO FAR AS I UNDERSTAND THAT THERE WAS NO WILLFUL NON COMPLIANCE OF THE OBLIGATION ON THE PART OF THIS OFFICE WAS NOT GOING TO GAIN ANY THING BY SUCH NON COMPLIANCE NOR IT WAS TO LOSE SO THI S BY COMPLIANCE THERE OF THE NON COMPLIANCE THUS HAS BEEN DUE TO IGNORANCE OF THE STATUTORY PROVISION. IN FACT TEHSILDAR BHIWANI HAS TO PERFORM DUTY AS SUB REGISTRAR IN ADDITION TO HIS NORMAL OFFICIALS FUNCTIONS REVENUE AUTHORITY AND EXECUTIVE MAGISTRAT E AND A/SO OTHER DUTIES EARMARKED BY D.C ITA NO S . 5733 - 5737/ DEL/ 2012 9 FOR ATTENDING UPON THE STATE MINISTERS & HIGHER OFFICIALS . THE PROVIS I ONS OF FILING THE ANNUAL INFORMATION R ETURN BEING NEW STATUTORY PROVISION THIS OFFICE WAS NOT AWARE OF THE LEGAL OBLIGATION IN THIS REGARD BECAU SE THE OFFICE OF INSPECTOR GENERAL OF REGISTRATION, REGISTRAR OF THE GOVT. HAD NEITHER PROVIDED THIS OFFICE WITH NECESSARY INSTRUCTION REGARDING THIS LEGAL OBLIGATION, AS SUCH THIS OFFICE HAD NOT DE L IBER A TELY MAKE & DEFIANCE OF LAW NOR IS GUILTY OF CONDUC T CONTUMACIOUS OR DISHONEST. THIS OFFICE EVEN HAD NOT ACTED IN CONSCIOUS DISREGARD OF ITS OBLIGATION IN REGARDING FILING OF AIR THOUGH NOR - COMPLIANCE OF THIS LEGAL OBLIGATION ATTRACTS THE PENAL PROVISIONS AS CONTAINED IN SECTION 271FA BUT THE HON'BLE S.C I N THE CASE OF HINDU STAN STEEL LTD. VS THE S TATE OF ORISSA 25 STC 211 HAS HELD THAT ACTION FOR LEVY OF PENALTY IS THE RESULT OF A QU ASI CRI MINAL PROCEEDINGS AND PENALTY WILL NOT ORDINARILY BE IMPOSED BECAUSE IT IS LAW FU LL TO DO SO. THE LEVY OF PENALTY FOR FAILURE TO PERFORM A STATUTORY OBLIGATION IS A MATTER OF DISCRETION OF THE AUTHORITY TO BE EXERCISED JUDICIALLY AND ON CONSIDERATION OF ALL THE RELEVANT CIRCUMSTANCES. EVEN IF M INIMUM PENALTY IS PRESCRIBED THE AUTHORITY COMPETENT TO IMPOSE THE PENALTY WILL BE JUSTIFIED IN REFUSING TO IMPOSE PENALTY WHEN THERE IS A TECHNICAL OR VENIAL BREACH OF THE PROVISIONS OF THE ACT OR WHERE THE BREACH FLOWS FROM A BONAFIDE BELIEF THAT THE OFFENDER IS NOT LIABLE TO ACT IN THE MANNER PRESCRIBED BY THE STATUTE. THE LEGAL POSITION EXPLAINED IN THE ABOVE AUTHORITY IS THAT WHERE THERE HAS BEEN A DEFIANCE OF STATUTORY OBLIGATION WHICH A PERSON IS OBLIGED TO PERFORM THE AUTHORITY COMPETENT TO LEVY THE PENALTY WILL BE JUSTIFIED IN REFUSING TO IMPOSE THE PENALTY IF THE PERSON OBL IGED TO PERFORM STATUTORY OBLIGATION AND HAD NOT BREACHED THE LEGAL OBLIGATION DELIBERATELY OR IN CONSCIOUS DISREGARD OF ITS ITA NO S . 