Auro Sugar Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 598/DEL/2015

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 5605 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 29-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAVIKANT GUPTA
• Assessee Lawyers: YUDHISTER SETH
• Keywords: Search and seizure; Question of law
• Section: 143(3); 142(1); 153A; 144

Judgement Text

IN THE INCOME-TAX APPELLATE TRIBUNAL, DELHI BENCH A, NEW DELHI BEFORE : SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA NO. 595, 596 & 597/DEL./2015 ASSESSMENT YEARS: 2005-06, 2006-07 & 2007-08 ASIA SUGAR INDUSTRIES PVT. LTD., 6-B,JOR BAGH LANE, NEW DELHI 110 003 PAN AAACA2286D) (APPELLANT) VS. D .C.I.T., CENTRAL CIRCLE-05 NEW DELHI. (RESPONDENT) AND ITA NO. 598, 599 & 600/DEL./2015 ASSESSMENT YEARS: 2005-06, 2006-07 & 2007-08 AURO SUGAR PVT. LTD., G-8, MAHARANI BAGH, NEW DELHI 110 065 PAN AACN0192K) (APPELLANT) VS. D.C.I.T., CENTRAL CIRCLE-05 NEW DELHI. (RESPONDENT) APPELLANT BY SH. RAHUL KHARE, C.A. & SH. YUDHISTER SETH, CA RESPONDENT BY SH. RAVI KANT GUPTA, SR. DR ORDER PER BENCH : THESE APPEALS FILED BY THE SEPARATE ASSESSEES ARE DIRECTED AGAINST THE TWO COMMON ORDERS BOTH DATED 31.10.2 014 PASSED BY LD. CIT(A)-XXXI, NEW DELHI FOR THE ASSESSMENT YEARS 2005-06, 2006- 07 AND 2007-08 RESPECTIVELY ON THE FOLLOWING COMMON GROUND : 2 THE LEARNED CIT(A) ERRED IN FACT AND IN LAW IN CONFI RMING THE PENALTY OF RS.10,000/- U/S 271(1)(B) OF THE INCOME T AX ACT, 1961 WHICH IS NOT ONLY ILLEGAL BUT ALSO AGAINST THE F ACTS AND CIRCUMSTANCES OF THE CASE. 2. SINCE COMMON QUESTION OF LAW AND FACTS ARE INVOLV ED IN ALL THESE APPEALS AND COMMON GROUND IS RAISED THEREIN, HENCE, FO R THE SAKE OF CONVENIENCE AND BREVITY, THE SAME ARE BEING DISPOSED OF BY THIS CONSOLIDATED ORDER. FOR THE SAKE OF CONVENIENCE, WE TA KE UP APPEAL NO. 595/DEL./2015 FIRST. 3. THE BRIEF FACTS OF THE CASE ARE THAT A SEARCH AND SEIZURE OPERATION WAS CARRIED OUT U/S. 132(1) OF THE ACT AT THE BUSINESS PREMISES OF THE COMPANY M/S. ASIA SUGAR INDUSTRIES PVT. LTD., SAMIR THUKRAL GROUP OF COMPANIES AND RESIDENTIAL PREMISES OF THE DIRECTORS ON 28.03.2011. NOTICE U/S. 153A WAS ISSUED TO ASSE SSEE AND NOTICE U/S. 142(1) ALONGWITH A QUESTIONNAIRE WAS ISSUED ON 0 6.12.2012 FIXING THE HEARING FOR COMPLIANCE ON 20.12.2012. ON THIS DAT E THE AR OF THE ASSESSEE ATTENDED AND SUBMITTED PARTIAL DETAILS REQU IRED BY THE AO. THE CASE WAS ADJOURNED TO 28.12.2012, WHICH STOOD UN -COMPLIED. IN RESPONSE TO PENALTY NOTICE, THE ASSESSEE, INTER ALIA , SUBMITTED THAT PENALTY PROCEEDINGS WERE INITIATED IN 12 CASES OF AS SESSEE GROUP AND DETAILED NOTICES AND QUESTIONNAIRES IN 12 CASES WERE RECEIVED ON 15.12.2012; THAT