Smt Jyotsana Ajmera, Indore, Indore V. ITO 2(3), Indore

ITA 617/Ind/2018

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 7142 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-10-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 14-10-2019
• Assessment Year: 2006-2007
• Appeal Filed On: 06-07-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S S MANTRI
• Assessee Lawyers: ARPIT GAUR CAS
• Keywords: Set aside
• Section: 271(1)(c); 142(1); 153A; 201; 274; 143(2); 139(4)

Judgement Text

JYOTSANA AJMERA ITA NO.617/IND/2018 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ITA NO. 617/IND/2018 ASSESSMENT YEAR 2006-07 REVENUE BY SHRI S.S. MANTRI, CIT ASSESSEE BY S/ S HRI ANIL KAMAL GARG & ARPIT GAUR, CAS DATE OF HEARING 14 . 1 0 . 201 9 DATE OF PRONOUNCEMENT 17 . 10 . 201 9 O R D E R PER MANISH BORAD, AM. THE ABOVE CAPTIONED APPEAL IS FILED AT THE INSTANCE OF ASSESSEE PERTAINING TO ASSESSMENT YEAR 2006-07 AND IS DIREC TED AGAINST THE ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS)- I (IN SHORT LD.CIT(A)], INDORE DATED 19.04.2018 WHICH ARE ARI SING OUT OF THE ORDER U/S 271(1)(C) OF THE INCOME TAX ACT 1961(IN S HORT THE ACT) DATED 10.03.2016 FRAMED BY ITO-2(3), INDORE. 2. ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL; SMT. JYO TSANA AJMERA, E-14, SAKET NAGAR, INDORE VS. ITO 2(3) INDORE ( APPELLANT ) (RESPONDENT ) PAN A CMPA2979A JYOTSANA AJMERA ITA NO.617/IND/2018 2 1. THAT, THE LEARNED CIT(A) ERRED, BOTH ON FACTS AND I N LAW, IN CONFIRMING THE ORDER OF PENALTY PASSED U/S. 271(1)(C) OF THE INCOM E-TAX ACT, 1961 BY THE ITO-2(3), INDORE, IMPOSING PENALTY OF RS.2,OO,OOO/-. 2. THAT, THE LEARNED CIT(A) GROSSLY ERRED IN NOT CONSI DERING THE MATERIAL FACT THAT IN THE INSTANT CASE, THE AO IMPOSED THE PENALT Y WITHOUT FIRST ISSUING A PROPER AND VALID SHOW-CAUSE NOTICE TO THE APPELLA NT. 3 (A) THAT, THE LEARNED CIT(A) GROSSLY ERRED, BOTH ON FACTS AND IN LAW, IN CONFIRMING THE ORDER OF PENALTY PASSED U/S. 271( 1)(C) OF THE ACT, WITHOUT CONSIDERING THE MATERIAL FACT THAT THE APPELLANT HA D NEITHER CONCEALED NOR FURNISHED INACCURATE PARTICULARS OF HER INCOME FOR THE YEAR UNDER CONSIDERATION AND THEREFORE SHE WAS NOT LIABLE FOR ANY PENALTY U/S. 271(1)(C) OF THE ACT. 4. THAT, WITHOUT PREJUDICE TO THE ABOVE, THE LEARNED C IT(A) ERRED IN CONFIRMING THE PENALTY WITHOUT CONSIDERING THE MATERIAL FACT T HAT THE ADDITION QUA WHICH THE PENALTY HAS BEEN IMPOSED, ITSELF WAS NOT SUSTAINABLE IN VIEW OF THE DECISION OF THE HON'BLE ITAT, SPECIAL BENCH, MU MBAI, IN THE CASE OF AL! CARGO GLOBAL LOGISTICS LTD & ORS. VS. DC I T, AS REPORTED IN (2012) 74 DTR (MUMBAI) (SB) (TRIB) 89 AND ALSO AS PER THE RATIO L AID DOWN BY MANY JUDICIAL AUTHORITIES INCLUDING BY THE HON'BLE ITAT INDORE BENCH. 