5733 - 5737/ DEL/ 2012 10 OBLIGATIONS IN THIS REGARD, IS FULLY APPLICABLE IN FACTS OF THE PRESENT AS EXPLAINED ABOVE. THE NON COMPLIANCE OF THE LEGAL OBLIGA TION HAS NOT CAUSED ANY WRONG FULL GAIN TO THIS OFFICE AND THE OFFICE OF WOULD H A VE IOST ANYTHING OF IT HAD COMPLIED WITH THE LEGAL PROVISIONS IN THIS REGARD. THE DEFIANCE WAS DUE TO BONA FIDE REASONS AS EXPLAINED ABOVE AND ALSO ON ACCOUNT OF HEAVY OFFICIA L DUTIES ATTACHED TO THE OFFICE AND ALSO OF FREQUENT TRANSFERS OF THE OFFICIALS AS IS EVIDENT FROM THE FACT THAT IN THE SPAN OF 5 YEARS 7 OFFICERS HAS BEEN TRANSFERRED/POSTED. IN THE CIRCUMSTANCES IT IS PRAYED THAT THE PENALTY PROCEEDINGS MAY KIND BE DROPP ED AND NOTICE MAY KINDLY BE VACATED. 7.5 AFTER CONSIDERING THE REPLY AND THE OTHER DOCUMENTARY EVIDENCE, THE AO HAS GIVEN HIS FINDING AT PARA NO. 6 PAGES 4 AND 5 WHICH IS REPRODUCED AS UNDER: - 6. THE CONTENTIONS OF THE FILER HAVE CAREFULLY BEEN CONSIDERED AND THE RELEVANT RECORD PERUSED. THE EXPLANATIONS OF THE FILER SUBMITTED IN THE FORM OF WRITTEN REPLY (S) QUOTED ABOVE ARE NOT ACCEPTABLE IN VIEW OF THE FOLLOWING: - 1) THE FILER HAS STATED THA T IT WAS IGNORANT ABOUT THE STATUTORY PROVISIONS, AS THE PROVISIONS WERE NEW ONE. THIS EXCUSE OF THE FILER IS NOT ACCEPTABLE AS THE PROVISIONS REGARDING FILING OF AIR BY THE FILER WITH NSDL ARE EFFECTIVE SINCE FINANCIAL YEAR 2004 - 05. MOREOVER, IGNORANCE OF LAW IS NOT A VALID GROUND IN THE EYES OF LAW. 2) FURTHER THE FILER'S ARGUMENT THAT THERE IS NO REVENUE LOSS TO THE DEPARTMENT IS ALSO NOT ACCEPTABLE AS THE INFORMATION UNDER AIR FORMS THE BASIS FOR SELECTION OF CASES UNDER SCRUTINY, ITA NO S . 5733 - 5737/ DEL/ 2012 11 THROUGH CASS, AND ALS O FOR FURTHER INVESTIGATION OF CASES, BOTH PROCEDURES ARE MEANS FOR DE TECTION OF TAX EVASION AND CONCEALMENT. THUS NON FILING OF AIR UNDER QUESTION HAS REVENUE IMPLICATIONS AND ALSO THE TAX EVADER DERIVES INDIRECT BENEFIT THROUGH IT. THE FILER'S CONTENTION S ARE, THEREFORE, NOT ACCEPTED. LACK OF MENS - REA HAS ALSO NOT BEEN PROVED, THE ONUS OF WHICH LIES ON THE FILER. 3) THE PRESENCE/ABSENCE OF INTENTION CAUSING THE DELAY IS NOT RELEVANT. THE (HAY WHETHER MALAFIDE OR BONAFIDE MAKES NO DIFFERENCE AS FAR AS PEN A L TY U/ S 271FA OF THE ACT IS CONCERNED. 4) TH E FILER WHETHER A GOVT. BODY OR A NON - GOVT. BODY ALSO MAKES NO DIFFERENCE AS THE LAW IS APPLICABLE WITH EQUAL FORCE TO EACH AND EVERY FILER UNLESS THERE ARE MOTIVES IMPUTED FOR PERSONAL INTERESTS ETC., WHICH I S NOT THE CASE HERE. 5) THE FILER HAS ALSO STATED IN ITS REPLY THAT NEITHER THE OFFICE OF INSPECTOR GENERAL OF REGISTRATION NOR THE GOVT. HAD PROVIDED WITH ITS OFFICE NECESSARY INSTRUCTION REGARDING FILING OF AIR. THIS CONTENTION OF THE FILER IS NOT ACCEPTABLE AS NOTICES WERE ISSUED BY THIS OFFICE FOR DIFFERENT FINANCIAL YEARS ON 30.11.2006, 11.05.2007, 10.07.2008, 17.04.2009, 13.08.2009, 20.11.2009 & ON 27.07.2010 ETC., WHICH REMAINED UN - COMPLIED WITH. THE FILER CA NNOT CLAIM ANY IGNORANCE AS IT WAS MADE AWARE .OF THE LT. PROVISIONS REGARDING FILING OF AIRS BY ISSUANCE OF NOTICES FROM TIME TO TIME. 6) FREQUENT TRANSFERS OF SUB - REGISTRAR S /REGISTRARS IS ALSO NOT RELEVANT FACTOR BECAUSE THIS OFFICE IS NOT FIXING ANY ITA NO S . 