Sri Chellayan Devidsamraj, CHENNAI V. ITO, CHENNAI

ITA 644/CHNY/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 8425 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 24-08-2016
• Assessment Year: 2008-2009
• Appeal Filed On: 31-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DURAI
• Assessee Lawyers: S SRIDHAR
• Keywords: Principle of natural justice

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, CHENNAI . . . , !, # !$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.644/MDS/2015 ' (' / ASSESSMENT YEAR : 2008-09 SRI CHELLAYAN DAVIDSAMRAJ, C/O SHRI S. SRIDHAR, ADVOCATE, NEW NO.14, OLD NO.82, FLAT NO.5, 1 ST AVENUE, INDIRA NAGAR, ADYAR, CHENNAI - 600 020. PAN : AAHPD 7938 B V. THE INCOME TAX OFFICER, BUSINESS WARD XIII(2), CHENNAI - 600 034. (*+/ APPELLANT) (,-*+/ RESPONDENT) *+ . / / APPELLANT BY : SHRI S. SRIDHAR, ADVOCATE ,-*+ . / / RESPONDENT BY : SHRI DURAI PANDIAN, JCIT 0 . 1# / DATE OF HEARING : 24.08.2016 23( . 1# / DATE OF PRONOUNCEMENT : 23.09.2016 / O R D E R PER S. JAYARAMAN, ACCOUNTANT MEMBER: THIS APPEAL OF THE ASSESSEE IS AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 12, CHENNAI, DATED 13.02.2015, WHEREIN THE LD. CIT(APPEALS) CONFIRMED THE PENALTY 2 I.T.A. NO.644/MDS/15 LEVIED BY THE ASSESSING OFFICER UNDER SECTION 271(1 )(C) OF THE INCOME-TAX ACT, 1961 (IN SHORT 'THE ACT') FOR NON-P URSUING OF THE APPEAL. 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE IS INVO LVED IN FABRICATION AND ERECTION OF MATERIAL HANDLING SYSTE MS FOR INDUSTRIES. THE ASSESSEE IS ALSO INVOLVED IN RENTING OUT CRANES FOR INDUSTRIAL PURPOSES. FOR ASSESSMENT YEAR 2008-09, HE ADMITTED CERTAIN TURNOVER IN CASH SYSTEM OF ACCOUNTING. THE ASSES SING OFFICER FOUND DIFFERENCE BETWEEN THE TOTAL PAYMENT MENTIONE D IN THE TDS CERTIFICATES AND GROSS RECEIPT ADMITTED BY THE ASSE SSEE. THE ASSESSEE HAS CLAIMED FULL CREDIT FOR THE TDS. FOR THE SHORTFALL IN ADMISSION OF INCOME, THE ASSESSEE CLAIMED THAT HE W AS FOLLOWING CASH SYSTEM OF ACCOUNTING AND ACCOUNTED ONLY ACTUAL RECEIPTS. THE ASSESSING OFFICER DID NOT ACCEPT SUCH CLAIM AND ASS ESSED THE TOTAL RECEIPTS SHOWN IN THE TDS CERTIFICATES AS TURNOVER AND INITIATED PENALTY PROCEEDING UNDER SECTION 271(1)(C) OF THE A CT. HE LEVIED PENALTY UNDER THAT SECTION FOR HAVING FURNISHED INA CCURATE / FALSE PARTICULARS OF INCOME AND THE CONCEALMENT OF INCOME TO THE TUNE OF ` 27,95,029/-. 3 I.T.A. NO.644/MDS/15 3. AGGRIEVED AGAINST THE PENALTY ORDER, THE ASSESSE E FILED AN APPEAL BEFORE THE ERSTWHILE CIT(APPEALS)-III, CHENN AI AND CONSEQUENT TO THE JURISDICTIONAL CHANGE, THE LD. CI T(APPEALS) 12, CHENNAI, CONFIRMED THE PENALTY ORDER FOR NON-PURSUI NG OF THE APPEAL. 