5. THAT, THE APPELLANT FURTHER CRAVES LEAVE TO ADD, AL TER AND/OR AMEND ANY OF THE FOREGOING GROUNDS OF APPEAL AS AND WHEN CONSIDE RED NECESSARY. 3. BRIEFLY STATED FACTS AS CULLED OUT FROM THE RECORDS ARE THAT THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM T HE BUSINESS OF MANUFACTURING AND TRADING OF CORRUGATED BOXES. RETU RN OF INCOME JYOTSANA AJMERA ITA NO.617/IND/2018 3 FILED FOR THE ASSESSMENT YEAR U/S 139(4) FILED ON 2 9.3.2007 DECLARING INCOME OF RS.2,15,000/-. A SEARCH ACTION U/S 132(1) OF THE ACT WAS CARRIED OUT AT THE RESIDENTIAL PREMISES OF THE APPELLANT FOLLOWED BY ISSUANCE OF NOTICE U/S 153A OF THE ACT DULY SERVED UPON THE ASSESSEE FOR FURNISHING HER RETURN OF TOTAL INC OME. IN RESPONSE TO THE NOTICE, THE APPELLANT FURNISHED HER RETURN O F INCOME ON 01.2.2010 DECLARING THE SAME INCOME OF RS.2,15,000/ - WHICH WAS DECLARED IN THE ORIGINAL RETURN OF INCOME. THE CASE WAS SELECTED FOR SCRUTINY. NOTICES U/S 143(2) & 142(1) WERE ISSUED A ND THE ASSESSEE COMPLIED WITH. THE ASSESSMENT U/S 153A R.W.S. 143(3 ) OF THE ACT WAS COMPLETED DETERMINING THE TOTAL INCOME AT RS.7, 50,000/- MAKING ADDITION OF RS.5,35,000/-. THE LD. A.O ALSO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT IN RES PECT OF ADDITIONS OF RS.4,95,000/-. 1. AGGRIEVED ASSESSEE PREFERRED APPEAL AGAINST T HE LEVY OF PENALTY BEFORE LD. CIT(A) BUT COULD NOT SUCCEED. 2. NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRI BUNAL AGAINST THE PENALTY OF RS.2,00,000/- IMPOSED U/S 271(1)(C) OF T HE ACT. 3. LD. COUNSEL FOR THE ASSESSEE RAISING LEGAL ISSUE R ELYING ON THE JYOTSANA AJMERA ITA NO.617/IND/2018 4 DECISION OF JUDGMENT OF HON'BLE APEX COURT IN THE CASE OF NATIONAL THERMAL POWER COMPANY LIMITED 229 ITR 383(SC) SUBMI TTED THAT AS PER PROVISIONS OF SECTION 271(1)(C) OF THE ACT T HE PENALTY CAN BE INITIATED EITHER FOR CONCEALING THE PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME, WHERE AS THE LD.A.O HAS NOT RECORDED ANY CHARGE ON THE ASSESSEE, AS TO WHETHER PENALTY IS TO BE LEVIED FOR FURNISHING INACCURATE PARTICU LARS OF INCOME OR CONCEALING THE PARTICULARS OF INCOME. PLACING REL IANCE ON THE JUDGMENTS MENTIONED IN THE WRITTEN SUBMISSION WHICH MAINLY INCLUDES JUDGMENT OF HON'BLE JURISDICTIONAL HIGH CO URT IN THE CASE OF PCIT VS KULWANT SINGH BHATIA ITA NO.9 OF 2018 DATED 9.5.2018, THE LD. COUNSEL FOR THE ASSESSEE CONTENDED THAT THE LD.A.O HAS FAILED IN COMPLY THE PROVISIONS OF SECTION 271(1)(C ) OF THE ACT BY INITIATING THE PENALTY PROCEEDINGS WITH NO SPECIFIC CHARGE. RELIANCE WAS ALSO PLACED ON INDORE TRIBUNAL DECISION IN THE CASE OF VARAD MEHTA ITA NO.693/IND/16 DATED 06.12.2018. 