Salim Valimohamad Meman, Ahmedabad V. ITO, Ward-6(1)(5), Ahmedabad

ITA 59/AHD/2019

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 5906 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 16-01-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S SHUKLA
• Keywords: Set aside
• Section: 271(1)(c); 143(3); 274

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD [CONDUCTED THROUGH VIRTUAL COURT] BEFORE SHRI RAJPAL YADAV, VICE PRESIDENT AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER ./ ITA.NO.59/AHD/2019 / ASSTT. YEAR: 2013-14 SALIM VALIMOHAMAND MEMAN 4, SAHAJANAND SOCIETY DANILIMDA AHMEDABAD. PAN : ACBPM 7325 B VS ITO, WARD - 6(1)(5) AHMEDABAD. / (APPELLANT) / (RESPONDENT) ASSESSEE BY : SHRI VARIS V. ISANI, AR REVENUE BY : SHRI S.S. SHUKLA, SR.DR / DATE OF HEARING : 10/09/2021 / DATE OF PRONOUNCEMENT: 15/09/2021 '# / O R D E R PER RAJPAL YADAV, VICE-PRESIDENT: PRESENT APPEAL IS DIRECTED AT THE INSTANCE OF THE A SSESSEE AGAINST ORDER OF LD.CIT(A)-6, AHMEDABAD DATED 12.11.2018 PA SSED FOR THE ASSTT.YEAR 2013-14. 2. ONLY GRIEVANCE OF THE ASSESSEE IS THAT THE LD.CI T(A) HAS ERRED IN CONFIRMING PENALTY OF RS.19,19,029/- IMPOSED BY THE AO UNDER SECTION 271(1)(C) OF THE INCOME TAX ACT, 1961. 3. WITH THE ASSISTANCE OF THE LD.REPRESENTATIVES, W E HAVE GONE THROUGH THE RECORD CAREFULLY. IT EMERGES OUT FROM THE RECORD THAT IN AN ITA NO.59 /AHD/2019 2 ASSESSMENT FRAMED UNDER SECTION 143(3) R.W.S. 147 O F THE ACT, THE INCOME OF THE ASSESSEE WAS FINALIZED BY MAKING ADDI TION OF RS.64,54,080/-. THIS QUANTUM ADDITION WAS CONFIRME D BY THE LD.CIT(A) ON ACCOUNT OF NON-APPEARANCE BEFORE THE LD.FIRST AP PELLATE AUTHORITY. THEREAFTER, THE LD.AO INITIATED PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) BY ISSUANCE OF NOTICE UNDER SECTION 274 O F THE ACT. FOR WANT OF SATISFACTORY EXPLANATION FROM THE ASSESSEE IN TH E PENALTY PROCEEDINGS, THE LD.AO IMPOSED PENALTY OF RS.19,19, 029/- BEING 100% OF THE AMOUNT OF TAX SOUGHT TO BE EVADED. ACTION O F THE LD.AO ALSO CONFIRMED BY THE LD.CIT(A). AGGRIEVED BY ACTION O F THE LD.REVENUE AUTHORITIES IN IMPOSING PENALTY UNDER SECTION 271(1 )(C) OF THE ACT, THE ASSESSEE IS NOW BEFORE THE TRIBUNAL. 4. THE LD.COUNSEL FOR THE ASSESSEE AT THE VERY OUTS ET SUBMITTED THAT ADDITION MADE BY THE LD.AO AND CONFIRMED BY THE LD. CIT(A) WAS CHALLENGED BEFORE THE ITAT VIDE ITA NO.2326/AHD/201 8 AND THE ITAT VIDE ORDER DATED 26.7.2019 HAS SET ASIDE EXPARTE ORDER OF THE LD.CIT(A) ON QUANTUM APPEAL, AND REMITTED THE ISSUE BACK TO H IS FILE FOR RE- ADJUDICATION. THUS, THE DETERMINATION OF INCOME FO R THE PURPOSE OF TAXATION IS YET TO BE FINALIZED. IN OTHER WORDS, W HETHER THE ADDITIONS ON ACCOUNT OF UNEXPLAINED CASH DEPOSITS IN BANK, UNEXP LAINED EXPENDITURE AND DISALLOWANCE OF DEDUCTIONS CLAIMED UNDER CHAPTE R VIA REQUIRE TO BE MADE IN THE HANDS OF THE ASSESSEE OR NOT, IS SUBJUD ICED BEFORE THE LD.FIRST APPELLATE AUTHORITY, AND THEREFORE, LEVY P ENALTY UNDER SECTION 271(1)(C) IS NOT JUSTIFIABLE, AND THE ORDERS OF THE REVENUE AUTHORITIES IN THIS BEHALF ARE TO BE SET ASIDE BACK TO THE FILE OF THE LD.CIT(A) FOR A RELOOK BASED ON THE OUTCOME OF THE ADDITIONS PENDIN G BEFORE HIM. ON THE OTHER HAND, THE LD.DR HAS NOT DISPUTED FACTUAL POSITION OF THE CASE STATED BY THE LD.COUNSEL FOR THE ASSESSEE. ITA NO.59 /AHD/2019 3 5. ON DUE CONSIDERATION OF THE FACTS AND CIRCUMSTAN CES, AND THE SUBMISSIONS OF BOTH THE PARTIES, WE FIND THAT SUB-C LAUSE (III) OF SECTION 271(1)(C) PROVIDES MECHANISM FOR QUANTIFICATION OF PENALTY. IT CONTEMPLATES THAT THE ASSESSEE WOULD BE DIRECTED TO PAY A SUM IN ADDITION TO TAXES, IF ANY, PAYABLE BY HIM, WHICH SH ALL NOT BE LESS THAN , BUT WHICH SHALL NOT EXCEED THREE TIMES THE AMOUNT O F TAX SOUGHT TO BE EVADED BY REASON OF CONCEALMENT OF INCOME AND FURNI SHING OF INACCURATE PARTICULARS OF INCOME. IN OTHER WORDS, THE QUANTIFICATION OF THE PENALTY IS DEPENDED UPON THE ADDITION MADE TO T HE INCOME OF THE ASSESSEE. IN THE PRESENT CASE, THE ASSESSEE HAS FI LED APPEAL BEFORE THE TRIBUNAL AGAINST QUANTUM ADDITION IN THE YEAR UNDER CONSIDERATION. THE TRIBUNAL VIDE ORDER DATED 26.7.2019 (SUPRA) HAS REM ITTED THE ISSUE BACK TO THE FILE OF THE LD.CIT(A), THEREFORE, IMPOS ITION OF PENALTY AT THIS STAGE IS PREMATURE AND NOT JUSTIFIABLE. THEREFORE, SINCE THE ADDITION ON QUANTUM HAS BEEN REMITTED TO THE FILE OF THE LD.CIT (A), WE ALSO REMIT THE ISSUE REGARDING LEVY OF PENALTY TO HIS FILE FOR RECONSIDERATION BASED ON THE OUTCOME OF ADDITION PENDING BEFORE HIM. IN O THER WORDS, THE LD.CIT(A) SHALL DECIDE THE ISSUE REGARDING LEVY OF PENALTY AFTER ASSESSING THE INCOME IN PURSUANCE OF TRIBUNALS ORDER CITED ( SUPRA) IN THE ASSESSEES QUANTUM APPEAL. 6. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED IN THE COURT ON 15 TH SEPTEMBER, 2021 AT AHMEDABAD. SD/- SD/- (WASEEM AHMED) ACCOUNTANT MEMBER (RAJPAL YADAV) VICE-PRESIDENT AHMEDABAD; DATED 15/09/2021