4. AGGRIEVED AGAINST THE ORDER OF THE CIT(APPEALS), THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNAL. THE GR OUNDS OF APPEAL ARE EXTRACTED AS UNDER:- (1) THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) 12, CHENNAI-600 034 DATED 13.02.2014 IN I.T.A. NO.56/ 2013-14 FOR THE ABOVE MENTIONED ASSESSMENT YEAR IS CONTRARY TO LAW, FACTS, AND IN T HE CIRCUMSTANCES OF THE CASE. (2) THE CIT(APPEALS) ERRED IN CONFIRMING THE LEVY OF PENALTY U/S 271(1)(C) OF THE ACT WITHOUT ASSIGNING PROPER REASONS AND JUSTIFICATION AND OUGHT TO HAVE APPRECIATED THAT THE SUSTENANCE OF THE PENALTY IMPOSED WAS WRONG, ERRONEOUS, UNJUSTIFIED, INCORREC T AND NOT SUSTAINABLE IN LAW. (3) THE CIT(APPEALS) FAILED TO APPRECIATE THAT THE ORDE R IMPOSING PENALTY U/S 271(1)(C) OF THE ACT WAS PASSED OUT OF TIME, INVALID, PASSED WITHOUT JURISDICTION A ND NOT SUSTAINABLE BOTH ON FACTS AND IN LAW. (4) THE CIT(APPEALS) ERRED IN DISMISSING THE APPEAL IN LIMINI FOR THE REASONS STATED FROM PARA 5 TO PARA 5.5 OF THE IMPUGNED ORDER WITHOUT ASSIGNING PROPER REASONS AND JUSTIFICATION AND OUGHT TO HAVE 4 I.T.A. NO.644/MDS/15 APPRECIATED THAT THE ORDER PASSED IN GROSS VIOLATIO N OF THE PRINCIPLES OF NATURAL JUSTICE IS NULLITY IN LAW. (5) THE CIT(APPEALS) FAILED TO APPRECIATE THAT THERE WA S NO POWER VESTED IN THE STATUTE TO DISMISS THE APPEA L IN LIMINI AND OUGHT TO HAVE APPRECIATED THAT NON PASSING OF THE APPELLATE ORDER ON MERITS WOULD VITIATE HIS DECISION COMPLETELY. 5. APART FROM THE ABOVE GROUNDS, THE LD.COUNSEL FOR THE ASSESSEE SUBMITTED THAT CONFIRMING THE LEVY OF PENA LTY WITHOUT DUE OPPORTUNITY IS UNJUSTIFIED. PER CONTRA, THE LD. DE PARTMENTAL REPRESENTATIVE RELIED ON THE ORDER OF THE LD. CIT(A PPEALS). 6. WE HAVE HEARD SUBMISSIONS ON EITHER SIDE AND PER USED THE RELEVANT MATERIAL AVAILABLE ON RECORD. WE ARE OF T HE OPINION THAT THE LD. CIT(APPEALS) SHOULD GIVE DUE OPPORTUNITY TO THE ASSESSEE BEFORE CONFIRMING THE PENALTY ORDER. HENCE, THE IS SUE IS REMITTED BACK TO THE FILE OF THE LD. CIT(APPEALS) FOR GIVING ADEQUATE OPPORTUNITY TO THE ASSESSEE AND THEN PASS AN APPROP RIATE ORDER. 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 5 I.T.A. NO.644/MDS/15 ORDER PRONOUNCED ON 23 RD SEPTEMBER, 2016 AT CHENNAI. SD/- SD/- ( . . . ) ( ! ) (N.R.S. GANESAN) (S. JAYARAMAN) /JUDICIAL MEMBER # / ACCOUNTANT MEMBER /CHENNAI, 5 /DATED, THE 23 RD SEPTEMBER, 2016. KRI. . ,167 87(1 /COPY TO: 1. *+ /APPELLANT 2. ,-*+ /RESPONDENT 3. 0 91 () /CIT(A)-12, CHENNAI-34 4. 0 91 /CIT, CHENNAI-3, CHENNAI 5. 7: ,1 /DR 6. ' ; /GF.