7. PER CONTRA DEPARTMENTAL REPRESENTATIVE VEHEMENTL Y ARGUED SUPPORTING THE ORDERS OF LOWER AUTHORITIES. 8. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORDS JYOTSANA AJMERA ITA NO.617/IND/2018 5 PLACED BEFORE US. THE ISSUES RAISED BY THE ASSESSE E ON BOTH LEGAL AND MERITS REVOLVES AROUND THE LEVY OF PENALTY AT RS.2,00,000/- LEVIED BY THE LD. A.O AND CONFIRMED BY LD.CIT(A). L D. COUNSEL FOR THE ASSESSEE PLEADED THAT LD. A.O HAS WRONGLY INITI ATED THE PENALTY PROCEEDINGS BY NOT SPECIFYING THE CHARGE FOR LEVY O F PENALTY I.E. WHETHER THE PENALTY PROCEEDINGS HAS BEEN INITIATED FOR CONCEALING PARTICULARS OF INCOME OR FOR FURNISHING THE INACCUR ATE PARTICULARS OF INCOME. IT WAS ALSO PLEADED BY THE LD. COUNSEL FOR THE ASSESSEE THAT THOUGH THE LD. ASSESSING OFFICER HAS MADE PROPER SA TISFACTION ON RECORD IN THE ASSESSMENT ORDER FOR INITIATING PENAL TY PROCEEDINGS BUT IN THE NOTICE ISSUE U/S 274 R.W.S. 271(1)(C) OF THE ACT, LD. A.O REMAINED SILENT BY NOT SPECIFYING AS FOR WHICH CHA RGE THE PENALTY PROCEEDINGS HAVE BEEN INITIATED. 9. TO EXAMINE THIS FACT WE HAVE GONE THROUGH THE IM PUGNED NOTICE ISSUED ON 29.02.2016 FOR INITIATING THE PENA LTY PROCEEDINGS U/S 271(1)(C) OF THE ACT FOR ASSESSMENT YEAR 2006- 07. FOR REFERENCE WE REPRODUCE BELOW THE NOTICE U/S 271(1)( C) OF THE ACT FOR ASSESSMENT YEAR 2006-07; JYOTSANA AJMERA ITA NO.617/IND/2018 6 F.NO.ITO-2(3)/IND/PENALTY/2015-16 DATE: 29.02.2016 PAN ACMPA2979A TO SMT. JYTISNA AJMERA, E-14 SAKET NAGAR, INDORE SIR/MADAM, NOTICE UNDER SECTION 274 READ WITH SECTION 271(1)(C ) OF THE INCOME TAX ACT, 1961. WHEREAS IN THE COURSE OF PROCEEDINGS BEFORE OE FOR THE A.Y. 2006- 07 IT APPEARS TO ME THAT YOU:- HAVE CONCEALED THE PARTICULARS OF YOUR INCOME OR FU RNISHED INACCURATE PARTICULARS OF SUCH INCOME. YOU ARE HEREBY REQUESTED TO APPEAR BEFORE ME AT 11 .30 AM ON 04.03.16 AND SHOW CAUSE WHY AN ORDER IMPOSING A PEN ALTY ON YOU SHOULD NOT BE MADE UNDER SECTION 271 OF THE INCOME TAX ACT, 1961. IF YOU DO NOT WITH TO AVAIL YOURSELF OF THIS OPPORTUNI TY OF BEING HEARD IN PERSON OR THROUGH AUTHORIZED REPRESENTATIVE, YOU MA Y SOW CAUSE IN WRITING ON OR BEFORE THE SAID DATE WHICH WILL BE CO NSIDERED BEFORE ANY SUCH ORDER IS MADE UNDER SECTION 271. YOURS SINCERELY, SD/- (RAJESH KUMAR JHA) INCOME TAX OFFICER-2(3),INDORE 10. FROM PERUSAL OF THE ABOVE SHOW CAUSE NOTICES WE FIND THAT THE LD.A.O HAS MERELY MENTIONED THE SECTION BUT THE SPE CIFIC CHARGE I.E. JYOTSANA AJMERA ITA NO.617/IND/2018 7 WHETHER THE PENALTY HAVE BEEN INITIATED FOR CONCEALM ENT OF PARTICULARS OF INCOME OR FOR FURNISHING INACCURATE PARTICULARS OF INCOME HAS NOT BEEN MENTIONED. NOW WHETHER SUCH TYPE OF NOTICE WHIC H DOES NOT SPEAK ABOUT THE SPECIFIC CHARGE LEVELED AGAINST THE ASSESSEE IS VALID AND TENABLE IN THE EYES OF LAW NEEDS TO BE EXAMINED . 