VINOD ANNA BIDKAR, NEW DELHI V. ITO, WARD- 71(2), NEW DELHI

ITA 5987/DEL/2018

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 0185 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 3 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 18-09-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANJOG KAPOOR
• Keywords: Revised return
• Section: 271(1)(c); 250; 274; 73; 27

Judgement Text

, . . , IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH S.M.C, NEW DELHI , BEFORE MS. SUSHMA CHOWLA, JUDICIAL MEMBER . / ITA NO.5987/DEL/2018 / ASSESSMENT YEAR: 2014-15 VINOD ANNA BIDKAR, C/O-M/S RRA TAXINDIA, D-28, SOUTH EXTENSION, PART-I, NEW DELHI-110049 PAN-AAXPB3952H .......... /APPELLANT VS THE ITO, WARD-71(2), NEW DELHI. . / RESPONDENT / APPELLANT BY : SH. SOMIL AGGARWAL, ADVOCATE, SHRI DEEPESH GARG, ADVOCATE, / RESPONDENT BY : SH. SANJOG KAPOOR, SR.DR / DATE OF HEARING : 02.12.2019 / DATE OF PRONOUNCEMENT: 31 .12.2019 / ORDER PER SUSHMA CHOWLA, JM: THE APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORD ER OF CIT(A)-21, NEW DELHI, DATED 20/08/2018, RELATING TO ASSESSMENT YEA R 2014-15, AGAINST PENALTY LEVIED UNDER SECTION 271(1)(C) OF THE INCOM E TAX ACT, 1961 (IN SHORT THE ACT). 2. THE LD. AR FOR THE ASSESSEE POINTED OUT THAT GRO UND OF APPEAL NUMBER 2 NEEDS TO BE DECIDED FIRST. 2 ITA NO. 5987/DEL/2018 ASSESSMENT YEAR: 2014-15 3. THE ISSUE WHICH IS RAISED IN THE PRESENT APPEAL IS AGAINST THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THE LD. AR FOR TH E ASSESSEE POINTED OUT THAT THE ASSESSING OFFICER WHILE RECORDING THE SATI SFACTION FOR INITIATING PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT HAS NO TED THAT THE SAME IS TO BE INITIATED FOR FURNISHING FOR INACCURATE PARTICUL AR OF INCOME. HOWEVER, IN THE NOTICES ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT, NO SPECIFIC CHARGE IS MENTIONED. HENCE, THE PRESENT PENALTY PROCEEDINGS I NITIATED ARE BAD IN LAW. 4. THE LD. AR FOR THE ASSESSEE REFERRED TO THE NOTI CES ISSUED U/S 274 R.W.S. 271(1)(C) OF THE ACT, WHICH IS PLACED AT PAG E 16 OF THE PAPER BOOK. HE FURTHER BROUGHT TO OUR INTENTION, SPECIFIC ISSUE RA ISED BEFORE THE CIT(A) IN THIS REGARD IN THE WRITTEN SUBMISSIONS, WHICH ARE P LACED AT PAGES 30 TO 49 AND REFERRED TO PAGE 46 OF THE PAPER BOOK IN THIS R EGARD. HE FURTHER PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HONBLE DELH I HIGH COURT IN THE CASE OF PR. CIT VS M/S SAHAR INDIA LIFE INSURANCE COMPAN Y LTD. IN ITA NO.475/2019, JUDGMENT DATED 02/08/2019 AND OTHERS. 5. THE LD. DR FOR THE REVENUE PLACED RELIANCE ON TH E RATIO LAID DOWN BY THE HONBLE MADRAS HIGH COURT IN THE CASE OF SUNDAR AM FINANCE LTD. VS ACIT (2018) 93 TAXMANN.COM 250 (MADRAS). THE LD. DR FURTHER POINTED OUT THAT SPECIAL LEAVE PETITION HAS BEEN DISMISSED BY H ONBLE APEX COURT. 6. ON PERUSAL OF THE RECORD AND AFTER HEARING BOTH THE AUTHORIZED REPRESENTATIVES, THE JURISDICTIONAL ISSUE WHICH ARI SES IN THE PRESENT APPEAL IS AGAINST THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT. THE AO IN THE 3 ITA NO. 5987/DEL/2018 ASSESSMENT YEAR: 2014-15 ASSESSMENT ORDER, AFTER MAKING THE ADDITION IN THE HANDS OF THE ASSESSEE ON ACCOUNT OF INCOME OFFERED IN THE REVISED RETURN OF INCOME, WHICH WAS ACCEPTED AS SUCH BY THE ASSESSING OFFICER, WAS OF T HE VIEW THAT THE ASSESSEE HAD FURNISHED INACCURATE PARTICULARS OF INCOME AND HENCE SATISFACTION WAS RECORDED FOR INITIATING THE PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT. WHILE ISSUING THE NOTICE U/S 274 R.W.S. 271(1)(C) O F THE ACT, THE AO FAILED TO STRIKE OUT EITHER OF THE LIMBS OF SECTION 271(1)(C) OF THE ACT; HOWEVER, THE AO HELD THE ASSESSEE LIABLE FOR LEVY OF PENALTY U/S 27 1(1)(C) OF THE ACT. THE ASSESSEE RAISED SPECIFIC PLEA BEFORE THE CIT(A) AS TO NON-STRIKING OF THE RELEVANT PORTION IN THE NOTICE ISSUED U/S 274 R.W.S 271(1)(C) OF THE ACT. BUT THE CIT(A) HAS FAILED TO DEAL WITH THE SAME AND CON FIRMED THE LEVY OF PENALTY FOR CONCEALMENT AGAINST THE ASSESSEE. 