5733 - 5737/ DEL/ 2012 12 RE SPONSIBILITY ON THE INDIVIDUAL INCUMBENTS WHO OCCUPIED OFFICE AT THE RELEVANT POINT OF TIME BUT IS RATHER ISSUING THE NOTICE TO THE OFFICE OF SUB - REGISTRAR FOR THE DELAY INVOLVED IN FILING OF AIR FOR VARIOUS FINANCIAL YEARS. NO FIXING OF RESPONSIBILITY ON INDIVIDUALS IS REQUIRED TO BE DONE BY THIS OFFICE. IN ANY CASE THIS IS PURELY INTERNAL ADMINISTRATIVE MATTER BETWEEN THE FILER AND THE STATE GOVT. FURTHER, IF THE WORK OF REGISTRATION OF PROPERTIES ETC. HAS GONE ON UNHINDERED DESPITE FREQUENT TRANSFERS OF OFFICERS AND STAFF; THERE IS NO REASON WHY AIR WAS NOT FILED ON TIME. 7) THE RELIANCE PLACED BY THE FILER ON THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE OF HI NDUSTAN STEEL LTD. VS. STATE OF ORI SSA (1972) 83 ITR 26 IS ALSO MISPLACED BECAUSE THE HON BLE APEX COURT IN THE CASE OF DHARMENDRA TEXTILE PROCESSOR 295 ITR 244 AFTER CONSIDERING THE JUDGEMENT IN CASE OF DILIP N. SHROFF 291 ITR 519 (S C ) HAS DECIDED THAT PENALTY IS A CIVIL LIABILITY AND THE ELEMENT OF MENS - REA IS NOT RELEVANT FOR IMPOSITION OF PENALTY EVEN U] S 271(1)(C) OF TH E ACT HERE IN THIS CASE WE ARE NOT CONCERNED WITH PENALTY U / S 271 [1 ] (C) WHICH COULD HAVE CAUSED SPECIAL DOUBT IN THE MIND OF THE FILER. SECTION 271FA OF THE ACT HAS NO SUCH REQUIREMENT AND THE ONLY REQUIREMENT TO CONDO NE THE DELAY IS THAT THE FILER SHOULD BE ABLE TO SHOW A REASONABLE CAUSE FOR THE DELAY, WHICH THE FILER HAS FAILED TO DO IN THIS CASE. 7.6 THE DIRECTOR OF INCOME TAX (CIB), CHANDIGARH AFTER CONSIDERING THE REPLY FILED BY THE ASSESSEE IS OF THE VIEW THAT THE ASSESSEE IS HABITUAL DEFAULTER AND HAVE NO RESPECT FOR THE LAW OF LAND AND IMPOSED THE PENALTY @RS. 100/ - PER DAY FOR DEFAULT FOR THE FINANCIAL ITA NO S . 5733 - 5737/ DEL/ 2012 13 YEARS UNDER CONSIDERATION VIDE THE ORDER DATED 6.1.2011 PASSED U/S. 271FA OF THE ACT. LD. FIRST APPELLATE TRIBUNAL HAS UPHELD THE ORDER OF THE AO BY PARTLY ALLOWED THE APPEAL AND HAS GIVEN HIS FINDING VIDE PARA NO. 5 PAGE 3 TO 4 OF HIS ORDER W HICH IS REPRODUCED AS UNDER: - 5. I HAVE CAREFULLY CONSIDERED THE ISSUE AND THE SUBMISSIONS MADE BY THE AR. SECTION 285BA IN THE PRESENT FORM WAS INSERTED W.E.F. 1.4.2005 CASTING OBLIGATION ON THE FILER TO FURNISH AIR WITHIN THE SPECIFIED DATE AS PER RULE 114E AND FORM NO. 61A. 5.1 PERUSAL OF RECORD SHOWS THAT NOTICES FOR FILING AIRS FOR DIFFERENT YEARS HAVE BEEN ISSUED ON 30.11.2006, 11.5.2007, 10.7.2008, 17.4.2009, 13.8.2009, 20.11.2009 & 27.7.2010 WHICH REMAINED UN COMPLIED WITH. THE ISSUE OF THE APPELL ANT IS COVERED BY THE CASE OF PATAN NAGRIK SARKARI BANK LTD. VS DIT (SUPRA) WHEREIN IT WAS HELD AS UNDER: - PENALTY U/ S 271FA - DELAY IN FILING ANNUAL INFORMATION RETURN - REASONABLE CAUSE - PETITIONER, A CO - OPERATIVE BANK SITUATED IN A MOFUSSIL AREA, WAS EXEMPT FROM INCOME TAX UNDER THE PROVISIONS OF S. 80P(2(A)(I) UPTO ASSTT. YR. 2006 - 07 AND WAS NOT HAVING THE ASSISTANCE OF CHARTERED ACCOUNTANTS - IN VIEW OF SAID EXPLANATION OF THE PETITIONER IT WOULD BE REASONABLE TO BELIEVE THAT THE PETITIONER WAS NOT AWARE OF THE PROVISIONS OF 28 5 BA WHICH WERE BROUGHT ON THE STATUTE BOOK IN THE PRESENT FORM W.E.F. I ST APRIL, 2005 - HOWEVER, ITA NO S . 5733 - 5737/ DEL/ 2012 14 EVEN AFTER THE ITO ISSUED NOTICE UNDER S. 28 5 BA( 5 ) ON 17TH DEC. 2008, THE PETITIONER DID NOT COMPLY WITH THE REQUIREMENTS OF S. 285BA - IT WAS ONLY WHEN A SECOND NOTICE WAS ISSUED ON 11 TH SEP T ., 2009, THAT THE PETITIONER FILED THE ANNUAL INFORMATION RETURN - THUS, EVEN IF IT IS ASSUMED THAT THE PETITIONER WAS INITIALLY NOT AWARE OF ITS STATUTORY OBLIGATION UNDER S. 28 5 BA, IT IS NOT OP EN TO THE PETITIONER TO TAKE SUCH DEFENCE ONCE THE DEPARTMENT HAD ISSUED NOTICE UNDER S. 28 5 BA( 5 ) ON 17TH DEC., 2008 - IT CANNOT BE SAID THAT THE PETITIONER HAD ANY REASONABLE CAUSE FOR NOT FILING THE ANNUAL INFORMATION RETURN WITHIN THE PERIOD OF SIXTY DAYS OF SERVICE OF THE FIRST NOTICE - FACT, THAT SUCH ANNUAL INFORMATION RETURN CAME TO BE FURNISHED WITHIN A MONTH FROM THE ISSUANCE OF THE SECOND NOTICE FALSIFIES THE CASE OF THE PETITIONER THAT THERE WERE SUBSTANTIAL NUMBER OF TRANSACTIONS AND THAT IT TOOK SOME TIME TO FATHER THE INFORMATION - THUS , PETITIONER WAS NOT ENTITLED TO ENTERTAIN ANY BONA FIDE BELIEF OR TO PLEAD IGNORANCE OF THE PROVISIONS OF S. 285BA FROM THE DATE OF SERVICE OF FIRST NOTICE UNDER S. 285BA(5) - DEFAULT ON THE PART OF THE PETITIONER H AS TO BE VIEWED AS A CONSCIOUS DISREGARD OF ITS STATUTORY OBLIGATION AND THE PETITIONER IS NOT ENTITLED TO THE BENEFIT OF THE PROVISIONS OF S. 273B IN RESPECT OF THE PERIOD SUBSEQUENT THERETO - PENALTY IS DELETED FOR THE PERIOD UP TO THE DATE OF SERVICE OF F IRST NOTICE ITA NO S . 5733 - 5737/ DEL/ 2012 15 UNDER S. 285BA(5) - FOR THE REMAINING PERIOD) PENALTY IS LEVIABLE FROM THE DATE OF SERVICE OF THE FIRST NOTICE. 5.2 IN THE PRESENT CASES, IT IS SEEN THAT NOTICES WERE ISSUED ON 30.11.2006, 11.5.2007, 10.7.2008, 17.4.2009, 13.8.2009, 20.11.2009 & 277.2010 CALLING FOR THE RETURNS DRAWING ATTENTION OF THE APPELLANT TO T HE PROVISIONS OF SECTION 285BA AND SECTION 271FA. RESPECTFULLY F OLLOWING THE JUDGMENT OF HON'BIE HIGH COURT OF GUJRAT IN THE CASE OF PATAN NAGRIK SARKARI BANK LTD. VS DIT (SUPRA), PE NALTY UPTO THE DATE OF SERVICE OF FIRST NOTICE IS CANCELLED AND FOR THE REMAINING PERIOD, PENALTY IS SUSTAINED. 