THE REQUISITE INFORMATION WERE PREPA RED AND FILED 3 FROM TIME TO TIME BEFORE THE AO; THAT ON 20.12.2012, THE AR OF THE ASSESSEE ATTENDED THE PROCEEDINGS AND FILED PARTIAL I NFORMATION; THAT THE ASSESSEE WAS PURSUING TO SEEK SEIZED MATERIAL FO R FILING COMPLETE INFORMATION IN THE ASSESSMENT PROCEEDINGS AND THERE WA S NO WILLFUL DEFAULT ON THE PART OF THE ASSESSEE. THE AO DID NOT CONCUR WITH THE REPLY OF ASSESSEE AND IMPOSED PENALTY OF RS.10,000/- IN EACH OF THESE CASES, WHICH STOOD CONFIRMED BY THE LD. CIT(A) VIDE IMPUGNED ORDER. AGGRIEVED, THE ASSESSEE IS IN PRESENT APPEAL BEFORE T HE TRIBUNAL. 4. AT THE TIME OF HEARING, LD. AR OF THE ASSESSEE ST ATED THAT THE ISSUE INVOLVED IN THESE APPEALS ARE SQUARELY COVERED BY THE DECISION OF ITAT, C BENCH, NEW DELHI IN ASSESSEES GROUP COMP ANY NAMELY M/S GLENASIA COMMODITIES PVT. LTD. VS. ACIT PASSED IN ITA NO. 589 TO 591/DEL/2015 (AYRS. 2005-06 TO 2007-08) WHEREIN, THE T RIBUNAL HAS ALLOWED THE APPEALS OF THE ASSESSEE AND DELETE THE PENALTY IN DISPUTE. HENCE, HE REQUESTED THAT BY RESPECTFULLY FOLLOW T HE PRECEDENTS, THE PENALTY IN DISPUTE MAY BE DELETED AND ACCORDINGLY, THE APPEALS OF THE ASSESSEE MAY BE ALLOWED. 5. ON THE OTHER HAND, LD. DR RELIED ON THE IMPUGNED ORDER AND SUBMITTED THAT THE ASSESSEE HAS NOT COMPLIED WITH T HE NOTICE FIXING THE DATE OF HEARING IN ASSESSMENT PROCEEDINGS ON 28.1 2.2012 AND THEREFORE, HAS RIGHTLY BEEN SADDLED WITH PENALTY. BUT HE DID NOT CONTROVERT THE CONTENTION OF THE LD. A.R. OF THE ASSES SE. 4 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RE CORDS ESPECIALLY THE IMPUGNED ORDER AS WELL THE ORDER OF TH E ITAT, C BENCH, NEW DELHI IN ASSESSEES GROUP COMPANY NAMELY M /S GLENASIA COMMODITIES PVT. LTD. VS. ACIT PASSED IN ITA NO. 589 TO 591/DEL/2015 (AYRS. 2005-06 TO 2007-08). FOR THE SAKE OF CLARITY, WE ARE REPRODUCING THE RELEVANT FINDING OF THE TRIBUNAL AS U NDER:- 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PERUSED THE ENTIRE MATERIAL AVAILABLE ON RECORD. A PERUSAL OF THE PENALTY ORDER REVEALS THAT THE LD. ASSESSING OFFICER HAS REJECTED THE EXPLANATION OF THE ASSESSEE ON THE PREMISE THAT AFTER ISSUANCE OF NOTICE DATED 06.12.2012, THE ASSESSEE SOUGHT 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 COPIES OF SEIZED MATERIAL AT EARLIER STAGE. WE DO NOT AGREE WITH THIS OBSERVATION OF THE AO IN VIEW OF THE CONTENTION OF THE ASSESSEE THAT THE ASSESSEE HAD ALREADY MADE REQUESTS FOR THE SAME VIDE LETTERS DATED 06.04.2011 AND 24.05.2012,WHICH FACT APPEARS TO HAVE BEEN IGNORED BY THE AUTHORITIES BELOW. THE CONTENTION 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 5 BEEN PASSED BY THE AO U/S. 153A READ WITH SECTION 143(3) AND THEREFORE, IN VIEW OF THE DECISION RELIED BY ASSESSEE 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 FINDINGS READ AS UNDER : 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 COMPLIANCE AND THE DEFAULTS COMMITTED EARLIER WERE IGNORED BY THE AO. THEREFORE, IN SUCH CIRCUMSTANCES, THERE COULD HAVE BEEN NO REASON TO COME TO THE CONCLUSION THAT THE DEFAULT WAS WILLFUL. 