Sh. Ashwani Kumar, Bhadson V. ITO, Nabha

ITA 642/CHANDI/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 1504 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-06-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 10-06-2019
• Assessment Year: 2009-2010
• Appeal Filed On: 07-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MUDIT SRIVASTAVA SR DR
• Assessee Lawyers: N K SAINI ITR
• Keywords: Opportunity of being heard; Period of limitation; Time period of passing order; Set aside
• Section: 271(1)(c)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BEN CH A, CHANDIGARH .., !' '# $, % &' BEFORE: SHRI. N.K.SAINI, VP & SHRI , SANJAY GARG, JM ITA NO. 642/CHD/2018 ASSESSMENT YEAR : 2009-10 SHRI ASHWANI KUMAR C/O SAI PLANT PROTECTORS THANA ROAD, BHADSON THE ITO NABHA PAN NO: AAZPK6954A APPELLANT RESPONDENT !' ASSESSEE BY : SHRI. N.K. SAINI, ITR #!' REVENUE BY : SH. MUDIT SRIVASTAVA, SR. DR $ %! & DATE OF HEARING : 10/06/2019 '()*! & DATE OF PRONOUNCEMENT : 14/06/2019 &(/ ORDER PER N.K. SAINI, VICE PRESIDENT THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DT. 10/04/2018 OF LD. CIT(A)-, PATIALA. 2. IN THE PRESENT APPEAL ASSESSEE HAS RAISED THE FO LLOWING GROUNDS: 1. THE LEARNED CIT(A) HAS ERRED IN FACTS AND LAW IN CO NFIRMING THE PENALTY UNDER SECTION 271(1)(C) LEVIED BY THE AO AT RS. 69,72,671 /- WITHOUT CONSIDERING HIS REPLIES IN PROPER MANNER. 2. THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE LEVY OF PENALTY U/S 271(1)(C ) OF RS. 69.72.681 -. THE ORDER PASSED BY THE ASSESSING OFFICER AS WELL AS THAT OF CIT(A) LACKS JURISDICTION AS NEITHER THE ASSESSMENT ORDER NOR THE PENALTY ORDERS REFERS TO 'WHETHER THE PENALTY UNDER SECTION 271(1)(C) IS ISS UED AND LEVIED FOR 'CONCEALING THE PARTICULARS OF HIS INCOME 'OR ASSESSEE HAS 'FUR NISHED INACCURATE PARTICULARS OF SUCH INCOME'. ONLY ON THIS GROUND THE ORDER LEVYING PENALTY U/S 271(1 )(C ) IS LIABLE TO BE QUASHED. 3. NO NOTICE UNDER SECTION 271(1)(C ) READ WITH SECTIO N 274 WAS ISSUED AND SERVED UPON THE ASSESSEE WHICH STATES 'WHETHER IT I S ISSUED FOR 'CONCEALING THE PARTICULARS OF HIS INCOME 'OR HAS 'FURNISHED INACCU RATE PARTICULARS OF SUCH INCOME' (THE RELEVANT CLAUSE IS NEITHER TICKED OR CLAUSE, N OT RELEVANT, HAS NOT BEEN STRUCK). ONLY ON THIS GROUND THE PENALTY ORDER LEVYING PENAL TY U/S 271(1 )(C ) IS LIABLE TO BE QUASHED. 4. THE PENALTY ORDER PASSED U/S 271(1)(C) ON 08.03.201 6 HAS BEEN PASSED BEYOND THE LIMITATION PERIOD AS THE LEARNED CIT(A) HAD CONFIRMED THE QUANTUM ORDER VIDE ITS ORDER DATED 24.12.2013. 5. THE PENALTY LEVIED BY AO AND CONFIRMED BY CIT(A) PA TIALA) HAS BEEN LEVIED ON THE GROUND 'I HOLD ASSESSEE IN DEFAULT AND IMPOS E MAXIMUM PENALTY' AND NOT EITHER FOR 'CONCEALING PARTICULARS OF HIS INCOME' O R 'FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME'. SINCE THE ORDER PASSED IS B AD IN LAW IT DESERVES TO BE QUASHED. 2 6. THE LEARNED C1T(A) HAS CONFIRMED THE LEVYING OF PEN ALTY WITHOUT AFFORDING ADEQUATE OPPORTUNITY OF BEING HEARD. THE ORDER IS L IABLE TO BE SET ASIDE. 7. IN ANY CASE THE LEARNED ASSESSING OFFICER HAS ERRED IN LEVYING THE PENALTY UNDER SECTION 271(1)(C ) AT 300% OF THE TAX SOUGHT TO BE EVADED WITHOUT BRINGING ON RECORD ANY SPECIAL OR EXTRAORDINARY CIRCUMSTANCE S FOR LEVYING MAXIMUM PENALTY. 8. THE APPELLANT CRAVES LEAVE FOR ANY ADDITION, DELETI ON OR AMENDMENT IN THE GROUNDS OF APPEAL ON OR BEFORE DISPOSAL OF APPEAL. 3. THE FACTS OF THE CASE IN BRIEF ARE THAT THIS CAS E WAS EARLIER DECIDED BY THE ITAT IN ITA NO. 58/CHD/2017 VIDE ORDER DT. 1 8/11/2016, AND THE MATTER WAS RESTORED TO THE LD. CIT(A) BY OBSERVING THAT THE FINDING IN QUANTUM PROCEEDINGS WOULD NOT OPERATE AS RES-JUDICA TA AND THE ASSESSEE COULD NOT BE STOPPED FROM RAISING NEW CONT ENTION WHICH HE HAD RAISED IN QUANTUM PROCEEDINGS AND THAT THE LD.CIT(A ) OUGHT TO HAVE CONSIDER THE ALTERNATE EXPLANATION GIVEN BY THE ASS ESSEE REGARDING THE SOURCES OF CASH DEPOSITS IN HIS BANK ACCOUNT BEFORE ADJUDICATING ON THE LEVY OF PENALTY. CONSEQUENTLY THE LD. CIT(A) DECIDE D THE APPEAL AND SUSTAINED THE PENALTY LEVIED BY THE A.O. UNDER SECT ION 271(1)(C) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS A CT). 4. NOW THE ASSESSEE IS IN APPEAL. 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE LD. CIT(A) HAD NOT FOLLOWED THE DIRECTIONS GIVEN BY THE ITAT IN RIGHT PERSPECTIVE AND EVEN THE ISSUE RELATING TO THE PENALTY UNDER SECTION 271(1)(C) HAS NOT BEEN DECIDED, REFERENCE WAS MADE TO PARA 5 OF THE IMPUGNED ORDER. 6. IN HIS RIVAL SUBMISSIONS THE LD. SR. DR STRONGLY SUPPORTED THE IMPUGNED ORDER PASSED BY THE LD. CIT(A). 7. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE P ARTIES AND PERUSED THE MATERIAL AVAILABLE ON THE RECORD. IN THE PRESENT CA SE IT IS NOTICED THAT THE LD. CIT(A) SUSTAINED THE PENALTY LEVIED BY THE A.O. BY OBSERVING IN PARA 5 OF THE IMPUGNED ORDER AS UNDER: 05. RESPECTFULLY FOLLOWING THE ORDER OF HON'BLE ITA T MENTIONED SUPRA, THE ALTERNATE SUBMISSION OF THE APPELLANT WHICH WERE NO T OFFERED BY HIM DURING PROCEEDINGS IN THE QUANTUM ASSESSMENT PROCEEDINGS W ERE EXAMINED AND AS MENTIONED IN PARA 3.1 SUPRA A NUMBER OF OPPORTUNITI ES WERE GIVEN TO THE APPELLANT. FINALLY AFTER SERVICE OF NOTICE BY AFFIX TURE, THE AR APPEARED ON BEHALF OF THE APPELLANT. QUA THESE ALTERNATE SUBMISSIONS, THE APPELLANT HAS PRODUCED COPIES OF THREE SEPARATE BANK ACCOUNTS, A LOAN ACCO UNT WITH BANK OF BARODA RELATING TO M/S SAI COLD STORAGE PVT. LTD., A CURRE NT ACCOUNT RELATING TO M/S SAI COLD STORAGE PVT. LTD WITH ORIENTAL BANK OF COMMERC E AND A SAVINGS BANK ACCOUNT OF SHRI ASHWANI KUMAR HIMSELF IN ORIENTAL B ANK OF COMMERCE (THE 3 IMPUGNED ACCOUNT WHERE THE DEPOSITS OF RS. 65,00,00 0/- WERE MADE. THE APPELLANT HAS STATED THAT THE DURING APPELLATE PROC EEDINGS BEFORE MY PREDECESSOR, IT WAS NOTICED BY THE AR) THAT THE DEP OSITS IN BANKS EXPLAINABLE FROM THE INTER-SE WITHDRAWALS FROM THE BANK ACCOUNT S MAINTAINED BY THE ASSESSEE AND VARIOUS CONCERNS IN WHICH HE WAS SUBSTANTIALLY INTERESTED. HE THUS CLAIMS THAT THE CASH DEPOSITS IN O.B.C. WERE MADE AFTER MAKING WITHDRAWALS FROM THE CURRENT ACCOUNT OF M/S SAI COLD STORAGE PRIVATE LTD WHICH I N TURN RELATE TO WITHDRAWALS MADE FROM THE LOAN ACCOUNT IN M/S SAI COLD STORAGE PRIVATE LTD. WHILE THE APPELLANT HAS SUBMITTED THAT M/S SAI COLD STORAGE P RIVATE LTD HAS A SUBSTANTIAL INTEREST OF THE APPELLANT, NO DETAILS OF THE OWNERS HIP PATTERN OF M/S SAI COLD STORAGE PRIVATE LTD. HAS BEEN SUBMITTED. FURTHER, N O DETAILS OF HOW THESE WITHDRAWALS FROM M/S SAI COLD STORAGE PRIVATE LTD. ARE TREATED IN THE BOOKS OF THE COMPANY HAVE ALSO BEEN SUBMITTED. THIS AFTER A NUMB ER OF OPPORTUNITIES THAT HAVE BEEN GIVEN AS MENTIONED SUPRA. IN VIEW OF THE ABOVE FACTS I FIND NO MERIT IN THE SUBMISSION OF THE LD AR AND NO OCCASION TO INTE RFERE WITH THE ORDER OF THE LD AO. FROM THE ABOVE OBSERVATIONS OF THE LD. CIT(A) IT IS CLEAR THAT HE HAS NOT DECIDED THE ISSUE RELATING TO THE LEVY OF PENALTY UNDER SEC TION 271(1)(C) OF THE ACT, RATHER HE HAS CONSIDERED THE SUBMISSIONS RELATING TO THE Q UANTUM ADDITION. HE HAD ALSO NOT DISCUSSED THE ALTERNATE EXPLANATION GIVEN BY THE ASSESSEE WHICH WAS DIRECTED TO BE CONSIDERED VIDE EARLIER ORDER DT. 18 /11/2016 BY THE ITAT. WE THEREFORE CONSIDERING THE TOTALITY OF THE FACTS OF THE PRESENT CASE, DEEM IT APPROPRIATE TO SET ASIDE THE IMPUGNED ORDER TO THE FILE OF THE LD. CIT(A) TO BE DECIDED AFRESH IN ACCORDANCE WITH LAW AND AS PER TH E DIRECTIONS GIVEN BY THE ITAT VIDE EARLIER ORDER DT. 18/11/2016. 8. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. (ORDER PRONOUNCED IN THE OPEN COURT ON 14/06/2019 ). SD/- SD/- '# $ .., (SANJAY GARG ) ( N.K. SAI NI) % &'/ JUDICIAL MEMBER / VICE PRESIDENT AG DATE: 14/06/2019 PLACE: CHANDIGARH (+! ,-.- COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. $ / CIT 4. $ / 01 THE CIT(A) 5. -2 45&456789 DR, ITAT, CHANDIGARH 6. 8:% GUARD FILE (+ $ BY ORDER, ; # ASSISTANT REGISTRAR