11. WE FIND THAT SIMILAR ISSUE CAME UP FOR ADJUDICA TION BEFORE US IN THE CASE OF VARAD MEHTA ITA NO.693/IND/16 DATED 06. 12.2018 (SUPRA) WHEREIN WE HAVE DECIDED THE ISSUE IN FAVOUR OF THE A SSESSEE BY FOLLOWING THE RATIO LAID DOWN BY THE HON'BLE JURISDIC TIONAL HIGH COURT IN THE CASE OF SHRI KULWANT SINGH BHATIA (SUPRA) WH EREIN THE HON'BLE COURT DISCUSSED THE JUDGMENT OF HON'BLE HIGH COURT IN THE CASE OF CIT V/S MANJUNATHA COTTON GINNING FACTORY (SUPRA) AND CIT V/S SSAS EMERALAD MEADOWS (SUPRA) HELD THAT ON DUE CONSIDERATION OF THE ARGUMENTS OF THE LD. COUNSEL FOR THE APPELLANT, SO ALSO CONSIDERING THE FACT THAT THE GROUND MENTIONED IN SHOW CAUSE NO TICE WOULD NOT SPECIFY THE REQUIREMENT OF LAW, AS NOTICE WAS NOT S PECIFIC, WE ARE OF THE VIEW THAT LD. TRIBUNAL HAS RIGHTLY ALLOWED THE APPE AL OF THE ASSESSEE AND SET ASIDE THE ORDER OF PENALTY ENFORCED BY THE AUTHORITY. 12. WE THEREFORE RESPECTFULLY FOLLOWING ABOVE REFER RED JUDGMENTS AND IN THE GIVEN FACTS AND CIRCUMSTANCES OF THE CAS E ARE OF THE JYOTSANA AJMERA ITA NO.617/IND/2018 8 CONSIDERED VIEW THAT THE ALLEGED NOTICE ISSUED U/S 271(1)(C) OF THE ACT DATED 29.02.2016 IS INVALID, UNTENABLE AND SUFF ERS FROM THE INFIRMITY OF NON APPLICATION OF MIND BY THE ASSESSI NG OFFICER. WE ACCORDINGLY DIRECT TO DELETE THE PENALTY OF RS.2,00 ,000/- LEVIED U/S 271(1)(C) ON THIS LEGAL GROUND ITSELF. WE ACCORDIN GLY ALLOW THE GROUND RAISED BY THE ASSESSEE ON THE LEGALITY OF TH E PENALTY PROCEEDINGS INITIATED U/S 271(1)(C) OF THE ACT. SI NCE THE ISSUE OF PENALTY U/S 271(1)(C) ALSO HAS BEEN DEALT ON THE PR ELIMINARY POINTS OTHER ARGUMENTS OF THE ASSESSEE DEALING WITH THE ME RITS OF THE LEVY OF PENALTY ARE NOT BEEN DEALT WITH, AS THE SAME ARE RENDERED ACADEMIC IN NATURE AND THUS THE APPEAL OF THE ASSES SEE FOR THE ASSESSMENT YEAR 2006-07 IS ALLOWED. 13. IN THE RESULT APPEALS OF THE ASSESSEE IS ALLOWE D. THE ORDER PRONOUNCED IN THE OPEN COURT ON 17.10.20 19. SD/- SD/- ( KUL BHARAT) (MANISH BORAD) JUDICIAL MEMBER ACCOUNTANT MEMBER / DATED : 17 OCTOBER 2019 /DEV JYOTSANA AJMERA ITA NO.617/IND/2018 9 COPY TO: THE APPELLANT/RESPONDENT/CIT CONCERNED/CIT (A) CONCERNED/ DR, ITAT, INDORE/GUARD FILE. BY ORDER, ASSTT.REGISTRAR, I.T.A.T., INDORE