7. IN THE INSTANT CASE THE NOTICE ISSUED FOR HEARING ON 20.12.2012 STOOD COMPLIED WITH, AS THE AR OF THE ASSESSEE ATTENDED THE PROCEEDINGS 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 NOTICE 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 ASSESSMENT YEARS , 6 I.E., FROM 2005-06 TO 2011-12 AND THE LD. CIT(A) DELETED THE PENALTY FOR THE 4 ASSESSMENT YEARS I.E. THE ASSESSMENT YEARS 2008-09 TO 2011-12, CONSIDERING THE EXPLANATION OF THE ASSESSEE AS PLAUSIBLE. HOWEVER, THE SAME EXPLANATION WAS NOT CONSIDERED AS PROPER FOR THE REMAINING ASSESSMENT YEARS I.E. ASSESSMENT 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 COGENT 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. ACCORDINGLY, THE APPEAL OF THE ASSESSEE DESERVES TO BE ALLOWED. 10. SINCE SIMILAR FACTS ARE PERMEATING THROUGH IN ALL THE REMAINING TWO APPEALS, OUR FINDINGS REACHED IN ITA NO. 589/DEL./2015 IN EARLIER PART OF THIS ORDER, SHALL APPLY MUTATIS MUTANDIS IN REST TWO APPEALS OF THE ASSESSEE, WHICH ALSO DESERVE TO BE ALLOWED. 11. IN THE RESULT, ALL THE THREE APPEALS OF THE ASSESSEE ARE ALLOWED.: 7 6.1 AFTER PERUSING THE FINDING OF THE TRIBUNAL, AS AFO RESAID, WE ARE OF THE CONSIDERED VIEW THAT THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE ARE EXACTLY SIMILAR AND IDENTICAL TO THE FACTS A ND CIRCUMSTANCES INVOLVED IN THE CASE OF M/S GLENASIA COMMODITIES PVT. LTD. VS. ACIT PASSED IN ITA NO. 589 TO 591/DEL/2015 (AYRS. 2005-06 T O 2007-08), AS AFORESAID. THEREFORE, BY RESPECTFULLY FOLLOWING THE PRECEDENT, AS AFORESAID, WE DELETE THE PENALTY IN DISPUTE AND ACCO RDINGLY ALLOW THE APPEAL OF THE ASSESSEE. 6.2 FOLLOWING THE CONSISTENT VIEW, AS AFORESAID, THE OTHER FIVE APPEALS BEING ITA NOS. 596 & 597/DEL/2015 (AYRS. 2006-07 & 200 7-08) IN THE CASE OF ASIA SUGAR INDUSTRIES PVT. LTD. AND ITA NOS. 5 98 TO 600/DEL/2015 (AYRS. 2005-06 TO 2007-08) IN THE CASE OF AURO SUGAR PVT. LTD. ARE ALSO ALLOWED BY RESPECTFULLY FOLLOWING T HE AFORESAID PRECEDENT. 7. IN THE RESULT, ALL THE 06 APPEALS FILED BY THE SE PARATE ASSESSES ARE ALLOWED. ORDER PRONOUNCED ON 16.04.2018. SD/- SD/- (L.P. SAHU) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 16.04.2018 *SR BHATNAGAR* COPY OF ORDER FORWARDED TO: (1) THE APPELLANT (2) THE RESPONDENT (3) COMMISSIONER (4) CIT(A) (5) DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR