Imtias Gulamgaus Mulla, Tiruppur V. DCIT, Tiruppur

ITA 684/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7523 (ITAT-CHENNAI)
• Duration Of Justice: 11 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-03-2017
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 30-01-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 21-03-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: CHENNAI . . . , ! '#.. $ %!& , ( )* BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S.SUNDER SINGH, ACCOUNTANT MEMBER ! ./ ITA NO.684/MDS/2016 + ,+ /ASSESSMENT YEAR: 2011-12 SHRI IMTIAS GULAMGAUS MULLA, PROP: TEXTILES N APPARELS, NO.57/13, AMARJOTHI GARDEN, WEST MAIN ROAD, KANGAYAM ROAD, TIRUPUR-641 604. VS. THE DY. COMMISSIONER OF INCOME TAX, CIRCLE-2, TIRUPUR. [PAN: AABPM 6505 H ] ( -. /APPELLANT) ( /0-. /RESPONDENT) -. 1 2 / APPELLANT BY : MR.G.BASKAR, ADVOCATE /0-. 1 2 /RESPONDENT BY : MR.G.M.DAS, CIT $ 1 3( /DATE OF HEARING : 31.01.2017 45, 1 3( /DATE OF PRONOUNCEMENT : 15.03.2017 / O R D E R PER D.S.SUNDER SINGH , ACCOUNTANT MEMBER : THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER DATED 17.12.2015 OF COMMISSIONER OF INCOME TAX (APPEALS)- 3, COIMBATORE, IN ITA NO.549/14-15 FOR THE AY 2011-12. 2.0 ALL THE GROUNDS OF THE APPEAL ARE RELATED TO THE L EVY OF PENALTY U/S.271(1)(C) OF INCOME TAX ACT (IN SHORT THE ACT ). THE ASSESSEE FILED ITA NO.684/MDS/2016 :- 2 -: RETURN OF INCOME DECLARING TOTAL INCOME OF RS.24,21 ,827/- AND THE ASSESSMENT WAS COMPLETED U/S.143(3) ON TOTAL INCOME OF RS.72,62,327/-. THE ASSESSING OFFICER (IN SHORT AO) INITIATED PEN ALTY U/S.271(1)(C). SUBSEQUENTLY, THE AO LEVIED A PENALTY OF RS.14,95,0 97/- U/S.271(1)(C). THE ASSESSEE WENT ON APPEAL BEFORE THE LEARNED COMM ISSIONER OF INCOME TAX (APPEALS) (HEREINAFTER REFERRED TO AS LD.CIT(A )) AND THE LD.CIT(A) CONFIRMED THE PENALTY. 3.0 AGGRIEVED BY THE ORDER OF THE LD.CIT(A), THE ASSES SEE FILED AN APPEAL BEFORE US. APPEARING FOR THE ASSESSEE, THE LEARNED AUTHORIZED REPRESENTATIVE (HEREINAFTER REFERRED TO AS LD.AR) ARGUED THAT TH E AO IS NOT CLEAR WHETHER PENALTY IS INITIATED FOR FURNISHING OF INACCURATE P ARTICULARS OR FOR CONCEALMENT OF INCOME. THE AO HAS NOT STRUCK THE IRRELEVANT COLUMN IN THE NOTICE ISSUED U/S.271(1)(C) GIVING SCOPE FOR AM BIGUITY TO EXPLAIN WHETHER THE ASSESSEE HAS TO EXPLAIN FOR CONCEALMEN T OF INCOME OR FOR FURNISHING OF INACCURATE PARTICULARS. ACCORDING TO THE LD.COUNSEL, THE PENALTY IMPOSED BY THE AO REQUIRED TO BE CANCELLED. THE LD.A.R PLACED RELIANCE ON THE DECISION OF THE HONBLE KARNATAKA H IGH COURT IN THE CASE OF CIT V. MANJUNATHA COTTON AND GINNING FACTORY (2013) 359 ITR 565 AND ALSO IN THE CASE OF THE HONBLE SUPREME COURT DILIP N.SHROFF [2007] 291 ITR 519 (SC).ON THE OTHER HAND THE THE LD.D.R RELIE D ON THE ORDER OF THE AO. ITA NO.684/MDS/2016 :- 3 -: 4.0 WE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MAT ERIAL PLACED BEFORE US. WE HAVE GONE THROUGH THE ASSESSMENT ORDER, PENALTY ORDER AND THE NOTICE ISSUED U/S.271(1)(C). THE AO HAS NOT MENTIO NED ANYWHERE EITHER IN THE ASSESSMENT ORDER OR IN THE PENALTY ORDER, WH ETHER THE PENALTY HAS BEEN INITIATED FOR CONCEALMENT OF INCOME OR FOR FUR NISHING OF INACCURATE PARTICULARS. IN THE PENALTY ORDER ALSO, THE AO HAS NOT MADE UP HIS MIND WHETHER THE PENALTY WAS IMPOSED FOR FURNISHING OF I NACCURATE PARTICULARS OR FOR CONCEALMENT OF INCOME. THE AO ISSUED THE NO TICE U/S.271(1)(C) AND HAS NOT STRUCK OF THE IRRELEVANT COLUMN RELATING TO FURNISHING OF INACCURATE PARTICULARS OR CONCEALMENT OF INCOME. IN THE DECIS IONS RELIED UPON BY THE ASSESSEE I.E CIT V. MANJUNATHA COTTON AND GINNING F ACTORY (2013) 359 ITR 565 AND ALSO IN THE CASE OF THE HONBLE SUPREME COURT IN DILIP N.SHROFF [2007] 291 ITR 519 (SC) HELD THAT NON-STRI KING OF THE IRRELEVANT COLUMN IN THE NOTICE ISSUED U/S.274 R.W.S.271(1)(C) MAKE THE NOTICE INVALID AND CONSEQUENT PENALTY REQUIRED TO BE CANCE LLED. THE HONBLE SUPREME COURT DISMISSED THE SPECIAL LEAVE PETITION FILED BY THE REVENUE ON THE SAME ISSUE. THE REVENUE HAS NOT CONTROVERTED THE DECISIONS RELIED UP ON BY THE ASSESSEE. RESPECTFULLY FOLLOWING THE LEGAL PRECEDENTS CITED SUPRA, WE HOLD THAT NOTICE ISSUED U/S.271(1)(C) WITHOUT PUTTING THE ASS ESSEE ON NOTICE FOR WHICH REASON THE PENALTY IS INITIATED IS BAD IN LA W AND CONSEQUENT PENALTY ITA NO.684/MDS/2016 :- 4 -: LEVIED U/S.271(1)(C) CANNOT BE SUSTAINED. ACCORDIN GLY, WE ANNUL THE ORDER PASSED U/S.271(1)(C) AND THE APPEAL OF THE ASSESSEE IS ALLOWED. 5.0 IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLO WED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH MARCH, 2017, AT CHENNAI. SD/- SD/- ( . . . ) (N.R.S. GANESAN) /JUDICIAL MEMBER ( '# . . $ %!& ) (D.S.SUNDER SINGH) ( /ACCOUNTANT MEMBER /CHENNAI, 6! /DATED: 15 TH MARCH, 2017. TLN 1 /3%7 87,3 /COPY TO: 1. -. /APPELLANT 4. $ 93 /CIT 2. /0-. /RESPONDENT 5. 7 : /3 /DR 3. $ 93 ( ) /CIT(A) 6. #+ = /GF