7.7 KEEPING IN VIEW OF THE ASSESSMENT ORDER AS WELL AS THE IMPUGNED ORDER PASSED BY THE LD. CIT(A), WE ARE OF THE VIEW THAT ACCORDING TO SECT ION 285BA OF THE I.T. ACT , T HE ASSESSEE IS REQUIRED TO FILE AIR FOR THE FINANCIAL YEARS UNDER CONSIDERATION IN RESPECT OF THE TRANSACTIONS OF PURCHASE AND SALE BY ANY PERSON OF THE IMMOVABLE PROPERTY VALUED AT RS. 30 LACS OR MORE BY 31 ST AUGUST, IMMEDIATEL Y FOLLOWING THE FINANCIAL YEAR IN WHICH THE TRANSACTION IS REGISTERED OR RECORDED. IN THE EVENT OF FAILURE TO FURNISH THE AIR, THE PENALTY IS LEVIABLE UNDER SECTION 271FA. FOR THE SAKE OF CONVENIENCE THE PROVISIONS OF SECTION 285BA(1) AND SECTION 271FA IS REPRODUCED AS UNDER: - SECTION 285BA(1): - ANY PERSON, BEING AN ASSESSEE; OR THE PRESCRIBED PERSON IN THE CASE OF AN OFFICE OF GOVERNMENT, WHO IS RESPONSIBLE FOR REGISTERING, OR MAINTAINING BOOKS OF ACCOUNT OR OTHER DOCUMENT CONTAINING A RECORD ITA NO S . 5733 - 5737/ DEL/ 2012 16 OF ANY SPECIFIED FINANCIAL TRANSACTION, UNDER ANY LAW FOR THE TIME BEING IN FORCE, SHALL FURNISH AN ANNUAL INFORMATION RETURN, IN RESPECT OF SUCH SPECIFIED FINANCIAL TRANSACTIONS WHICH IS REGISTERED OR RECORDED BY HIM DURING ANY FINANCIAL YEAR BEGINNING ON OR AFT ER THE 1 ST DAY OF APRIL, 2004 AND INFORMATION RELATING TO WHICH IS RELEVANT AND REQUIRED FOR THE PURPOSES OF THE ACT, TO THE PRESCRIBED INCOME TAX AUTHORITY OR SUCH OTHER AUTHORITY OR AGENCY AS MAY BE PRESCRIBED. SECTION 271FA: - IF A PERSON WHO IS R EQUIRED TO FURNISH THE AIR AS REQUIRED UNDER SUB - SECTION (1) OF SECTION 285BA, FAILS TO FURNISH SUCH RETURN WITHIN THE TIME PRESCRIBED UNDER THAT SUB - SECTION, THE INCOME TAX AUTHORITY PRESCRIBED UNDER THE SUB - SECTION MAY DIRECT THAT SUCH PERSON SHALL PAY, BY WAY OF PENALTY, A SUM OF ONE HUNDRED RUPEES FOR EVERY DAY DURING THE FAILURE CONTINUES. 7.8 KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCE OF THE PRESENT CASE AND THE PROVISIONS OF LAW REPRODUCED AS ABOVE, WE ARE OF THE VIEW THAT THE MAIN CONTENTION OF THE ASSESSEE IS THAT THE ASSESSEE WAS IGNORANT OF LAW I.E. ABOUT THE PROVISIONS OF SECTION 285BA OF THE I.T. ACT. WE ARE OF THE VIEW THAT THE PROVISIONS OF SECTION 285BA OF THE ACT WAS INTRODUCED BY THE FINANCE (NO. 2) ACT, 2004 W.E.F. 1.4.2005, IT I S NOT THE CASE THAT THIS SECTION HAS BEEN INTRODUCED FOR THE FIRST TIME BY FINANCE (NO. 2) ACT, 2004. PRIOR TO ITS SUBSTITUTION, SECTION 285BA WAS INSERTED WHERE ANY PERSON WHO ENTERS INTO ANY FINANCIAL TRANSACTION, AS MAY BE PRESCRIBED, WITH ANY OTHER PER SON, ITA NO S . 