7. PENALTY U/S 271(1)(C) OF THE ACT IS LEVIABLE WHERE THE ASSESSEE HAD EITHER CONCEALED ITS INCOME OR FURNISHED INACCURATE PARTICULARS OF INCOME. THE HONBLE BOMBAY HIGH COURT IN CIT VS. SAMSON PER INCHERY (2017) 392 ITR 4 (BOM.) HAS LAID DOWN THE PROPOSITION THAT IT IS INCUMBENT UPON THE AO TO SHOW CAUSE THE ASSESSEE AS TO WHICH LIMB WAS NOT FULFILLED BY THE ASSESSEE, IN ORDER TO ATTRACT THE LEVY OF PENALTY U /S 271(1)(C) OF THE ACT. THE FAILURE TO DO SO IS FATAL AS FAR AS PASSING AN ORDE R LEVYING PENALTY FOR CONCEALMENT IS CONCERNED. 8. THE HONBLE DELHI HIGH COURT IN PR CIT VS SAHARA INDIA LIFE INSURANCE COMPANY LTD. (SUPRA) HAVE ALSO LAID DOWN THAT NOTICE ISSUED FOR IMPOSING OF PENALTY WOULD BE BAD IN LAW, IF IT DOES NOT SPECIFY UNDER WHICH 4 ITA NO. 5987/DEL/2018 ASSESSMENT YEAR: 2014-15 LIMB OF SECTION 271(1)(C) OF THE ACT, PENALTY PROCE EDINGS HAD BEEN INITIATED I.E. WHETHER FOR CONCEALMENT OF INCOME OR FOR FURNI SHING INACCURATE PARTICULARS OF INCOME. IN THIS REGARD, RELIANCE WA S PLACED ON THE DECISION OF HONBLE KARNATAKA HIGH COURT IN CIT VS MANJUNATHA C OTTON GINNING FACTORY 359 ITR 565 (KARN.) AND IT WAS OBSERVED THA T THE NOTICE ISSUED BY THE ASSESSING OFFICER WOULD BE BAD IN LAW IF IT DID NOT SPECIFY WHICH LIMB OF SECTION 271(1)(C) OF THE ACT, PENALTY PROCEEDINGS H AD BEEN INITIATED UNDER I.E. WHETHER FOR CONCEALMENT OF PARTICULARS OF INCO ME OR FOR FURNISHING OF INACCURATE PARTICULAR OF INCOME; WHICH WAS FOLLOWED IN THE SUBSEQUENT ORDER IN COMMISSIONER OF INCOME TAX VS SSAS EMERAL D MEADOWS (2016) 73 TAXMAN.COM 241 (KARN.). 9. IN THESE FACTS AND CIRCUMSTANCES OF THE CASE AND APPLYING THE SAID PROPOSITIONS TO THE FACTS OF THE PRESENT APPEAL, TH ERE IS MERIT IN THE PLEA OF THE ASSESSEE AS FAR AS INITIATION OF PENALTY PROCEE DINGS FOR CONCEALMENT UNDER SECTION 271(1)(C) OF THE ACT ARE CONCERNED. THE LD. DR FOR THE REVENUE HAD PLACED RELIANCE ON THE RATIO LAID DOWN BY THE HONBLE MADRAS HIGH COURT IN THE CASE OF SUNDARAM FINANCE LTD. VS ACIT (SUPRA), WHEREIN IT WAS HELD THAT WHERE THE CASE AGAINST THE ASSESSE E WAS THAT THEY HAD CONCEALED ITS PARTICULARS OF INCOME AND FURNISHED I NACCURATE PARTICULARS OF INCOME, THEN THE NOTICE ISSUED U/S 274 R.W.S. 271(C ) OF THE ACT WAS CORRECT. THE PLEA OF THE ASSESSEE WAS REJECTED ON THE GROUND THAT THE NON-STRIKING OF NOTICE WAS RAISED BEFORE THE HONBLE HIGH COURT AFT ER DELAY OF 10 YEARS AND NOT BEFORE ANY OF THE AUTHORITIES BELOW. THE SLP FI LED BY THE ASSESSEE 5 ITA NO. 5987/DEL/2018 ASSESSMENT YEAR: 2014-15 AGAINST THE SAID ORDER OF THE HONBLE MADRAS HIGH C OURT WAS DISMISSED. BUT THE COURTS HAVE HELD THAT MERE DISMISSAL OF APPEAL DO NOT LAY DOWN THE RULE OF LAW. IN SUCH FACTS AND CIRCUMSTANCES, THERE IS N O MERIT IN THE RELIANCE PLACED BY THE LD. DR ON THE SAID DECISION OF THE HO NBLE MADRAS HIGH COURT IN SUNDARAM FINANCE LTD. VS ACIT (SUPRA). IN THE PA RAS ABOVE, REFERENCE IS MADE TO THE DECISION OF THE JURISDICTIONAL HIGH COU RT IN PR. CIT VS M/S SAHARA INDIA LIFE INSURANCE COMPANY LTD. & ORS. (SU PRA) AND FOLLOWING THE SAME, THE ISSUE RAISED IN THIS APPEAL IS DECIDED IN FAVOUR OF THE ASSESSEE ON THE JURISDICTIONAL GROUND ITSELF. THE GROUND OF APP EAL IS THUS ALLOWED. 7. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST DAY OF DECEMBER, 2019. SD/- (SUSHMA CHOWLA) /JUDICIAL MEMBER / DATED : 31 ST DECEMBER, 2019 . * S SHEKHAR * / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT (A) 4. / THE PR. CIT 5. 6. , , / DR, ITAT, DELHI / GUARD FILE. / BY ORDER , // TRUE COPY // , , ASSISTANT REGISTRAR, ITAT, DELHI