Euro Grain Ltd., New Delhi V. ACIT, New Delhi

ITA 583/DEL/2015

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5448 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 3 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-05-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 29-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVIKANT GUPTA
• Keywords: Search and seizure; Question of law
• Section: 143(3); 153A; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH A NEW DLEHI BEFORE SHRI G.D. AGRAWAL, PRESIDENT AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER I.T.A. NOS.601 TO 603/DEL/2015 ASSESSMENT YEARS: 2005-06 TO 2007-08 ODIMCO TECHNOLOGIES P. LTD. VS ASSTT. COMMI SSIONER OF INCOME-TAX, 6-B, JOR BAGH LANE, CENTRAL CIRCLE 5, NE W DELHI. NEW DELHI. (PAN: AAACO3504C) I.T.A. NOS.583 TO 585/DEL/2015 ASSESSMENT YEARS: 2005-06 TO 2007-08 M/S EURO GRAIN LTD. VS ASSTT. COMMISSIONE R OF INCOME-TAX, 6-B, JOR BAGH LANE, CENTRAL CIRCLE 5, NE W DELHI. NEW DELHI. (PAN: AAACE2333F) I.T.A. NOS.586 TO 588/DEL/2015 ASSESSMENT YEARS: 2005-06 TO 2007-08 ASSOCIATEDE SHOES P.LTD. VS ASSTT. COMMISSI ONER OF INCOME-TAX, 6-B, JOR BAGH LANE, CENTRAL CIRCLE 5, NE W DELHI. NEW DELHI. (PAN: AAACA2231N) I.T.A. NOS.592 TO 594/DEL/2015 ASSESSMENT YEARS: 2005-06 TO 2007-08 PLANET PULSE FITNESS P. LTD. VS ASSTT. COM MISSIONER OF INCOME-TAX, 6-B, JOR BAGH LANE, CENTRAL CIRCLE 5, NE W DELHI. 2 NEW DELHI. (PAN: AADCP0764A) I.T.A. NO.3149/DEL/2015 ASSESSMENT YEAR: 20 MS SAJNI THUKRAL, VS ASSTT. COMMISSIONER OF INCOME-TAX, G8, MAHARANI BAGH, CENTRAL CIRCLE 5, NEW DELHI. NEW DELHI. (PAN: ACRPT8214E) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI RAHUL KHARE, ADVOCATE SHRI YUDHISHTER SETH, CA RESPONDENT BY: SHRI RAVIKANT GUPTA, SR. DR ORDER DATE OF HEARING: 02.05.2018 DATE OF PRONOUNCEMENT: .05.2018 PER BENCH ALL THESE APPEALS ARE FILED BY THE ASSESSEES ON THE FOLLOWING COMMON GROUND: THE LD. CIT(A) ERRED IN FACT AND IN LAW IN CONFIRM ING THE PENALTY OF RS.10,000/-UNDER SECTION 271 (1) (B) OF THE INCOME TAX ACT, 1961 WHICH IS NOT ONLY ILLEGAL BUT ALSO AGAINST THE FACTS AND CIR CUMSTANCES OF THE CASE. 2. FACTS, THE QUESTION OF LAW AND THE GROUNDS OF AP PEAL INVOLVED IN ALL THESE APPEALS ARE THE SAME, AS SUCH ALL THESE MATTERS COU LD BE CONVENIENTLY DISPOSED OF BY THIS COMMON ORDER. 3. FACTS, IN BRIEF, ARE THAT A SEARCH AND SEIZURE O PERATION WAS CARRIED OUT UNDER SECTION 132(1) OF THE ACT AT THE BUSINESS PRE MISES OF THE COMPANY M/S 3 ACR SUGAR INDUSTRIES PRIVATE LIMITED (SAMEER THUKRA L GROUP OF COMPANIES) AND THE RESIDENTIAL PREMISES OF THE DIRECTORS ON 28/03/ 2011. THE ASSESSEES RECEIVED NOTICES UNDER SECTION 153A OF THE ACT. THE ASSESSE ES RECEIVED LETTER DATED 06/12/2012 ON 15/12/2012 WHERE UNDER THE INFORMATIO N UNDER 31 ITEMS WAS SOUGHT. INASMUCH AS THE INFORMATION RELATES TO 12 C ASES FOR 6 YEARS, THE ASSESSEE WAS PREPARING AND FILING INFORMATION BEFORE THE LD. AO FROM TIME TO TIME. ACCORDING TO THE ASSESSEE THERE WAS REPRESENTATION FILED BEFORE THE LD. AO ON 20/12/2012 AND 28/12/2012 BUT ON 28/12/2012 THEY WER E TOLD THAT THE LD. AO WAS BUSY IN THE TIME BARRING APPEALS AND WAS UNABLE TO ATTEND TO THEIR CASE. HOWEVER, A