5733 - 5737/ DEL/ 2012 17 SHALL FURNISH, WITHIN THE PRESCRIBED TIME, AN ANNUAL INFORMATION RETURN IN SUCH FORM AND MANNER, AS MAY BE PRESCRIBED IN RESPECT OF SUCH FINANCIAL TRANSACTIONS ENTERED INTO BY HIM DURING ANY PREVIOUS YEAR. RULE 114A TO 114E PRESCRIBES SUCH RETURN TO BE FURNISHED IN FORM NO. 61A AND SHALL BE VERIFIED IN THE MANNER INDICATED THEREIN. AT ITEM NO. 6 OF THE SAID RULE, RETURN SHALL BE FURNISHED ON OR BEFORE 31 ST AUGUST, IMMEDIATELY FOLLOWING THE FINANCIAL YEAR IN WHICH THE TRANSACTION IS REGISTERED OR RECORDED. 7.9 THE PLEA TAKEN BY THE ASSESSEE FOR IGNORANCE OF LAW IS NOT SUSTAINABLE IN THE EYES OF LAW, BECAUSE THE IGNORANCE OF LAW IS NOT AN EXCUSE, AS PER THE DECISION OF HON BLE SUPREME COURT OF INDIA IN THE CASE OF UOI & ORS. VS. DHARMENDRA TEXTILE PROCESSOR 295 ITR 244 AND THE DECISION OF THE HON BLE HIGH COURT OF GUJRAT IN THE CA SE OF PATAN NAGRIK SARKARI BANK LTD. VS. DIT (2011) 240 CTR 113 (GUJ.) AND THE DECISION OF HON BLE SUPREME COURT IN THE CASE OF MOTI LAL PADAMPAT SUGAR MILLS CO. LTD. VS. STATE OF UTTAR PRADESH & ORS. REPORTED IN (1979) 118 ITR 326 (SC). 8. KEEPING IN VIE W OF THE AFORESAID DISCUSSION, WE ARE OF THE CONSIDERED VIEW THAT ASSESSEE HAS NOT ESTABLISHED ANY REASONABLE CAUSE FOR NOT FILING THE ANNUAL INFORMATION RETURN (AIR) WITHIN TIME. SECONDLY, ASSESSEE HAS ALSO FAILED TO FILE ANY DOCUMENTARY EVIDENCE SUPPO RTING THE VERSION SUBMITTED BEFORE THE REVENUE AUTHORITY AS WELL BEFORE US. ACCORDING TO THE PROVISIONS OF LAW APPLICABLE TO THE CASE OF THE ASSESSEE AS WELL AS DECISION CITED BY THE ASSESSEE BEFORE THE REVENUE AUTHORITY AND BEFORE US, AFTER THOROUGHLY GOING THROUGH THE SAME, WE ARE OF THE CONSIDERED VIEW THAT THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE ARE NOT IDENTICAL TO THE FACTS OF THE CASE RELIED UPON BY THE ASSESSEE S COUNSEL. ASSESSEE HAS ALSO FAILED TO ESTABLISH ANY BONAFIDE IN NOT FILING T HE AIR WITHIN TIME, INSPITE OF THE FACT THAT ASSESSEE IS HOLDING A VERY RESPONSIBLE POST ITA NO S . 5733 - 5737/ DEL/ 2012 18 AND DISCHARGING VERY IMPORTANT DUTIES WHICH DIRECTLY AFFECT THE EXCHEQUER OF THE COUNTRY. SINCE THE AIR TO BE FILED BY THE ASSESSEE IS VERY MUCH ESSENTIAL FOR FURTHE R CAUSE OF ACTION ON THE SAME FOR WHICH THE ASSESSEE HAS FAILED TO SUBMIT WITHIN TIME. THEREFORE, THE PENALTY IN DISPUTE HAS RIGHTLY BE LEVIED BY THE REVENUE AUTHORITIES, HENCE, WE UPHOLD THE PENALTY IN DISPUTE BY DISMISSING ALL THE APPEALS FILED BY THE ASSESSEE. 9 . IN THE RESULT, ALL THE 05 APPEALS FILED BY THE ASSESSEE STAND DISMISSED. ORDER PRONOUNCED IN THE O PEN C OURT ON 09 / 2 /20 1 5 . SD/ - SD/ - [ J.S. REDDY ] [ H.S. SIDHU ] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 09 / 2 /201 5 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES ITA NO S . 5733 - 5737/ DEL/ 2012 19