SHOW CAUSE NOTICE OF PARA UNDER SECTION 271(1)(B) OF THE ACT WAS SERVED ON THE ASSESSEES ON 31/01/2013 TO WHICH THEY HAVE SUBMITTED THEIR EXPLANATIONS. ACCORDING TO THE ASSESSEE AS THEY HAV E ALWAYS BEEN READY TO COOPERATE AND COMPLETE THE ASSESSMENTS BUT IN VIEW OF THE HUGE VOLUME OF WORK INVOLVED IN THIS, WE ARE COMPLYING WITH THE INF ORMATION/REQUIREMENT OF THE LD. AO IN A PHASED MANNER. HOWEVER, LD. AO LEVIED A PENALTY OF RS. 10,000/- UNDER SECTION 271(1)(B) OF THE ACT FOR EACH ASSESSM ENT YEAR. LD. CIT(A) CONFIRMED THE PENALTY BUT RESTRICTED THE SAME TO 3 O UT OF 7 YEARS. HENCE, THESE APPEALS BY THE ASSESSEES. 4. IT IS THE SUBMISSION ON BEHALF OF THE ASSESSEE T HAT THE AUTHORISED REPRESENTATIVE WAS PRESENT ON ALL THE DATES OF HEAR ING BEFORE THE LD. AO SUBMITTING PART OF THE INFORMATION AS AND WHEN IT W AS READY AND INASMUCH AS THE ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) O F THE ACT BUT NOT UNDER SECTION 144 OF THE ACT, NO PENALTY COULD HAVE BEEN L EVIED. LD.AR BROUGHT TO OUR NOTICE THAT IN THE CASES OF THE OTHER GROUP COMPANI ES IN ITA NOS.589 TO 591/12/2015, A COORDINATE BENCH OF THIS TRIBUNAL HA S DEALT WITH THE ISSUE AT 4 LENGTH AND REACHED THEIR CONCLUSION THAT THERE WAS NO WILFUL DEFAULT ON THE PART OF THE ASSESSEE OR NON COOPERATIVE ATTITUDE WITH TH E DEPARTMENT AND ON THE PREMISES DELETED THE PENALTY. SINCE THE FACTS CONTIN UE TO BE SIMILAR IN ALL THE CASES, HE PRAYED THAT THE RATIO MAY BE APPLIED TO THI S SET OF CASES ALSO AND THE PENALTY MAY BE DELETED. 5. PER CONTRA, LD. DR SUBMITTED THAT THE ASSESSEE H AS NOT COMPLIED WITH THE NOTICE FIXING THE DATE OF HEARING IN ASSESSMENT PROCEEDINGS ON 28/12/2012 AND, THEREFORE, IS RIGHTLY LIABLE TO BE SADDLED WITH PENALTY. HE PLACED RELIANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 6. WE HAVE GONE THROUGH THE RECORD IN THE LIGHT OF THE SUBMISSIONS ON EITHER SIDE. IN THE CASE OF A GROUP COMPANY IN GLENA SIA COMMODITIES PVT. LTD., VS. A.C.I.T. ITA NO. 589, 590 & 591/DEL./2015, A CO ORDINATE BENCH OF THIS TRIBUNAL HELD AS FOLLOWS: 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PER USED THE ENTIRE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE PENALTY ORDER REVEALS THAT THE LD. ASSESSING OFFICER HAS REJECTED THE EXPLANATION OF THE ASSESSE E ON THE PREMISE THAT AFTER ISSUANCE OF NOTICE DATED 06.12.2012, THE ASSESSEE S OUGHT THE COPIES OF SEIZED MATERIAL VIDE LETTER SUBMITTED ON 18.01.2013, I.E., ABOUT ONE AND HALF MONTHS AND NOTHING PREVENTED THE APPELLANT TO SEEK THE COP IES OF SEIZED MATERIAL AT EARLIER STAGE. WE DO NOT AGREE WITH THIS OBSERVATIO N OF THE AO IN VIEW OF THE CONTENTION OF THE ASSESSEE THAT THE ASSESSEE HAD AL READY MADE REQUESTS FOR THE SAME VIDE LETTERS DATED 06.04.2011 AND 24.05.2012,W HICH FACT APPEARS TO HAVE BEEN IGNORED BY THE AUTHORITIES BELOW. THE CONTENTI ON OF HUGE QUANTUM OF WORK WITH RESPECT TO SAME CAUSE OF ACTION IN OTHER GROUP OF CASES, IN THE ATTENDING FACTS AND CIRCUMSTANCES CAN ALSO NOT BE RULED OUT. MOREOVER, THE ASSESSMENT ORDERS IN THE PRESENT CASES HAVE BEEN PASSED BY THE AO U/S. 153A READ WITH SECTION 143(3) AND THEREFORE, IN VIEW OF THE DECISION RELIED BY A SSESSEE IN CASE OF AKHIL BHARTIYA PRATHMIK SHMSHAK SANGH BHAWAN TRUST, 115 TTJ 419, NO PENALTY U/S. 271(1)(B) CAN BE SUSTAINED. THE RELEVANT FINDI NGS READ AS UNDER : 5 'WE ALSO FIND THAT THE FINALLY THE ORDER WAS PASSED UNDER S. 143(3) AND NOT UNDER S. 144 OF THE ACT. THIS MEANS THAT SUBSEQUENT COMPLIANCES IN THE ASSESSMENT PROCEEDINGS WAS CONSIDERED AS GOOD C OMPLIANCE AND THE DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE AO. THEREFORE, IN SUCH CIRCUMSTANCES, THERE COULD HAVE BEEN NO REASON TO C OME TO THE CONCLUSION THAT THE DEFAULT WAS WILLFUL.' 7. IN THE INSTANT CASE THE NOTICE ISSUED FOR HEARIN G ON 20.12.2012 STOOD COMPLIED WITH, AS THE AR OF THE ASSESSEE ATTENDED THE PROCEE DINGS ON THIS DATE AND SUBMITTED REPLY/DETAILS WHICH HE HAD IN POSSESSION. THE LD. DR ALSO COULD NOT REFUTE THE CONTENTION OF THE ASSESSEE THAT ALL THE INFORMATION/DETAILS STOOD FILED WITH THE DEPARTMENT BEFORE RECEIPT OF SHOW CAUSE NO TICE OF PENALTY ON 31.01.2013. 8. IT IS ALSO PERTINENT TO MENTION HERE THAT IN THE CASES OF ASSESSEE THE AO APPEARS TO HAVE LEVIED THE PENALTY FOR SEVEN ASSESS MENT YEARS , I.E., FROM 2005- 06 TO 2011-12 AND THE LD. CIT(A) DELETED THE PENALT Y FOR THE 4 ASSESSMENT YEARS I.E. THE ASSESSMENT YEARS 2008-09 TO 2011-12, CONSI DERING THE EXPLANATION OF THE ASSESSEE AS PLAUSIBLE. HOWEVER, THE SAME EXPLANATIO N WAS NOT CONSIDERED AS PROPER FOR THE REMAINING ASSESSMENT YEARS I.E. ASSE SSMENT YEARS 2005-06 TO 2007-08. IN OUR OPINION, THE STAND TAKEN BY THE LD. CIT(A) WAS NOT JUSTIFIED PARTICULARLY WHEN HE WAS SATISFIED THAT THERE WAS A PROPER AND PLAUSIBLE EXPLANATION FOR THE 4 OUT OF THE 7 ASSESSMENT YEARS FOR WHICH PENALTY WAS LEVIED BY THE AO U/S 271(L)(B) OF THE ACT. 9. IN VIEW OF ABOVE DISCUSSION, WE DO NOT FIND COGE NT REASON TO OBSERVE ANY WILLFUL DEFAULT ON THE PART OF THE ASSESSEE OR NON- COOPERATIVE ATTITUDE WITH THE DEPARTMENT. THEREFORE, WE FIND NO JUSTIFICATION TO SUSTAIN THE PENALTY IMPOSED U/S. 271(1)(C) OF THE ACT. 7. FURTHER, UNDER SIMILAR CIRCUMSTANCES, IN THE CAS E OF GLOBUS INFOCOM LIMITED VS DCIT ITA 738/12/2014, A COORDINATE BENCH OF THIS TRIBUNAL WHILE FOLLOWING THE DECISION IN AKHIL BHARATIYA PRATHAMIK SHAIKSHAK SANGH BHAWAN TRUST VERSUS ACIT DELETED THE PENALTY LEVIED UNDER S ECTION 271(1)(B) OF THE ACT. FACTS BEING SIMILAR IN ALL THESE MATTERS, WHILE RES PECTFULLY FOLLOWING THE VIEW TAKEN BY THE COORDINATE BENCHES UNDER SIMILAR CIRCUM STANCES, WE ARE OF THE CONSIDERED OPINION THAT THE PLEA TAKEN BY THE ASSES SEE THAT BECAUSE OF THE HUGE 6 WORK INVOLVED IN FURNISHING INFORMATION IN 12 CASES FOR 6 YEARS CONSTITUTES A PROPER AND PLAUSIBLE EXPLANATION. FURTHER, WE FIND THAT THE RATIO LAID DOWN IN AKHIL BHARATIYA PRATHMIK SHIKSHACK SANGH BHAWAN TRUS TS CASE SQUARELY APPLIES TO THE FACTS OF THIS BATCH OF CASES. WE, THEREFORE, FIND THAT THE PENALTY LEVIED UNDER SECTION 271(1)(B) OF THE ACT CANNOT BE SUSTAI NED. WE ACCORDINGLY DIRECT THE LD. AO TO DELETE THE SAME. 8. IN THE RESULT ALL THIS PIECE OF THE ASSESSEES AR E ALLOWED ORDER PRONOUNCED IN THE OPEN COURT ON MAY, 201 8. (G.D. AGRAWAL) (K. NARASIMHA CHARY) PRESIDENT JUDICIAL MEMBER DATED: MAY, 2018 VJ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT BY ORDER ASSTT. REGISTRAR